Exhibit 10.2
AGREEMENT OF SUBLEASE
This Sublease is made and entered into by and between Xxxxx Xxxxx Xxxxxxxx
and Xxxxx Xxxx Xxxxxxxx, husband and wife, d/b/a Xxxxxxxx'x Fresh World
(hereinafter referred to as "Sublessor") and Bank of the Ozarks, an Arkansas
banking corporation with its principal office at Chenal Parkway and West Markham
Streets, Little Rock, Arkansas (hereinafter referred to as "Sublessee") on the
following terms and conditions:
DECLARATIONS:
A. Sublessor presently operates a supermarket ("Supermarket") which it
leases from East Gate, LLC ("East Gate") located at 00000 Xxxxxxx 0, Xxxxx X,
Xxxxxxxx, Xxxxxxxx (hereinafter referred to as the "Shopping Center");
B. Sublessor desires that Sublessee establish and operate a retail banking
and depository facility (hereinafter referred to as the "Bank Facility") in the
Supermarket on the terms and conditions hereinafter set forth;
C. Sublessee desires and is willing to establish and operate the Bank
Facility in the Supermarket on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises set forth above and the
mutual covenants set forth below, and other good and valuable consideration,
Sublessor and Sublessee agree as follows:
1. LEASE OF SPACE. Sublessor does hereby rent, lease and demise unto
Sublessee, and Sublessee does hereby rent, lease and accept from Sublessor, for
the purpose of establishing and operating the Bank Facility, a space of
approximately 449 square feet, in the front quadrant of the Supermarket
(hereinafter referred to as the "Space," as shown on the floor plan which is
attached hereto as Exhibit A and made a part hereof by this reference.
2. TERM.
A. This Sublease is made and accepted for a term of five (5) years.
Said term shall begin on the commencement date, as hereinafter defined, and run
for five (5) years thereafter.
B. The commencement date shall be the first (1/st/) day of the
calendar month coming next after the later of the (i) date when the lease is
signed, (ii) all required consents or approvals of the Federal Deposit Insurance
Corporation, the Commissioner of Banking for the State of Sublessee's
incorporation shown above or any other federal or state bank or thrift
institution regulatory agency having jurisdiction over Sublessee (the
"Regulatory Agency") shall have been obtained to open and maintain the Bank
Facility for banking business at the location of the Space; (iii) Sublessee has
completed its modifications of the Space and is open for business at the Banking
Facility, but no later than August 1, 2002.
C. Sublessee shall promptly make an application to any such
regulatory agency for approval to operate a retail banking depository facility
in the Supermarket and shall exercise due diligence to obtain same. Sublessee
shall give Sublessor notice when the approval has been issued. If said approval
has not been obtained by July 1, 2002, Sublessee may terminate this Sublease
without any liability.
D. Sublessee shall have the right to occupy the Space after
receiving regulatory approval prior to opening for business for the sole purpose
of completion of the Improvement Work as defined herein. The cost of all
Improvement Work shall be Sublessee's expense. Additionally, upon receipt of the
approval referenced in Subparagraphs 2-B-(ii) and 2-C, Sublessee shall pay to
Sublessor the sum of $3,000 as an allowance for any and all expenses Sublessor
incurs adapting the Supermarket to the Bank Facility.
3. RENT. Sublessee shall pay to Sublessor as rent for the space an
amount equal to $1,500 per month for the original five (5) year term of this
Sublease, but only after the first six (6) months, such rent to be payable in
advance, commencing on the date which is six (6) months after the Commencement
Date, and not later than the fifth (5/th/) day of each calendar month during the
continuance of this Sublease. All rent shall be payable to Sublessor at its
principal office shown above.
4. USE AND OCCUPANCY.
A. Sublessee shall have the right to use and occupy the Space
for the sole purpose of establishing and operating a retail banking and
depository facility for the benefit and convenience of the public and for no
other use and purpose except that Sublessee may offer at the Bank Facility such
services or products as are customarily offered by Sublessee at its other Bank
Facilities. Sublessee's exclusive right hereunder to provide retail banking and
other depository services in the Supermarket shall not limit or restrict
Sublessor's right to make change, cash checks, verify checks, arrange for check
verification, sell money orders, or to transact or conduct any other commercial
activity or service which is necessary and customary for the proper and adequate
operation of the Supermarket.
B. If Sublessee elects to include a night depository in the
operation of the Bank Facility, then the location of same shall be subject to
the prior approval of Sublessor (but such approval shall not be unreasonably or
arbitrarily withheld by Sublessor).
C. Sublessee shall have the exclusive right to place an
automated teller machine ("ATM") in the Bank Facility, the location of same to
be subject to the prior approval of Sublessor (but such approval shall not be
unreasonably or arbitrarily withheld by Sublessor). Sublessor shall sublease no
other space in the Supermarket for use by a depository institution or similar
use, including but not limited to a branch bank or ATM, while the Sublease is in
effect.
D. Sublessee shall comply with all applicable federal, state,
and local laws, rules, regulations, and ordinances governing or regulating the
establishment and operation of the Bank Facility.
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E. Sublessee, in its sole discretion, shall determine the days
and hours during which the Banking Facility will be open for business; provided,
however, the Banking Facility will not be open for business at any time when the
Supermarket is not open for business; and provided further, the Banking Facility
will open for a minimum of forty (40) hours per week. Sublessee shall provide
Sublessor with a schedule of business hours and holidays and shall not change
such schedule except after giving Sublessor two (2) weeks advance notice of any
change.
5. EMPLOYEES.
A. Sublessee shall cause its employees to comply with
reasonable rules and regulations as from time to time mutually agreed upon by
the parties pertaining to employee ingress, egress, and parking and use by them
of Sublessor's employee restroom and breakroom, to which Sublessor consents.
Canvassing, soliciting and peddling by non-employees of Sublessor and Sublessee
in the Supermarket are prohibited and Sublessee and Sublessor shall cooperate to
prevent the same.
B. Sublessee shall be solely responsible for providing
security for the Bank Facility, and Sublessee acknowledges that Sublessor is not
an insurer of the Bank Facility and the Sublessor does not undertake to provide
any security for the Bank Facility.
6. IMPROVEMENT WORK.
A. Sublessee shall have the right to improve the Space (herein
referred to as the "Improvement Work") so that the Space may be used for the
establishment and operation of a Banking Facility in accordance with Section 4
hereof and, at its own expense, to complete the total improvements.
B. Sublessee shall repair any damage to Sublessor's property
arising from the contractor's operations relating to the Improvement Work.
C. Sublessee, at its sole cost and expense, shall furnish all
improvements, fixtures, equipment, and furnishings which it deems necessary or
desirable for the establishment and operation of the Bank Facility. All permits,
licenses, and authorizations required in connection with the Improvement Work
shall be obtained and paid for by Sublessee as the same are required.
D. Sublessee shall make no major structural alterations or
additions of any kind to the Space or the Bank Facility without first obtaining
Sublessor's consent (not to be unreasonably or arbitrarily withheld), Sublessor
having approved the plot plan represented by Exhibit A hereto.
7. SIGNS. Sublessee shall have the right to erect whatever signs
on the Supermarket property (including the Supermarket building, lot and
grounds) it deems appropriate, provided that such signs shall not violate the
terms of the prime lease or any applicable law, ordinance or governmental
regulation.
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8. MAINTENANCE. Sublessee shall, at its sole cost and expense, take
good care of and maintain the Bank Facility in good order and repair, including,
without limitation, telephone or other lines for computer/data processing and
transmission for the Bank Facility. The sidewalks and public portions of the
Supermarket, such entrances, passages, vestibules, and aisles, shall not be
obstructed or encumbered by Sublessee or Sublessor. No cooking shall be done or
permitted by Sublessee in the Space. Neither Sublessee nor any of Sublessee's
servants, employees, agents, visitors, or licensees, shall at any time bring or
keep in the space any flammable, combustible or explosive fluid, or chemical
substance, other than reasonable amounts of cleaning fluids or solvents required
in the normal operation of Sublessee's business. Canvassing, soliciting and
peddling by non-employees of Sublessor and Sublessee in the Supermarket are
prohibited and Sublessee and Sublessor shall cooperate to prevent the same.
9. UTILITIES.
A. Except as provided in subsection (B) of this Section 9,
Sublessor agrees to furnish to the Bank Facility, at Sublessor's sole cost and
expense, all electricity, heat, air conditioning and other utilities.
B. Sublessee shall furnish, at Sublessee's cost and expense, all
telephone data transmission services, including all line, cables, and
connections necessary for the operation of the Bank Facility.
10. INSURANCE. Sublessee shall maintain, with respect to the Space,
public liability insurance with limits (for each occurrence) of at least Two
Hundred Fifty Thousand Dollars ($250,000) for the injury or death of any one
person; and at least Five Hundred Thousand Dollars ($500,000) for the injury or
death to all persons involved; and Fifty Thousand Dollars ($50,000) for damage
to property; which may be by blanket policy. It shall be Sublessee's
responsibility to purchase fire and extended coverage insurance upon the
merchandise, furnishings, equipment, fixtures, and personal property it places
in the Space.
11. TAXES. During the term of this Lease, Sublessee shall pay to
Sublessor, on an annual basis, such taxes which may now or hereafter be levied
or assessed against the Supermarket or the land on which the Supermarket is
located by the taxing authority solely on account of Sublessee's fixtures,
furnishings, equipment, merchandise, personal property, and appurtenances used
in connection with the operation of the Bank Facility in the Space.
12. SURRENDER. Sublessee agrees that it shall, if not exercising the
options:
A. Remove all of the fixtures, furnishings, equipment, and
personal property belonging to and being the property of Sublessee from the
Space, provided that the time of removal Sublessee is not in default in the
payment of rent or any other terms or provisions of this Lease;
B. Surrender peaceful possession of the Space to Sublessor.
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13. PRIME LEASE.
A. East Gate and Sublessor agree not to amend or terminate
their lease agreement ("Lease") in such a way that would materially affect
Sublessee's rights under this Sublease, as to parking or otherwise.
B. In the event the Lease is terminated for any reason or
Sublessor does not extend the Lease for a period beyond the term of the Sublease
and any extensions thereof, East Gate agrees that any successor tenants of the
Supermarket will take that space subject in all respects to the terms of this
Sublease.
C. East Gate consents to this Sublease as provided for in
paragraphs 5 and 9 of the Lease, and agrees that, so long as Sublessee is not
under default under the terms of the Sublease, it shall have quite possession
and enjoyment of the Space. Sublessee agrees to attorn to any successor tenant
or to East Gate or East Gate's mortgage lender, as the case may be.
D. East Gate acknowledges the benefit to it of having a branch
bank in the Shopping Center and, in consideration of Sublessee's entering into
this Sublease, agrees that, until the termination of this Sublease or until the
third anniversary of the commencement date defined in Subsection 2-B hereof,
whichever is sooner, it will not lease space or permit subleases of space in the
Shopping Center for a regulated financial institution, including but not limited
to a branch bank, ATM or similar facility.
14. OPTION TO EXTEND. If Sublessee shall keep, observe, and perform
all the terms and conditions of this Sublease on Sublessee's part to be kept and
performed, Sublessee shall have the right to extend the term of this Sublease
for additional successive five (5) three-year periods from the expiration date
of the original term of this Sublease. Each such extension shall be automatic
unless Sublessee shall have given Sublessor written notice to the contrary at
least ninety (90) days prior to the next expiration date. Sublessor's notice
address for all purposes is set forth in Declaration A. Sublessee's notice
address is Bank of the Ozarks, Attention; Xxxx Xxxx, Xxxx Xxxxxx Xxx 0000,
Xxxxxx Xxxx, Xxxxxxxx 00000-0000.
15. ASSIGNMENT. Sublessee shall not, without the prior written
consent of Sublessor, assign, hypothecate, encumber, or otherwise transfer this
Sublease or any interest hereunder, or sublease the Space or any part thereof,
or permit the use of the Space by any part other than Sublessee, except a
successor by merger or affiliated entity.
16. OPTION TO LEASE AND RIGHT OF FIRST REFUSAL. Sublessee shall have
the first right of refusal to negotiate with Sublessor to enter into a new lease
for the purpose of establishing and operating a Banking Facility similar to the
one described in this Sublease in any other Supermarket(s) now owned by
Sublessor or in any new Supermarket(s) Sublessor plans to acquire or open. At
such time as Sublessor makes the decision to have a Banking Facility in any
other Supermarket now owned by Sublessor, or to open and operate any new
Supermarket(s), Sublessee shall have the option to establish and operate in such
Supermarket(s) a Banking Facility similar to the one described herein, all on
such terms and conditions as shall be mutually agreeable to the parties.
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17. FEDERAL REGULATORY AGENCY REQUIREMENTS. Notwithstanding any
other provisions contained in this Sublease, in the event the Sublessee is
closed by, or taken over by, the banking authority of the State of Arkansas, or
other bank supervisory authority ("Regulator"), Sublessor may thereafter
terminate this Sublease only after giving such Regulatory written notice of any
existing default and Sublessor's intent to terminate, and such Regulator fails
to cure such default within thirty (30) days after such written notice. Provided
such Regulator cures all existing defaults within thirty (30) days of notice of
any such default from Sublessor, and provided thereafter such Regulator complies
with all of the terms and conditions of the Sublease on behalf of Sublessee, any
such Regulator shall in such event have the election either to continue or to
terminate this Sublease by giving Sublessor written notice of such intention
within sixty (60) days of the closing or takeover, and in the event of any
election to terminate, this Sublease shall automatically terminate. In the event
this Sublease is so terminated, such termination shall be without prejudice to
Sublessor's claim for damages or indemnity, provided, in such event the maximum
claim of Sublessor for damages or indemnity for injury resulting from the
rejection or abandonment of the unexpired term of the Sublease shall in no event
be an amount exceeding the rent and estimated additional charges (such as common
area maintenance) reserved by the Sublease, without acceleration, for the year
next succeeding the date of the surrender of the Space to the Sublessor, or the
date of re-entry of the Sublessor, whichever first occurs, whether before or
after the closing of the bank, plus an amount equal to the unpaid rent and
additional charges (such as common area maintenance) accrued. In the event this
Sublease is terminated in compliance with the provisions of this section,
ownership of the leasehold improvements shall, upon such termination revert to
Sublessor free and clear of any encumbrances.
IN WITNESS WHEREOF, Sublessor and Sublessee and East Gate, acting by
and through their duly authorized officers, have hereunto set their hands and
seals as of this 21 day of May, 2002.
SUBLESSOR: XXXXXXXX'X FRESH WORLD
By: /s/ Xxxxx Xxxxx Xxxxxxxx
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Xxxxx Xxxxx Xxxxxxxx
By: /s/ Xxxxx Xxxx Xxxxxxxx
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Xxxxx Xxxx Xxxxxxxx
Signature page to Agreement of Sublease
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SUBLESSEE: BANK OF THE OZARKS
By: /s/ Xxxx X. Xxxx
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Name: Xxxx X. Xxxx
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Title: Vice Chairman/President
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Signature page to Agreement of Sublease
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EAST GATE: EAST GATE, LLC
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, Managing Member
Signature page to Agreement of Sublease
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