Exhibit 10.2
LAND AND BUILDING LEASE
between
FRI FISH, LLC
as LANDLORD
and
SHELLS SEAFOOD RESTAURANTS, INC.
as TENANT
April 17, 2006
INDEX TO LAND AND BUILDING LEASE
Article
RECITALS
I. Demise of Premises 4
II. Term 5
III. Rent 5
IV. Use 9
V. Acceptance of Demised Premises 9
VI. Alterations 9
VII. Repairs and Maintenance 10
VIII. Compliance with Law 11
IX. Utilities 12
X. Indemnity 12
XI. Insurance 14
XII. Damage or Destruction 16
XIII. Eminent Domain 18
XIV. Covenants of Landlord 20
XV. Insolvency 20
XVI. Default 21
XVII. Unavoidable Delays, Force Majeure 25
XVIII. No Waiver 25
XIX. Notices 25
XX. Access 26
XXI. Signs 27
XXII. Improvements and Fixtures 27
XXIII. End of Term 28
XXIV. Holding Over 28
XXV. Assignment and Subletting 29
XXVI. Landlord's Loan 30
XXVII. Maintenance of Outside Areas 32
XXVIII. Certificates 33
XXIX. Relationship of Parties 34
XXX. Recording 34
XXXI. Captions and Section Numbers 34
XXXII. Applicable Law 35
XXXIII. Entire Agreement 35
XXXIV. Landlord's Liability 35
XXXV. Attorney's Fees 36
XXXVI. Intentionally Deleted 36
XXXVII. Environmental 37
XXXVIII. Addenda 41
XXXIX. Counterparts 41
Exhibit A Location/Legal Description/Address of the Real Property
Exhibit B Tenant's Personal Property List
Exhibit C Tenant's Estoppel Certificate
Exhibit D Memorandum of Lease
Exhibit E Intentionally Deleted
Exhibit F Subordination, Nondisturbance and Attornment Agreement
LAND AND BUILDING LEASE
THIS LAND AND BUILDING LEASE (the "Lease") is made and entered into as
of April 17, 2006 (the "Effective Date"), between FRI FISH, LLC ("Landlord") and
SHELLS SEAFOOD RESTAURANTS, INC. ("Tenant").
R E C I T A L S
A. Landlord is the owner of the tract of real property (the "Real Property").
The Property is more particularly described in Exhibit A attached hereto.
B. Tenant desires to lease from Landlord the Property so that Tenant may, in
accordance with and subject to the terms, conditions, and restrictions of the
Lease, operate a Shells family dining restaurant at the Real Property. The
buildings and all improvements to or on the Real Property, including but not
limited to all site work, landscaping, fixtures, utilities, and other
improvements, is referred to as the "Building". Certain personal property
located at the Demised Premises, and moveable trade fixtures (as defined in
Section 22.02) are owned by Tenant and are described on Exhibit B attached
hereto and are not included in the definition of Building or Real Property
leased to Tenant pursuant to this Lease.
C. The Property and the Building shall be referred to as the "Demised Premises."
D. Tenant desires to lease the Demised Premises from Landlord on the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the lease of the Demised Premises and the
rents, covenants and conditions herein set forth, Landlord and Tenant do hereby
covenant, promise and agree as follows:
ARTICLE I
DEMISE OF PREMISES
Landlord does hereby lease unto Tenant, and Tenant does hereby hire from
Landlord, for the term hereinafter provided in Section 2.01, the Demised
Premises for the use thereof by Tenant, Tenant's employees, concessionaires,
licensees, agents, customers and invitees, which use shall be exclusive except
as otherwise provided in Section 3.06 or elsewhere herein.
ARTICLE II
TERM
Section 2.01
(a) The "Commencement Date" of this Lease shall be upon the
Effective Date. The Lease shall continue for a period of twenty (20) years
following the Effective Date (the "Original Lease Term"). The "Lease Term", as
such term is used herein, shall mean the Original Lease Term as extended (or as
may be extended) pursuant to Section 2.02 below.
(b) This Lease shall be deemed to be in full force and effect
upon the Effective Date. Tenant shall be deemed in possession of the Demised
Premises upon the Effective Date.
Section 2.02 Tenant shall have the option to extend the term of this Lease for
up to four (4) separate option periods upon and subject to the terms set forth
below in this Section 2.02. The first option period shall commence at the
expiration of the Original Lease Term and each subsequent option period shall
commence at the expiration of the previous option period. The option periods are
sometimes referred to herein collectively as the "Option Periods" and
individually as an "Option Period." Each Option Period shall continue for a
period of five (5) years from the commencement date of such Option Period.
Except as otherwise expressly provided herein, all of the terms and conditions
of this Lease applicable to the Original Lease Term shall continue to apply
during each Option Period. To validly extend the Lease Term for each Option
Period, Tenant (a) must and shall deliver to Landlord written notice of Tenant's
election to so extend not later than 180 days prior to the commencement of such
Option Period and (b) shall not be in default, beyond the expiration of any
applicable cure period under any material term or condition of this Lease as of
the date of such notice or the commencement of such Option Period. Without
limiting anything contained in Article XXXIII hereof, time is of the essence in
the performance of each provision of this Section 2.02.
ARTICLE III
RENT
Section 3.01 Tenant shall pay to Landlord, from and after the Commencement Date
and thereafter throughout the Lease Term, the sums set forth in this Lease as
"Rent" without prior demand therefore and without offset, deduction, or
abatement except as may be otherwise expressly provided herein. Notwithstanding
the foregoing, any amounts due by Tenant to Landlord hereunder for which no due
date is expressly specified herein (e.g., the first day of each month) shall be
due within ten (10) days following the giving to Tenant by Landlord of written
notice of such amounts due, except if some other period of time following
written notice or demand is otherwise expressly provided below, then such other
period shall apply. As used herein, "Rent" shall be deemed to include not only
Fixed Rent but also all additional sums payable or owed by Tenant under this
Lease, including without limitation as set forth in Section 3.07 ("Additional
Rent"). Except as otherwise expressly provided herein, in the event of
nonpayment by Tenant of any Rent, Landlord shall have the same rights and
remedies in respect thereof regardless of whether such Rent constitutes Fixed
Rent or Additional Rent. All payments of Rent to be paid to Landlord shall be
paid to Landlord (at its election) in one of the following manners: (1) via
electronic deposit into an account designated by Landlord, (2) by mail at the
Landlord's office indicated in Article XIX or (3) by mail to any other place
designated by Landlord upon at least thirty (30) days' prior written notice to
Tenant. If the Effective Date (and the Commencement Date) shall not be the first
day of a calendar month, then the rent for such month shall be prorated based
upon a Three Hundred Sixty-Five (365) day year.
Section 3.02 Intentionally left blank.
Section 3.03 Fixed Rent:
The "Fixed Rent" for the Demised Premises for each month of the
Lease Term prior to the first anniversary of the Commencement Date shall be
$12,718.75. On the first anniversary of the Commencement Date, and thereafter,
on each anniversary of such date throughout the Lease Term, the monthly Fixed
Rent shall increase by two percent (2%) over the Fixed Rent charged in the
immediately preceding month of the Lease Term, and such increase shall apply for
the ensuing year. Tenant shall pay to Landlord Fixed Rent in advance, without
demand therefore, on the first day of each calendar month commencing with the
Commencement Date.
Section 3.04 Intentionally left blank.
Section 3.05 Additional Rent.
(a) Tenant shall pay to Landlord, as Additional Rent, all "Real
Estate Taxes" (as hereinafter defined) assessed against, or allocable or
attributable to each of the Demised Premises whether accruing prior to or after
the Effective Date. Real Estate Taxes for the last year of the Lease Term shall
be prorated. As used herein, the term "Real Estate Taxes" means all taxes and
general and special assessments and other impositions in lieu thereof, as a
supplement thereto and any other tax which is measured by the value of real
property and assessed on a uniform basis against the owners of real property,
including excise taxes described in Section 3.05 (d) and any substitution in
whole or in part of any of the foregoing due to a future change in the method of
taxation. Nothing contained in this Lease, however, shall require the Tenant to
pay any estate, inheritance, corporate, franchise or income tax of Landlord, nor
shall any of same be deemed Real Estate Taxes, unless same shall be specifically
imposed in substitution for, or in lieu of, Real Estate Taxes, and then only to
the extent same are limited to the Demised Premises as if it were the only
property owned by Landlord. If by law, any general or special assessment or like
charge may be paid in installments without any penalty or interest whatsoever,
then such assessment shall be paid in such installments and Tenant shall only be
liable for the portion thereof that is allocable or attributable to the Lease
Term or any portion thereof.
(b) Tenant shall pay the Real Estate Taxes on or before five (5)
business days prior to the earlier of (i) the delinquency thereof, or (ii) the
date that any penalty or interest would accrue on any unpaid installment.
Landlord shall have the tax xxxx for the Demised Premises sent directly to
Tenant, and Tenant shall pay the tax xxxx directly to the collecting authority,
and in such event Tenant shall provide Landlord a copy of the paid receipt for
each installment of Real Estate Taxes so paid. If Tenant fails to pay the Real
Estate Taxes when due hereunder, then Tenant shall, in addition to all other
remedies available to Landlord, reimburse Landlord for any and all penalties or
interest, or portion thereof, incurred by Landlord as a result of such
nonpayment or late payment by Tenant.
(c) Tenant shall have the right to seek an abatement of Real
Estate Taxes or a reduction in the valuation of the Demised Premises and/or
contest the applicability of any Real Estate Taxes to the Demised Premises or
the improvements thereon; provided, however, Tenant shall have paid timely all
amounts pursuant to Section 3.05(b) above. In any instance where any such action
or such proceeding is being undertaken by Tenant, Landlord shall reasonably
cooperate with Tenant, at no cost or expense to Landlord, and execute any and
all documents approved by Landlord required in connection therewith. Tenant
shall be entitled to any refund (after the deduction therefrom of all reasonable
expenses incurred by Landlord in connection therewith) of any Real Estate Taxes
and penalties or interest thereon received by Tenant or Landlord, whether or not
such refund was a result of proceedings instituted by Tenant, which have been
paid by Tenant or paid by Landlord for the benefit of Tenant and repaid to
Landlord by Tenant.
(d) Tenant shall pay to Landlord, with each payment of Rent due
hereunder, all taxes imposed upon Landlord with respect to rental or other
payments in the nature of a gross receipts tax, sales tax, privilege tax or the
like, excluding federal or state net income taxes, whether imposed by a federal,
state or local taxing authority, which when added to such rental or other
payment shall yield to Landlord after deduction of all such tax payable by
Landlord with respect to all such payments a net amount which Landlord would
have realized from such payment had no such tax been imposed.
Section 3.06 Matters of Record: Tenant hereby accepts the Demised Premises in
the condition as of the date of possession hereunder, subject to all applicable
zoning, municipal, county, and state laws, ordinances, and regulations,
including private easements and restrictions (whether or not evidence thereof is
recorded in the public records), governing and regulating the use of the Demised
Premises, and accepts this Lease subject thereto and to all matters disclosed
thereby, and by any exhibits attached hereto ("Diligence Matters"). Tenant
acknowledges that neither Landlord nor Landlord's agent has made any
representation or warranty as to the suitability of the Leased Property for the
conduct of the Tenant's business.
Section 3.07 Additional Charges: Tenant and Landlord agree that the rent
accruing under this Lease shall be net to Landlord and that all taxes, costs,
promotional fees, common area maintenance fees, expenses and charges of every
kind and nature, including attorneys' fees incurred by Landlord in enforcing the
provisions of this lease, whether or not any legal proceedings are commenced
("Additional Charges") arising in connection with or relating to the Demised
Premises (excluding, however, (1) taxes other than Real Estate Taxes for which
Landlord is responsible under Section 3.05(a) and (2) any payments for interest
or principal under any fee mortgage relating to the Demised Premises) which may
arise or become due at any time during the Lease Term, shall be paid by Tenant.
Tenant hereby indemnifies, defends, protects, and saves Landlord wholly harmless
from and against any and all Additional Charges. As used herein, the term
"Additional Rent" shall include, without limitation, all of the following: (1)
any and all Additional Charges for which Tenant is responsible hereunder, or
which Tenant otherwise assumes or agrees to pay; (2) all interest and penalties
that may accrue on such Additional Charges if Tenant fails to pay them timely
within any applicable cure periods; (3) all other damages, costs and expenses
(including, without limitation, reasonable attorneys' fees and other legal and
court costs) which Landlord may suffer or incur in enforcing this Lease; and (4)
any and all other sums which may become due by reason of Tenant's default or
failure to comply with its obligations under this Lease.
Section 3.08 Late Charge: Without limiting anything contained in Article XVI of
this Lease and in addition to all other remedies set forth in this Lease, any
payment of Fixed Rent due to Landlord not received by Landlord within ten (10)
days after such payment is due hereunder, and any payment of Additional Rent due
to Landlord not received by Landlord when due hereunder, shall be deemed
delinquent and cause Tenant to incur a late charge of three percent (3%) on each
delinquent payment, due and payable immediately with the delinquent Fixed Rent
or delinquent Additional Rent, as the case may be.
Section 3.09 Character of Demised Premises: From the Commencement Date and
thereafter throughout the Lease Term, Tenant shall conduct its business in a
first class and reputable manner consistent with Tenant's prior operating
practices with respect to the Demised Premises. Tenant shall open and operate a
Shells family dining restaurant at the Demised Premises continuously during all
hours which is customary for similarly situated Shells restaurants, subject to
temporary closing due to casualty, condemnation, remodeling or other force
majeure condition. The character of the occupancy of the Demised Premises is an
additional consideration and inducement for the granting of this Lease.
ARTICLE IV
USE
Tenant may use the Demised Premises to operate a Shells family dining
restaurant, including beer, wine and liquor sales, and such other incidental
uses related thereto in Tenant's discretion. Tenant may use the Demised Premises
only for the uses expressly permitted under this Section, and for no other use
without the prior written consent of Landlord, which approval shall not be
unreasonably withheld, delayed or conditioned. Notwithstanding any other
provision of this Article, Tenant shall not use, or suffer or permit any person
or entity to use the Demised Premises or any portion thereof for any purpose in
violation of any applicable law, ordinance or regulation.
ARTICLE V
ACCEPTANCE OF DEMISED PREMISES
Tenant acknowledges that it has owned the Demised Premises prior to execution of
this Lease and has had the opportunity to perform all tests, studies and
inspections that it desires, and that Tenant is accepting the Demised Premises
subject to all Diligence Matters and in its AS IS condition existing on the date
Tenant executes this Lease.
ARTICLE VI
ALTERATIONS
Tenant shall have no right to make changes, alterations or additions
(collectively, "Alterations") to the Building which will require changes to the
foundation, roof, exterior walls or utility systems at the Building without
prior written consent of Landlord, which Landlord agrees it will not withhold
unreasonably; provided, however, in no event shall any Alterations be made
which, after completion, would: (i) reduce the value of the Building as it
existed prior to the time that said Alterations are made; or (ii) adversely
affect the structural integrity of the Building. Any and all Alterations made by
Tenant shall be at Tenant's sole cost and expense. Prior to the commencement of
construction, Tenant shall deliver promptly to Landlord detailed cost estimates
for any proposed Alterations, as well as all available drawings, plans and other
information regarding such Alterations (such estimates, drawings, plans and
other information are collectively referred to herein as the "Alteration
Information"). Landlord's review and/or approval of any Alteration Information
shall in no event constitute any representation or warranty of Landlord
regarding (x) the compliance of any Alteration Information with any governmental
or legal requirements, (y) the presence or absence of any defects in any
Alteration Information, or (z) the safety or quality of any of the Alterations
constructed in accordance with any plans or other Alteration Information.
Landlord's review and/or approval of any of the Alteration Information shall not
preclude recovery by Landlord against Tenant based upon the Alterations, the
Alteration Information, or any defects therein. In making any and all
Alterations, Tenant also shall comply with all of the following conditions:
(a) No Alterations shall be undertaken until Tenant shall have
(i) procured and paid for, so far as the same may be required, all necessary
permits and authorizations of all governmental authorities having jurisdiction
over such Alterations, and (ii) delivered to Landlord at least fifteen (15) days
prior to commencing any such Alterations written evidence reasonably acceptable
to Landlord of all such permits and authorizations. Landlord shall, to the
extent necessary (but at no cost, expense, or risk of loss to Landlord), join in
the application for such permits or authorizations whenever necessary, promptly
upon written request of Tenant.
(b) Any and all structural Alterations of the Building shall be
performed under the supervision of an architect and/or structural engineer.
(c) Tenant shall notify Landlord at least fifteen (15) days
prior to commencing any Alterations so as to permit, and Tenant shall permit,
Landlord access to the Demised Premises in order to post and keep posted thereon
such notice(s) as may be provided or required by applicable law to disclaim
responsibility for any construction on the Demised Premises.
(d) Any and all Alterations shall be conducted and completed
promptly (subject to the terms of Article XVII), in a good and workmanlike
manner, and in compliance with all applicable laws, municipal ordinances,
building codes and permits, and requirements of all governmental authorities
having jurisdiction over the Demised Premises, and of the local Board of Fire
Underwriters, if any; and, within thirty (30) days after completion of any and
all Alterations, Tenant shall obtain and, upon Landlord's request, deliver to
Landlord a copy of the amended certificate of occupancy for the Demised
Premises, if required under applicable law or by governmental authority. Any and
all Alterations shall be made and conducted so as not to disrupt Tenant's
business; provided however that major alterations which require closing of the
business on a temporary basis may be made so long as otherwise in compliance
with the provisions of this Lease.
(e) The cost of any and all Alterations shall be promptly paid
by Tenant so that the Demised Premises at all times shall be free of any and all
liens for labor and/or materials supplied for any Alterations.
ARTICLE VII
REPAIRS AND MAINTENANCE
Tenant, at its sole cost and expense, shall maintain the Demised Premises and
each part thereof, structural and non-structural, in good order and condition
and, subject to the terms and conditions of Article VI, if and as applicable,
shall make any necessary Repairs thereto, interior and exterior, whether
extraordinary, foreseen or unforeseen. When used in this Article VII, the term
"Repairs" shall include all such replacements, renewals, alterations, additions
and betterments necessary for Tenant to properly maintain the Demised Premises
in good order and condition and in compliance with all applicable laws. The
necessity for, and adequacy of, any and all Repairs to the Demised Premises
required or conducted pursuant to this Article VII shall be measured by and
meet, at a minimum, all of the following standards: (1) at least equal in
quality and class to the condition of the Demised Premises prior to the need for
such Repairs; (2) at least equal in quality and class to the condition of
buildings and related facilities of similar construction and class in the
general geographic area of the Demised Premises are generally maintained; (3)
subject to the terms and conditions of Article VI, avoidance of any and all
structural damage or injury to the Building or persons therein; (4) any and all
maintenance, service, operation and repair standards and requirements set forth
by Tenant for its (or its subsidiaries' or affiliates') restaurants; (5) any and
all repairs, replacements or upgrades necessary to ensure compliance with the
rules and regulations of all governmental agencies, including all Environmental
Laws (as defined below); and (6) no mold which inhibits or impairs the intended
use of the Demised Premises shall be permitted to remain unabated at the Demised
Premises. Landlord shall have no duty whatsoever to maintain, replace, upgrade,
or repair any portion of the Demised Premises. If Tenant fails or neglects to
make all necessary Repairs or fulfill its other obligations as set forth above,
then Landlord or its agents may enter the Demised Premises for the purpose of
making such Repairs or fulfilling those obligations. All costs and expenses
incurred as a consequence of Landlord's action shall be paid by Tenant to
Landlord as Additional Rent within fifteen (15) days after Landlord delivers to
Tenant copies of invoices for such Repairs or other obligations. These invoices
shall be prima facie evidence of the payment of the charges to be paid by
Landlord. Except in the case of emergency, Landlord shall refrain from taking
any such action unless Tenant has not commenced and diligently pursued making
such repairs or fulfilling such obligations within thirty (30) days after
Landlord delivers written notice of the proposed actions to be taken by
Landlord.
ARTICLE VIII
COMPLIANCE WITH LAW
Tenant shall, throughout the Lease Term, at its sole cost and expense, comply,
in all material respects, with all laws and regulations of federal, state,
municipal and local governments, departments, commissions and boards pursuant to
law, or directives or orders issued pursuant thereto, including without
limitation all Environmental Laws and the Americans With Disabilities Act, with
respect to, regarding, or pertaining to the Demised Premises. Notwithstanding
the foregoing, Tenant may, subject to the terms and conditions of this Section,
contest or appeal such requirements or orders. To the extent any such contest or
appeal by Tenant suspends any and all obligations on the part of Tenant,
Landlord, or the Demised Premises to comply with such requirements or orders,
and suspends any and all applicability of such requirements or orders to the
Demised Premises, Tenant shall not be required to comply with any such laws,
regulations, orders, requirements or rules. In no event shall any such appeals,
contests or proceedings pursued by Tenant subject Landlord to criminal liability
or any civil liability. Upon final resolution of any such appeal, proceeding or
contest pursued by Tenant, Tenant shall comply with the judgment, finding or
order of the governmental authority so resolving such appeal, proceeding or
contest, and shall be liable in full for any and all fines, penalties, charges
or costs of any type whatsoever which accrue during the pendency of any contest
or appeal.
ARTICLE IX
UTILITIES
Without limiting any of Tenant's obligations set forth in Article III, Tenant
shall be solely responsible for, and shall pay the cost of all utility services
provided to the Demised Premises throughout the Lease Term.
ARTICLE X
DISCLAIMER AND INDEMNITY
Section 10.01 As used in this Lease, (x) "Landlord Parties" means, collectively,
Landlord, Landlord's Affiliates and Landlord's Lender; (y) "Landlord's
Affiliates" means Landlord's members, partners, officers, directors,
shareholders, employees, or any person or entity that directly or indirectly
through one or more intermediaries controls, is controlled by, or is under
common control with Landlord, (for purposes of this definition, the term
"control," "controlled by" or "under common control with" means the power,
direct or indirect, to direct or cause the direction of the management and
policies of Landlord, whether through the ownership of voting stock, by
contract, as trustee or executor, or otherwise); and (z) "Landlord's Lender"
means any persons or entities providing financing to Landlord or Landlord's
Affiliates. To the extent not prohibited by law, none of the Landlord Parties
shall be (and Tenant hereby agrees that they shall not be) liable, under any
circumstances (except only Landlord (and not any other Landlord Parties) in the
event of, and then only to the extent directly attributable to, Landlord's gross
negligence or willful misconduct), for any loss, injury, death or damage to
person or property (including but not limited to the business or any loss of
income or profit therefrom) of Tenant, Tenant's members, officers, directors,
shareholders, agents, employees, contractors, customers, invitees or any other
person in or about the Demised Premises, whether the same are caused by (1)
fire, explosion, falling plaster, steam, dampness,
electricity, gas, water, rain or (2) breakage, leakage or other defects of
sprinklers, wires, appliances, plumbing fixtures, water or gas pipes, roof, air
conditioning, lighting fixtures, street improvements, or subsurface improvements
or (3) theft, acts of God, acts of the public enemy, riot, strike, insurrection,
war, court order, requisition or order of governmental body or authority, or (4)
any act or omission of any other occupant of the Demised Premises or any other
party, or (5) operations in construction of any private, public or quasi-public
work, or (6) any other cause, including damage or injury which arises from the
condition of the Demised Premises, from occupants of adjacent property, from the
public, or from any other sources or places, and regardless of whether the cause
of such damage or injury or the means of repairing the same are inaccessible to
Tenant, or which may arise through repair, alteration or maintenance of any part
of the Demised Premises or failure to make any such repair, from any condition
or defect in, on or about the Demised Premises including any "Environmental
Conditions" (as defined in Article XXXVII) or the presence of any mold or any
Hazardous Materials (as defined in Article XXXVII), or from any other condition
or cause whatsoever.
Section 10.02 Tenant hereby fully and forever releases, discharges, acquits, and
agrees to indemnify, protect, defend (with counsel selected by Tenant and
approved by Landlord, such approval not to be unreasonably withheld) and hold
the Demised Premises, and each of the Landlord Parties wholly free and harmless
of, from and against any and all claims, demands, actions, causes of action,
settlements, obligations, duties, indebtedness, debts, controversies, losses,
remedies, choses in action, liabilities, costs, penalties, fines, damages,
injury, judgments, forfeiture, losses (including without limitation diminution
in the value of the Demised Premises) or expenses (including without limitation
reasonable attorneys' fees, consultant fees, testing and investigation fees,
expert fees and court costs), whether known or unknown, whether liquidated or
unliquidated: (a) arising out of or in any way related to or resulting directly
or indirectly from: (i) the use, occupancy or activities of Tenant, its agents,
employees, contractors or invitees in or about the Demised Premises, (ii) any
failure on the part of Tenant to comply with any applicable law, including
without limitation all Environmental Laws; (iii) any default or breach by Tenant
in the performance of any obligation of Tenant under this Lease; (iv) any other
loss, injury or damage described in Section 10.01 above caused (whether by
action or omission) by Tenant, its agents, employees, contractors or invitees;
and (v) in connection with mold at the Demised Premises; and (b) whether
heretofore now existing or hereafter arising out of or in any way related to or
resulting directly or indirectly from the presence or "Release" (as defined in
Article XXXVII) at, on, under to or from the Demised Premises of any Hazardous
Material; provided, however, that the foregoing indemnity shall not be
applicable to the extent any such claims are directly attributable to the gross
negligence or willful misconduct of such Landlord Party. All of the personal or
any other property of Tenant kept or stored at, on or about the Demised Premises
shall be kept or stored at the risk of Tenant.
Section 10.03 Tenant hereby fully and forever releases, discharges, acquits, and
agrees to indemnify, protect, defend (with counsel selected by Tenant and
approved by Landlord, such approval not to be unreasonably withheld) and hold
the Demised Premises, and all Landlord Parties wholly free and harmless of, from
and against any and all claims, demands, actions, causes of action, settlements,
obligations, duties, indebtedness, debts, controversies, losses, remedies,
choses in action, liabilities,
costs, penalties, fines, damages, injury, judgments, forfeiture, losses
(including without limitation diminution in the value of the Demised Premises)
or expenses (including without limitation reasonable attorneys' fees, consultant
fees, testing and investigation fees, expert fees and court costs), whether
known or unknown, hereafter arising, whether liquidated or unliquidated, arising
out of or in any way related to or resulting directly or indirectly from work or
labor performed, materials or supplies furnished to or at the request of Tenant
or in connection with obligations incurred by or performance of any work done
for the account of Tenant in, on or about the Demised Premises.
Section 10.04 Landlord and Tenant each (a) represent to the other party that
such representing party has dealt with no broker or brokers in connection with
the negotiation, execution and delivery of this Lease and (b) hereby agrees to
indemnify, defend, protect (with counsel selected by the other party) and hold
such other party wholly free and harmless of, from and against any and all
claims or demands for any and all brokerage commissions and/or finder's fees due
or alleged to be due as a result of any agreement or purported agreement made by
such indemnifying party.
Section 10.05 The provisions of this Article X shall survive the expiration or
sooner termination of this Lease. Tenant hereby waives the provisions of any
applicable laws restricting the release of claims which the releasing parties do
not know or suspect to exist at the time of release, which, if known, would have
materially affected Tenant's decision to agree to this release. In this regard,
Tenant hereby agrees, represents, and warrants to Landlord that Tenant realizes
and acknowledges that factual matters now unknown to Tenant may hereafter give
rise to causes of action, claims, demands, debts, controversies, damages, costs,
losses and expenses which are presently unknown, unanticipated and unsuspected,
and Tenant further agrees, represents and warrants that the release provided
hereunder has been negotiated and agreed upon in light of that realization and
that Tenant nevertheless hereby intends to release, discharge and acquit the
parties set forth herein above from any such unknown causes of action, claims,
demands, debts, controversies, damages, costs, losses and expenses which are in
any manner set forth in or related to this Lease, the Demised Premises and all
dealings in connection therewith.
ARTICLE XI
INSURANCE
Section 11.01
(a) Liability Insurance. Throughout the Lease Term, Tenant
shall, at its sole expense, provide and cause to be maintained comprehensive
general public liability insurance with an insurance company licensed to do
business in each state in which the Demised Premises is located and which is
approved by Landlord (which approval shall not be unreasonably withheld),
against claims for bodily injury, death or property damage occurring on, in or
about each of the Demised Premises, such insurance to afford a minimum coverage
protection of not less than Two Million Dollars ($2,000,000) combined single
limit (per occurrence) for injury to, or death of, persons and loss of, or
damage to, property. Such coverage shall include a contractual obligation
endorsement covering Tenant's duties and obligations under Article X above.
Landlord may require increases in coverage from Tenant from time to time as
required by any lender of Landlord.
(b) Property Insurance. Throughout the Lease Term, Tenant shall
maintain property insurance against loss or damage by fire and such other risks
to the Building (including, but not limited to, Tenant's inventory, equipment
and/or trade fixtures), as are included in so-called "all-risks extended
coverage" endorsements, in an amount equal to the full replacement cost thereof
in a stipulated amount, with change of condition, exclusive of the cost of
foundations, excavations and footings, with a replacement cost endorsement
without any deduction being made for depreciation.
Said policy shall contain coverage for loss of rents insurance which will cover
the Fixed Rent and Additional Rent for a period of up to one (1) year.
(c) In addition to the other insurance required under this
Section 11.01, for so long as Tenant shall serve liquor or other alcoholic
beverages in or from the Leased Premises, Tenant agrees to maintain minimum
limits of coverage of at least Two Million Dollars ($2,000,000) under an
umbrella policy covering excess "liquor law" liability (sometimes also known as
"Dram Shop" insurance) which shall insure Tenant and Landlord, and all of those
claiming by, through or under Landlord, against any and all claims, demands or
actions for personal bodily injury to, or death of, one person or multiple
persons in one or more accidents, and for damages to property, so that at all
times Landlord will be fully protected against claims that may arise by reason
of or in connection with the sale, dispensing and consumption of liquor and
alcoholic beverages in, on, at, from or about the Leased Premises.
Section 11.02 All insurance provided for in this Article shall be effected under
policies issued by insurers with at least an A rating by A.M. Best's Insurance
Guide. No insurance policy may have a deductible amount exceeding $25,000.00 per
occurrence. Tenant shall provide to Landlord, beginning on the Effective Date
and continuing annually thereafter with certificates (or other evidence
reasonably requested by Landlord) from all applicable insurance carriers
evidencing the payment of premiums or accompanied by other evidence of such
payment (e.g., receipts, canceled checks) reasonably satisfactory to Landlord.
Section 11.03 The policies of insurance required under this Article XI shall
name Tenant as the named insured and Landlord Parties (as defined in Section
10.01 above) as additional named insureds as their interests may appear, with
primary coverage in favor of all additional named insureds (and with provisions
that any other insurance carried by any additional insured or Landlord shall be
non-contributing and that naming Landlord and other Landlord Parties as
additional insureds shall not negate any right Landlord or other Landlord
Parties would have had as claimants under the policy if not so named). All
insurance policies required under this Article XI also shall provide that the
beneficial interest of Landlord in such policies shall be fully transferable.
All policies referred to in Section 11.01(b) above shall provide that the
proceeds of all such policies shall be made payable to the account of both
Landlord and Tenant to be disbursed in accordance with the provisions of, and
for the purposes set forth in, Article XII hereof.
Section 11.04 Any insurance provided for in this Article may be effected by a
blanket policy or policies of insurance, or under so-called "all-risk" or
"multi-peril" insurance policies, provided that the amount of the total
insurance available with respect to the Demised Premises shall provide coverage
and indemnity at least equivalent to separate policies in the amounts herein
required, and provided further that in other respects, any such policy or
policies shall comply with the provisions of this Article. Any increased
coverage provided by individual or blanket policies shall be satisfactory,
provided the aggregate liability limits covering the Demised Premises under such
policies shall otherwise comply with the provisions of this Article.
Section 11.05 Every insurance policy carried by either party with respect to the
Demised Premises shall (if it can be so written) include provisions waiving the
insurer's subrogation rights against the other party to the extent such rights
can be waived by the insured prior to the occurrence of damage or loss. Subject
to the above, each party hereby waives any rights of recovery against the other
party for any direct damage or consequential loss covered by said policies
against which such party is protected by insurance whether or not such damage or
loss shall have been caused by any acts or omissions of the other party, but
such waiver shall operate only to the extent such waiving party is so protected
by such insurance coverage.
Section 11.06 Each insurance policy required to be carried by Tenant hereunder
shall include a provision requiring the insurance carrier insuring such policy
to provide Landlord with not less than thirty (30) days' prior written notice of
any threatened or actual lapse, cancellation, reduction, or other material
change in such policy's coverage or its terms. If any insurance policy required
to be and in fact carried by Tenant and covering the Demised Premises or any
part thereof is cancelled or is threatened by the insurer to be cancelled (other
than in the case of the lapse of the policy at the end of its stated term), or
if the coverage thereunder is reduced in any way by the insurer for any reason,
and if Tenant fails to remedy the condition giving rise to cancellation,
threatened cancellation, or reduction of coverage within 48 hours after notice
thereof by Landlord, Landlord may, in addition to all other rights and remedies
available to Landlord, enter the Demised Premises and remedy the condition
giving rise to such cancellation, threatened cancellation or reduction, and
Tenant shall forthwith pay the cost thereof to Landlord (which cost may be
collected by Landlord as Additional Rent) and Landlord shall not be liable for
any damage or injury caused to any property of Tenant or of others located on
the Demised Premises as a result of any such entry. In the event Tenant fails to
procure or maintain any policy of insurance required under Article XI, Landlord
may, at its option, purchase such insurance and charge Tenant all costs and
expenses incurred in procuring and maintaining such insurance as Additional
Rent.
ARTICLE XII
DAMAGE OR DESTRUCTION
Section 12.01 Subject to the provisions of Section 12.04 and Section 12.05
below, if at any time during the Lease Term, the Demised Premises or any part
thereof shall be damaged or destroyed by fire or other casualty of any kind or
nature, Tenant shall proceed within ninety (90) days after the first date of
such damage or destruction with commercially reasonable due diligence to repair,
replace or rebuild the Demised Premises as nearly as possible to its condition
and character immediately prior to such damage with such variations and
Alterations requested by Tenant as may be permitted under (and subject to the
provisions of ) Article VI (the "Restoration Work").
Section 12.02 All property and casualty insurance proceeds payable to Landlord
or Tenant (except (i) insurance proceeds payable to Tenant on account of
Tenant's trade fixtures or inventory and business interruption insurance carried
by Tenant and (ii) insurance proceeds payable from comprehensive general public
liability, or any other liability insurance) at any time as a result of casualty
to the Demised Premises shall be paid jointly to Landlord and Tenant for
purposes of payment for the cost of the Restoration Work, except as may be
otherwise expressly set forth herein, and advanced from time to time for such
purposes as the work progresses upon certified request of Tenant's architect.
Landlord and Tenant shall cooperate in order to obtain the largest possible
insurance award lawfully obtainable and shall execute any and all consents and
other instruments and take all other actions necessary or desirable in order to
effectuate same and to cause such proceeds to be paid as hereinbefore provided.
The proceeds of any such insurance in the case of loss shall, to the extent
necessary, be used first for the Restoration Work with the balance, if any,
payable to Tenant. If insurance proceeds as a result of a casualty to the
Demised Premises are insufficient to complete the Restoration Work necessary by
reason of such casualty, then Tenant shall supply promptly the balance of the
amount necessary to complete the Restoration Work. If Tenant so supplies such
balance, then the funds so supplied by Tenant shall first be used in their
entirety for the Restoration Work, and only after all such funds have been fully
expended shall the insurance proceeds collected by reason of such casualty be
used and expended.
Section 12.03 Except as provided for in Section 12.04, this Lease shall not be
affected in any manner by reason of the total or partial destruction to the
Demised Premises or any part thereof, or any reason whatsoever, and Tenant,
notwithstanding any law or statute, present or future, waives all rights to quit
or surrender any Demised Premises or any part thereof. Fixed Rent and Additional
Rent required to be paid by Tenant hereunder shall not xxxxx as a result of any
casualty.
Section 12.04
(a) Notwithstanding Section 12.01 above, if the Building is destroyed or
damaged in excess of Twenty-Five percent (25%) of the replacement cost thereof
(the Demised Premises at which the Building is located is hereafter referred to
as the "Casualty Property"), exclusive of foundation and footings, by fire or
other insured casualty at any time during the last two (2) years of the Lease
Term, then Tenant shall have the right, at its election, to terminate this Lease
by giving Landlord written notice of termination within sixty (60) days after
the date on which such damage or destruction occurs. Such termination shall be
effective on the last day of the month following the month in which Tenant gives
Landlord notice of its election to so terminate. In such event, Landlord shall
be entitled to all insurance proceeds payable pursuant to the policy carried by
Tenant pursuant to Section 11.01(b) above, except amounts payable with respect
to Tenant's inventory, equipment and/or trade fixtures or moveable trade
fixtures.
(b) In the event of the termination of the Lease, Tenant shall pay to
Landlord, prior to such termination date, an amount equal to the Fixed Rent and
any then accrued Additional Rent payable under this Lease to the date of such
termination. With respect to any amounts of Additional Rent which are payable by
Tenant in the event of such termination, but which are not then ascertainable,
Tenant shall pay to Landlord an amount equal to such Additional Rent as and when
the same is determined. This Section 12.04 shall survive expiration or
termination of the Lease. ARTICLE XIII EMINENT DOMAIN
Section 13.01 If more than fifty percent (50%) of the Demised Premises, fifty
percent (50%) of the existing access to or from the Demised Premises, or fifty
percent (50%) of the parking available at the Demised Premises shall be taken
for any public or quasi-public use under any statute or by right of eminent
domain, or by purchase in lieu thereof and such taking makes the Demised
Premises unusable for the purposes set forth in Article IV, then this Lease
shall terminate as of the date that possession has been so taken (the "Vesting
Date").
Section 13.02
(a) In the event of a taking of less than or equal to fifty percent (50%)
of the Demised Premises, Tenant may elect to terminate this Lease and not
restore such Demised Premises if, by reason of the taking, the taking shall
result in a diminution in value of more than 20% of the Demised Premises and as
a result of such taking Tenant's business at the Demised Premises has been
materially and adversely affected. Tenant's business at the Demised Premises
will be deemed materially adversely affected only if there is (i) a taking of a
portion of the Building located at the Premises making reconfiguration
uneconomical, (ii) a taking of access to the Demised Premises in which an
alternative access provides significantly reduced traffic counts (iii) a taking
of a significant number of parking spaces where alternative parking spaces are
not available, or (iv) a taking that would preclude use of the Property for its
current use under applicable zoning or other use regulations.
(b) In the event Tenant elects by reason of any of the foregoing events
described in this Article XIII to terminate the Lease as to a Demised Premises
("Condemned Property"), Tenant shall give written notice to Landlord of its
intention to so terminate within ninety (90) days after formal notice of the
proposed taking is given to Tenant, and this Lease shall terminate as of the
last day of the calendar month following the month in which such notice is
given. In the event the condemning authority revokes or terminates its
condemnation proceeding, Landlord, prior to the date set for termination of this
Lease, may, by notice to Tenant, elect to rescind such termination. In the event
of such termination, however, Tenant shall pay to Landlord, prior to such
termination date, an amount equal to the Fixed Rent and any then accrued
Additional Rent payable under this Lease to the date of such termination, and
neither party shall have any further rights or liabilities under this Lease
(except for rights and liabilities that explicitly survive termination or
expiration of the Lease as set forth herein). With respect to any items of
Additional Rent which are payable by Tenant in the event of such termination,
but which are not then ascertainable, Tenant shall pay to Landlord an amount
equal to such Additional Rent as and when the same is determined. The covenants
and agreements with respect to the adjustment and payment of items of Additional
Rent shall survive the termination of this Lease.
Section 13.03 In the event of a taking resulting in the termination of this
Lease with respect to a Condemned Property pursuant to the provisions of
Sections 13.01 or 13.02, the parties hereto agree to cooperate in applying for
and in prosecuting any claim for such taking and further agree that the
aggregate net award shall be distributed as follows:
(a) Landlord shall be entitled to the entire award for the
Condemned Property.
(b) Tenant shall be entitled to any award that may be made for
the taking of, or injury to or on account of, any cost or loss Tenant may
sustain in the removal of its merchandise, fixtures, moveable trade fixtures and
equipment and furnishings, and so long as it does not diminish the amount of the
award otherwise available to Landlord for the Condemned Property, the award for
loss of business and goodwill.
Section 13.04
(a) In case of a taking of less than or equal to fifty percent
(50%) of the Demised Premises, and if this Lease is not terminated as provided
in Section 13.02 above, Tenant shall proceed with diligence (subject to
reasonable time periods for purposes of adjustment of any award and unavoidable
delays) to repair or reconstruct the affected Building to a complete
architectural unit (all such repair, reconstruction and work being referred to
in this Article as "Reconstruction Work"). Landlord shall reimburse Tenant for
the cost of the Reconstruction Work up to and not exceeding the net compensation
amount realized by Landlord as a result of such taking (i.e., the gross amount
of the compensation received by Landlord from the taking authority less all
reasonable costs and expenses incurred by Landlord in pursuing, prosecuting,
and/or recovering its claim to such award). All Reconstruction Work shall be
performed pursuant to (and subject to) the requirements for Alterations set
forth in Article VI.
(b) In case of a taking of less than substantially all of the
Demised Premises, and if this Lease is not terminated as provided in Section
13.02 above, the monthly Fixed Rent payable hereunder shall, from and after the
date of such taking, be reduced by an amount equal to the product of (i) 1/12
multiplied by (ii) 7% multiplied by (iii) the net condemnation proceeds retained
by Landlord after the application of any such proceeds to the repair,
restoration or replacement necessitated by the condemnation taking.
(c) Tenant shall be entitled to claim, prove and receive in any
condemnation proceeding such awards as may be allowed for loss of business and
goodwill, provided such award shall not diminish the amount of the award
otherwise available to Landlord for the Demised Premises hereunder.
(d) Any compensation for a temporary taking shall be payable to
Tenant without participation by Landlord, except to the proportionate extent
such temporary taking extends beyond the end of the Lease Term, and there shall
be no abatement of Rent as a result thereof.
ARTICLE XIV
COVENANTS OF LANDLORD AND TENANT
Section 14.01 Landlord and Tenant represent, warrant and covenant to the other
as follows:
(a) Landlord currently has, and as of the Effective Date will
continue to have, the right and lawful authority to enter into this Lease and
perform Landlord's obligations hereunder.
(b) Tenant has the right and lawful authority to enter into this
Lease and perform Tenant's obligations hereunder.
(c) From and after the Effective Date until the termination of
the Lease Term, and provided Tenant is not in default beyond expiration of all
applicable cure periods under this Lease, Tenant shall have quiet enjoyment of
the Demised Premises as against any adverse claim of Landlord or any party
claiming under Landlord subject, however, to the terms of the Lease, the
Diligence Matters and any agreement between Tenant and any such party claiming
under Landlord.
ARTICLE XV
INSOLVENCY
Section 15.01 If at any time during the Lease Term, (1) proceedings in
bankruptcy shall be instituted (voluntarily or involuntarily) by or against
Tenant which result in an adjudication of bankruptcy, or (2) if Tenant shall
file, or any creditor or other person shall file against Tenant, any petition in
bankruptcy (i.e., seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief) under the Bankruptcy
Act of the United States of America (or under any other present or future
statute, law or regulation), and such filing is not vacated or withdrawn within
sixty (60) days thereafter, or (3) if a trustee or receiver shall be appointed
to take possession of the Demised Premises, or of all or substantially all of
the business or assets of Tenant, and such appointment is not vacated or
withdrawn and possession restored to Tenant, within thirty (30) days thereafter,
or (4) if a general assignment or arrangement is made by Tenant for the benefit
of creditors, or (5) if any sheriff, marshal, constable or other
duly-constituted public official takes possession of the Demised Premises, or of
all or substantially all of the business or assets of Tenant by authority of any
attachment, execution, or other judicial seizure proceedings, and if such
attachment or other seizure remains undismissed or undischarged for a period of
thirty (30) days after the levy thereof, or (6) if Tenant shall admit in writing
Tenant's inability to pay its debts as they become due; the filing by Tenant of
an answer admitting or failing timely to contest a material allegation of a
petition filed against Tenant in any such proceeding; or, if within sixty (60)
days after the commencement of any proceeding against Tenant seeking any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any present or future statute, law or regulation, such
proceeding shall not have been dismissed, then an Event of Default under this
Lease shall have occurred on the part of Tenant and Landlord may, at its option
in any of such events, on thirty (30) days notice to Tenant, if such action is
not vacated or withdrawn, immediately recapture and take possession of the
Demised Premises and terminate this Lease pursuant to process of law.
ARTICLE XVI
DEFAULT
Section 16.01 Events Of Default. The occurrence of any of the following shall
constitute an event of default ("Event of Default") on the part of Tenant:
(a) Nonpayment Of Rent. Failure to pay any installment of Fixed
Rent or Additional Rent due and payable hereunder within five (5) business days
after written notice to Tenant.
(b) Insolvency. The occurrence of any event described in
Article XV above. In the event that under applicable law the trustee in
bankruptcy or Tenant has the right to affirm this Lease and continue to perform
the obligations of Tenant hereunder, such trustee or Tenant shall, within such
time period as may be permitted by the bankruptcy court having jurisdiction,
cure all defaults of Tenant hereunder outstanding as of the date of the
affirmance of this Lease and provide to Landlord such adequate assurances as may
be necessary to ensure Landlord of the continued performance of Tenant's
obligations under this Lease.
(c) Intentionally Deleted.
(d) Intentionally Deleted.
(e) Environmental. Tenant's violations of any Environmental Laws
or the Release of any Hazardous Materials, or the failure to xxxxx the presence
of mold which would inhibit or impair the intended use of the Demised Premises,
such failure continuing for a period of thirty (30) days after written notice of
such failure, or such longer period as is reasonably necessary to remedy such
default, provided that Tenant commences an appropriate response action for such
violation or Release within such thirty (30) day period and continuously and
diligently pursues such remedy at all times until complete.
(f) Delivery of Documents. The failure by Tenant to deliver any
of the documents required pursuant to Section 26.01 or 28.01 within the time
periods required pursuant to such sections.
(g) Intentionally Deleted.
(h) Other Obligations. The failure by Tenant to timely perform
any obligation, agreement or covenant under this Lease, other than those matters
specified in Sections 16.01(a)-(f) above, and such failure continuing for a
period of thirty (30) days after written notice of such failure is delivered to
Tenant (or such longer period, up to but not exceeding an additional ninety (90)
days, as is reasonably necessary to remedy such default, provided that Tenant
commences the remedy within such thirty (30) day period and continuously and
diligently pursues such remedy at all times during the additional ninety (90)
day period.)
Section 16.02 Remedies Upon Default. If an Event of Default by Tenant occurs,
then, in addition to any other remedies available to Landlord at law or in
equity or elsewhere hereunder, Landlord shall have the following remedies:
(a) Termination. Landlord shall have the right, with or without
notice or demand, immediately upon expiration of any applicable grace period
specified herein, to terminate this Lease, and at any time thereafter recover
possession of all or any portion of the Demised Premises or any part thereof and
expel and remove therefrom Tenant and any other person occupying the same by any
lawful means, and repossess and enjoy all or any portion of the Demised Premises
without prejudice to any of the remedies that Landlord may have under this
Lease. If Landlord elects to terminate the Lease, Landlord shall also have the
right to reenter the Demised Premises and take possession of and remove all
equipment and fixtures of Tenant, if any, in such Demised Premises, and to
operate the restaurant at the Demised Premises. In connection with any such
repossession, Tenant (and any affiliate of Tenant holding a liquor license with
respect to the Demised Premises) shall provide reasonable cooperation in
transferring its liquor license to Landlord, or in assisting Landlord in
obtaining a liquor license. Tenant (and Tenant's affiliate) agree upon
Landlord's written request, to grant a security interest to Landlord in the
liquor license at the Demised Premises to secure Tenant's obligations hereunder,
provided that the grant of such security interest does not violate any state or
local law or ordinance. Upon any assignment or foreclosure of Tenant's liquor
license, Tenant's liability to Landlord on account of any default under this
Lease shall be reduced by the fair market value of the liquor license so
transferred to Landlord. If Landlord elects to terminate this Lease and Tenant's
right to possession, or if Tenant's right to possession is otherwise terminated
by operation of law, Landlord may recover as damages from Tenant the following:
(i) all Rent then due under the Lease; (ii) the Rent due for the remainder of
the Lease Term (discounted by the discount rate of the Federal Reserve Bank of
San Francisco plus one percent (1%)), not to exceed, in any event 6%; (iii) the
cost of reletting the Demised Premises; and (iv) any other costs and expenses
that Landlord may reasonably incur in connection with the Event of Default.
Landlord shall use commercially reasonable efforts to mitigate Tenant's damages
for any such default; provided, however, that Landlord's efforts to mitigate
shall not waive Landlord's right to recover damages which are calculated
consistent with Landlord's duty to mitigate.
(b) Continuation After Default. If Landlord does not elect to
terminate this Lease, then this Lease shall continue in effect, and Landlord may
enforce all of its rights and remedies under this Lease, including, without
limitation, the right to recover Rent as it becomes due, and Landlord, without
terminating this Lease, may exercise all of the rights and remedies of a
landlord under
New York law. Landlord shall not be deemed to have terminated this Lease except
by an express statement in writing. Acts of maintenance or preservation, efforts
to relet the Demised Premises, or the appointment of a receiver upon application
of Landlord to protect Landlord's interest under this Lease shall not constitute
an election to terminate Tenant's right to possession unless such election is
expressly stated in writing by Landlord. Notwithstanding any such reletting
without such termination, Landlord may at any time thereafter elect to terminate
Tenant's right to possession and this Lease. If Landlord elects to relet the
Demised Premises for the account of Tenant, the rent received by Landlord from
such reletting shall be applied as follows: first, to the payment of any and all
costs of such reletting (including, without limitation, reasonable attorneys'
fees, brokers' fees, alterations and repairs to any of the Demised Premises, and
tenant improvement costs); second, to the payment of any and all indebtedness
other than Rent due hereunder from Tenant to Landlord; third, to the payment of
any and all Rent due and unpaid hereunder; and the balance, if any, shall be
held by Landlord and applied in payment of future Rent as it becomes due. If the
rent received from the reletting is less than the sum of the costs of reletting,
other indebtedness due by Tenant, and the Rent due by Tenant, then Tenant shall
pay the deficiency to Landlord promptly upon demand by Landlord. Such deficiency
shall be calculated and paid monthly.
Section 16.03 Indemnification. Nothing in this Section shall be deemed to affect
Tenant's obligation to indemnify, defend, protect and hold harmless Landlord and
the other Landlord Parties under Article X of this Lease, and such obligation
shall survive the termination or expiration of this Lease.
Section 16.04 Waiver of Notice/ Performance by Landlord. Notwithstanding any
provision herein, (a) if Tenant is required to comply with any governmental
requirement, Tenant shall not be entitled to notice of default from Landlord and
right to cure beyond the period within which such compliance may be required by
applicable law or government agency; or (b) if in Landlord's reasonable
determination the continuance of any default by Tenant for the full period of
notice provided for herein will constitute a threat of injury or harm to persons
or property, Landlord may, with or without notice, elect to perform those acts
with respect to which Tenant is in default for the account and at the expense of
Tenant. If by reason of such governmental requirement or default by Tenant,
Landlord is compelled or elects to pay any sum of money, (including without
limitation reasonable attorneys' fees, consultant fees, testing and
investigation fees, expert fees and court costs), such sums so paid by Landlord,
plus an administrative charge of ten percent (10%) of such sums, shall be due as
Additional Rent from Tenant within ten (10) days of written demand therefore
from Landlord.
Section 16.05 Interest. Tenant hereby acknowledges that late payment by Tenant
to Landlord of Fixed Rent and any Additional Rent will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges and late charges which may be imposed on
Landlord by the terms of any mortgage or trust deed covering the Demised
Premises. Accordingly, any sum due by Tenant to Landlord under this Lease which
is not paid when due shall bear interest at the lesser of the prime rate
announced from time to time by Xxxxx Fargo Bank, N.A., plus five percent (5%)
per annum or the maximum rate allowed under New York law, not to exceed, in any
event 15%, from the date such sum becomes due and payable by Tenant hereunder
until paid, unless otherwise expressly provided in this Lease. The foregoing
shall be in addition to, and not in lieu of, any other rights, remedies and
charges as a result of any such late payment by Tenant set forth in this Lease,
including without limitation any late charge imposed on any such amount as set
forth in Section 3.08.
Section 16.06 Tenant's Subleases. If Landlord elects to terminate this Lease on
account of any Event of Default, then Landlord may: (i) terminate any sublease
by a subtenant and any license, concession, or other consensual arrangement for
possession entered into by Tenant and affecting any of the Demised Premises
which are not the subject of a nondisturbance agreement executed by Landlord; or
(ii) choose to succeed to Tenant's interest in such arrangement. No payment by a
subtenant with respect to a sublease shall entitle such subtenant to possession
of any Property after termination of this Lease and Landlord's election to
terminate the sublease by the subtenant. If Landlord elects to succeed to
Tenant's interest in such arrangement, then Tenant shall, as of the Effective
Date of notice given by Landlord to Tenant of such election, have no further
right to, or interest in, any rent or other consideration receivable under that
arrangement.
Section 16.07 Form of Payment After Default. If Tenant fails to pay any amount
due to Landlord under this Lease within five (5) business days after written
notice of such failure is given to Tenant by Landlord, or if Tenant attempts to
pay any such amount by drawing a check on an account with insufficient funds,
then Landlord shall have the right to require that any and all subsequent
amounts paid by Tenant to Landlord under this Lease (to cure a default or
otherwise) be paid in the form of cash, money order, cashier's or certified
check drawn on an institution acceptable to Landlord, or any other form approved
by Landlord in its sole and absolute discretion, notwithstanding that Landlord
may have previously accepted payments from Tenant in a different form.
Section 16.08 Acceptance of Rent Without Waiving Rights. No payment by Tenant
shall be deemed to be other than on account of the earliest sum due from Tenant
hereunder, nor shall any endorsement or statement by Tenant on any check or any
letter accompanying such payment be deemed an accord and satisfaction of any
amount in dispute between Tenant and Landlord or otherwise. Landlord may accept
any and all of Tenant's payments without waiving any right or remedy under this
Lease, including but not limited to the right to commence and pursue an action
to enforce rights and remedies under a previously served notice of default,
without giving Tenant any further notice or demand.
Section 16.09 Waiver by Tenant. Tenant hereby waives all claims for damages that
may be caused by Landlord's lawful reentering and taking possession of the
Demised Premises in accordance with the provisions of this Lease or removing and
storing the property of Tenant as herein provided.
Section 16.10 Remedies Cumulative. All rights, privileges, elections, and
remedies of Landlord are cumulative and not alternative with all other rights
and remedies hereunder, at law or in equity to the fullest extent permitted by
law. The exercise of one or more rights or remedies by Landlord shall not impair
Landlord's rights to exercise any other right or remedy to the fullest extent
permitted by law.
Section 16.11 Default by Landlord. Landlord shall not be in default unless
Landlord fails to perform obligations required of Landlord within a reasonable
time, but in no event later than ten (10) days after written notice by Tenant to
Landlord and to the holder of any first mortgage, deed of trust, deed to secure
debt or security deed granted by Landlord against any portion of the Demised
Property whose name and address shall have been furnished to Tenant in writing,
specifying Landlord's failure to perform such obligation; provided, however,
that, if the nature of Landlord's obligation is such that more than ten (10)
days are required for performance, then Landlord shall not be in default if
Landlord commences performance within such ten (10) day period and thereafter
diligently prosecutes the same to completion. Tenant agrees that the mortgagee,
beneficiary or trustee under any such first mortgage, deed of trust, deed to
secure debt or security deed shall have the right to cure such default on behalf
of Landlord within ten (10) calendar days after receipt of such notice, and
Tenant further agrees not to invoke any of its remedies under this Lease until
such ten (10) calendar day period has elapsed.
ARTICLE XVII
UNAVOIDABLE DELAYS, FORCE MAJEURE
If either party shall be prevented or delayed from punctually performing any
obligation or satisfying any condition under this Lease by any strike, lockout,
labor dispute, inability to obtain labor, materials or reasonable substitutes
thereof, Acts of God, present or future governmental restrictions, regulations
or control, insurrection, sabotage, fire or other casualty, final determination
of insurance and condemnation claims, or any other condition beyond the control
of the party, exclusive of financial inability of a party, then the time to
perform such obligation or satisfy such condition shall be extended by the delay
caused by such event, but only for a reasonable period of time not to exceed, in
any event, 180 days. The provisions of this Article shall in no event, however,
operate to delay the Commencement Date or to excuse Tenant from the prompt
payment of Fixed Rent or Additional Rent.
ARTICLE XVIII
NO WAIVER
The failure of Landlord or Tenant to insist upon strict performance of any of
the terms and conditions hereof shall not be deemed a waiver of any rights or
remedies that party or any other such party may have, and shall not be deemed a
waiver of any subsequent breach or default in any of such terms, covenants or
conditions.
ARTICLE XIX
NOTICES
Whenever it is provided herein that notice, demand, request or other
communication shall or may be given to either of the parties by the other, it
shall be in writing and, any law or statute to the contrary notwithstanding,
shall not be effective for any purpose unless same shall be given or served as
follows:
(a) If given or served by Landlord, (1) by hand delivery to
Tenant, (2) by mailing same to Tenant by registered or certified mail, postage
prepaid, return receipt requested, or (3) by delivery by overnight courier such
as Federal Express, all delivered and addressed to Tenant at the following
address:
00000 Xxxxx Xxxx Xxxxx Xxx, Xxx 000
Xxxxx, XX 00000
Attn: Mr. Xxxxxx Xxxxxx
(b) If given or served by Tenant, (1) by hand delivery to
Landlord, (2) by mailing same to Landlord by U.S. registered or certified mail,
postage prepaid, return receipt requested, or (3) by delivery by overnight
courier such as Federal Express, all delivered and addressed to Landlord at the
following address:
Fortress Realty Management, LLC
0000 X. X'Xxxxxx Xxxx, Xxxxx 000
Xxxxxx XX 00000
Attn: Xxxxx Xxxxxxxxx
(c) All notices, demands, requests or other communications
hereunder shall be deemed to have been given or served: (1) if hand delivered,
on the date received (or the date delivery is refused) by the recipient party;
(2) if delivered by registered or certified mail, three (3) days after the date
of posting as marked on the U.S. postage receipt; and (3) if by Federal Express
or similar overnight courier service, on the date of receipt (or the date
delivery is refused) by the recipient party.
(d) Either Landlord or Tenant may at any time during the Lease
Term designate one additional party to whom copies of notices must be sent.
(e) Either Landlord or Tenant may from time to time change its
address for receiving notices under this Lease by providing written notice to
the other party in accordance with this Article XIX.
ARTICLE XX
ACCESS
Section 20.01 Landlord and its designees shall have the right on Twenty-Four
(24) hours' prior written notice (except in the event of an emergency, where no
prior notice shall be required) to Tenant to enter upon the Demised Premises at
reasonable hours accompanied by an employee of Tenant to inspect such Demised
Premises or, during the period commencing one hundred eighty (180) days prior to
the end of the Lease Term, for the purpose of exhibiting same to prospective
tenants. Landlord's right to enter and inspect the Demised Premises shall
include the right to take samples of Environmental Media (as defined in Article
XXXVII) as necessary to confirm the presence or absence of Hazardous Materials.
Such entry and/or inspection shall not unreasonably interfere with Tenant's
ability to conduct its business operations from the Demised Premises.
ARTICLE XXI
SIGNS
No sign shall be installed on the Demised Premises until all governmental
approvals and permits required therefore are first obtained and all fees
pertaining thereto have been paid by Tenant. In no event shall Tenant permit the
installation of billboards or similar signs pertaining to or advertising
businesses, trade names or activities other than Tenant's operation of a
restaurant.
ARTICLE XXII
IMPROVEMENTS AND FIXTURES
Section 22.01 Any and all portions of the Building, all other improvements on
the Real Property at the Commencement Date and all fixtures on the Demised
Premises at the Commencement Date shall be the property of Landlord. In the
event that Tenant installs or erects fixtures or improvements to the Demised
Premises after the Commencement Date, such fixtures or improvements (except
those referenced in Section 22.02 which can be removed without damage to the
Demised Premises) shall at the expiration or earlier termination of the Lease,
become the property of Landlord and remain upon and be surrendered with the
Demised Premises. Notwithstanding the foregoing provisions, Tenant shall be
liable for all property taxes, assessments, and similar charges assessed against
or allocable to any fixtures or equipment at the Demised Premises (irrespective
of whether such fixtures are owned by Landlord or Tenant) and which are
attributable to any period of time during the Lease Term.
Section 22.02 Moveable trade fixtures (except the Landlord's Equipment, as
defined in Section 22.03), furnished or installed by Tenant on the Demised
Premises, shall be and remain the property of Tenant and may be removed by
Tenant or others entitled to remove same at any time during the Lease Term
provided that Tenant is not in default of this Lease, provided that such removal
shall in no way affect Tenant's covenants with respect to the operation of the
Demised Premises pursuant to Section 3.09. Tenant shall repair all damage to the
Demised Premises caused by removal of any such trade fixtures by Tenant or its
subtenants, licensees or mortgagees. Upon default of this Lease by Tenant,
Landlord shall have the option to purchase any or all of such trade fixtures,
and equipment for $1.00, which option is assignable by Landlord.
Section 22.03 During the Lease Term, Tenant shall be entitled to use Landlord's
equipment ("Landlord's Equipment") in Tenant's operations at the Demised
Premises. Landlord's Equipment shall include the following items located at each
Demised Premises on the Commencement Date: walk-in coolers/refrigerators,
freezers, HVAC equipment and hoods. Tenant shall keep the Landlord's Equipment
in good working order and repair (normal wear and tear, casualty and
condemnation excepted), shall not remove Landlord's Equipment from the Demised
Premises and shall not permit any lien or other encumbrance to attach to
Landlord's Equipment. Tenant shall keep the equipment insured and shall be
responsible for any casualty or other loss to Landlord's Equipment or occasioned
by Landlord's Equipment. Tenant may, from time to time, retire or replace
Landlord's Equipment with new items of equipment purchased by Tenant, in which
event such replaced items of Equipment shall become Landlord's Equipment.
ARTICLE XXIII
END OF TERM
Upon the expiration or earlier termination of the Lease Term, Tenant shall
peaceably and quietly quit and surrender the Demised Premises, and all
Alterations which are then part of the Demised Premises, broom clean and in good
order and condition, subject to reasonable wear and tear and except as provided
in Articles XII and XIII. Tenant shall, within thirty (30) days prior to the end
of the Lease Term, transfer to Landlord all plans, drawings, other Alteration
Information, and technical descriptions of the Property, and shall assign to
Landlord all assignable permits, licenses, authorizations and warranties with
respect to the Property (in each case to the extent not previously transferred
or assigned to Landlord). This Article XXIII shall survive the expiration or
termination of the Lease.
ARTICLE XXIV
HOLDING OVER
If Tenant holds over in possession after the expiration of the Lease Term, then
such holding over shall not be deemed to extend the Lease Term or renew this
Lease, but rather the tenancy thereafter shall continue as a tenancy at
sufferance pursuant to the terms and conditions herein contained, at One Hundred
Fifty percent (150%) of the Fixed Rent; and Tenant shall be responsible for the
consequences of any unauthorized holdover and shall indemnify, defend, protect
(with counsel selected by Landlord) and hold Landlord Parties wholly free and
harmless of, from and against any and all damages, losses, costs, expenses and
claims arising therefrom, including attorneys fees and costs.
ARTICLE XXV
ASSIGNMENT AND SUBLETTING
Section 25.01 This Lease shall be fully assignable by the Landlord or its
assigns, subject to the terms of Article XXXIV.
Section 25.02
(a) Neither Tenant, nor Tenant's successors or assigns, shall
assign in whole or in part, by operation of law or otherwise, or sublet the
Demised Premises, in whole or in part, or permit the Demised Premises or any
portion of it to be used or occupied by others, or enter into a management
contract or other arrangement whereby the Demised Premises shall be managed or
operated by anyone other than the owner of the Tenant's leasehold estate,
without the prior written consent of Landlord in each instance. Provided Tenant
remains liable for all its obligations under this Lease,
Landlord shall not unreasonably withhold consent to an assignment of this Lease
to an individual, partnership or corporation if such individual, partnership or
corporation has, in the opinion of Landlord, a record of timely payment of
obligations and compliance with applicable laws and is a commercially and
financially sound individual, partnership, or corporation. Tenant may assign or
sublease the Demised Premises without the consent of Landlord if such assignment
or sublease is to a partnership of which Tenant is a general partner or a
corporation of which Tenant is the majority shareholder or to the parent
corporation of Tenant or an affiliate under common control of the parent
corporation of Tenant or in the event of Tenants' merger or consolidation with
another entity; provided further that no such assignment or sublease shall
relieve Tenant of any liability hereunder, and Tenant shall not transfer its
interest as a general partner (or as a majority shareholder as the case may be)
without the prior written consent of Landlord in each instance, which consent
shall not be unreasonably withheld.
(b) Tenant shall submit current financial statements of any
proposed assignee or sublessee together with Tenant's request for Landlord's
approval of any proposed assignment or sublease, except if (i) the proposed
assignee or sublessee is a partnership of which Tenant is a general partner, or
is a corporation or limited liability company of which Tenant is a major
shareholder, parent company or an affiliate under common control, and (ii) the
financial statements of such proposed assignee or sublessee are consolidated
with Tenant. Tenant shall reimburse Landlord for all costs and expenses actually
paid by Landlord in connection with any requested assignment or sublease in an
amount not to exceed Two Thousand Five Hundred Dollars ($2,500.00). Such amount
shall increase by three percent (3%) on each anniversary of the Effective Date
of this Lease.
(c) If this Lease is assigned or transferred, or if all or any
part of the Demised Premises is sublet or occupied by any party other than
Tenant, Landlord may collect rent from the assignee, transferee, subtenant or
occupant, and apply the net amount collected to the Rent reserved in this Lease,
but no such assignment, subletting, occupancy or collection shall be deemed a
waiver of any covenant or condition of this Lease, or the acceptance of the
assignee, transferee, subtenant or occupant as tenant, or a release of Tenant
from the performance or further performance by Tenant of its obligations under
this Lease. Without limiting the generality of the forgoing, Tenant expressly
acknowledges and agrees that in the event of an assignment of this Lease, Tenant
shall remain joint and severally liable with the assignee for all of the
obligations under this Lease, and in all other cases of any transfer of Tenant's
interest under this Lease, Tenant shall remain primarily liable for such
obligations, unless released by Landlord in writing pursuant to Section 25.03.
Subject to the foregoing, the consent by Landlord to an assignment, transfer,
management contract or subletting shall not in any way be construed to relieve
Tenant from obtaining the express written consent of Landlord in each instance
to any subsequent similar action that Tenant may intend to take.
Section 25.03 Notwithstanding anything contained in Section 25.02 to the
contrary, Tenant shall have the right to sublease the Demised Premises in the
ordinary course of Tenant's business with Landlord's consent, which shall not be
unreasonably withheld, and provided that Tenant delivers to Landlord copies of
such sublease agreements contemporaneous with their effectiveness, and Tenant
remains primarily liable for all obligations under this Lease.
Section 25.04 An assignment made with Landlord's consent or as otherwise
permitted hereunder shall not be effective until Tenant delivers to Landlord an
executed counterpart of such assignment containing an agreement, in recordable
form, executed by the assignor and the proposed assignee, in which the assignee
assumes the performance of the obligations of the assignor under this Lease
throughout the Lease Term.
Section 25.05 This Lease shall be binding upon, enforceable by, and inure to the
benefit of the parties hereto and their respective heirs, successors,
representatives and assigns.
ARTICLE XXVI
LANDLORD'S LOAN; TENANT'S LOAN
Section 26.01 This Lease shall be subject and subordinate to all ground leases
and the lien of all mortgages and deeds of trust which now or hereafter affect
Landlord's interest in the Demised Premises, and all amendments thereto, all
without the necessity of Tenant's executing further instruments to effect
subordination. The interest in the Demised Premises of any such future ground
lessee or lienholder shall have priority over the interest of Tenant in this
Lease and in the Demised Premises provided that such ground lessee or lienholder
executes a non-disturbance and attornment agreement in the form of the
Subordination, Nondisturbance and Attornment Agreement attached as Exhibit F
hereto. Tenant shall execute and deliver to Landlord on the Commencement Date a
Subordination, Nondisturbance and Attornment Agreement in the form of Exhibit F,
and shall upon ten (10) days' written notice from Landlord, execute additional
subordination, nondisturbance and attornment agreements and obtain from any
subtenant at the Demised Premises, subordination, nondisturbance and attornment
agreements substantially in the form of Exhibit F.
Section 26.02 In the event of a foreclosure proceeding, the exercise of the
power of sale under any mortgage or deed of trust or the termination of a ground
lease, Tenant shall, if requested, attorn to the purchaser thereupon and
recognize such purchaser as Landlord under this Lease; provided, however,
Tenant's obligation to attorn to such purchaser shall be conditioned upon such
purchaser's written agreement not to disturb Tenant's interest in this Lease,
except that such purchaser shall be entitled to enforce all rights and remedies
of Landlord hereunder.
Section 26.03 Books and Records. Tenant shall keep accurate books and records of
account sufficient to permit the preparation of financial statements in
accordance with generally accepted accounting principles as in effect in the
United States of America from time to time ("GAAP"). Landlord and its duly
authorized representatives shall have the right to examine, copy and audit
Tenant's records and books of account at all reasonable times during regular
business hours. Tenant shall provide, or cause to be provided, to Landlord, in
addition to any other financial statements required under this Lease, the
following financial statements and information, all of which must be prepared in
a form acceptable to Landlord:
(i) promptly and in any event within forty-five (45) days after the end
of each of the first three (3) calendar quarters, and ninety (90) days after
year-end, statements of financial position of Tenant as of the end of each such
quarter or year-end, as applicable, including a balance sheet and statement of
profits and losses, expenses and retained earnings, changes in financial
position and cash flows, which statements shall be duly certified by an officer
of Tenant to fairly represent the financial condition of Tenant, as of the date
thereof, prepared by Tenant in accordance with GAAP, and, with respect to the
year-end statement only, accompanied by a statement of a nationally recognized
accounting firm acceptable to Landlord in its sole discretion that such
financial statements present fairly, in all material respects, the financial
condition of Tenant as of the end of the calendar year being reported on and
that the results of the operations and cash flows for such year were prepared,
and are being reported on, in conformity with GAAP; and
(ii) Property level profit and loss statements on a monthly basis,
delivered to Landlord on or before the twentieth (20th) day of the end of the
following month, and containing year-to-date information; and
(iii) such other information with respect to the Demised Property or
Tenant that may be reasonably requested from time to time by Landlord, within a
reasonable time after the applicable request, provided that such information is
collected by Tenant in the ordinary course of its business and that Tenant shall
not incur additional costs in delivering same to Landlord. If Tenant is publicly
traded on a national securities exchange, financial information reported by
Tenant to the Securities and Exchange Commission will satisfy the requirements
of Section 26.03(i) hereof.
Section 26.04 Provided that Tenant and Landlord shall secure any required
consent from Landlord's Lender, Tenant shall have the right to encumber or
hypothecate Tenant's interest in the leasehold estate created by this Lease but
only with a leasehold deed of trust, mortgage, assignment of leases, assignment,
security agreement and/or other security document securing a loan from a lender
approved by Landlord (collectively, a "Leasehold Mortgage"). All proceeds from
such Leasehold Mortgage shall remain the property of Tenant.
Section 26.05 Landlord shall not be obligated to subordinate any or all of
Landlord's right, title or interest in and to the Demised Premises and this
Lease to the lien of any Leasehold Mortgage.
Section 26.06 A Leasehold Mortgage shall encumber only Tenant's leasehold
interest in the Demised Premises, and shall not encumber Landlord's right title
or interest in the Demised Premises. Landlord shall have no liability whatsoever
for the payment of the note or any obligation secured by any Leasehold Mortgage
or any other provisions of such note or the Leasehold Mortgage or related
obligations. Should there be any conflict between the provisions of this Lease
and of any Leasehold Mortgage, the provisions of this Lease shall control. No
Leasehold Mortgage will be for a term longer than the Term of this Lease, as and
if extended as provided herein. Either prior to or concurrently with the
recordation of the Leasehold Mortgage, Tenant shall cause a fully conformed copy
thereof and of the note secured thereby to be delivered to Landlord, together
with a written notice containing the name and post office address of the Lender
(as defined herein).
Section 26.07 If Landlord declares a default under this Lease, Landlord shall
notify any Lender who has given Landlord a prior written request for such notice
of such default by sending a copy of the default notice required under this
Lease to the Lender.
Section 26.08 Immediately upon the recording of the Leasehold Mortgage, Tenant,
at Tenant's expense, shall cause to be recorded in the office of the County
Recorder of each county in which the Demised Premises is located, a written
request duly executed and acknowledged by Landlord for a copy of any notice of
default and of any notice of sale under the Leasehold Mortgage, as provided by
the law in which the Demised Premises are located.
Section 26.9 If title to Landlord's estate and to Tenant's estate are acquired
by the same person or entity, other than as a result of termination of this
Lease, no merger shall occur if the effect of such merger would impair the lien
of any Leasehold Mortgage.
ARTICLE XXVII
MAINTENANCE OF OUTSIDE AREAS
Section 27.01 The term "Outside Areas" shall refer to all areas outside of the
Buildings including all sidewalks, driveways, landscaping, trash enclosures, and
trash compacting and loading areas on the Demised Premises.
Section 27.02 Tenant shall be responsible for maintaining the Outside Areas in a
neat and clean condition, and shall ensure that debris from the operation of
each restaurant on the Demised Premises are cleaned on a regular basis.
ARTICLE XXVIII
CERTIFICATES
Section 28.01
(a) Tenant shall, at its sole cost and expense, at any time and
from time to time, within ten (10) days after delivery of written request by
Landlord, deliver a written instrument to Landlord or any other person, firm or
corporation specified by Landlord, duly executed and acknowledged, certifying
that:
(i) This Lease is unmodified and in full force and
effect, or if there has been any modification,
that the Lease is in full force and effect as
modified and stating any such modification;
(ii) Whether or not there are then existing, to the
knowledge of the executing officer, any defenses
against the enforcement of any of the agreements,
terms, covenants or conditions of this Lease upon
the part of Tenant to be performed or complied
with, and, if so, specifying same (including,
without limitation, whether Tenant knows or does
not know of any default by Landlord in Landlord's
performance of all agreements, terms, covenants
and conditions to be performed by Landlord, and if
such default does exist, specifying same); and
(iii) The amounts and dates to which the Fixed Rent, and
Additional Rent have been paid, the amounts of any
and all outstanding balances of such items, if
any, known to Tenant.
(iv) Such other truthful information reasonably
requested by Landlord.
(b) Tenant's failure to so deliver said certificate shall
constitute an Event of Default at the sole option of Landlord and shall be
conclusive as to the truthfulness of the items stated in Landlord's request.
Delivery of a completed Estoppel Certificate in substantially the form as set
forth on Exhibit C attached hereto ("Estoppel Certificate") shall satisfy this
requirement.
Section 28.02 Landlord shall, at its sole cost and expense, at any time and from
time to time, within ten (10) days after request by Tenant deliver to Tenant or
any entity indicated by Tenant a written instrument, certifying whether or not
its Lease is in full force and effect; whether it has been modified (and if so
setting forth such modification); whether Tenant has fully made all payments
then and theretofore due under this Lease, and whether Landlord knows or does
not know, as the case may be, of any default by Tenant in the performance by
Tenant of all agreements, terms, covenants and conditions on Tenant's part to be
performed and if it does know of any failures or defaults, specifying same and
setting forth such other truthful information as may be reasonably requested by
Tenant. Delivery of a completed Estoppel Certificate similar (except for the
parties) to the form set forth on Exhibit C attached hereto shall satisfy this
requirement.
ARTICLE XXIX
RELATIONSHIP OF PARTIES
Nothing contained in this Lease shall be construed to create the relationship of
principal and agent, partnership, joint venture or any other relationship
between the parties hereto other than the relationship of Landlord and Tenant.
Except as otherwise expressly provided herein, this Lease shall not in any way
impose any liability upon the members, stockholders, officers, directors or
trustees of Landlord if Landlord should be a limited liability company,
corporate entity, or trust, or upon the stockholders, officers, directors or
trustees of Tenant if Tenant should be a corporate entity or trust. If more than
one person or entity is named as the Tenant hereunder, the obligations under
this Lease of all such persons and entities as Tenant shall be joint and
several.
ARTICLE XXX
RECORDING
Neither Landlord nor Tenant shall record this Lease; however, upon the request
of either party hereto, the other party shall join in the execution of a
memorandum of lease for the purposes of recordation in the form attached hereto
as Exhibit D and by this reference incorporated herein (the "Memorandum"). The
Memorandum shall describe the parties, the Demised Premises, the term of this
Lease, any special provisions other than those pertaining to Rent and shall
incorporate this Lease by reference. Tenant shall pay all costs charged or
collected by the County Recorders to record the Memoranda.
ARTICLE XXXI
CAPTIONS AND SECTION NUMBERS
The captions, section numbers, and index appearing in this Lease are inserted
only as a matter of convenience and in no way define, limit, construe or
describe the scope or intent of such sections or articles nor in any way affect
this Lease.
ARTICLE XXXII
APPLICABLE LAW
This Lease shall be governed by, and construed in accordance with the laws of
the State of New York. If any provision of this Lease or the application thereof
to any person or circumstances shall, to any extent, be invalid or
unenforceable, the remainder of this Lease shall not be affected thereby, and
each provision of the Lease shall be valid and enforceable to the fullest extent
permitted by the law.
ARTICLE XXXIII
ENTIRE AGREEMENT
This Lease and the Exhibits attached hereto, all of which form a part hereof,
set forth all the covenants, promises, agreements, conditions and understandings
between Landlord and Tenant concerning the Demised Premises, and there are no
covenants, promises, agreements, conditions or understandings heretofore made,
either oral or written, between them other than as herein set forth. No
modification, amendment, change or addition to this Lease shall be binding upon
Landlord or Tenant unless reduced to writing and signed by each party. Time is
of the essence of this Lease.
ARTICLE XXXIV
LANDLORD'S LIABILITY
The obligations of Landlord under this Lease are not personal obligations of the
individual members, partners, directors, officers, shareholders, agents or
employees of Landlord; Tenant shall look solely to the Demised Premises for
satisfaction of any liability of Landlord and shall not look to other assets of
Landlord nor seek recourse against the assets of the individual members,
partners, directors, officers, shareholders, agents or employees of Landlord.
Whenever Landlord transfers its interest, Landlord shall be automatically
released from further performance under this Lease and from all further
liabilities and expenses hereunder, provided the transferee of Landlord's
interest assumes all liabilities and obligations of Landlord hereunder from the
date of such transfer.
ARTICLE XXXV
ATTORNEYS' FEES
If any legal action should be commenced in any court regarding any dispute
arising between the parties hereto, or their successors and assigns, concerning
any provision of this Lease or the rights and duties of any person in relation
thereto, then the prevailing party therein shall be entitled to collect its
reasonable expenses, attorneys' fee and court costs, including the same on
appeal. As used herein, the term "prevailing party" means the party who, in
light of the claims, causes of action, and defenses asserted, is afforded
greater relief.
ARTICLE XXXVI
INTENTIONALLY DELETED
ARTICLE XXXVII
ENVIRONMENTAL
Section 37.01
(a) For the purpose of this Lease, the following definitions
pertaining to environmental matters shall apply:
"Environmental Conditions" means the conditions of "Environmental Media" (as
defined below), and the conditions of any part of the Demised Premises,
including but not limited to building materials, which affect or may affect
Environmental Media.
"Environmental Laws" shall mean any federal, state or local law, statute,
ordinance, permit condition or regulation pertaining to public health,
occupational health and safety, natural resources or environmental protection,
including, without limitation: (1) the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S. C. ? 9601 et seq. as amended
("CERCLA"), the Solid Waste Disposal Act, 42 U.S.C. ? 6901 et seq. as amended
("RCRA"), the Federal Water Pollution Control Act of 1972, as amended by the
Clean Water Act of 1977, as amended, 33 U.S.C. 1251 et seq.; the Toxic
Substances Control Act of 1976, as amended, 15 U.S.C. 2601 et seq.; the
Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. 11001 et
seq.; the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of
1990, 42 USC 7401 et seq.; the National Environmental Policy Act of 1970, as
amended, 42 USC 4321 et seq.; the Rivers and Harbors Act of 1899, as amended, 33
USC 401 et seq.; the Mine Safety and Health Act of 1977, as amended, 30 U.S.C.
Section 801 et seq. the Endangered Species Act of 1973, as amended, 16 U.S.C.
1531, et seq.; the Occupational Safety and Health Act of 1970, as amended 29
U.S.C. 651, et seq.; the Safe Drinking Water Act of 1974, as amended, 42 U.S.C.
300(f) et seq.,
the Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801 et seq. as
amended, and all regulations, published governmental policies, and
administrative or judicial orders promulgated under said laws; (2) all state or
local laws which implement the foregoing federal laws or which pertain to public
health and safety, occupational health and safety, natural resources or
environmental protection: all as amended from time to time, and all regulations,
published governmental policies, and administrative or judicial orders
promulgated under the foregoing laws; (3) all federal and state common law,
including but not limited to the common law of public or private nuisance,
trespass, negligence or strict liability, where such common law pertains to
public health and safety, occupational health and safety, natural resources,
environmental protection, or the use and enjoyment of property, and all judicial
orders promulgated under said laws; and (4) all comparable local laws and
comparable laws of other jurisdictions.
"Environmental Media" means soil, fill material, or other geologic materials at
all depths, groundwater at all depths, surface water including storm water and
sewerage, indoor and outdoor air, and all living organisms, including without
limitation all animals and plants, whether such Environmental Media are located
on or off the Demised Premises.
"Hazardous Materials" means any ignitable, reactive, explosive, corrosive,
carcinogenic, mutagenic, toxic or radioactive material, whether virgin material,
secondary material, by-product, waste or recycled material, defined, regulated
or designated as a contaminant, pollutant, hazardous or toxic substance,
material, waste, contaminant or pollutant under any Environmental Laws or any
other federal, state or local law, statute, regulation, ordinance, or
governmental policy presently in effect or as amended or promulgated in the
future, and shall specifically include, without limitation: (a) those materials
included within the definitions of "hazardous substances," "extremely hazardous
substances," "hazardous materials," "toxic substances" "toxic pollutants,"
"hazardous air pollutants" "toxic air contaminants," "solid waste," "hazardous
waste," "pollutants," contaminants" or similar categories under any
Environmental Laws; (b) those materials which create liability under common law
theories of public or private nuisance, negligence, trespass or strict
liability; and (c) specifically including, without limitation, any material,
waste or substance which contains: (i) petroleum or petroleum derivatives
byproducts, including crude oil and any fraction thereof and waste oil; (ii)
asbestos; (iii) polychlorinated biphenyls; (iv) formaldehyde; and (v) radon.
"Release" means any active or passive spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping or
disposing into any Environmental Media. For the purposes of this Lease,
"Release" also includes any threatened Release.
"Remedial Activities" means any investigation, work plan preparation removal,
repair, cleanup, abatement, remediation, monitored natural attenuation, natural
resource damage assessment and restoration, closure, post-closure,
detoxification or remedial activity of any kind whatsoever necessary to address
Environmental Conditions.
"Use" means the receipt, handling, generation, storage, treatment, recycling,
transfer, transportation, introduction, or incorporation into, on, about, under
or from the Demised Premises.
(b) Tenant acknowledges that it owned and operated the Demised
Premises prior to selling the Demised Premises to Landlord and that Landlord
makes no warranties or representations of any kind, or in any manner or in any
form whatsoever, as to the status of Environmental Conditions or Hazardous
Materials at the Demised Premises. Landlord has granted Tenant the absolute
right to inquire with regard to the Environmental Conditions of the Demised
Premises, including the right to inquire and obtain from Landlord or Landlord's
predecessor copies of any and all existing environmental assessments. Landlord
agrees to furnish Tenant with all copies of non-legally privileged environmental
reports covering the Demised Premises, if any, which are in the possession of
Landlord. Tenant will conduct at its own expense any and all investigations
regarding Environmental Conditions of the Demised Premises and will satisfy
itself as to the absence or existence of Hazardous Materials contamination of
the Demised Premises. Tenant's entry into this Lease shall be made at its sole
risk.
Section 37.02 From and after the Effective Date, Tenant shall not be entitled to
the Use of any Hazardous Materials at the Demised Premises, unless performed in
full compliance with all Environmental Laws and any other applicable local,
state and federal statutes, orders, ordinances, rules and regulations. Tenant
shall be prohibited from conducting or allowing the Release of Hazardous
Materials onto, on, about, under or from the Demised Premises, the exception
being sewer or other permitted discharges or Releases, in full compliance with
all Environmental Laws and any other applicable laws. From and after the date of
this Lease, Tenant covenants to, and shall, undertake all Remedial Activities
necessary to address any Use or Release of Hazardous Materials after the date of
this Lease, by Tenant or its agents, employees, representatives, invitees,
licensees, subtenants, customers or contractors ("Other Parties"), or otherwise
adversely affecting the Demised Premises at Tenant's sole cost and expense, and
shall give immediate written notice of same to Landlord. If any Remedial
Activities are required to be performed at any location other than the Demised
Premises, Tenant shall use its best efforts to obtain any required access
agreements from third parties
Section 37.03 In addition to any other obligation herein, Tenant shall defend,
indemnify and hold Landlord Parties free and harmless from any and all claims,
losses, liabilities and other obligations of any kind whatsoever that may be
made against or incurred by Landlord Parties in connection with (i) the
violation of any Environmental Law, or (ii) Hazardous Materials or Environmental
Conditions at or from the Demised Premises whether heretofore now existing or
hereafter arising, and whether in connection with or as a result of Tenant's
operations at the Demised Premises, including without limitation any and all
costs and fees of attorneys or experts incurred by Landlord in defending against
same; provided, however, that the foregoing indemnity shall not be applicable to
the extent any such claims are directly attributed to the gross negligence, or
willful misconduct of Landlord. This and any other right of Landlord may be
assigned to its successors in interest under the terms of this Lease.
Section 37.04 Within fifteen (15) days after notification to Tenant, Tenant
shall inform Landlord in writing of (i) any and all enforcement actions,
initiation of Remedial Activities where no Remedial Activities are currently
being conducted upon receipt of such notification, or other governmental or
regulatory actions (excluding routine actions such as permit renewals)
instituted, completed or threatened pursuant to any Environmental Laws affecting
the Demised Premises; (ii) all claims made or threatened by any third person
against Tenant or the Demised Premises relating in any way whatsoever to
Hazardous Materials or Environmental Conditions (the matters set forth in
clauses (i) and (ii) are hereinafter referred to as "Environmental Claims");
(iii) Tenant's knowledge of any material Release of Hazardous Materials at, on,
in, under to or from the Demised Premises or on, in or under any adjoining
property. Tenant shall also supply to Landlord within three (3) business days
after Tenant first receives or sends the same, copies of all claims, reports,
complaints, notices, warnings, asserted violations or other communications
relating in any way to the matters described in this Section.
Section 37.05 In addition to any other obligations herein, Tenant shall be
solely responsible for and shall indemnify and hold harmless all Landlord
Parties from and against any and all private or governmental claims, lawsuits,
administrative proceedings, judgments, penalties, fines, proceedings, loss,
damage, cost, expense or liability directly or indirectly arising out of or
associated in any manner whatsoever with Tenant's Use or the presence of
Hazardous Materials (which may have occurred at any time including prior to the
term hereof) or Release of Hazardous Materials at, on, under, about or from the
Demised Premises during the term hereof, including any extensions. Tenant's
indemnity and release includes, without limitation: (i) the costs associated
with Remedial Activities, including all necessary plans and reports, incurred by
the U.S. Environmental Protection Agency, or any other federal, state or local
governmental agency or entity or by any other person, incurred pursuant to the
CERCLA, RCRA, or any other applicable Environmental Laws; (ii) any oversight
charges, fines, damages or penalties arising from the presence or Release of
Hazardous Materials, and any related Remedial Activities, incurred pursuant to
the provisions of CERCLA, RCRA, or any other applicable Environmental Laws;
(iii) any liability to third parties arising out of the presence or Release of
Hazardous Materials for personal injury, bodily injury, or property damage
arising under any statutory or common law theory, including damages assessed for
the maintenance of a public or private nuisance, the costs of Remedial
Activities, or for the carrying on of an abnormally dangerous activity; (iv) all
direct or indirect compensatory, consequential, or punitive damages arising out
of any claim based on the presence or Release of Hazardous Materials or damage
or threatened damage to Environmental Conditions; (v) any and all reasonable
costs, fees and expenses of attorneys, consultants and experts incurred or
sustained in making any investigation on account of any claim, in prosecuting or
defending any action brought in connection therewith, in obtaining or seeking to
obtain a release therefrom, or in enforcing any of the agreements herein
contained; and (vi) Rent during any period of Remedial Activities equal to the
Base Rent then in effect, or if the Lease has terminated, the Base Monthly Rent
which was in effect on the Termination Date; provided, however, that the
foregoing indemnity shall not be applicable to the extent any such claims are
directly attributable to the gross negligence or willful misconduct of Landlord
The foregoing indemnity shall apply to Tenant's Use of Hazardous Materials
irrespective of whether any of Tenant's activities were or will be undertaken in
accordance with Environmental Laws or other applicable laws, regulations, codes
and ordinances. This indemnity is intended to be operable under 42 U.S. C.?
9607(e)(1). Tenant specifically agrees that it shall not xxx or seek
contribution from any indemnitee or any successors or assigns thereof in any
matter relating to any Hazardous Material liability except as a result of the
gross negligence of Landlord or other Landlord Parties on the Demised Premises.
All costs and expenses related to this paragraph incurred by Landlord shall be
repaid by Tenant to Landlord as Additional Rent. This indemnity shall survive
termination of the Lease.
ARTICLE XXXVIII
ADDENDA
Section 38.01 The following exhibits have been agreed to by the parties and
attached hereto or initialed by the parties prior to the execution hereof, it
being the intention of the parties that they shall become a binding part of this
Lease as if fully set forth herein.
Exhibit A Location/Legal Description/Address of the Real Property
Exhibit B Tenant's Personal Property List
Exhibit C Tenant's Estoppel Certificate
Exhibit D Memorandum of Lease
Exhibit E Intentionally Deleted
Exhibit F Subordination, Nondisturbance and Attornment Agreement
ARTICLE XXXIX
COUNTERPARTS
Section 39.01 This Lease may be executed in counterparts and shall be binding on
all the parties hereto as if one document had been signed. The delivery of an
executed copy of this Lease by facsimile transmission shall have the same force
and effect as the delivery of the original, signed copy of this Lease.
[SIGNATURES ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the parties have executed this Lease to be effective as of
the date first above written.
LANDLORD:
FRI FISH, LLC
By:
----------------------------- -----------------------------------------
Witness Name:
---------------------------------------
Title:
------------------------------
----------------------------
Witness
TENANT:
SHELLS SEAFOOD RESTAURANTS, INC
By:
----------------------------- -----------------------------------------
Witness Name:
---------------------------------------
Title:
------------------------------
----------------------------
Witness
EXHIBIT A
LOCATION/LEGAL DESCRIPTION/ADDRESS OF REAL PROPERTY
Physical Address:
0000 X.X. Xxxxxxx Xxxx, Xxxxx, XX 00000
EXHIBIT B
TENANT'S PERSONAL PROPERTY LIST
EXHIBIT C
TENANT'S ESTOPPEL CERTIFICATE
The undersigned, ________________, whose address is 00000
Xxxxx Xxxx Xxxxx Xxx., Xxx 000, Xxxxx, XX 00000 represents and certifies as
follows:
1. The undersigned is (i) the tenant ("Tenant") under that
certain lease ("Lease") dated _______________ with _____________________ as
Landlord, covering the property described therein (collectively the "Demised
Property").
2. The Lease constitutes the only agreement (either written or
oral) the undersigned has with respect to the Demised Property and any right of
occupancy or use thereof.
3. The Lease is in full force and effect and has not been
assigned, subleased, supplemented, modified or amended except as follows:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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4. The undersigned presently occupies the Demised Property and
is paying rent on a current basis. No rent has been paid by Tenant in advance
except for the monthly rental that became due on _______________, and a security
deposit in the sum of US$0.00 now held by Landlord in accordance with the terms
of the Lease.
5. The monthly Fixed Rent is the sum of Dollars
(US$_____________).
6. The present Lease term expires on ________________ and
there are no options to renew except: four (5) five-year options.
7. There are no defaults under the Lease by Landlord or any
events which with the passage of time or giving of notice or both will result in
any such default. The undersigned does not presently have (nor with the passage
of time or giving of notice or both will have) any offset, charge, lien, claim,
termination right or defense under the Lease.
8. The undersigned occupies and has accepted possession of the
Demised Property covered by the Lease. All obligations of Landlord under the
Lease required to be performed to date, including any improvements to be
constructed by Landlord (or its predecessors or successors) or the granting of
any free rent, rent credit, offset, deductions, building allowance or rent
reduction have been completed to the satisfaction of the undersigned.
9. Landlord has no personal liability under the Lease
(recourse against Landlord being limited to Landlord's interest in the Demised
Property).
10. The undersigned is aware that third parties intend to rely
upon this Certificate and the statements set forth herein and that the
statements and facts set forth above shall be binding on the undersigned
11. The undersigned and the persons executing this Certificate
on behalf of the undersigned have the power and authority to execute and deliver
this Certificate.
12. Tenant has no right of first refusal, or option to
purchase, with respect to all or any portion of any Demised Property; and
13. No deposits or prepayments of rent have been made in
connection with the Lease, except as follows:
---------------------------------
"TENANT"
Shells Seafood Restaurants, Inc.
By:
-------------------------------------------
Name:
-------------------------------------------
Title:
-------------------------------------------
EXHIBIT D
MEMORANDUM OF LEASE
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(Above space reserved for recorder and recording information)
This instrument prepared by and |
after recording return to: |
|
|
--------------------------------------------------------------------------------
MEMORANDUM OF LEASE
This Memorandum of Lease is made and entered into as of April 17, 2006 by and
between FRI FISH, LLC ("Landlord") and Shells Seafood Restaurants, Inc.
("Tenant"), who agree as follows:
1. Terms and Premises. Pursuant to a certain Land and Building Lease (the
"Lease") dated April 17, 2006 entered into between Landlord and Tenant, Landlord
has leased to Tenant and Tenant has leased from Landlord a leasehold estate for
years in and to Landlord's reversionary fee simple interest in that certain real
property, together with all the improvements thereon and appurtenances thereunto
belonging (the "Premises"), more particularly described on Exhibit "A" which is
attached hereto and incorporated herein, commonly known as:
0000 X.X. XXXXXXX XXXX, XXXXX, XX 00000
- commencing on April 17, 2006 and expiring on April 16, 2026. Tenant has FOUR
(4) five-year options to extend the term of the Lease, all as more particularly
set forth in the Lease.
2. Subordination Provisions. Tenant's rights under the Lease shall at all times
be subject and subordinate to any fee mortgages and/or trust deeds now or
hereafter filed against the Premises and to the rights of any Fee Mortgagee
thereunder or as otherwise set forth in Section 26.01 of the Lease.
3. Purpose of Memorandum of Lease. This Memorandum of Lease is executed and
recorded to give public notice of the Lease between the parties and all terms
and conditions of the Lease are incorporated by reference into this Memorandum
and this Memorandum of Lease does not modify the provisions of the Lease. If
there are any conflicts between the Lease and this Memorandum of Lease, the
provisions of the Lease shall prevail. The rights and obligations set forth
herein shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns. Any term not defined herein shall have
the meaning as set forth in the Lease.
[SIGNATURES AND ACKNOWLEDGMENTS ON NEXT PAGE]
LANDLORD: TENANT:
FRI FISH, LLC SHELLS SEAFOOD RESTAURANTS, INC.
By: By:
------------------------------------------------
Date: Date:
----------------------------------------------
Signed, sealed, and delivered this _____ Signed, sealed, and delivered this _____
day of ______________, _______ in the presence of: day of _____________, _________ in the presence of:
--------------------------------------------------- ---------------------------------------
Witness Witness
Witness Witness
--------------------------------------------------- -------------------------------------
Notary Public, County of _____________, Notary Public, County of _____________,
State of __________________ State of __________________
My commission expires:_________________ My commission expires:_________________
(Notary Seal) (Notary Seal)
EXHIBIT E
INTENTIONALLY DELETED
EXHIBIT F
SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
------------------------
------------------------
------------------------
------------------------
Attn: ______________________
Loan No. ______________________
================================================================================
SUBORDINATION AGREEMENT; ACKNOWLEDGMENT OF LEASE ASSIGNMENT,
ATTORNMENT AND NON-DISTURBANCE AGREEMENT
(Lease To Deed of Trust)
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN
THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN
OF SOME OTHER OR LATER SECURITY INSTRUMENT.
THIS SUBORDINATION AGREEMENT; ACKNOWLEDGMENT OF LEASE ASSIGNMENT, ATTORNMENT AND
NON-DISTURBANCE AGREEMENT ("Agreement") is made DATE OF DOCUMENTS by and between
BORROWER NAME, a general partnership ("Owner", or "Lessor"), NAME OF LESSEE HERE
("Lessee") and _______________ ("Lender").
R E C I T A L S
A. Pursuant to the terms and provisions of a lease dated ____________,
2006 ("Lease"), Owner, as "Lessor", granted to Lessee a leasehold
estate in and to a portion of the property described on Exhibit A
attached hereto and incorporated herein by this reference (which
property, together with all improvements now or hereafter located on
the property, is defined as the "Property").
B. Owner has executed, or proposes to execute, a deed of trust with
absolute assignment of leases and rents, security agreement and fixture
filing ("Deed of Trust") securing, among other things, a promissory
note ("Note") in the principal sum of LOAN AMOUNT AND NO/100THS DOLLARS
($LOAN AMOUNT NOS.), dated DATE OF DOCUMENTS, in favor of Lender, which
Note is payable with interest and upon the terms and conditions
described therein ("Loan"). The Deed of Trust is to be recorded
concurrently herewith.
C. As a condition to making the Loan secured by the Deed of Trust, Lender
requires that the Deed of Trust be unconditionally and at all times
remain a lien on the Property, prior and superior to all the rights of
Lessee under the Lease and that the Lessee specifically and
unconditionally subordinate the Lease to the lien of the Deed of Trust,
in each case, in accordance with the terms and provisions of this
Agreement.
E. Owner and Lessee have agreed to the subordination, attornment and other
agreements herein in favor of Lender.
NOW THEREFORE, for valuable consideration and to induce Lender to make the Loan,
Owner and Lessee hereby agree for the benefit of Lender as follows:
SUBORDINATION. Owner and Lessee hereby agree that:
1.1 Prior Lien. The Deed of Trust securing the Note in favor of Lender,
and any modifications, renewals or extensions thereof, shall unconditionally be
and at all times remain a lien on the Property prior and superior to the Lease;
1.2 Subordination. Lender would not make the Loan without this agreement
to subordinate; and
1.3 Whole Agreement. This Agreement shall be the whole agreement and only
agreement with regard to the subordination of the Lease to the lien of the Deed
of Trust and shall supersede and cancel, but only insofar as would affect the
priority between the Deed of Trust and the Lease, any prior agreements as to
such subordination, including, without limitation, those provisions, if any,
contained in the Lease which provide for the subordination of the Lease to a
deed or deeds of trust or to a mortgage or mortgages. AND FURTHER, Lessee
individually declares, agrees and acknowledges for the benefit of Lender, that:
1.4 Use of Proceeds. Lender, in making disbursements pursuant to the Note,
the Deed of Trust or any loan agreements with respect to the Property, is under
no obligation or duty to, nor has Lender represented that it will, see to the
application of such proceeds by the person or persons to whom Lender disburses
such proceeds, and any application or use of such proceeds for purposes other
than those provided for in such agreement or agreements shall not defeat this
agreement to subordinate in whole or in part;
1.5 Subordination. Lessee intentionally and unconditionally subordinates
all of Lessee's right, title and interest in and to the Property to the lien of
the Deed of Trust, in accordance with the terms and provisions of this
Agreement, and understands that in reliance upon, and in consideration of, this
waiver, relinquishment and subordination, specific loans and advances are being
and will be made by Lender and, as part and parcel thereof, specific monetary
and other obligations are being and will be entered into which would not be made
or entered into but for said reliance upon this waiver, relinquishment and
subordination.
2. ASSIGNMENT. LESSEE ACKNOWLEDGES AND CONSENTS TO THE ASSIGNMENT OF THE LEASE
BY LESSOR IN FAVOR OF LENDER.
3. ESTOPPEL. LESSEE ACKNOWLEDGES AND REPRESENTS THAT:
3.1 Lease Effective. The Lease has been duly executed and delivered by
Lessee and, subject to the terms and conditions thereof, the Lease is in full
force and effect, the obligations of Lessee thereunder are valid and binding and
there have been no modifications or additions to the Lease, written or oral;
3.2 No Default. To the best of Lessee's knowledge, as of the date hereof:
(i) there exists no breach, default, or event or condition which, with the
giving of notice or the passage of time or both, would constitute a breach or
default under the Lease; and (ii) there are no existing claims, defenses or
offsets against rental due or to become due under the Lease;
3.3 Entire Agreement. The Lease, together with the Purchase and Sale
Agreement referred to therein, constitutes the entire agreement between Lessor
and Lessee with respect to the Property, and Lessee claims no rights with
respect to the Property other than as set forth in the Lease or the Purchase and
Sale Agreement;
3.4 No Right of First Refusal or Option to Purchase: Neither the Lease nor
the Purchase and Sale Agreement grants to Lessee any right of first refusal, or
option to purchase, with respect to all or any portion of the Property; and
3.5 No Prepaid Rent. No deposits or prepayments of rent have been made in
connection with the Lease, except as follows: (if none, state "None")
____________________________________.
4. ADDITIONAL AGREEMENTS. Lessee covenants and agrees that, during all such
times as Lender is the Beneficiary under the Deed of Trust:
4.1 Notice of Default. Lessee will notify Lender in writing concurrently
with any notice given to Lessor of any default by Lessor under the Lease, and
Lessee agrees that Lender has the right (but not the obligation) to cure any
breach or default specified in such notice within the time periods set forth
below and Lessee will not declare a default of the Lease, as to Lender, if
Lender cures such default within fifteen (15) days from and after the expiration
of the time period provided in the Lease for the cure thereof by Lessor;
provided, however, that if such default cannot with diligence be cured by Lender
with-in such fifteen (15) day period, the commencement of action by Lender
within such fifteen (15) day period to remedy the same shall be deemed
sufficient so long as Lender pursues such cure with diligence;
4.2 Assignment of Rents. Upon receipt by Lessee of written notice from
Lender that Lender has elected to terminate the license granted to Lessor to
collect rents, as provided in the Deed of Trust, and directing the payment of
rents by Lessee to Lender, Lessee shall comply with such direction to pay and
shall not be required to determine whether Lessor is in default under the Loan
and/or the Deed of Trust.
4.3 Certain Actions Not Binding on Lender. Lender shall not be bound by
any modification, amendment, termination or cancellation of the Lease (in whole
or in part) that was effected without Lender's prior written consent.
5. ATTORNMENT. IN THE EVENT OF A FORECLOSURE UNDER THE DEED OF TRUST, LESSEE
AGREES FOR THE BENEFIT OF LENDER (INCLUDING FOR THIS PURPOSE ANY TRANSFEREE OF
LENDER OR ANY TRANSFEREE OF LESSOR'S TITLE IN AND TO THE PROPERTY BY LENDER'S
EXERCISE OF THE REMEDY OF SALE BY FORECLOSURE UNDER THE DEED OF TRUST), UPON THE
RECEIPT BY LESSEE OF WRITTEN NOTICE OF SUCH FORECLOSURE, AS FOLLOWS:
5.1 Payment of Rent. Lessee shall pay to Lender all rental payments
required to be made by Lessee pursuant to the terms of the Lease for the
duration of the term of the Lease;
5.2 Continuation of Performance. Lessee shall be bound to Lender in
accordance with all of the provisions of the Lease for the balance of the term
thereof; provided that the Lease shall be deemed not to include any
modification, amendment, termination or cancellation of the Lease (in whole or
in part) that was effected without Lender's prior written consent; and Lessee
hereby attorns to Lender as its landlord, and Lender hereby accepts such
attornment, such attornment to be effective and self-operative without the
execution of any further instrument immediately upon Lender succeeding to
Lessor's interest in the Lease and giving written notice thereof to Lessee;
5.3 No Offset. Lender shall not be liable for, nor subject to, any offsets
or defenses which Lessee may have by reason of any act or omission of Lessor
under the Lease with respect to the period preceding the effectiveness of the
attornment provided for herein, nor for the return of any sums which Lessee may
have paid to Lessor under the Lease (a) as and for security deposits, rentals
paid more than one (1) month before the time when they became due under the
lease, or otherwise, except to the extent that such sums are actually delivered
by Lessor to Lender and applied to amounts due in respect of the Loan (or held
by Lender as collateral therefore); and, for purposes of determining the rentals
due under the Lease, any amount paid in respect of rentals paid more than one
(1) month before the time such amount became due under the Lease and not
delivered by Lessor to Lender and applied to amounts due in respect of the Loan
(or held by Lender as collateral therefore) shall be treated as if they had not
been paid; or (b) any payment made by Lessee to Lessor in consideration of any
modification, termination or cancellation of the Lease (in whole or in part)
without Lender's prior written consent.
5.4 Subsequent Transfer. If Lender, by succeeding to the interest of
Lessor under the Lease, should become obligated to perform the covenants of
Lessor thereunder, then, upon any further transfer of Lessor's interest by
Lender, all of such obligations shall terminate as to Lender.
6. NON-DISTURBANCE. IN THE EVENT OF A FORECLOSURE UNDER THE DEED OF TRUST, SO
LONG AS THERE SHALL THEN EXIST NO "EVENT OF DEFAULT" ON THE PART OF LESSEE UNDER
(AND AS DEFINED IN) THE LEASE, LENDER AGREES FOR ITSELF AND ITS SUCCESSORS AND
ASSIGNS THAT THE LEASEHOLD INTEREST OF LESSEE UNDER THE LEASE SHALL NOT BE
EXTINGUISHED OR TERMINATED BY REASON OF SUCH FORECLOSURE, BUT RATHER THE LEASE
SHALL CONTINUE IN FULL FORCE AND EFFECT IN ACCORDANCE WITH THE TERMS THEREOF
EXCEPT AS MODIFIED OR LIMITED BY THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION,
THE PROVISIONS OF SECTIONS 4.3 AND 5.2 HEREOF), AND LENDER SHALL RECOGNIZE AND
ACCEPT LESSEE AS TENANT UNDER THE LEASE SUBJECT TO THE TERMS AND PROVISIONS OF
THE LEASE EXCEPT AS MODIFIED OR LIMITED BY THIS AGREEMENT.
7. MISCELLANEOUS.
7.1 Heirs, Successors, Assigns and Transferees. The covenants herein shall
be binding upon, and inure to the benefit of, the heirs, successors and assigns
of the parties hereto; and
7.2 Notices. All notices or other communications required or permitted to
be given pursuant to the provisions hereof shall be deemed served upon delivery
or, if mailed, upon the first to occur of receipt or the expiration of three (3)
days after deposit in United States Postal Service, certified mail, postage
prepaid and addressed to the address of Lessee or Lender appearing below:
"OWNER" "LENDER"
BORROWER NAME, a general partnership ________________
STREET ADDRESS ________________
CITY, STATE ZIP ________________
________________
Attn: ________________
Loan No. ______________
"LESSEE"
NAME OF LESSEE HERE
LESSEE'S ADDRESS (STACKED) HERE
provided, however, any party shall have the right to change its address for
notice hereunder by the giving of written notice thereof to the other party in
the manner set forth in this Agreement; and
7.3 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute and be construed as one and the same instrument; and
7.4 Remedies Cumulative. All rights of Lender herein to collect rents on
behalf of Lessor under the Lease are cumulative and shall be in addition to any
and all other rights and remedies provided by law and by other agreements
between Lender and Lessor or others; and
7.5 Paragraph Headings. Paragraph headings in this Agreement are for
convenience only and are not to be construed as part of this Agreement or in any
way limiting or applying the provisions hereof.
7.6 Lender's Consent. If the Lease is being entered into by Owner after
the making of the Loan, Lender hereby consents to Owner's entry into the Lease.
7.7 Owner's Consent. By its execution and delivery of this Agreement,
Owner consents to, and authorizes Lessee to comply with, each of the provisions
hereof.
INCORPORATION. Exhibit A is attached hereto and incorporated herein by this
reference. IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE
PERSON OBLIGATED ON YOUR REAL PROPERTY SECURITY TO OBTAIN A LOAN A
PORTION OF WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT
OF THE LAND.
IT IS RECOMMENDED THAT, PRIOR TO THE EXECUTION OF THIS AGREE-MENT, THE PARTIES
CONSULT WITH THEIR ATTORNEYS WITH RESPECT HERETO.
"OWNER"
BORROWER NAME,
a general partnership
By:
--------------------------------------------
Its:
--------------------------------------------
STATE OF __________________
COUNTY OF _________________ SS.
On this ______ day of ____________________, 20__, before me, ____________a
Notary Public in and for the State of _______________, personally appeared
personally known to me (or proved on the basis of satisfactory evidence) to be
the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal
Signature
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My commission expires
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"LENDER"
--------------------
By:
-------------------------------------------
Signee's Name
Its: Signee's Title
STATE OF __________________
COUNTY OF _________________ SS.
On this ______ day of ____________________, 20__, before me, ____________a
Notary Public in and for the State of _______________, personally appeared
personally known to me (or proved on the basis of satisfactory evidence) to be
the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal
Signature
-------------------------------------------
My commission expires
-------------------------------
"LESSEE"
NAME OF LESSEE HERE
LESSEE SIGNATURE BLOCK HERE
STATE OF __________________
COUNTY OF _________________ SS.
On this ______ day of ____________________, 20__, before me, ____________a
Notary Public in and for the State of _______________, personally appeared
personally known to me (or proved on the basis of satisfactory evidence) to be
the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal
Signature
-------------------------------------------
My commission expires
-------------------------------
(ALL SIGNATURES MUST BE ACKNOWLEDGED)
DESCRIPTION OF PROPERTY
EXHIBIT A to Subordination Agreement; Acknowledgment of Lease Assignment,
Attornment and Non-Disturbance Agreement dated as of DATE OF DOCUMENTS, executed
by BORROWER NAME, a general partnership as "Owner", NAME OF LESSEE HERE, as
"Lessee", and ___________________________, as "Lender". All that certain real
property located in the County of PROPERTY COUNTY, State of ____________,
described as follows:
APN
