NET LEASE
THIS LEASE, Made this 14th day of September, 1979, by and between Max &
Xxxxxxxxx Xxxxxxxx 0000 X. Xxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx 00000 ("Lessor"),
and Max of Switzerland an Arizona Corporation ("Lessee").
W I T N E S S E T H:
1. Leased Premises. Lessor hereby leases to Lessee, and Lessee hereby
leases from Lessor, certain premises consisting of Automobile Dealership
facilities at 6903, 6905, 6907, 6913, 0000 X. XxXxxxxx Xx., Xxxxxxxxxx, Xxxxxxx
00000 (see attached legal description of subject property & survey) (the "Leased
Premises"), the Leased Premises being more particularly described in Exhibit A
attached hereto and made a part hereof for all purposes.
2. Term. The term of this Lease shall be for Eighteen (18) years,
commencing on October 1, 1979, (the "Commencement Date"), and terminating
September 30, 1997 (11) years after the Commencement Date.
3. Basic Rent. Lessee shall pay to Lessor without demand, deduction, or
offset as rent for the Leased Premises the total sum of TWO MILLION THREE
HUNDRED SEVENTY SIX THOUSAND DOLLARS ($2,376,000.00), payable in monthly
installments of ELEVEN THOUSAND DOLLARS ($11,000,00), the first installment
payable in advance on the first day of the term of this lease and subsequent
installments payable in advance on the first day of each month thereafter during
the term of this lease.
4. Taxes. Lessee shall pay as additional rent any privilege tax, sales tax,
gross proceeds tax, rent tax, or like tax (but not including income tax), now or
hereafter levied, assessed or imposed by any federal, state, county, or
municipal governmental authority, or any, subdivision thereof, upon any rent or
other payments required to be paid under this lease.
Lessee shall also pay before delinquent as additional rent all personal
property taxes and assessments levied or assessed by any governmental authority
against any personal property or fixtures of Lessee in, on, or about the Leased
Premises.
Lessee shall pay before delinquent, as additional rent, exhibiting receipts
therefor to Lessor on demand, all real property taxes and assessments levied or
assessed against the Leased Premises and improvements thereon, both general and
special, foreseen and unforeseen, and all water charges or assessments levied in
connection with any improvements or irrigation projects, or district or other
taxes, assessments or governmental charges of any kind levied or assessed
against, the Leased Premises. Lessee shall have the right, in good faith and at
its sole and own cost and expense and in its own name or in
the name of Lessor, to protest or contest or seek to have reviewed, reduced,
equalized, or abated any tax or assessment by legal proceedings in such manner
as it may deem advisable. No protest, contest, or other action, however, shall
be maintained by Lessee after the time limited for the payment without penalty
or interest of the tax or assessment unless Lessee shall have first paid the
amount of such tax or assessment under protest or shall have procured a stay of
proceedings to enforce the collection thereof, and shall have also provided for
the payment thereof together with all penalties, interest, costs, and expenses
by the deposit of a bond in form approved by Lessor if required by law to
accomplish such stay.
5. Purpose. Lessee shall use and occupy the Leased Premises or cause said
Leased Premises to be used only as Automobile Agency and for no other purpose
without Lessor's prior written consent. Lessee shall operate its business on the
Leased Premises in conformity with all applicable laws, regulations, ordinances,
and licensing requirements, if any.
6. Utilities. Lessee shall pay or cause to be paid when due all charges for
water, gas, electricity, telephone service, sewage services, garbage services,
and other utilities used in or upon the Leased Premises during the term of this
lease.
7. Maintenance. During the term of this lease, Lessee, at its own cost and
expense, shall keep and maintain the Leased Premises and all buildings and
improvements thereon, in good order, condition and repair, hereby waiving all
rights to make repairs at the expense of Lessor, and shall not cause any
nuisance or cause or permit any waste or allow any trash to accumulate on the
Leased Premises. Further, Lessee agrees to make any and all necessary
replacements to air-conditioning, cooling, heating, plumbing, lighting, and
other equipment on the Leased Premises and to any other part of the Leased
Premises in the event said replacements are necessary. Lessee shall have the
right at its sole cost and expense at any time and from time to time, to make
such alterations and improvements to the building on the Leased Premises which
do not adversely affect the value thereof as Lessee sees fit, provided, however,
that no structural alterations shall be made without first obtaining the written
consent and approval of the Lessor as to the proposed plans and specifications,
which consent and approval Lessor agrees will not be unreasonably withheld and
further provided that any alterations or improvements shall be done
expeditiously and in a good and workmanlike manner. Lessee agrees to provide
Lessor with a performance bond or other security satisfactory to Lessor to
insure the fact that there will be no mechanic's liens or materialmen's liens or
any other liens against the premises caused by Lessee's alterations or other
improvements and to indemnify and hold harmless Lessor from and against any such
liens. In the event that Lessee does not make the necessary repairs,
replacements, or maintenance as herein provided, Lessor, after giving Lessee
thirty (30) days' written notice, shall have
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the right to do the same and all amounts so expended by the Lessor shall be
deemed additional rental, to be due and owing at the time the next rental
payment is due following the date that such repairs, replacements, or
maintenance have been done by the Lessor. Any and all alterations, repairs,
replacements, and additions that are made by either party shall immediately
become the property of the Lessor.
8. Insurance. During the term of this lease, Lessee, at Lessee's expense,
shall keep all improvements on the Leased Premises insured against loss or
damage by fire and the hazards covered by extended coverage insurance in an
amount equal to not less than the full replacement value of such improvements
without offset for depreciation. The policy or policies therefor shall name
Lessor as insured and shall be payable to Lessor with a waiver of subrogation
clause and a standard mortgage clause in favor of the holder of any mortgage
(the "mortgagee") on the Leased Premises and shall contain a replacement cost
endorsement. The policy or policies shall in all respects and amounts be
acceptable to Lessor and the mortgagee, and, without limiting the foregoing
general requirement, shall provide coverage for six (6) months' loss of rent and
vandalism and malicious mischief. Lessee shall not commit or permit any acts in
or about the Leased Premises which may in any way impair or invalidate such
policy or policies of insurance for the building. The full replacement value of
such improvements shall be determined from time to time (but not less often than
once every three years) by Lessee and its insurer or insurers.
Lessor and Lessee each hereby release the other and their respective
agents, servants, and employees from any and all liability or responsibility to
the other or anyone claiming through or under them by way of subrogation or
otherwise for any loss or damage to property caused by fire or any of the
extended coverage or supplementary contract casualties, even if such fire or
other casualty shall have been caused by the fault or negligence of the other
party or its agents, servants, and employees or anyone for whom such party may
be responsible, provided, however, that this release shall be applicable and in
force and effect only with respect to loss or damage occurring during such time
as Lessor's and Lessee's insurance policies, as the case may be, shall permit
that any such release shall not adversely affect or impair said policies or
prejudice the right of Lessor or Lessee, as the case may be, to recover
thereunder.
Lessee shall be solely responsible for obtaining any fire or extended
coverage insurance for personal property and improvements of Lessee and for all
goods, commodities and material stored by Lessee in or about the Leased
Premises.
9. Casualty. If the Leased Premises are wholly or partially destroyed by
fire or other casualty, Lessee shall promptly rebuild, repair or restore the
Leased Premises to their condition at the time immediately preceding the loss or
damage.
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If the damage is caused by an insured casualty, Lessee shall give immediate
notice thereof in writing to Lessor, and shall fully cooperate with Lessor and
the mortgagee in filing all necessary proofs of claim with insurance companies
and the proceeds of such insurance applicable to the Leased Premises shall be
made available to Lessee for such restoration. The complete or partial
destruction of the Leased Premises shall not affect or abrogate Lessee's
obligation to make rental payments pursuant to the terms of this lease. Lessee
expressly waives any statutory right under the laws of the State of Arizona to
cease paying rent and surrender the Leased Premises in the event of injury to or
destruction of said Leased Premises.
10. Liability Insurance. During the term of this lease, Lessee, at Lessee's
expense, shall maintain comprehensive general liability insurance including
contractual liability against claims for injury, wrongful death, or property
damage occurring upon, in, or about the Leased Premises, in companies and in
form acceptable to Lessor, with minimum limits of Two Hundred Fifty Thousand
Dollars ($250,000,00) on account of bodily injuries to or death of one person,
Five Hundred Thousand Dollars ($500,000.00) on account of bodily injuries or
death of more than one person as the result of any one accident or disaster, and
property damage insurance with minimum limits of Fifty Thousand Dollars
($50,000.00).
11. Insurance Certificates. Promptly after the commencement of the term of
this lease, Lessee shall deliver to Lessor certificates of its insurers
evidencing all the insurance required to be maintained in Paragraphs 8 and 10
herein, and, within thirty (30) days prior to the expiration of any such
insurance, other certificates evidencing the renewal of such insurance, together
with receipts showing payment of the premiums therefor. Each such certificate
shall contain a clause requiring twenty (20) days' notice to Lessor and the
mortgagee before any such policy can be cancelled or nonrenewed.
If Lessee at any time fails or refuses to maintain such insurance, Lessor
may, but shall not be obligated to, obtain such insurance and Lessee shall pay
Lessor on demand, as additional rent, the premiums therefor, together with
interest thereon from the date of payment thereof at the rate of ten percent
(10%) per annum.
12. Indemnity. Lessee shall indemnify and hold Lessor harmless from and
against all liabilities, obligations, losses, damages, penalties, claims,
actions, suits, costs, charges, and expenses, including reasonable attorney's
fees, which may be imposed upon or incurred by or asserted against Lessor
arising from any use or condition of the Leased Premises by or attributable to
Lessee or Lessee's employees, customers, agents, invitees, licensees, and
guests. In the event that any action or proceeding shall be brought against
Lessor by reason of any claim above referred to, Lessee, upon written notice
from Lessor, shall
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at Lessee's sole cost and expense defend the same. Lessor shall not be liable
for any damage to or theft of any personal property, goods, commodities, or
materials in or about the Leased Premises.
13. Condemnation. If the Leased Premises, or such a substantial portion
thereof as shall prevent Lessee from conducting its business under this lease,
shall be taken by proper authority for public use, Lessee may terminate this
lease by giving Lessor written notice of such termination within thirty (30)
days after such taking and the rent shall xxxxx during the unexpired portion of
this lease, effective from the date when possession of the part so taken shall
be required. If a portion of the Leased Premises is taken and the part not taken
shall be sufficient for the reasonable use of Lessee's business under this
lease, this lease shall be reduced in proportion to which the Leased Premises so
taken bears to the Leased Premises originally leased, provided, that
consideration shall be given to the respective values of the space taken and the
space not taken. All compensation awarded for any such taking shall belong to
and be the property of the Lessor or the mortgagee (as governed by separate
agreement between them); provided, however, that Lessee shall be entitled to an
award only for Lessee's loss of business and the taking of or depreciation to,
and the cost of removal of, Lease's stock in trade, trade fixtures, equipment,
and other personal property in the Leased Premises.
14. Liens. If the Leased Premises or Lessee's leasehold interest therein,
shall at any time during the term of the lease become subject to any mechanic's,
laborer's or materialman's lien based upon the furnishing of material or labor
to Lessee on the Leased Premises and contracted for by Lessee, Lessee shall
cause the same, at Lessee's expense, to be discharged within sixty (60) days
after notice thereof, unless the lien is then being litigated in good faith by
the Lessee, and shall indemnify and hold harmless Lessor from and against any
such lien.
15. Assignment. Lessee shall not assign this lease or sublet the Leased
Premises, or any part thereof, without the prior written consent of Lessor,
which consent shall not be unreasonably withheld. Any such assignment or
subletting shall not release Lessee hereunder, and Lessee shall remain jointly
and severally liable with any assignee or subtenant, all of whom shall be
required to expressly assume Lessee's obligations hereunder.
16. Default.
A. Lessee does hereby grant to Lessor a contract lien on all property
of Lessee now, or hereafter, placed in or upon the Leased Premises (except
such part of property or merchandise as may be exchanged, replaced or sold
from time to time in the ordinary course of operations or trade), and such
property is hereby subjected to a lien in favor of
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Lessor and shall be, and remain, subject to such lien for payment of all
rents and other sums agreed to be paid by Lessee, said lien to be in
addition to and cumulative of the landlord's lien provided by law.
B. If Lessee shall fail to pay any installment of rent or other sum
when it becomes due and payable as provided herein, or shall fail in the
performance of any of the covenants, agreements, terms or conditions of
this lease, or if Lessee shall desert, abandon or vacate the Leased
Premises, or if by reason of Lessee's occupancy of the Leased Premises,
Lessor shall be unable to procure or keep insurance on the Leased Premises
or the improvements thereon, then in any such event, if such default or
condition shall continue after ten (10) days' notice thereof in writing to
Lessee to make good such default or condition (provided, that, as to any
failure to pay rent or other sum occurring after Lessor has given written
notice as to any such prior failures twice in any calendar year, Lessor
shall not be required to give written notice before pursuing any remedy
provided herein), Lessee shall be deemed to be in default; and, without
further notice of any kind, Lessor may at its option:
(1) Reenter and take possession of the Leased Premises by legal
proceedings or otherwise without terminating this lease, by force if
necessary, and relet the Leased Premises in whole or in part for the
account of Lessee at such rental and upon such covenants and
conditions to such tenant or tenants as Lessor may deem proper and for
a longer or shorter period than the balance of the term of this lease.
Lessor shall receive all proceeds and rents accruing from such
reletting and shall apply such proceeds first to the payment of all
reasonable costs and expenses incurred by Lessor in obtaining
possession and in reletting the Leased Premises, including without
limitation reasonable attorneys' fees and collection fees, then to the
reasonable cost of alterations, repairs or remodeling necessary in
Lessor's opinion to enable Lessor to relet the Leased Premises, and
finally to the payment of all such amounts as may be due or may become
due under the provisions of this lease, and the balance remaining, if
any, at the expiration of the full term of this lease or upon the
sooner termination thereof shall be paid to Lessee. If the proceeds or
rentals so received by Lessor under the provisions of this paragraph
are insufficient to pay all such expenses and all amounts due and
becoming due hereunder, Lessee shall pay to Lessor upon demand by
Lessor such deficiency as may from time to time exist, and Lessor need
not wait until the termination of this lease to recover such
deficiency by legal or other action.
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(2) Terminate this lease at once, including any interest of
Leases hereunder, and immediately reenter and take possession of the
Leased Premises by legal proceedings or otherwise and by force if
necessary.
(3) In the event of any reentry, Lessor may remove all persons
from the Leased Premises, and Lessor may remove all property located
in or about the Leased Premises. At Lessor's option, it may either
place such property located in a public warehouse at the cost and risk
of Lessee, or sell such property in whole or in part in the manner and
after giving the notices required by the laws of the State of Arizona
to the highest bidder for cash, with or without such property being
present at the sale. The proceeds shall be applied first to the
payment of all reasonable costs and expenses incurred by Lessor in
taking and removing such property, including without limitation
reasonable attorneys' fees, then to the payment of any rent or other
amounts owing to Lessor and finally the balance remaining, if any,
shall be paid to Lessee.
(4) No reentry or reletting of the Leased Premises shall be
construed as an election by Lessor to terminate this lease unless a
written notice of such intention is given by Lessor to Lessee; and
notwithstanding any such reletting without terminating this Lease,
Lessor may at any time thereafter elect to terminate this lease in the
event that Lessee remains in default hereunder.
(5) Lessee waives all claims or demands for damages that may be
caused by Lessor in reentering and taking possession of the Leased
Premises as hereinabove provided and all claims or demands for damages
resulting from the destruction of or injury to the Leased Premises and
all claims or demands for damage or loss of property belonging to
Lessee or any other person that may be in or about the Leased Premises
at the time of such reentry.
(6) In addition to all rights of Lessor specified herein, Lessor
shall be entitled to all other rights provided in law or equity. The
various rights, options and remedies of Lessor contained in this lease
shall be cumulative, and no one of them shall be construed as
exclusive of any of the others.
(7) Neither the acceptance of rental hereunder nor lapse of time
nor any other act or omission on the part of Lessor, its agents or
employees, shall constitute a waiver of any breach by Lessee of the
covenants or conditions of this lease; as long as any such breach
continues, Lessor shall have the right to
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declare the Lessee to be in default and to enforce the remedies
provided herein. The waiver by Lessor, its agents or employees, of any
breach in the performance by Lessee or any covenant contained herein
shall not be construed to be a waiver of any preceding or subsequent
breach of any other covenant contained herein. The subsequent
acceptance of rent or other sums hereunder by Lessor shall not be
deemed a waiver of any preceding breach other than the failure of
Lessee to pay the particular rental or other sum so accepted,
regardless of Lessor's knowledge of such preceding default at the time
of acceptance of such rent or other sum.
(8) If Lessor retains an attorney to enforce any of its rights
hereunder, or becomes involved in any suit connected with this lease,
Lessee shall pay Lessor's reasonable court costs and attorneys' fees.
17. Lessee's Insolvency or Bankruptcy. It is agreed by Lessee that upon the
filing of any petition by or against Lessee under any chapter of the federal
bankruptcy laws, or upon the adjudication of Lessee as a bankrupt or insolvent,
or upon the appointment of a receiver or trustee to take possession of all or
substantially all of the assets of Lessee, or upon the making of a general
assignment by Lessee for the benefit of creditors, or upon the taking of any
other action by Lessee under any state or federal insolvency or bankruptcy act
or other similar law, and upon the continuance of any of the foregoing events
for thirty (30) days, Lessor may, at its election, declare this lease in default
upon the giving of written notice thereof to Lessee; and, in such an event,
Lessor may exercise all rights and remedies herein provided to it upon default
without necessity of further notice to Lessee.
Neither this lease, or any interest herein, nor any estate created hereby,
shall pass by operation of law under any state or federal insolvency or
bankruptcy act or similar law to any trustee, receiver, assignee for the benefit
of creditors, or any other person whatsoever without the prior written consent
of Lessor. Any purported or attempted transfer in violation of the provisions of
this paragraph shall constitute a default under this lease, and Lessor, at its
option by written notice to Lessee, may exercise all rights and remedies herein
provided for upon such a default, including the termination of this lease
without the necessity of further notice.
18. Lessor May Pay Lessee's Obligations. In the event that Lessee does not
pay before delinquent any taxes, assessments, or other charges to be paid
hereunder by Lessee, Lessor shall have the right, without notice to Lessee to
make such payment and to charge Lessee therefor, together with interest thereon
from the date of such payment to the date of repayment by Lessee to Lessor at
the rate of ten percent (10%) per annum.
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19. Subordination. This lease shall be subject to and subordinate to the
lien of any mortgage or deed of trust which now or hereafter may constitute a
lien on the Leased Premises, and to any agreements at any time made, modifying,
supplementing, extending, or renewing any such mortgage or deed of trust;
provided, however, that Lessor shall attempt to obtain from the mortgagee under
any such mortgage or beneficiary under any such deed of trust an agreement that
so long as Lessee shall not be in default in the terms of this lease, this lease
shall not be terminated. The provisions for the subordination of the lease shall
be self-operative and no further instrument shall be required to effect such
subordination; provided, that the Lessee shall, upon request by any mortgagee at
any time or times, execute and deliver any and all instruments that may be
reasonable, necessary or proper to affect such subordination. Lessee understands
that Lessor contemplates assigning its rights under this lease to the mortgagee
and Lessee agrees, upon request by Lessor, to execute the mortgagee's standard
acceptance of premises agreement. Lessee further agrees that, upon written
notice of the mortgagee's address, Lessee shall give to the mortgagee a copy of
all notices that Lessee is required to give to Lessor hereunder at the same time
such notices are given to Lessor.
20. Signs. No signs, advertisements or notices shall be placed by the
Lessee on the outside of the building except such as shall be first approved in
writing by Lessor. If such approval by Lessor is given, such signs,
advertisements or notices shall be installed and maintained at Lessee's expense
and shall conform to all applicable governmental laws, rules and regulations.
21. Entry Reserved by Lessor. Lessor may, during the term of this lease, at
reasonable times, enter upon the Leased Premises for the purpose of inspecting
same or to do anything required or permitted by this lease, and may at any time
during the last six (6) months of the term of this lease, show the Leased
Premises to prospective lessees or prospective purchasers.
22. Surrender. Upon the expiration of the term of this lease, or upon an
earlier termination of this lease, Lessee shall surrender up peaceable
possession of the Leased Premises in the same condition as the Leased Premises
are in at the commencement of this lease, reasonable wear and tear excepted.
23. Notices. Any notice required or permitted to be given or served by
either party to this lease shall be deemed to have been given or served when
made in writing by certified United States mail, postage prepaid, addressed as
follows:
Lessor: Max & Xxxxxxxxx Xxxxxxxx
0000 X. Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
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Lessee: Max of Switzerland
0000 X. XxXxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
All rental payments shall be made to the Lessor at the above address. The
addresses may be changed from time to time by either party by serving notice as
above provided.
24. Broker's Commission. Lessor and Lessee represent to the other that
there are no broker's commissions in connection with this lease.
25. Estoppel Certificates. Lessee shall, at any time, on ten (10) days'
prior written notice by Lessor or the mortgagee, execute, acknowledge, and
deliver to Lessor or the mortgagee a written statement certifying that this
lease continues unmodified and in full force and effect (or if there have been
modifications, that this lease continues in full force and effect as modified
and stating the modifications), and the dates to which the minimum and the
additional rent have been paid, and stating whether Lessor is in default in
performing any covenants to this lease, and, should Lessor be in default,
specifying each and every such default, it being intended that any such
statement delivered pursuant to this paragraph may be relied on by Lessor or any
prospective purchaser or mortgagee of the fee or any assignee of any mortgagee
on the fee of the Leased Premises.
26. Compliance with Laws. Lessee agrees, at its sole cost and expense, to
comply with all the regulations and requirements of all municipal, county, state
and federal authorities now in force or which may hereafter be in force
pertaining to the Leased Premises and shall faithfully observe in the use of the
Leased Premises all municipal ordinances and county, state and federal statutes
now in force or which may hereafter be in force. Lessee further agrees that it
will pay for any alterations or changes in the Leased Premises which may be
required during the term of this lease to comply with any regulations and
requirements of municipal, county, state or federal authorities. Lessee shall
indemnify and hold harmless the Lessor from any penalties, damages, or charges
imposed or incurred for any violation of such regulations, requirements,
ordinances or laws, whether or not occasioned by the negligence of the Lessee or
any agent, tenant, or contractor then upon or using the Leased Premises.
Lessee shall, however, have the right to contest by appropriate legal
proceedings, without cost or expense to Lessor, the validity of any of the
foregoing requirements, statutes and ordinances; and if by the terms of any such
statutes or ordinances, compliance therewith may lawfully be postponed without
subjecting Lessee or Lessor to any liability for failure to comply therewith,
Lessee may postpone such compliance until the final determination of any such
proceedings.
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27. Partial Invalidity. If any term, covenant, condition or provision of
this lease is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the provisions hereof shall remain in full force
and effect and shall in no way be affected, impaired or invalidated thereby.
28. Net Lease. The Lessor and Lessee agree that this lease is an absolutely
"Net Lease", which means that the Lessee pays as additional rent, without
defense, offset, or deduction, all expenses connected with the Leased Premises,
including but not limited to real and personal property taxes and assessments,
fire and extended coverage insurance premiums, liability and damage insurance
premiums, parking lot and common area maintenance expenses, and all expenses of
maintenance, replacement, repair, and reconstruction on the Leased Premises.
29. Effect of Waiver. Any waiver by Lessor or Lessee of any breach of this
lease, or of any right of either party, shall not constitute a waiver of any
other breach or of any other right.
30. Sole Agreement. This lease contains the entire agreement between the
parties hereto and no term or provision hereof may be changed, waived,
discharged or terminated unless the same be in writing executed by Lessor and
Lessee.
31. Law. The law of Arizona shall govern the construction, performance and
enforcement of this lease.
32. Time of Essence. Time shall be of the essence in the performance of
every term, covenant and condition of this lease.
33. Captions. The Article captions are inserted for convenience of
reference and are in no way to be construed as a part of this lease or as a
limitation on the scope of the Article to which they refer.
34. Benefit. This lease shall inure to the benefit of and be binding upon
the parties hereto and their respective heirs, executors, administrators, legal
representatives, successors, and assigns.
35. Assignment by Lessor. The term "Lessor" as used in this lease means
only the owner for the time being in fee of the Leased Premises, or the owner of
the leasehold estate created by an underlying lease, or the mortgagee of the fee
or of such underlying lease in possession for the time being of the Leased
Premises, so that in the event of any sale of the Leased Premises or of any
transfer or assignment or other conveyance of such underlying lease and the
leasehold estate thereby created, the seller, transferor, or assignor shall be
entirely relieved of all further obligations of the Lessor herein. It shall be
deemed without further agreement between the parties or their successors in
interest, or between the parties and any such purchaser,
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transferee, or assignee, that such purchaser, transferee, or assignee has agreed
to carry out all obligations of the Lessor hereunder.
IN WITNESS WHEREOF, the parties hereto have executed this lease as of the
day and year first above written.
LESSOR /s/ Xxx Xxxxxxxx
-------------------------------
Xxx Xxxxxxxx
/s/ Xxxxxxxxx Xxxxxxxx
-------------------------------
Xxxxxxxxx Xxxxxxxx
LESSEE
Max of Switzerland BY:
/s/ Xxx Xxxxxxxx
-------------------------------
Xxx Xxxxxxxx, President
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STATE OF ARIZONA )
) ss:
County of Maricopa )
On this the 17th day of September, 1979, before me, the undersigned
officers, personally appeared Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx, known to
me (or satisfactorily proven) to be the persons whose names are subscribed to
the within instrument and acknowledged that they executed the same for the
purpose therein contained.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Xxxxx Xxxxxx
-------------------------------
Notary Public
My commission expires:
My Commission Expires March 8, 1982
-----------------------------------
STATE OF ARIZONA )
) ss:
County of Maricopa )
On this the 17th day of September, 1979, before me, the undersigned
officer, personally appeared Xxx Xxxxxxxx, who acknowledged himself to be the
Lessee, respectively, of MAX OF SWITZERLAND, an Arizona Corporation, and that
they, as such he being authorized so to do, executed the foregoing instrument
for the purposes therein contained, by signing the name of the corporation by
himself as President.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Xxxxx Xxxxxx
-------------------------------
Notary Public
My commission expires:
My Commission Expires March 8, 1982
-----------------------------------
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/s/ Xxxxx X. [Illegible]
-------------------------------
Registered Land Surveyor
Number: 9087
RESULT
OF
SURVEY
DESCRIPTION OF LAND IN MARICOPA COUNTY, ARIZONA:
------------------------------------------------
That part of FARM UNIT "B" according to the FARM UNIT Plat of Section 3,
Township 1 North, Range 4 East of the Gila and Salt River Base and Meridian,
Maricopa County, Arizona, described as follows:
BEGINNING at the Northeast corner of said FARM UNIT "B"; thence West along the
North line of said FARM UNIT a distance of 393 feet to a point; thence south and
parallel to the East line of said FARM UNIT to a point on the North line of
PAPAGO PARKWAY, according to Book 78 of Maps, page 12, records of Maricopa
County, Arizona; thence East along the North line of said PAPAGO PARKWAY to the
East line of said FARM UNIT; thence North along said East line to the point of
beginning;
EXCEPT any part lying within the property conveyed to the City of Scottsdale,
recorded in Docket 119913, PAGE 854, and in Docket 11999, page 122,
AND EXCEPT the North 65 feet of the East 180.00 feet thereof;
AND EXCEPT the East 30.00 feet thereof.
Exhibit A to Lease between Max & Xxxxxxxxx Xxxxxxxx and Max of Switzerland dated
September 9, 1977
6925 X. XxXxxxxx
(Land & Bldg)
SUBLEASE
DATE: August 11, 1980
LESSOR: MAX OF SWITZERLAND, an Arizona corporation
LESSEE: SCOTTSDALE PORSCHE+AUDI, LTD., an Arizona corporation
PROPERTY: See attached Schedule "A"
THIS LEASE AGREEMENT is entered into on the date set forth above, by Lessor
and Lessee, with respect to the following described property, together with all
buildings, improvements and leasehold improvements located thereon (the
"premises" or the "leased premises"), situated in Maricopa County, Arizona;
SEE ATTACHED SCHEDULE "A".
The complete agreement between the parties is as follows:
1. Term. The premises are hereby leased by Lessor to Lessee for a term
commencing on August 11, 1980 and extending for a period of twenty (20) years
thereafter to and including August 10, 2000.
2. Rental.
2.01 Base Rental. Lessee agrees to pay to Lessor, as the rent for the
premises during the term hereof, the sum of $10,000.00 per month, as adjusted as
set forth in paragraph 2.02, payable on the 11th day of each month during the
term hereof, commencing August 11, 1980.
2.02 Three Year Cost of Living Adjustment. The monthly rent provided
for in paragraph 2.01 shall be subject to adjustment at the commencement of the
fourth, seventh, tenth, thirteenth, sixteenth and nineteenth years of the term
of this Lease ("the adjustment date") as set forth in this paragraph.
The base for computing the adjustment is the Consumer Price Index,
United States (All Items), published by the United States Department of Labor,
Bureau of Labor Statistics ("Index"), which is published for the month
immediately preceding the month in which the lease term commences ("Beginning
Index"). If the Index published nearest the adjustment date ("Extension Index")
has increased over the Beginning Index, the monthly rent for the following three
years (until the next rent adjustment) shall be set by multiplying the monthly
rent set forth in paragraph 2.01 by a fraction, the numerator of which is the
Extension Index and denominator of which is the Beginning Index, but in no event
shall said adjustment reduce the monthly rental below the monthly rent which
existed immediately prior to the adjustment.
The monthly rental shall not at any time be greater than that set
forth on the attached Monthly Rent Payment Schedule.
If the Index is changed so that the base differs from that used as of
the month immediately preceding the month in which the term commences, the Index
shall be converted in accordance with the conversion factor published by the
United
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States Department of Labor, Bureau of Labor Statistics. If the Index is
discontinued or revised during the term, such other government index or
computation with which it is replaced (or if it is not replaced, some other
comparable index or computation) shall be used in order to obtain substantially
the same result as would be obtained if the Index had not been discontinued or
revised.
3. Taxes and Impounds.
3.01 Taxes - On Rental. Lessee agrees to pay any transaction privilege
or sales tax imposed on lease rentals by the State of Arizona and the City of
Scottsdale concurrently with, and in addition to, each monthly rental payment.
If at any time during the term hereof an additional tax or excise on rents as a
form of taxation is levied upon or assessed to Lessor by any taxing authority,
and not as a part of a general income tax, Lessee will pay the same at the time
and in the manner herein-before provided with respect to payment of rent.
3.02 Taxes - On Property. Lessee agrees to pay all ad valorem property
taxes relating to the premises during the term hereof, prorated during the
period this Lease is in effect. Lessor agrees to absorb all improvement lien
assessments for public improvements on or with respect to the leased premises
during the term hereof. Lessor shall use his best efforts promptly to cause the
leased premises to be assessed separately for property taxes from other property
owned by Lessor. Until such time as the leased premises is separately assessed,
ad
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valorem property taxes will be allocated between the leased premises and any
other property covered by property tax bills on the basis of the square footage
of the leased premises to the square footage of the entire property covered by
the tax bills.
3.03 Impounds. During the term hereof while there exists any first
encumbrance against the premises in favor of an institutional lender, and which
first encumbrance requires Lessor to make impound payments to the holder of the
encumbrance for taxes or insurance, Lessee will pay such amounts to Lessor at
the times and in the manner hereinbefore provided with respect to the payment of
rent.
4. Alterations. Lessee will not, without the prior written consent of
Lessor (which Lessor will not unreasonably withhold), make or allow to be made
alterations, improvements or additions to the leased premises. Any alterations,
improvements or additions made will become a part of the leased premises,
subject to the terms hereof, and will be the property of Lessor.
5. Trade Fixtures. Lessee, at its expense and subject to other provisions
set forth or incorporated herein, may install any necessary trade fixtures,
equipment and furniture which will remain Lessee's property and will be removed
at the end of this Lease. Lessee at its expense will repair all damage caused by
such installation or removal.
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6. Maintenance.
6.01 Maintenance - By Lessee. Lessee at its expense will maintain in
good order and repair all portions of the leased premises which are not the
obligation of Lessor, including without limitation: walls (painting the same as
often as necessary); partitions; floor structures; pipes and conduits; roof
utility installations; air conditioning and heating equipment, after any
warranties on such equipment have expired; asphalt and concrete floors; and all
glass and glassing. Lessee at its expense will also make all repairs of every
kind and character to the interior of the leased premises. On the last day of
the term hereof, Lessee will surrender the leased premises to Lessor in a state
of good repair, excepting only reasonable wear and tear, obsolescence, damage by
fire, act or God or the elements and damages which Lessor is required to repair
hereunder.
6.02 Maintenance - By Lessor. Lessor at its expense will cure any
structural defects in the leased premises. Lessor will have no other obligation
to maintain or repair any portion of the leased premises, except as expressly
provided herein. Lessor will not be liable to Lessee for any damage resulting
from, or caused by, Lessor's failure to make repairs unless Lessee has promptly
notified Lessor in writing of the need for such repairs and Lessor has failed to
make them in a diligent manner.
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6.03 Current Condition. Lessor warrants that at the commencement of
the term of this Lease the leased premises are in good condition and repair, and
that all equipment located on the leased premises, including without limitation
plumbing, heating, air conditioning, mechanical, gas and electrical equipment is
in good operating condition. Lessee represents and warrants that it has replaced
all plate glass having bullet holes or cracks in the showroom of the premises
and has replaced the references to Max of Switzerland on all doors of the
premises with materials which match the doors and are of comparable quality.
Lessor represents and warrants that the buildings, improvements and leasehold
improvements located upon the property described in Schedule A on the date
hereof are the same buildings, improvements and leasehold improvements which
were located upon said property on March 21, 1980, plus any additions thereto
subsequent to said date.
7. Utilities. Upon commencement of the term hereof, Lessor will provide
adequate sewer, water, electric and gas lines, pipes and conduits to and for the
leased premises. Less__ will pay for all water, gas, electricity and other
utilities, including those required for the operation of air conditioning and
heating equipment used by Lessee on the leased premises. Lessor shall use his
best efforts to cause the leased premises to have utility meters separate from
other property owned by Lessor, at Lessor's expense.
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8. Inspection by Lessor. Lessor may go upon the leased premises at all
reasonable times for the purposes of inspecting the same, or for the purpose of
inspecting the performance by Lessee of the terms and conditions hereof, or for
the purpose of constructing, maintaining and repairing the leased premises
pursuant to the terms hereof.
9. Liens. Except for such as it may be contesting in good faith, Lessee
will promptly pay and discharge all claims for work or labor done, supplies
furnished or services rendered at the request of Lessee and will keep the leased
premises free and clear of all mechanics' liens and materialmen's liens in
connection therewith.
10. Insurance Clause. Lessor and Lessee agree that no insurer of any
interest of either is to have any right of subrogation against the other and
that all fire and other insurance policies carried by the either on the leased
premises or the fixtures and equipment therein or other contents thereof will
contain a full waiver of subrogation by the insurer against the other and its
assigns.
11. Damage to Lessee's fixtures. Lessee agrees that it will assume the risk
of damage to any fixtures installed by or at the expense of Lessee in the leased
premises, title to which is retained by Lessee hereunder, from every source
other than damage (i) caused by the negligence or willful misconduct of Lessor,
its agents or contractors or (ii) resulting by reason of any breach of any of
Lessor's obligations under this Lease.
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12. Insurance.
12.01 Public Liability - Insurance. Lessee at its expense will
maintain in full force during the term hereof public liability and property
damage insurance covering the leased premises and Lessee's activities therein
against claims for personal injury and death to limits of at least $500,000 for
each person and $1,000,000 for each occurrence and against property damage
claims to a limit of at least $100,000 or in such greater amount as may be
required by an institutional lender who holds a first encumbrance against the
premises. Lessee will furnish to Lessor a certificate evidencing the fact that
such insurance has been obtained and is in full force and effect, that Lessor
and any such institutional lender are additional insureds thereunder, and that
such insurance cannot be cancelled without ten days' prior notice to Lessor and
any such institutional lender.
12.02 Public Liability - Indemnity. Lessee will hold harmless and
indemnify Lessor from and against any and all loss, cost or damage arising by
reason of injury or death of persons or damage to property in or upon the leased
premises or caused by activities conducted thereon; provided, however, that
Lessee will not be required to indemnify Lessor against any damage or injury of
any kind arising out of the negligence of Lessor, its agents or employees.
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12.03 Fire Insurance. Lessee at its expense will maintain in full
force and effect during the term hereof fire and extended coverage insurance
upon the leased premises in an amount not less than 80% of the replacement cost
thereof or such greater amount as may be required by an institutional lender who
holds a first encumbrance against the premises. Lessee will furnish to Lessor a
certificate evidencing the fact that such insurance has been obtained and is in
full force and effect, that Lessor and any such institutional lender are
additional insureds thereunder, and that such insurance cannot be cancelled
without ten days' prior notice to Lessor and any such institutional lead.
12.04 Insurance Adjustments. On approximately each fifth annual
anniversary of the commencement date hereof, Lessor shall meet with Lessee to
consider the adequacy of the required minimum limits for public liability
insurance and fire and extended coverage insurance. If such limits are not
adequate based upon changes which have occurred in the economy since the
commencement of the term hereof, such limits shall be adjusted so that the
limits are then adequate. Lessor and Lessee shall act reasonably in making such
determination.
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13. Damage and Destruction of Premises. In the event of damage or
destruction to the premises which is covered by insurance, the insurance
proceeds shall be used for the repair and reconstruction of such damage and the
parties shall promptly repair and/or reconstruct the premises and the interior
improvements to their condition immediately prior to the damage or destruction.
This Lease shall continue in full force and effect in the event of such damage
and reconstruction. In the event the premises are damaged by a cause not covered
by the fire and extended coverage insurance carried on the premises, Lessor
shall reconstruct the premises to the extent of the construction at the
commencement hereof; provided however, if such uninsured loss exceeds 33% of the
then replacement cost of the building, Lessor shall have the option of
terminating this Lease by written notice to Lessee, within thirty (30) days of
such damage or destruction, in which event this Lease shall terminate as of the
date of the damage or destruction. Should Lessor not elect to so terminate the
Lease, it shall proceed with due dispatch to reconstruct the premises to the
extent of the construction at the commencement hereof, in which event this Lease
shall continue in full force and effect. In the event Lessor elects to terminate
this Lease, all rentals and other payments shall be prorated as of the date of
termination.
14. Condemnation.
14.01 Total Condemnation of Leased Premises. If the whole of the
leased premises shall be acquired or condemned
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by eminent domain for any public or quasi-public use or purpose, then the term
of this Lease shall cease and terminate as of the date of title vesting in such
proceeding, and all rentals shall be paid up to date and Lessee shall have no
claim against Lessor or the condemning authority for the value of any unexpired
term of this Lease.
14.02 Partial Condemnation. If any part of the leased premises shall
be acquired or condemned as aforesaid, and in the event that such partial taking
or condemnation shall render the leased premises unsuitable for business of the
Lesssee, when the term of this Lease shall cease and terminate as of the date of
title vesting in such proceeding. Lessee shall have no claim against lessor nor
the condemning authority for the value of any unexpired term of this Lease, and
rent shall be adjusted to the date of such termination. In the event of a
partial taking or condemnation which is not extensive enough to render the
premises unsuitable for the business of the Lessee, then Lessor shall promptly
restore the leased premises to a condition comparable to its condition at the
time of such condemnation, less the portion lost in the taking, and this Lease
shall continue in full force and effect with an adjustment in rent based upon
the square footage of the leased premises taken to the square footage of the
leased premises prior to the taking.
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14.03 Lessor's Damages. In the event of any condemnation or taking as
aforesaid, whether whole or partial, the Lessee shall not be entitled to any
part of the award paid for such condemnation, and Lessor shall receive the full
amount of such award, Lessee hereby expressly waiving any right to or claim to
any part thereof.
14.04 Lessee's Damages. Although all damages in the event of any
condemnation for diminution in value of the leasehold or to the fee of the
leased premises shall belong to Lessor, Lessee shall have the right to claim and
recover from the condemning authority, but not from Lessor, such compensation as
may be separately awarded or recoverable by Lessee in Lessee's own right on
account of any and all damage to Lessee's business by reason of the condemnation
and for or on account of any cost or loss to which Lessee might be put in
removing Lessee's merchandise, furniture, fixtures, leasehold improvements and
equipment.
14.05 Notice and Execution. Lessor agrees, immediately upon service of
process in connection with any appropriation or taking, to give to Lessee notice
in writing thereof. Lessee agrees to execute and deliver to the Lessor all
instruments that may be required to effectuate the provisions of this paragraph.
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15. Default.
15.01 Default - Grounds, The failure to pay any monetary amount due
and payable hereunder upon the date when such payment is due, such failure
continuing for a period of fifteen days after written notice of such default,
shall constitute an event of default on the part of Lessee. The occurrence of
any of the following events will constitute an event of default by either party
hereunder: (i) default in the performance of any of such party's agreements or
obligations hereunder, such default continuing for thirty days after written
notice thereof from the non-defaulting party to the defaulting party, provided
that if such default cannot reasonably cured within such thirty day period, then
the defaulting party will not be in default hereunder if it, within such thirty
day period, commences curing of such default and diligently and in good faith
prosecutes the same; (ii) a general assignment by a party for the benefit of
creditors; (iii) the filing of a voluntary petition in bankruptcy by a party or
the filing of an involuntary petition by a party's creditors, such involuntary
petition remaining undischarged for a period of thirty days; (iv) the
appointment of a receiver to take possession of substantially all of a party's
assets or of this leasehold, such receivership remaining undissolved or
undischarged for a period of thirty days; or (v) attachment, execution or other
judicial seizure of substantially all of a party's assets or this leasehold,
such attachment, execution or other seizure remaining undismissed or
undischarged for a period of thirty days after the levy thereof.
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15.02 Default - Remedies. Upon the happening of any such event of
default on the part of Lessee, Lessor, at any time thereafter, and prior to the
curing of such default, may: (i) with or without notice or demand declare the
term hereof ended and re-enter the leased premises or any part thereof (with or
without process of law) and expel or remove therefrom Lessee and all parties
occupying the ____ ___ any of them, using such force as may be necessary to do
so, and ______ repossess and enjoy the same without prejudice to any remedies
that Lessor might otherwise have by reason of such default; or (ii) re-enter the
leased premises at its option, without declaring the lease term ended, and relet
the whole or any part thereof for the account of Lessee on such terms and
conditions and at such rent as may then prevail for comparable property,
collecting such rent and applying it on the amount due from Lessee hereunder and
on the expense of reletting and on any other damage or expense so sustained by
Lessor, or on any such item or items, recovering from Lessee the difference
between the proceeds of such reletting and the amount of the rentals reserved
hereunder, which said Lessee agrees to pay upon demand. Should Lessor terminate
this Lease by reason of any such default by Lessee, Lessor may thereupon recover
from Lessee the worth, at the time of such termination, of the excess, if any,
of the amount of rent and charges equivalent to rent reserved herein for the
balance of the term over the then reasonable rental value of the leased premises
in the same period. Lessor will not, by any re-entry or other act, be deemed to
have terminated this lease, or the liability of
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Lessee for the total rent hereunder or any installment thereof then due or
thereafter accruing or for damages, unless Lessor notifies Lessee in writing
that Lessor has so elected to terminate the lease. In addition to the foregoing
remedies, Lessor may rectify any defaults of Lessee and add to the rent to be
paid hereunder, and to any installment or installments thereof thereafter
becoming due. If any installment of rent or any other payment is not paid
promptly when due it will bear interest at the highest legal rate permitted by
law from the date on which it becomes due until paid, but this provision is not
intended to relieve Lessee from any default in the making of any payment at the
time and in the manner herein specified. The foregoing interest, expenses and
damages will be recoverable from Lessee by the exercise of Lessor's remedies
hereinabove set forth. The remedies of Lessor specified herein will be
cumulative as to each default to the extent allowed by law.
Upon the happening of any such event of default by Lessor, Lessee, at
any time thereafter, and prior to the curing of such default may: (i) declare
the term hereof ended; (ii) xxx Xxxxxx for damages; (iii) xxx Xxxxxx for
specific performance; or (iv) exercise any of the rights or remedies as may be
allowed by law or equity. The remedies of Lessee specified herein will be
cumulative as to each default to the extent allowed by law.
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16. Holding Over. In the event of any holding over with the consent of
Lessor beyond the end of the term hereof, this Lease will be deemed a monthly
tenancy upon the agreements herein contained and Lessee will pay a monthly
rental at the rate most recently payable by it pursuant to Section _ above, in
advance at the beginning of each heldover month, plus any other charges or
payments contemplated in this lease.
17. Compliance with Laws. Leassee will comply with all governmental laws,
ordinances, rules and regulations at any time applicable to Lessee's use and
occupancy of the leased premises. Lessee will have the right, however, to
contest any such law, ordinance, rule or regulation by appropriate legal action,
provided that such contest is conducted without expense or prejudice to Lessor.
18. Statement from Lessee. Lessee will at any time and from time to time
within twenty days after written request by Lessor execute, acknowledge and
deliver to Lessor a written statement certifying that this Lease is unmodified
and in full force and effect if such is the fact (or, if there has been any
modification thereof, stating the modifications) and the dates to which the
rentals and other charges have been paid in advance, if any. It is understood
that any such statement may be relied upon by any prospective purchaser of the
estate of Lessor, or by the mortgagee or assignee of any mortgage or the trustee
or beneficiary of any deed of trust constituting a lien upon the leased
premises.
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19. Notices. All notices required to be given hereunder are to be in
writing. Such notices will be personally delivered or sent by United States
certified mail, postage prepaid, addressed to Lessor at 0000 Xxxx XxXxxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxx 00000, and to Lessee at the leased premises, or at such
other place as respective addressee may have designated in a written notice to
the other party. Service by delivery will be deemed to occur on delivery and
service by mail will be deemed to occur on the delivery date shown on the return
receipt.
20. Waiver. No waiver of any default by either party hereunder will be
implied from any omission by either party to take action on account of such
defaults if such default persists or is repeated, and no express waiver will
affect any default other than the default specified in the waiver, and then such
waiver will be operative only for the time and to the extent therein stated. A
waiver by either party of any provision hereof will not be construed as a waiver
of any subsequent breach of the same provision, nor will the consent or approval
by either party to or of any act by the other be deemed to waive or render
unnecessary its consent or approval to or of any subsequent similar acts.
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21. Property Near XxXxxxxx Road and Access Parcel. For purposes of this
Lease, the leased premises shall be deemed to include all of the right, title
and interest of Lessor in the display pads and sign located on the north end of
the property near XxXxxxxx Road, in the property where said items are located
and the right to use and occupy said property. During the term hereof Lessor
(and Max of Switzerland) and Lessee shall have joint use of the Access Parcel
solely for the purpose of passage of vehicles and persons. Lessor and Lessee
shall jointly maintain the Access Parcel, and the expenses thereof shall be
borne equally by Lessor and Lessee.
22. Complete Agreement. It is expressly agreed that the provisions of this
Lease cannot be altered, changed, modified or added to except in writing signed
by the parties hereto.
23. Time. Time is of the essence hereof.
24. Short-form Lease. Upon request of either party, Lessor or Lessee will
both execute and acknowledge a short-form lease for purposes of recording, which
short-form lease will describe the premises as being subject to the rights,
agreement and restrictions contained herein and the term hereof.
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25. Assignment and Subletting. Lessee may not assign this Lease or any
interest herein, or sublet the leased premises or any portion thereof, without
the prior written consent of Lessor, which consent will not be unreasonably
withheld. Lessor hereby consents to an assignment by Lessee to a corporate
successor upon merger or consolidation of Lessee. Any assignment or subletting
prohibited hereunder without the consent of Lessor will be void. The assignee
under any such assignment must agree to perform all of Lessee's obligations
hereunder, but no such assignment will have the effect of relieving Lessee of
its primary liability for the performance of all of its said obligations.
26. Mortgage by Lessor. It is expressly understood that Lessor will have
the right at any time during the term of this Lease and from time to time to
mortgage its interest in the leased premises for any purpose, and that Lessee
will, if requested by the lender, subordinate its interest in the leased
premises to the lien of such mortgage provided the lender agrees to respect this
Lease and accept the performance by Lessee of its obligations hereunder in the
event such mortgage is foreclosed, and provided further that the total monthly
obligations secured by all of the encumbrances upon the property do not exceed
the monthly rental set forth in paragraph 2.
27. Applicable Law. This Lease shall be construed under the laws of the
State of Arizona.
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28. Attorney's Fees. In the event of any action at law or in equity between
Lessor and Lessee to enforce any of the provisions or rights hereunder, the
unsuccessful party to such litigation covenants and agrees to pay the successful
party all costs and expenses, including reasonable attorneys' fees incurred
therein by said successful party, and if said successful party shall recover
judgment in any such action or proceeding, such costs, expenses and attorneys'
fees shall be included in and made a part of such judgment. Should Lessor,
without fault, be made party to any litigation instituted by or against Lessee,
Lessee covenants and agrees to pay Lessor all costs and expenses, including
reasonable attorneys' fees incurred by Lessor in connection with such
litigation. Should Lessee, without fault, be made a party to any litigation
instituted by or against Lessor, Lessor covenants and agrees to pay Lessee all
costs and expenses, including reasonable attorneys' fees incurred by Lessee in
connection with such litigation.
29. Address, Quiet Enjoyment and Condition of Title. Lessor covenants and
warrants that the leased premises has a street address of 0000 Xxxx XxXxxxxx,
Xxxxxxxxxx, Xxxxxxx 00000, that the leased premises constitutes the property
upon which the business of Scottsdale Prosche-Audi, Inc. was conducted
immediately preceding the commencement of the term hereof and that the leased
premises is all of the property lying north of the south line of the leased
premises and east of the center line of the wall and east of the center line of
the wall as extended north to XxXxxxxx Road (the wall being that certain wall
which
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divided the businesses of Scottsdale Porsche-Audi, Inc. and Max of Switzerland
on March 21, 1980). Lessor covenants and agrees that Lessee, so long as it shall
not be in default hereunder, shall peacefully and quietly hold, occupy and enjoy
the premises during the term of this Lease. Lessor covenants and warrants that
the leased premises are free and clear of all liens, encumbrances and adverse
claims, except 1980 taxes and the matters set forth on Schedule "B" attached
hereto.
30. Rights of First Refusal. At any time prior to fifty-five days following
the expiration of the term of this Lease, Lessor shall not sell or contract to
sell less than all of the leased premises. At any time prior to fifty-five days
following the expiration of the term of this Lease, Lessor shall not sell or
contract to sell all of the leased premises unless the premises is first offered
to Lessee for the same price, and upon the same terms and conditions as to which
Lessor proposes to sell or transfer the premises to the third party. Lessor must
give Lessee written notice setting forth the name and address of the proposed
purchaser and the price, terms and conditions of any bona fide offer by or to
Lessor under which Lessor proposes to sell or transfer the premises. Within the
thirty day period following Lessee's receipt of such notice, or within sixty
days following the expiration of the term of the Lease, whichever first occurs,
Lessee by written notice to Lessor may elect to purchase the premises, for the
same price and upon the same terms as the offer. If Lessee does not elect to
purchase the premises, Lessor may then sell the premises to the third party
named in
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Lessor's notice to Lessee, for the price and upon the terms therein stated. If
the escrow is not closed for the price and upon the terms and conditions
contained in the notice, then Lessor may not thereafter, at any time prior to
fifty-five days following the expiration of the term of this Lease, sell the
premises to any party other than Lessee without first offering the premises to
Lessee in the manner set forth in this paragraph. The provisions of this
paragraph shall have no application to a transfer of the premises or any portion
thereof, by gift or in any other manner, by Lessor to his spouse, to any of his
lineal descendants or spouses of lineal descendants (through natural birth or
legal adoption), to a corporation or partnership, the majority voting interest
of which is owned by Lessor, or to a trust, all of the beneficial interest of
which is owned by one, some or all of the foregoing permitted transferees.
At any time prior to fifty-five days following the expiration of the term
of this Lease, Lessor shall not lease or contract to lease all or any portion of
the leased premises unless same is first offered to Lessee for the period
following the expiration of the term of this Lease, upon the same lease terms
and conditions as to which Lessor prepares to lease same to the third party.
Lessor must give Lessee written notice setting forth the name and address of the
proposed Lessee and the terms and conditions of any bona fide offer by or to
Lessor under which Lessor proposes to lease the premises. Within the thirty day
period following Lessee's receipt of such notice, or within sixty days following
the expiration of the term of the Lease, whichever
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first occurs, Lessee by written notice to Lessor may elect to lease the
premises, upon the same terms as the offer. If Lessee does not elect to lease
the premises, Lessor may then lease the premises to the third party named in
Lessor's notice to Lessee, upon the terms therein stated. If the lease is not
executed upon the terms and conditions contained in the notice, then Lessor may
not thereafter, at any time prior to fifty-five days following the expiration of
the term of this Lease, lease the premises to any party other than Lessee
without first offering the premises to Lessee in the manner set forth in this
paragraph.
31. Other Agreement and ? Default. Xxx Xxxxxxxx and Lessee are
simultaneously herewith executing a Consultating Agreement. An event of default
by a party under said Consulting Agreement shall also constitute an event of
default under this Lease in the same manner as if an event of default had
occurred directly under this Lease.
32. Setoff. This Lease arose as a result of an Agreement between Xxx
Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx ("Xxxxxxxx") and Xxxxxx Xxxxxxxxxxxxx, or
nominee, dated June 1_, 1980. Haechler has certain obligations under ______
Agreement and the documents executed and delivered pursuant thereto. Lessee may,
but is not obligated to, set off against any obligations of Lessee to Lessor
under this Lease any claim which Xxxxxx Xxxxxxxxxxxxx, or nominee may have
against Haechler under said Agreement and the documents executed and ___________
thereto. Notwithstanding anything herein to the contrary, the
-23-
right of setoff shall not exist with respect to any claim unless Lessee gives
notice to Lessor of such claim and Lessor fails to satisfy such claim within
sixty days after such notice.
33. Possible Extension. On approximately the commencement of the 19th year
of the term hereof, Lessor shall meet with Lessee to consider extending the term
hereof beyond 20 years and establishing the provisions of such extended term.
Nothing herein shall obligate Lessor or Lessee to agree upon extending the term
or establishing the terms.
34. Benefit and Burden. The rights, duties and obligations created
hereunder shall inure to the benefit of and be binding upon the parties hereto,
their heirs, personal representatives, successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the
date indicated on the first page.
LESSOR: LESSEE:
MAX OF SWITZERLAND SCOTTSDALE PORSCHE+AUDI, LTD.
By /s/ Xxx Xxxxxxxx By /s/ Xxxxxx Xxxxxxxxxxxxx
----------------------------- --------------------------------
Xxx Xxxxxxxx, President Xxxxxx Xxxxxxxxxxxxx
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the 11th day of August, 1980, before me, the undersigned officer,
personally appeared XXX XXXXXXXX who
-24-
acknowledged himself to be the President of MAX OF SWITZERLAND, and that he, as
such officer, being authorized so to do, executed the foregoing instrument for
the purposes therein contained by signing the name of the corporation by himself
as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Illegible
---------------------------------
Notary Public
My commission expires:
3/7/82
----------------------
-25-
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the 11th day of August, 1980, before me, the undersigned officer,
personally appeared XXXXXX XXXXXXXXXXXXX who acknowledged himself to be the
President of SCOTTSDALE PORSCHE+AUDI, LTD., and that he, as such officer, being
authorized so to do, executed the foregoing instrument for the purposes therein
contained by signing the name of the corporation by himself as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Illegible
---------------------------------
Notary Public
My commission expires:
3/7/82
----------------------
GUARANTY
The undersigned, jointly and severally, personally guarantee all of the
obligations of Lessee set forth on the above Sublease.
DATED this 11th day of August, 1990
/s/ Xxxxxx Xxxxxxxxxxxxx
-------------------------------------
XXXXXX XXXXXXXXXXXXX
/s/ Xxxxxx X. Xxxxxxxxxxxxx
-------------------------------------
XXXXXX X. XXXXXXXXXXXXX
-00-
XXXX XXXXXX
A portion of FARM UNIT "B", FARM UNIT Plat, of Xxx 0, Xxxxxxx 0, XXX, X0X,
X&XXX&X, Xxxxxxxx Xxxxxx, Arizona, more particularly described as follows:
Beginning at the Northeast corner of said FARM UNIT "B"; thence Westerly
along the North line of said FARM UNIT "B", S 89(Degree)02'50" W, a distance of
265.81 feet; thence S 00(Degree)52'45" E, a distance of 374.66 feet to the North
line of PAPAGO PARKWAY Subdivision as recorded in Book 78 Page 12 of Maricopa
County Records; thence Easterly along the North line of said PAPAGO PARKWAY
Subdivision N 89(Degree)01'50" E, a distance of 252.50 feet to the East line of
said FARM UNIT "B"; thence along said East line N 01(Degree)09'20" E, a distance
of 374.85 feet to the Point of Beginning,
EXCEPT for previously dedicated public Right-of-Way.
ACCESS PARCEL
A portion of FARM UNIT "B", FARM UNIT Plat of Xxx 0, Xxxxxxx 0, XXX, X0X,
X&XXX&X, Xxxxxxxx Xxxxxx, Arizona, more particularly described as follows:
Beginning at the Northeast corner of said FARM UNIT "B"; thence Westerly
along the North line of said FARM UNIT "B", S 89(Degree)02'50" W, a distance of
265.81 feet; thence S 00(Degree)52'45" E, a distance of 65.00 feet to the True
Point of Beginning; thence N 89(Degree)02'50" E, a distance of 18.50 feet;
thence S 00(Degree)32'45" E, a distance of 53 feet; thence S 89(Degree)02'50" W,
a distance of 32.00 feet; thence N 00(Degree)32'45" W a distance of 53.00 feet;
thence N 89(Degree)02'50" E, a distance of 13.50 feet to the True Point of
Beginning.
LEASEHOLD IMPROVEMENTS
1 1,000 gallon motor oil tank (underground)
1 500 gallon waste oil tank (underground)
2 Stationary engine work stands (mounted in tool room)
All light fixtures (outdoor display, showroom, office, Parts Dept.)
Peg board for P+A tools
45 8 foot lights & bulbs (Shop)
2 Globe Twin Side by side post lifts drive over
2 Globe Twin side by side post lifts, drive thru
4 Globe single post lifts
1 Rotary Twin post drive on lift
1 Globe Side by Side post lift for Hunter Alignment Machine
2 Yale 2-Ton chain hoists
2 1 Beam rails for chain hoists
2 Champion upright air compressors, model W184T170BA, 5 HP
1 Exhaust scavanger system, model CP 1436, 3 HP
1 Refrigerator "Subzero", Owner's Office
Sofa (built-in) & 4 pillows (Owner's Office)
Mini blinds (8 sets, Office Bldg.)
All similar items located upon the Main Parcel on June 17, 1980.
SCHEDULE "A" (Continued)
SCHEDULE "B"
(All recording data refer to records in the office of the County Recorder of the
County in which the land is situated.)
A. The liabilities, obligations and burdens imposed upon said land by reason
of inclusion within the Salt River Project Agricultural Improvement and
Power District and Agricultural Improvement Districts.
B. TAXES AND ASSESSMENTS collectible by the County Treasurer, not yet due and
payable for the following year;
Year 1980.
EASEMENT and rights incident thereto, as set forth in instrument;
Recorded in Docket 2790
Page 560
Purpose Electric transmission lines
Affects The centerline to extend from the North
to the South boundaries of the South 180
feet of the North 375 feet of FARM UNIT
"B" along, parallel to and 180 feet West
of the East line thereof.
EASEMENT and rights incident thereto, as set forth in instrument;
Recorded in Docket 2949
Page 226
Purpose Electric transmission lines
Affects The centerline to extend from the East to
the West boundaries of the West 356 feet
of the East 386 feet of the North 375
feet of FARM UNIT "B" along, parallel to
and 158.5 feet North of the South line
thereof.
ANY ACTION that may be taken by the Department of Transportation to acquire
right of way for State Highway, as disclosed by Resolution of Intent;
Recorded in Docket 4515
Page 203.
continued
SCHEDULE B CONTINUED
FINANCING STATEMENT between;
Debtor Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx
Secured Party The Arizona Bank
Recorded November 8, 1976
Docket 11935
Page 703.
(Covers more)
EASEMENT and rights incident thereto, as set forth in instrument;
Recorded in Docket 11999
Page 000
Xxxxxxx Xxxxxxx and utility purposes
Affects The South 20 feet.
FACILITIES LEASE under the terms and conditions contained herein made by;
Lessor Chevron U.S.A. Inc.
Lessee Max of Switzerland
Dated February 23, 1977
Term 5 years
Recorded April 11, 1977
Docket 12163
Page 508;
(Affects personal property attached to the within property)
LESSORS INTEREST was collaterally assigned;
To Southland Life Insurance Company, a Texas
corporation
By Assignment dated November 7, 1979
Recorded November 8, 1979
Docket 14019
Page 122
As additional security for indebtedness secured by Deed of Trust;
Recorded in Docket 14019
Page 108;
THEREAFTER AN ATTORNMENT AGREEMENT modifying said lease was executed by the
parties named below;
Lessee Max of Switzerland, an Arizona
corporation
Lender Southland Life Insurance Company
Dated November 7, 1979
Recorded November 8, 1979
Docket 14019
Page 133;
SAID ATTORNMENT AGREEMENT among other things subordinated the
continued
Lessees interest to the lien of the instrument referred to below;
Instrument Deed of Trust
Recorded in Docket 14019
Page 108;
THEREAFTER THE LESSOR'S INTEREST was subordinated to the lien of the
instrument;
Recorded in Docket 14019
Page 108
by Subordination Agreement;
Recorded in Docket 14019
Page 141.
(Covers more)
FINANCING STATEMENT between;
Debtor Max Switzerland
Secured Party The Arizona Bank
Recorded October 4, 1977
Docket 12467
Page 1487;
THEREAFTER SUBORDINATED to the lien of the instrument;
Recorded in Docket 14019
Page 108;
By Subordination Agreement;
Recorded in Docket 14019
Page 148.
(Covers more)
SECURITY AGREEMENT between;
Debtor Max of Switzerland
Secured Party The Arizona Bank
Recorded October 4, 1977
Docket 12467
Page 1490;
THEREAFTER SUBORDINATED to the lien of the instrument;
Recorded in Docket 14019
Page 108;
By Subordination Agreement;
Recorded in Docket 14019
Page 152.
(Covers more)
EASEMENT and rights incident thereto, as set forth in instrument;
Recorded in Docket 13497
Page 306
Purpose Alley
Affects The South 10 feet.
continued
SCHEDULE B CONTINUED
DEED OF TRUST AND ASSIGNMENT OF RENTS given to secure the original amount
shown below and any other amount payable under the terms thereof;
Original amount $175,000.00
Dated April 19, 1979
Recorded May 1, 1979
Docket 13603
Page 237
Trustor Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx,
his wife
Trustee The Arizona Bank
Beneficiary The Arizona Bank;
10. continued
SAID DEED OF TRUST WAS SUBORDINATED to the lien of instrument;
Recorded November 8, 1979
Docket 14019
Page 108
By Subordination Agreement;
Recorded November 8, 1979
Docket 14019
Page 144.
(Covers more)
DEED OF TRUST AND SECURITY AGREEMENT given to secure the original amount
shown below and any other amount payable under the terms thereof;
Original amount $757,516.13
Dated November 7, 1979
Recorded November 8, 1979
Docket 14019
Page 108
Trustor Xxx Xxxxxxxx, an individual and Xxxxxxxxx
X. Xxxxxxxx, an individual
Trustee Title Insurance Company of Minnesota, a
Minnesota corporation
Beneficiary Southland Life Insurance Company, a Texas
corporation
(Covers more)
FINANCING STATEMENT between;
Debtor Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx
Secured Party Southland Life Insurance Company
Recorded November 8, 1979
Docket 14019
Page 138.
(Covers more)
Deed of Trust and Assignment of Rents to The Arizona Bank in the original
principal sum of $200,000.00, recorded in Docket 14465, page
continued
SCHEDULE B CONTINUED
145.
continued
MONTHLY RENT PAYMENT SCHEDULE
(MAXIMUM MONTHLY RENT)
Year Monthly Rent Maximum
---- --------------------
1 $10,000.00
2 $10,000.00
3 $10,000.00
4 $12,000.00
5 $12,000.00
6 $12,000.00
7 $14,400.00
8 $14,400.00
9 $14,400.00
10 $17,280.00
11 $17,280.00
12 $17,280.00
13 $20,390.00
14 $20,390.00
15 $20,390.00
16 $24,060.00
17 $24,060.00
18 $24,060.00
19 $28,391.00
20 $28,391.00
continued
6/6/85
EXHIBIT A
SUBLEASE
DATE: June 7, 1985
LESSOR: MAX OF SWITZERLAND, an Arizona corporation
LESSEE: SCOTTSDALE PORSCHE+AUDI, LTD.,
an Arizona corporation
PROPERTY: See attached Schedule "A"
THIS LEASE AGREEMENT is entered into on the date set forth above, by Lessor
and Lessee, with respect to the following described property, together with all
buildings, improvements and leasehold improvements located thereon (the
"premises" or the "leased premises"), situated in Maricopa County, Arizona;
See attached Schedule "A".
The complete agreement between the parties is as follows:
1. Term. The premises are hereby leased by Lessor to Lessee for a term
commencing on January 1, 1986 and extending
thereafter to and including December 31, 2005, provided that if Lessee becomes a
franchisee of Jaguar Cars, Inc. for the sale of Jaguar motor vehicles at 0000
Xxxx XxXxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx prior to January 1, 1986, the term shall
commence on the next business day following such becoming a franchisee. The date
on which the term commences is herein called "Commencement Date".
2. Rental.
2.01 Base Rental. Lessee agrees to pay to Lessor, as the rent for the
premises during the term hereof, the sum of $8,000.00 per month, as adjusted as
set forth in paragraph 2.02, payable on the lst day of each month during the
term hereof, commencing on the Commencement Date, without the need for demand
except as otherwise set forth herein. Rent for the first month and the last
month of the term hereof shall equal what would otherwise be the base rental for
such month multiplied by a fraction, the numerator of which is the number of
days of the term of this Lease during such month and the denominator of which is
the number of days in such month.
2.02 Two Year Cost of Living Adjustment. The monthly rent provided for
in paragraph 2.01 shall be subject to adjustment at the commencement of each
even numbered calendar year of the term of this Lease commencing 1988 ("the
adjustment date"), as set forth in this paragraph.
-2-
The base for computing the adjustment is the Consumer Price Index,
United States (All Items), published by the United States Department of Labor,
Bureau of Labor Statistics ("Index"), which is published for the month
immediately preceding the month in which the lease term commences ("Beginning
Index"). If the Index published nearest the adjustment date ("Extension Index")
has increased over the Beginning Index, the monthly rent for the following two
years (until the next rent adjustment) shall be set by multiplying the monthly
rent set forth in paragraph 2.01 by a fraction, the numerator of which is the
Extension Index and denominator of which is the Beginning Index, but in no event
shall said adjustment reduce the monthly rental below the monthly rent which
existed immediately prior to the adjustment.
The monthly rental shall not at any time be greater than that set
forth on the attached Monthly Rent Payment Schedule.
If the Index is changed so that the base differs from that used as of
the month immediately preceding the month in which the term commences, the Index
shall be converted in accordance with the conversion factor published by the
United States Department of Labor, Bureau of Labor Statistics. If the Index is
discontinued or revised during the term, such other government index or
computation with which it is replaced (or if it is not replaced, some other
comparable index or computation) shall be used in order to obtain substantially
the same result
-3-
as would be obtained if the Index had not been discontinued or revised.
3. Taxes and Impounds.
3.01 Taxes - On Rental. Lessee agrees to pay any transaction privilege
or sales tax imposed on lease rentals by the State of Arizona and the City of
Scottsdale concurrently with, and in addition to, each monthly rental payment.
If at any time during the term hereof an additional tax or excise on rents as a
form of taxation is levied upon or assessed to Lessor by any taxing authority,
and not as a part of a general income tax, Lessee will pay the same at the times
and in the manner hereinbefore provided with respect to payment of rent.
3.02 Taxes - On Property. Lessee agrees timely to pay all ad valorem
property taxes relating to the premises during the term hereof, prorated during
the period this Lease is in effect and timely to provide Lessor with proof of
payment thereof. Lessee agrees to absorb all improvement lien assessments for
public improvements on or with respect to the leased premises during the term
hereof. Lessor shall use his best efforts promptly to cause the leased premises
to be assessed separately for property taxes from other property owned by
Lessor. Until such time as the leased premises is separately assessed, ad
valorem property taxes will be allocated between the leased premises and any
other property covered by property tax bills on the basis of the square footage
of the leased premises
-4-
to the square footage of the entire property covered by the tax bills.
3.03 Impounds. During the term hereof while there exists any
encumbrance against the premises in favor of an institutional lender, and which
encumbrance requires Lessor to make impound payments to the holder of the
encumbrance for taxes or insurance, Lessee will pay such amounts to Lessor at
the times and in the manner hereinbefore provided with respect to the payment of
rent.
4. Alterations. Lessee will not, without the prior written consent of the
holder of any encumbrance upon the leased premises from whom consent is
required, make or allow to be made alterations, improvements or additions to the
leased premises or raze any improvements on the leased premises, provided such
improvements are made in accordance with the requirements of all applicable
governing bodies. Lessor will use its best efforts to assist in obtaining such
approvals. Any such alterations, improvements or additions made will become a
part of the leased premises, subject to the terms hereof, and will be the
property of Lessor.
5. Trade Fixtures. Lessee, at its expense and subject to other provisions
set forth or incorporated herein, may install any necessary trade fixtures,
equipment and furniture which will remain Lessee's property and will be removed
at the
-5-
end of this Lease. Lessee at its expense will repair all damage caused by such
installation or removal.
6. Maintenance.
6.01 Maintenance - By Lessee. Lessee at its expense will maintain in
good order and repair all portions of the leased premises which are not the
obligation of Lessor, including without limitation: walls (painting the same as
often as necessary); partitions; floor structures; pipes and conduits; roof;
utility installations; air conditioning and heating equipment, after any
warranties on such equipment have expired; asphalt and concrete floors; and all
glass and glasing. Lessee at its expense will also make all repairs of every
kind and character to the interior of the leased premises. On the last day of
the term hereof, Lessee will surrender the leased premises to Lessor in a state
of good repair, excepting only reasonable wear and tear, obsolescence, damage by
fire, act of God or the elements and damages which Lessor is required to repair
hereunder.
6.02 Maintenance By Lessor. Lessor will have no obligation to maintain
or repair any portion of the leased premises.
6.03 Current Condition. Lessor makes no warranties with respect to the
condition, repair or operating condition of any portions of the leased premises,
and Lessee accepts the leased premises "AS IS" with respect to their
-6-
quality. Lessor represents and warrants that the buildings, improvements and
leasehold improvements which will be located upon the property described in
Schedule "A" on the commencement of the term hereof are the same buildings,
improvements and leasehold improvements which are located upon said property on
the date hereof, plus any additions thereto subsequent to the date hereof.
7. Utilities. Lessee will pay for all water, gas, electricity and other
utilities, including those required for the operation of air conditioning and
heating equipment used by Lessee on the leased premises.
8. Inspection by Lessor. Lessor may go upon the leased premises at all
reasonable times for the purposes of inspecting the same, or for the purpose of
inspecting the performance by Lessee of the terms and conditions hereof, or for
the purpose of constructing, maintaining and repairing the leased premises
pursuant to the terms hereof.
9. Liens. Except for such as it may be contesting in good faith, Lessee
will promptly pay and discharge all claims for work or labor done, supplies
furnished or services rendered at the request of Lessee and will keep the leased
premises free and clear of all mechanics' liens and materialmen's liens in
connection therewith.
10. Insurance Clause. Lessor and Lessee agree that no insurer of any
interest of either is to have any right of
-7-
subrogation against the other and that all fire and other insurance policies
carried by the other on the leased premises or the fixtures and equipment
therein or other contents thereof will contain a full waiver of subrogation by
the insurer against the other and its assigns.
11. Damage to Lessee's Fixtures. Lessee agrees that it will assume the risk
of damage to any fixtures installed by or at the expense of Lessee in the leased
premises, title to which is retained by Lessee hereunder, from every source
other than damage (i) caused by the negligence or willful misconduct of Lessor,
its agents or contractors, or (ii) resulting by reason of any breach of any of
Lessor's obligations under this Lease.
12. Insurance.
12.01 Public Liability - Insurance. Lessee at its expense will
maintain in full force during the term hereof public liability and property
damage insurance covering the leased premises and Lessee's activities' therein
against claims for personal injury and death to limits of at least $500,000 for
each person and $1,000,000 for each occurrence and against property damage
claims to a limit of at least $100,000 or in such greater amounts as may be
required by an institutional lender who holds a first encumbrance against the
premises. Lessee will furnish to Lessor a certificate evidencing the fact that
such insurance has been obtained and is in full force and effect, that Lessor
and any such institutional lender are additional insureds
-8-
thereunder, and that such insurance cannot be cancelled without ten days' prior
notice to Lessor and any such institutional lender.
12.02 Public Liability - Indemnity. Lessee will hold harmless and
indemnify Lessor from and against any and all loss, cost or damage arising by
reason of injury or death of persons or damage to property in or upon the leased
premises or caused by activities conducted thereon; provided, however, that
Lessee will not be required to indemnify Lessor against any damage or injury of
any kind arising out of the negligence of Lessor, its agents or employees.
12.03 Fire Insurance. Lessee at its expense will maintain in full
force and effect during the term hereof fire and extended coverage insurance
upon the leased premises in an amount not less than the replacement cost thereof
or such greater amount as may be required by an institutional lender who holds
an encumbrance against the premises. Lessee will furnish to Lessor a certificate
evidencing the fact that such insurance has been obtained and is in full force
and effect, that Lessor and any such institutional lender are additional
insureds thereunder, and that such insurance cannot be cancelled without ten
days' prior notice to Lessor and any such institutional lender.
12.04 Insurance Adjustments. On approximately each fifth annual
anniversary of the commencement date hereof,
-9-
Lessor shall meet with Lessee to consider the adequacy of the required minimum
limits for public liability insurance and fire and extended coverage insurance.
If such limits are not adequate based upon changes which have occurred in the
economy since the commencement of the term hereof, such limits shall be adjusted
so that the limits are then adequate. Lessor and Lessee shall act reasonably in
making such determination.
13. Damage and Destruction of Premises. In the event of damage or
destruction to the premises which is covered by insurance, unless required
otherwise by an institutional lender who holds an encumbrance against the
premises, the insurance proceeds shall be used for the repair and reconstruction
of such damage and the parties shall promptly repair and/or reconstruct the
premises and the interior improvements to their condition immediately prior to
the damage or destruction. This Lease shall continue in full force and effect in
the event of such damage and reconstruction. In the event the premises are
damaged by a cause not covered by the fire and extended coverage insurance
carried on the premises, Lessor shall reconstruct the premises to the extent of
the construction at the commencement hereof; provided however, if such uninsured
loss exceeds 33% of the then replacement cost of the building, Lessor shall have
the option of terminating this Lease by written notice to Lessee, within thirty
(30) days of such damage or destruction, in which event this Lease shall
terminate as of the date of the damage or destruction. Should Lessor not elect
to so terminate the Lease,
-10-
it shall proceed with due dispatch to reconstruct the premises to the extent of
the construction at the commencement hereof, in which event this Lease shall
continue in full force and effect. In the event Lessor elects to terminate this
Lease, all rentals and other payments shall be prorated as of the date of
termination. If Lessor and Lessee are not able to agree if the uninsured loss
exceeds 33% of the then replacement cost of the building, the question shall be
resolved by the procedure set forth in paragraph 14.06.
14. Condemnation.
14.01 Total Condemnation of Leased Premises. If the whole of the
leased premises shall be acquired or condemned by eminent domain for any public
or quasi-public use or purpose, then the term of this Lease shall cease and
terminate as of the date of title vesting in such proceeding, and all rentals
shall be paid up to date and Lessee shall have no claim against Lessor or the
condemning authority for the value of any unexpired term of this Lease.
14.02 Partial Condemnation. If any part of the leased premises shall
be acquired or condemned as aforesaid, and in the event that such partial taking
or condemnation shall render the leased premises unsuitable for business of the
Lessee, then the term of this Lease shall cease and terminate as of the date of
title vesting in such proceeding. Lessee shall have no claim against Lessor nor
the condemning authority for the value
-11-
of any unexpired term of this Lease, and rent shall be adjusted to the date of
such termination. In the event of a partial taking or condemnation which is not
extensive enough to render the premises unsuitable for the business of the
Lessee, then Lessor shall promptly restore the leased premises to a condition
comparable to its condition at the time of such condemnation, less the portion
lost in the taking, and this Lease shall continue in full force and effect with
an adjustment in rent based upon the square footage of the leased premises taken
to the square footage of the leased premises prior to the taking. If Lessor and
Lessee are not able to agree whether the partial taking or condemnation has
rendered the leased premises unsuitable for the business of Lessee, the question
shall be resolved by the procedure set forth in paragraph 14.06.
14.03 Lessor's Damages. In the event of any condemnation or taking as
aforesaid, whether whole or partial, the Lessee shall not be entitled to any
part of the award paid for such condemnation, and Lessor shall receive the full
amount of such award, Lessee hereby expressly waiving any right to or claim to
any part thereof.
14.04 Lessee's Damages. Although all damages in the event of any
condemnation for diminution in value of the leasehold or to the fee of the
leased premises shall belong to Lessor, Lessee shall have the right to claim and
recover from the condemning authority, but not from Lessor, such compensation as
may be separately awarded or recoverable by Lessee in Lessee's
-12-
own right on account of any and all damage to Lessee's business by reason of the
condemnation and for or on account of any cost or loss to which Lessee might be
put in removing Lessee's merchandise, furniture, fixtures, leasehold
improvements and equipment.
14.05 Notice and Execution. Lessor agrees, immediately upon service of
process in connection with any appropriation or taking, to give to Lessee notice
in writing thereof. Lessee agrees to execute and deliver to the Lessor all
instruments that may be required to effectuate the provisions of this paragraph.
14.06 Resolution of Certain Disputes. In the event Lessor and Lessee
are unable to agree upon certain matters set forth in paragraphs 13, 14.02 or
34, Lessor and Lessee shall jointly appoint an arbitrator to decide the
question, or if Lessor and Lessee are unable to jointly agree upon an
arbitrator, Lessor or Lessee at any time by written notice to the other may
appoint an arbitrator, and the other party within five (5) days thereafter by
written notice to the first party may appoint an arbitrator. The arbitrator or
arbitrators so selected shall decide the question and give notice to Lessor and
Lessee thereof within five (5) business days after appointment. If there are two
arbitrators who are unable to agree, either arbitrator may request the presiding
judge of the Maricopa County Superior Court to appoint a third arbitrator and
the decision of a majority of the arbitrators, which shall be made and given to
Lessor and
-13-
Lessee within five (5) business days after appointment of the third arbitrator,
shall be binding upon Lessor and Lessee. If Lessor or Lessee fails to timely
designate an arbitrator, the decision shall be made by the arbitrator appointed
by the other party. The decision as determined by arbitration shall be binding
upon the parties. The costs of arbitration shall be borne equally by Lessor and
Lessee.
15. Default.
15.01 Default - Grounds. The failure to pay any monetary amount due
and payable hereunder upon the date when such payment is due, such failure
continuing for a period of fifteen days after written notice of such default,
shall constitute an event of default on the part of Lessee. The occurrence of
any of the following events will constitute an event of default by either party
hereunder: (i) default in the performance of any of such party's agreements or
obligations hereunder, such default continuing for thirty days after written
notice thereof from the non-defaulting party to the defaulting party, provided
that if such default cannot reasonably be cured within such thirty day period,
then the defaulting party will not be in default hereunder if it, within such
thirty day period, commences curing of such default and diligently and in good
faith prosecutes the same; (ii) a general assignment by a party for the benefit
of creditors; (iii) the filing of a voluntary petition in bankruptcy by a party
or the filing of an involuntary petition by a party's creditors, such
involuntary petition remaining undischarged for a
-14-
period of thirty days; (iv) the appointment of a receiver to take possession of
substantially all of a party's assets or of this leasehold, such receivership
remaining undissolved for a period of thirty days; or (v) attachment, execution
or other judicial seizure of substantially all of a party's assets or this
leasehold, such attachment, execution or other seizure remaining undismissed or
undischarged for a period of thirty days after the levy thereof.
15.02 Default - Remedies. Upon the happening of any such event of
default on the part of Lessee, Lessor, at any time thereafter, and prior to the
curing of such default, may: (i) with or without notice or demand declare the
term hereof ended and re-enter the leased premises or any part thereof (with or
without process of law) and expel or remove therefrom Lessee and all parties
occupying the same or any of them, using such force as may be necessary to do
so, and again repossess and enjoy the same without prejudice to any remedies
that Lessor might otherwise have by reason of such default; or (ii) re-enter the
leased premises at its option, without declaring the lease term ended, and relet
the whole or any part thereof for the account of Lessee on such terms and
conditions and at such rent as may then prevail for comparable property,
collecting such rent and applying it on the amount due from Lessee hereunder and
on the expense of reletting and on any other damage or expense so sustained by
Lessor, or on any such item or items, recovering from Lessee the difference
between the proceeds of such reletting
-15-
and the amount of the rentals reserved hereunder, which sum Lessee agrees to pay
upon demand. Should Lessor terminate this lease by reason of any such default by
Lessee, Lessor may thereupon recover from Lessee the worth, at the time of such
termination, of the excess, if any, of the amount of rent and charges equivalent
to rent reserved herein for the balance of the term over the then reasonable
rental value of the leased premises for the same period. Lessor will not, by any
re-entry or other act, be deemed to have terminated this lease, or the liability
of Lessee for the total rent hereunder or any installment thereof then due or
thereafter accruing or for damages, unless Lessor notifies Lessee in writing
that Lessor has so elected to terminate the lease. In addition to the foregoing
remedies, Lessor may rectify any defaults of Lessee and add to the rent to be
paid hereunder, and to any installment or installments thereof thereafter
becoming due. If any installment of rent or any other payment is not paid
promptly when due it will bear interest at 18% per annum from the date on which
it becomes due until paid, but this provision is not intended to relieve Lessee
from any default in the making of any payment at the time and in the manner
herein specified. The foregoing interest, expenses and damages will be
recoverable from Lessee by the exercise of Lessor's remedies hereinabove set
forth. The remedies of Lessor specified herein will be cumulative as to each
default to the extent allowed by law.
-16-
Upon the happening of any such event of default by Lessor, Lessee, at
any time thereafter, and prior to the curing of such default, may: (i) declare
the term hereof ended; (ii) xxx Xxxxxx for damages; (iii) xxx Xxxxxx for
specific performance; or (iv) exercise any of the rights or remedies as may be
allowed by law or equity. The remedies of Lessee specified herein will be
cumulative as to each default to the extent allowed by law.
16. Holding Over. In the event of any holding over with the consent of
Lessor beyond the end of the term hereof, this Lease will be deemed a monthly
tenancy upon the agreements herein contained and Lessee will pay a monthly
rental at the rate most recently payable by it pursuant to Section 2 above, in
advance at the beginning of each heldover month, plus any other charges or
payments contemplated in this lease.
17. Compliance with Laws. Lessee will comply with all governmental laws,
ordinances, rules and regulations at any time applicable to Lessee's use and
occupancy of the leased premises. Lessee will have the right, however, to
contest any such law, ordinance, rule or regulation by appropriate legal action,
provided that such contest is conducted without expense or prejudice to Lessor.
18. Statement from Lessee. Lessee will at any time and from time to time
within twenty days after written request by Lessor execute, acknowledge and
deliver to Lessor a written statement certifying that this Lease is unmodified
and in full
-17-
force and effect if such is the fact (or, if there has been any modification
thereof, stating the modifications) and the dates to which the rentals and other
charges have been paid in advance, if any. It is understood that any such
statement may be relied upon by any prospective purchaser of the estate of
Lessor, or by the mortgage or assignee of any mortgage or the trustee or
beneficiary of any deed of trust constituting a lien upon the leased premises.
19. Notices. All notices required to be given hereunder are to be in
writing. Such notices will be personally delivered or sent by United States
certified mail, postage prepaid, addressed to Lessor at 0000 Xxxx XxXxxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxx 00000, and to Lessee at 0000 Xxxx XxXxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxx 00000, or at such other place as respective addressee may have
designated in a written notice to the other party. Service by delivery will be
deemed to occur on delivery and service by mail will be deemed to occur on the
delivery date shown on the return receipt.
20. Waiver. No waiver of any default by either party hereunder will be
implied from any omission by either party to take action on account of such
default if such default persists or is repeated, and no express waiver will
affect any default other than the default specified in the waiver, and then such
waiver will be operative only for the time and to the extent therein stated. A
waiver by either party of any provision hereof will not be construed as a waiver
of any subsequent breach of the
-18-
same provision, nor will the consent or approval by either party to or of any
act by the other be deemed to waive or render unnecessary its consent or
approval to or of any subsequent similar acts.
21. Access Parcel. During the term hereof Lessee shall have use of the
Access Parcel for the purpose of passage of vehicles and persons, and for such
other purposes as may be acceptable to the party then entitled to possession of
the property immediately east of the leased premises. During the term hereof
Lessor shall have no right to the use of the Access Parcel.
22. Complete Agreement. It is expressly agreed that the provisions of this
Lease cannot be altered, changed, modified or added to except in writing signed
by the parties hereto.
23. Time. Time is of the essence hereof.
24. Short-form Lease. Upon request of either party, Lessor or Lessee will
both execute and acknowledge a short-form lease for purposes of recording, which
short-form lease will describe the premises as being subject to the rights,
agreements and restrictions contained herein and the term hereof.
25. Assignment and Subletting. Lessee may not assign this Lease or any
interest herein, or sublet the leased premises or any portion thereof, without
the prior written consent of Lessor, which consent will not be unreasonably
withheld. Lessor
-19-
hereby consents to an assignment by Lessee to an affiliate of or related party
to Lessee or a stockholder thereof or a spouse or lineal descendent thereof or a
trust, estate, partnership, corporation or entity with respect to which the
principal beneficiaries or beneficial owners are such stockholders, spouses or
lineal descendents, or their parents, brothers, sisters, uncles, aunts or
cousins. Any assignment or subletting prohibited hereunder without the consent
of Lessor will be void. The assignee under any such assignment must agree to
perform all of Lessee's obligations hereunder, but no such assignment will have
the effect of relieving Lessee of its primary liability for the performance of
all of its said obligations.
26. There is none.
27. Applicable Law. This Lease shall be construed under the laws of the
State of Arizona.
28. Attorney's Fees. In the event of any action at law or in equity between
Lessor and Lessee to enforce any of the provisions or rights hereunder, the
unsuccessful party to such litigation covenants and agrees to pay the successful
party all costs and expenses, including reasonable attorneys' fees incurred
therein by said successful party, and if said successful party shall recover
judgment in any such action or proceeding, such costs, expenses and attorneys'
fees shall be included in and made a part of such judgment. Should Lessor,
without fault, be made a party to any litigation instituted by or against
Lessee, Lessee
-20-
covenants and agrees to pay Lessor all costs and expenses, including reasonable
attorneys' fees incurred by Lessor in connection with such litigation. Should
Lessee, without fault, be made a party to any litigation instituted by or
against Lessor, Lessor covenants and agrees to pay Lessee all costs and
expenses, including reasonable attorneys' fees incurred by Lessee in connection
with such litigation.
29. Address, Quiet Enjoyment and Condition of Title. Lessor covenants and
warrants that the leased premises has a street address of 0000 Xxxx XxXxxxxx,
Xxxxxxxxxx, Xxxxxxx 00000, that the leased premises constitutes the property
upon which the business of Max of Switzerland is being conducted on the date
hereof and that the leased premises is all of the property lying north of the
south line of the leased premises and west of the center line of the wall and
west of the center line of the wall as extended north to XxXxxxxx Road (the wall
being that certain wall which divides the businesses of Scottsdale Porsche+Audi,
Ltd. and Max of Switzerland on the date hereof). Lessor covenants and agrees
that Lessee, so long as it shall not be in default hereunder, shall peacefully
and quietly hold, occupy and enjoy the premises during the term of this Lease.
Lessor covenants and warrants that the leased premises are free and clear of all
liens, encumbrances and adverse claims except, second half 1984 taxes, 1985
taxes and liens, encumbrances and adverse claims in favor of Southland Life
Insurance Company and The Arizona Bank.
-21-
30. Rights of First Refusal. At any time prior to fifty-five days following
the expiration of the term of this Lease, Lessor shall not sell or contract to
sell less than all of the leased premises. At any time prior to fifty-five days
following the expiration of the term of this Lease, Lessor shall not sell or
contract to sell all of the leased premises unless the premises is first offered
to Lessee for the same price, and upon the same terms and conditions as to which
Lessor proposes to sell or transfer the premises to the third party. Lessor must
give Lessee written notice setting forth the name and address of the proposed
purchaser and the price, terms and conditions of any bona fide offer by or to
Lessor under which Lessor proposes to sell or transfer the premises. Within the
thirty day period following Lessee's receipt of such notice, or within sixty
days following the expiration of the term of the Lease, whichever first occurs,
Lessee by written notice to Lessor may elect to purchase the premises, for the
same price and upon the same terms as the offer. It Lessee does not elect to
purchase the premises, Lessor may then sell the premises to the third party
named in Lessor's notice to Lessee, for the price and upon the terms therein
stated. If the escrow is not closed for the price and upon the terms and
conditions contained in the notice, then Lessor may not thereafter, at any time
prior to fifty-five days following the expiration of the term of this Lease,
sell the premises to any party other than Lessee without first offering the
premises to Lessee in the manner set forth in this paragraph. The provisions of
this paragraph shall have no application to a
-22-
transfer of the premises or any portion thereof, by gift or in any other manner,
by Lessor to his spouse, to any of his lineal descendants or spouses of lineal
descendants (through natural birth or legal adoption), to a corporation or
partnership, the majority voting interest of which is owned by Lessor, or to a
trust, all of the beneficial interest of which is owned by one, some or all of
the foregoing permitted transferees.
At any time prior to fifty-five days following the expiration of the term
of this Lease, Lessor shall not lease or contract to lease all or any portion of
the leased premises unless same is first offered to Lessee for the period
following the expiration of the term of this Lease, upon the same lease terms
and conditions as to which Lessor proposes to lease same to the third party.
Lessor must give Lessee written notice setting forth the name and address of the
proposed lessee and the terms and conditions of any bona fide offer by or to
Lessor under which Lessor proposes to lease the premises. Within the thirty day
period following Lessee's receipt of such notice, or within sixty days following
the expiration of the term of the Lease, whichever first occurs, Lessee by
written notice to Lessor may elect to lease the premises, upon the same terms as
the offer. If Lessee does not elect to lease the premises, Lessor may then lease
the premises to the third party named in Lessor's notice to Lessee, upon the
terms therein stated. If the lease is not executed upon the terms and conditions
contained in the notice, then Lessor may not thereafter, at any time prior to
fifty-five days following the expiration of the term of this Lease, lease the
premises to
-23-
any party other than Lessee without first offering the premises to Lessee in the
manner set forth in this paragraph.
The name of the proposed purchaser or lessee shall be kept confidential by
Lessee, and Lessee shall not take any action which would jeopardize the proposed
sale or lease, other than to exercise Lessee's right to purchase or lease
pursuant to this paragraph 30.
31. Other Agreement and Cross Default. Xxx Xxxxxxxx and Lessee are
simultaneously herewith executing a Consulting and Non-Compete Agreement. An
event of default by a party under said Consulting and Non-Compete Agreement
shall also constitute an event of default under this Lease in the same manner as
if an event of default had occurred directly under this Lease.
32. There is none.
33. Option to Extend. By written notice to Lessor given not later than
December 31, 2004, and provided Lessee is not then in default hereunder, Lessee
shall have the right to extend the term hereof for an additional period of five
(5) years commencing January 1, 2006. All of the terms and provisions hereof
shall be applicable during the renewal term, except that a cost of living
adjustment shall be made in accordance with paragraph 2.02 hereof at the
commencement of the two year period beginning January 1, 2006, at the
commencement of the two year period beginning January 1, 2008, and at the
commencement of the one year period beginning January 1, 2010, and provided that
the
-24-
monthly rental shall not at any time be greater than that set forth on the
attached Monthly Rent Payment Schedule.
34. Option to Purchase. If the original term or renewal term of this Lease
is then in effect and Lessee is not then in default hereunder, Lessee shall have
the right to purchase the premises, exercisable by giving written notice to
Lessor at least one (1) year prior to the end of the original term of this Lease
or at any time during the renewal term of this Lease for a purchase price equal
to 100 times the last monthly base rental in effect prior to the close of the
escrow hereinafter described, which purchase price shall be paid in full in cash
at the close of escrow. Notwithstanding the foregoing, if the written notice is
given during the original term, the amount which the monthly base rental would
have been during January, 2006 had there been a cost of living adjustment as of
January 1, 2006 shall be calculated (with the January, 2006 figure not being
greater than 233.33% of the base rental in years 1 and 2), and the purchase
price shall equal 100 times such amount.
Within fifteen (15) days after the date of such notice, an escrow shall be
opened with the title insurance company ("Escrow Agent") designated by Lessee in
such notice. Such escrow shall close not later than sixty (60) days after the
opening of same; provided, however, if Lessee exercises such option during the
original term hereof, the close of escrow shall occur on January 31, 2006, and
if Lessee exercises such option
-25-
during the renewal term hereof, the close of escrow shall occur not earlier than
thirty (30) days after the date of such notice. Lessee is not then in default,
Lessee shall be entitled to copy the leased premises pursuant to the terms
hereof at the rental then in effect until the close of escrow.
Escrow Agent, within ten (10) days after the opening of escrow, shall
deliver to Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx (the "Haechlers") and to
Lessee a preliminary title report or commitment for a standard owner's title
insurance policy (herein "Preliminary Report") to insure fee simple title in
Lessee as to the premises, under which the insured is Lessee and in the amount
of the purchase price. In addition to the Preliminary Report, Escrow Agent shall
simultaneously deliver to Lessee copies of all documents identified in Part 2 of
Schedule B of the Preliminary Report and in the Requirements Section of the
Preliminary Report. At any time prior to the scheduled close of escrow, Lessee
shall have the right to notify Escrow Agent and the Haechlers in writing of any
defect in the title of the premises and if the Haechlers do not cause such
defect to be eliminated or agreed to be insured over within ten (10) days of
receipt of notice of such defect, Lessee, at its option, shall be entitled to
cancel the escrow, or accept title in its then condition in which event the
expense of eliminating such defects and the amount of any such defects which are
not eliminated shall be treated as credits to Lessee and applied against the
purchase price. A defect in title
-26-
for purposes hereof shall be any condition then customarily deemed in Maricopa
County, Arizona to render the premises unmarketable. If Lessor and Lessee are
not able to agree as to whether an item constitutes a defect in title, the
question shall be resolved by the procedure set forth in paragraph 14.06. At
close of escrow, the Haechlers shall provide to Lessee a standard coverage
owner's title insurance policy which shall show as exceptions no items other
than those permitted by Lessee according to the terms hereof, and shall be in
the form of the standard coverage owner's title insurance policy usually then
issued by the title insurer for Escrow Agent. At close of escrow, the Haechlers
shall execute a Warranty Deed to be recorded at close of escrow which shall
warrant title subject only to those exceptions permitted by Lessee pursuant to
the terms hereof.
35. Prime Lease. Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx will timely pay and
perform all obligations of the lessor under that certain Net Lease, dated
September 14, 1979, between Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx as lessor and
Lessor as lessee ("Prime Lease"), and Lessor will timely pay and perform all
obligations of the lessee under the Prime Lease. Lessor will not declare a
breach or forfeiture by the lessor under the Prime Lease, will not advise the
lessor under the Prime Lease of any default by the lessor thereunder and will
not perform any act which would give Southland Life Insurance Company the right
to declare a default under any documents relating to
-27-
the property which is the subject of the Sublease. The Prime Lease may not be
amended without the prior written consent of Lessee.
36. Subordination. Lessee shall have the right during the original term and
renewal term of this Lease to obtain construction loans, the proceeds of which
shall be used only for alterations, improvements and additions to be built upon
the premises. For this purpose, Lessee may subject the premises to a lien and
Lessor and Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx covenant and agree to join
with Lessee in the execution and delivery of such instruments as may be
reasonably required to evidence the subordination of the premises to such lien.
Such mortgage, deed of trust or other security instrument shall constitute a
lien on the premises as well as the buildings and improvements erected thereon
by Lessee, which shall be senior and superior to the interests of Lessor and Xxx
Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx therein.
37. Benefit and Burden. The rights, duties and obligations created
hereunder shall inure to the benefit of and be binding upon the parties hereto,
their heirs, personal representatives, successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the
date indicated on the first page.
LESSOR: LESSEE:
-28-
MAX OF SWITZERLAND SCOTTSDALE PORSCHE+AUDI, LTD.
By /s/ Xxx Xxxxxxxx By /s/ Xxxxxxxxxxxxx
---------------------------- --------------------------------
Xxx Xxxxxxxx, President Xxxxxx Xxxxxxxxxxxxx, Chairman
-29-
STATE OF ARIZONA )
: SS.
County of Maricopa )
On this, the 7 day of June, 1985, before me, the undersigned officer,
personally appeared XXX XXXXXXXX who acknowledged himself to be the President of
MAX OF SWITZERLAND, and that he, as such officer, being authorized so to do,
executed the foregoing instrument for the purposes therein contained by signing
the name of the corporation by himself as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ (Illegible)
----------------------------------
NOTARY PUBLIC
My Commission Expires:
My Commission Expires Mar. 25, 1989
-----------------------------------
STATE OF ARIZONA )
: SS.
County of Maricopa )
On this, the 7 day of June, 1985, before me, the undersigned officer,
personally appeared XXXXXX XXXXXXXXXXXXX who acknowledged himself to be the
Chairman of SCOTTSDALE PORSCHE+AUDI, LTD., and that he, as such officer, being
authorized so to do, executed the foregoing instrument for the purposes therein
contained by signing the name of the corporation by himself as such officer.
continued
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ (Illegible)
----------------------------------
NOTARY PUBLIC
My Commission Expires:
My Commission Expires Mar. 25, 1989
-----------------------------------
-2-
MONTHLY RENT PAYMENT SCHEDULE
(Maximum Monthly Rent)
Monthly Rent Maximum
(the following percentage
of the base rental in
Calendar Years years 1 and 2)
-------------- --------------
3-4 113.33%
5-6 126.67%
7-8 140.00%
9-10 153.33%
11-12 166.67%
13-14 180.00%
15-16 193.33%
17-18 206.67%
19-20 220.00%
Option years 1-2 233.33%
Option years 3-4 246.67%
-3-
Option year 5 260.00%
-4-
6/6/85
AMENDMENT TO SUBLEASE
DATE: June 7, 1985
LESSOR: MAX OF SWITZERLAND, an Arizona corporation
LESSEE: SCOTTSDALE PORSCHE+AUDI, LTD., an Arizona corporation
RECITALS:
Lessor and Lessee entered into a certain Sublease and various letter
amendments thereto, all dated August 11, 1980 (collectively "Sublease") and are
desirous of amending the Sublease on the terms hereinafter set forth.
The parties hereto agree as follows:
I
Paragraph 30 of the Sublease is amended by adding at the end thereof the
following: "Notwithstanding anything in this paragraph 30 to the contrary, the
rights of first refusal set forth in this paragraph 30 shall terminate on August
12, 1998 if prior to that date Lessee has not given written notice to Lessor
that Lessee elects to extend the term hereof pursuant to paragraph 33 hereof."
II
Paragraph 33 of the Sublease is amended in its entirety to read as follows:
"33. Option to Extend. By written notice to Lessor given not later
than August 11, 1998, and provided Lessee is not then in default hereunder,
Lessee shall have the right to extend the term hereof for an additional
period of five (5) years commencing August 11, 2000. All of the terms and
provisions hereof shall be applicable during the renewal term, except that
a cost of living adjustment shall be made in accordance with paragraph 2.02
hereof (except at two year intervals) at the commencement of the renewal
term for the first two years of the renewal term, at the commencement of
the third year of the renewal term for years 3-4 of the renewal term and at
the commencement of the fifth year of the renewal term for year 5 of the
renewal term, and provided that the monthly rental shall not at any time be
greater than that set forth on the attached Extension Term Monthly Rent
Payment Schedule."
III
The Sublease is amended by adding thereto the following paragraph 35:
"35. Subordination.
With the prior written consent of Lessor (which Lessor will not
unreasonably withhold), Lessee shall have the right during the original
term and renewal term of this Lease to obtain construction loans, the
proceeds of which shall be used only for alterations, improvements and
additions to be built upon the premises. For this purpose, Lessee may
subject the
2
premises to a lien and Lessor and Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx
covenant and agree to join with Lessee in the execution and delivery of
such instruments as may be reasonably required to evidence the
subordination of the premises to such lien. Such mortgage, deed of trust or
other security instrument shall constitute a lien on the premises as well
as the buildings and improvements erected thereon by Lessee, which shall be
senior and superior to the interests of Lessor and Xxx Xxxxxxxx and
Xxxxxxxxx X. Xxxxxxxx therein."
IV
The Sublease shall remain in full force and effect, as amended hereby.
V
The rights, duties and obligations created hereunder shall inure to the
benefit of and be binding upon the parties hereto, their heirs, personal
representatives, successors and assigns.
3
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to
Sublease as of the date indicated on the first page.
LESSOR: LESSEE:
MAX OF SWITZERLAND SCOTTSDALE PORSCHE+AUDI, LTD.
By /s/ Xxx Xxxxxxxx By /s/ Stseven Xxxxxxxxxxxxx
---------------------------- ---------------------------------
Xxx Xxxxxxxx, President Xxxxxx Xxxxxxxxxxxxx,
Chairman
STATE OF ARIZONA )
: ss.
County of Maricopa )
On this, the 7 day of June, 1985, before me, the undersigned officer,
personally appeared XXX XXXXXXXX who acknowledged himself to be the President of
MAX OF SWITZERLAND, and that he, as such officer, being authorized so to do,
executed the foregoing instrument for the purposes therein contained by signing
the name of the corporation by himself as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Xxxxx Xxxxxxxxx
------------------------------------
NOTARY PUBLIC
My Commission Expires:
My Commission Expires Mar. 25, 1989
-----------------------------------
4
STATE OF ARIZONA )
: ss.
County of Maricopa )
On this, the 7 day of June, 1985, before me, the undersigned officer,
personally appeared XXXXXX XXXXXXXXXXXXX who acknowledged himself to be the
Chairman of SCOTTSDALE PORSCHE+AUDI, LTD., and that he, as such officer, being
authorized so to do, executed the foregoing instrument for the purposes therein
contained by signing the name of the corporation by himself as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Xxxxx Xxxxxxxxx
------------------------------------
NOTARY PUBLIC
My Commission Expires:
My Commission Expires Mar. 25, 1989
-----------------------------------
CONSENT
The undersigned guarantors hereby consent to the foregoing Amendment to
Sublease.
DATED this 7 day of June, 1985
/s/ Xxxxxx Xxxxxxxxxxxxx
------------------------------------
Xxxxxx Xxxxxxxxxxxxx
/s/ Xxxxxx X. Xxxxxxxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxxxxxxx
5
/s/ Xxx Xxxxxxxx
------------------------------------
Xxx Xxxxxxxx
/s/ Xxxxxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxxxxx X. Xxxxxxxx
6
EXTENSION TERM MONTHLY
RENT PAYMENT SCHEDULE
(Maximum Monthly Rent)
Monthly Rent Maximum
(the following
percentage of the base
rental in year 1 of the
Option Years base term)
------------ -----------------------
1-2 297.24%
3-4 310.58%
5 323.91%
NON-DISTURBANCE AGREEMENT
THIS AGREEMENT entered into this 7 day of June, 1985, between XXX XXXXXXXX
and XXXXXXXXX X. XXXXXXXX ("Lessor") and SCOTTSDALE PORSCHE+AUDI, LTD., an
Arizona corporation ('Sublessee"),
W I T N E S S E T H:
WHEREAS, Lessor is the owner of certain property described on Exhibit A
attached hereto,
WHEREAS, Lessor and MAX OF SWITZERLAND, an Arizona corporation
("Sublessor") entered into a certain Lease of the property described in Exhibit
A, dated September 14, 1979 ("Prime Lease") in which Lessor is lessor and
Sublessor is lessee, and
WHEREAS, Sublessor and Sublessee have entered into a certain Sublease with
respect to a portion of the property described on Exhibit A, dated June 7, 1985,
NOW, THEREFORE, it is mutually agreed as follows:
I
As an inducement to Sublessee to execute said Sublease, Lessor agrees that
Lessor, its successors and assigns, will not
disturb the possession of Sublessee under said Sublease as a result of any
default by Sublessor under the Prime Lease and that Lessor will hold
Sublessee in quiet enjoyment of the premises described in the Sublease
under the terms of the Sublease so long as Sublessee shall not be in
default under the terms of the Sublease.
II
Lessor consents to the Sublease between Sublessor and Sublessee.
III
The rights, duties and obligations created hereunder shall inure to the
benefit of and be binding upon the parties hereto, their heirs, personal
representatives, successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Non-Disturbance
Agreement the day and year first above written.
LESSOR:
/s/ Xxx Xxxxxxxx
---------------------------------
Xxx Xxxxxxxx
-2-
/s/ Xxxxxxxxx X. Xxxxxxxx
---------------------------------
Xxxxxxxxx X. Xxxxxxxx
SUBLESSEE:
SCOTTSDALE PORSCHE+AUDI, LTD.
By /s/ Xxxxxx Xxxxxxxxxxxxx
------------------------------
Xxxxxx Xxxxxxxxxxxxx, Chairman
-3-
STATE OF ARIZONA )
: ss.
County of Maricopa )
On this, the 7 day of June, 1985, before me, the undersigned officer,
personally appeared XXX XXXXXXXX and XXXXXXXXX X. XXXXXXXX, known to me to be
the persons whose names are subscribed to the within instrument and acknowledged
that they executed the same for the purposes therein contained.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Xxxxx Xxxxxxxxx
--------------------------------
NOTARY PUBLIC
My Commission Expires:
My Commission Expires Mar. 25, 1989
-----------------------------------
STATE OF ARIZONA )
: ss.
County of Maricopa )
-4-
On this, the 7 day of June, 1985, before me, the undersigned officer,
personally appeared XXXXXX XXXXXXXXXXXXX who acknowledged himself to be the
Chairman of SCOTTSDALE PORSCHE+AUDI, LTD., and that he, as such officer, being
authorized so to do, executed the foregoing instrument for the purposes therein
contained by signing the name of the corporation by himself as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ Xxxxx Xxxxxxxxx
--------------------------------
NOTARY PUBLIC
My Commission Expires:
My Commission Expires Mar. 25, 1989
-----------------------------------
-5-
AGREEMENT
THIS AGREEMENT ("Agreement") is made by and among XXX XXXXXXXX and
XXXXXXXXX X. XXXXXXXX, husband and wife ("Haechler"), MAX OF SWITZERLAND, an
Arizona corporation ("Max") and SCOTTSDALE PORSCHE + AUDI, LTD., an Arizona
corporation ("SPA").
R E C I T A L S:
A. Some or all of the parties hereto executed the following documents, each
dated June 7, 1985: Escrow Instructions, Sublease, Memorandum of Sublease,
Nondisturbance Agreement, Amendment to Sublease, Consulting and Non-compete
Agreement and Agreement (all collectively called "Instruments").
B. The parties now desire to modify the Instruments.
FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. Subordination and Amendment of Sublease. Max, as sublessor under a
sublease agreement with SPA, as sublessee, dated August 11, 1980, ("Sublease")
as amended by the Amendment to Sublease dated June 7, 1985, agreed to
subordinate its interest in the leased premises to allow SPA to obtain certain
financing. The parties now agree that this subordination provision shall be
deleted from the Sublease, and that Max or Haechler shall have no obligation
whatsoever to subordinate the property commonly known as the Scottsdale Porsche
+ Audi dealership property for any reason. The parties agree that this Agreement
shall act as a second Amendment to the Sublease.
Max and/or Haechler agree to subordinate only the property commonly known
as the Max of Switzerland Jaguar dealership property which is the subject of the
Sublease Agreement between Max and SPA dated June 7, 1985.
2. Lot Split. Max and/or Haechler own and/or lease various property which
is the subject of leases with SPA and adjacent property. The parties agree that
it is necessary to split out these properties for tax reasons and lien reasons,
among others, and the parties agree to take whatever steps are necessary to
implement this lot split.
3. Reaffirmation. In all other respects, the Instruments are hereby
reaffirmed.
IN WITNESS WHEREOF, the parties have executed this Agreement this 15th day
of July, 1985.
/s/
--------------------------------
XXX XXXXXXXX
/s/
--------------------------------
XXXXXXXXX X. XXXXXXXX
By: Xxx Xxxxxxxx - power of attorney
MAX OF SWITZERLAND, an Arizona
corporation
By: /s/
----------------------------
Its: President
SCOTTSDALE PORSCHE + AUDI,
LTD., an Arizona corporation
By: /s/
--------------------------------
XXXXXX XXXXXXXXXXXXX
Its: Chairman
/s/
--------------------------------
XXXXXX XXXXXXXXXXXXX
/s/
--------------------------------
XXXXXX X. XXXXXXXXXXXXX
[6.3-2]
-2-
[Letterhead of Schweizerisches Konsulat]
Scottsdale, 16 April 1985
Power of Attorney
The undersigned, Xxxxxxxxx X. Xxxxxxxx herewith assigns full power of attorney
to her husband Xxx Xxxxxxxx for any and all transactions related to whatever
matter relative to the Max of Switzerland corporation or any other personal
matters concerning joint real estate holdings.
/s/
--------------------------------
XXXXXXXXX X. XXXXXXXX
April 16, 1985
[Notarial Seal]
State of Arizona
County of Maricopa
/s/
--------------------------------
My Commission Expires Nov. 24, 1987
-3-
AMENDMENT TO SUBLEASE
DATE: November 11, 1985
LESSOR: MAX OF SWITZERLAND, An Arizona corporation
LESSEE: SPA AUTOMOTIVE, LTD., an Arizona corporation (whose former name was
Scottsdale Porsche+Aud, Ltd.)
RECITALS:
A. Lessor and Lessee entered into a certain Sublease, dated June 7, 1985
("Sublease").
X. Xxxxxx and Lessee are desirous of amending the Sublease to reflect a
different description of the leased premises.
AGREEMENTS:
IT IS MUTUALLY AGREED AS FOLLOWS:
1. Schedule "A" attached hereto is substituted for the Schedule "A"
attached to the Sublease, and the "premises" or "leased premises" as described
in the Sublease shall be the property described on Schedule "A" attached hereto.
2. The Sublease shall remain in full force and effect, as amended hereby.
3. The rights, duties and obligations created hereunder shall inure to the
benefit of and be binding upon the parties hereto, their heirs, personal
representatives, successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to
Sublease as of the date indicated on the first page.
LESSOR: LESSEE:
MAX OF SWITZERLAND SPA AUTOMOTIVE, LTD.
By /s/ Xxx Xxxxxxxx By /s/ Xxxxxx Xxxxxxxxxxxxx
------------------------------- ---------------------------------
Xxx Xxxxxxxx, President Xxxxxx Xxxxxxxxxxxxx, Chairman
The undersigned hereby approve all of the terms and provisions of the
foregoing Amendment to Sublease.
/s/ Xxxxxx Xxxxxxxxxxxxx /s/ Xxxxxx X. Xxxxxxxxxxxxx
------------------------------- ---------------------------------
Xxxxxx Xxxxxxxxxxxxx Xxxxxx X. Xxxxxxxxxxxxx
-2-
/s/ Xxx Xxxxxxxx /s/ Xxxxxxxxx X. Xxxxxxxx
------------------------------- ---------------------------------
Xxx Xxxxxxxx Xxxxxxxxx X. Xxxxxxxx
-3-
SCHEDULE "A"
Main Parcel
A portion of FARM UNIT "B", FARM UNIT Plat of Xxx 0, Xxxxxxx 0, XXX X0X,
X&XXX&X, Xxxxxxxx Xxxxxx, Arizona, more particularly described as follows:
Beginning at the Northeast corner of said FARM UNIT "B"; thence Westerly
along the North line of said FARM UNIT "B", S 89(degree)02'50" W, a distance of
265.81 feet to the True Point of Beginning; thence S 00(degree)52'45" E, a
distance of 374.66 feet to the North line of PAPAGO PARKWAY Subdivision as
recorded in Book 78, Page 12 of Maricopa County Records; thence Westerly along
the North line of said PAPAGO PARKWAY Subdivision S 89(0)01'50" W, a distance of
140.52 feet; thence N 01(0)09'20" E, a distance of 374.95 feet to the North line
of said FARM UNIT "B"; thence S 89(degree)02'50" E, a distance of 127.21 feet to
the True Point of Beginning.
ACCESS PARCEL
A portion of FARM UNIT "B", FARM UNIT Plat of Xxx 0, Xxxxxxx 0, X0X,
X0X, X&XXX&X, Xxxxxxxx Xxxxxx, Arizona, more particularly described as follows:
Beginning at the Northeast corner of said FARM UNIT "B"; thence Westerly along
the North line of said XXXX XXXX "X", X00(xxxxxx)00'00" X, a distance of 265.81
feet; thence S 00(degree)52'45" E, a distance of 65.00 feet to the True Point of
Beginning; thence N 89(degree)02'50" E, a distance of 18.50 feet; thence S
00(degree)32'45" E, a distance of 53.00 feet; thence S 89(degree)02'50" W, a
distance of 32.00 feet; thence N 00(degree)32'45" W a distance of 53.00 feet;
thence N 89(degree)02'50" E, a distance of 13.50 feet to the True Point of
Beginning.
-4-
TOGETHER with all leasehold improvements and fixtures located upon the Main
Parcel on the date hereof, including without limitation all hoists, compressors
and coolers, but excluding one wheel adjustment rack head and all personal
property.
-5-
8/7/86
SECOND AMENDMENT TO SUBLEASE
DATE: July 30, 1986
LESSOR: MAX OF SWITZERLAND, an Arizona corporation
LESSEE: SPA AUTOMOTIVE, LTD., an Arizona corporation
RECITALS:
A. Lessor and Lessee entered into a certain Sublease, dated June 7, 1985,
as amended by Amendment to Sublease, dated November 11, 1985 ("Sublease").
X. Xxxxxx and Lessee are desirous of amending the Sublease on the terms set
forth herein.
AGREEMENTS:
IT IS MUTUALLY AGREED AS FOLLOWS:
1. Paragraph 36 of the Sublease is amended to read:
"36. Subordination. Lessee shall have the right to borrow from The
Arizona Bank the principal sum of $2,250,000.00 in accordance with a Note to The
Arizona Bank dated July 30, 1986 and a Deed of Trust and Assignment of Rents
securing payment of the Note likewise dated July 30, 1986. Thereafter, so long
as Lessee is not in default, Lessee shall
have the right during the original term and the renewal terms of this Lease from
time to time to refinance said loan (as said loan may from time to time be
refinanced), provided that the principal amount of any such loan shall not
exceed the sum of $2,250,000.00, and that the loans shall be on such terms and
conditions as are then available in the market place for loans of like nature.
For this purpose, Lessee may subject the premises to liens to secure such loans
and Lessor and Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx (jointly "Haechlers")
covenant and agree to join with Lessee in the execution and delivery of such
instruments as may be reasonably required to evidence the subordination of the
premises to such items, provided that Lessor and Haechlers are given notice and
an opportunity to cure and a secured indemnity on substantially similar terms as
those contained in that certain Indemnification Agreement of even date herewith
by and between Xxxxxx X. Xxxxx, as Trustee of the X. X. Xxxxxxxxxxxxx Trusts Xx.
0, Xx. 0 xxx Xx. 0, Xxxxxx Xxxxxxxxxxxxx and Xxxxxx X. Xxxxxxxxxxxxx, and each
of them, Xxx Xxxxxxxx, Xxxxxxxxx X. Xxxxxxxx and Max of Switzerland, an Arizona
corporation. Such mortgage, deed of trust or other security with respect to each
loan shall constitute a lien on the premises as well as the buildings and
improvements erected thereon by Lessee, which shall be senior and superior to
the interests of Lessor and Haechlers therein. Lessee shall cause the lien of
any such mortgage, deed of trust or other security to which Lessor or Haechlers
have subordinated their interest in the premises to be released from the
premises on or before the expiration of the
-2-
base term (or the renewal term if the renewal option is exercised) hereof unless
Lessee shall have acquired the interest of Lessor and Haechlers in the
premises."
2. Should a default occur in any payment and/or performance required
under the terms of any loans or any documents evidencing the loan to which
Lessor and Haechlers have subordinated,* and/or should a default occur in any
performance required under the Indemnification Agreement given in connection
with such subordination, such default shall also constitute a default under this
Sublease.
3. The Sublease shall remain in full force and effect, as amended
hereby.
*and/or should any of the terms of the loan or any document evidencing the loan
to which Lessor and Haechlers have subordinated be altered or changed in any
material way, without the prior written consent of Lessor and Haechlers, which
will not be unreasonably withheld,
4. The rights, duties and obligations created hereunder shall inure to
the benefit of and be binding upon the parties hereto, their heirs, personal
representatives, successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment to Sublease as of the date indicated on the first page.
-3-
LESSOR: LESSEE:
MAX OF SWITZERLAND SPA AUTOMOTIVE, LTD.
By /s/ By /s/
----------------------------- -----------------------------------
Xxx Xxxxxxxx, President Xxxxxx Xxxxxxxxxxxxx, Chairman
-4-
The undersigned hereby approve all of the terms and provisions of the
foregoing Second Amendment to Sublease, and the undersigned Xxx Xxxxxxxx and
Xxxxxxxxx X. Xxxxxxxx further agree to timely perform those obligations imposed
upon them under the Sublease and the foregoing Amendment to Sublease.
/s/ By Xxxxxx Xxxxxxxxxxxxx,
/s/ attorney-in-fact
------------------------------- ---------------------------------
Xxxxxx Xxxxxxxxxxxxx Xxxxxx X. Xxxxxxxxxxxxx
/s/ by Xxx Xxxxxxxx,
/s/ attorney-in-fact
------------------------------- ---------------------------------
Xxx Xxxxxxxx Xxxxxxxxx X. Xxxxxxxx
-5-
ASSIGNMENT AND ASSUMPTION OF SUBLEASE
DATE: June 7, 1989
ASSIGNOR: SPA AUTOMOTIVE LTD., an Arizona corporation
formerly known as Scottsdale Porsche+Audi, Ltd.
ASSIGNEE: SL AUTOMOTIVE, LTD., an Arizona corporation
RECITALS:
A. Max of Switzerland, an Arizona corporation, as "Lessor," and Assignor,
as "Lessee," entered into a certain Sublease dated June 7, 1985, which Sublease
was amended by a certain Amendment to Sublease dated November 11, 1985 and a
certain Second Amendment to Sublease dated July 30, 1986 (collectively, the
"Sublease").
B. Assignor desires to assign to Assignee, and Assignee desires to assume,
the rights and obligations of Assignor under the Sublease.
AGREEMENTS:
In consideration of the mutual covenants contained herein and for other
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
1. Assignor assigns to Assignee all of Assignor's right, title and interest
in, to and under the Sublease and the leasehold estate created thereby, such
assignment to be effective on the earlier of August 1, 1989 and the date upon
which Assignee
opens for business to the public a motor vehicle dealership at the leased
premises as defined in the Sublease (the "Effective Date").
2. Assignor represents and warrants to Assignee that:
(a) Assignor is the sole owner and holder of the title to the entire
leasehold estate created by the Sublease.
(b) To the best of Assignor's knowledge, there are no claims pending
against Assignor with respect to the Sublease or which would affect Assignee in
any way as a result of this Assignment. Assignor is not in default under the
Sublease, and no conditions exist which with notice or lapse of time, or both,
would constitute a default or event of default by Assignor under the Sublease.
(c) This Assignment does not constitute a breach of or a default under
the Sublease.
3. Assignee agrees to perform and assumes all obligations of Assignor under
the Sublease accruing from and after the Effective Date. Assignee shall
indemnify Assignor against and hold Assignor harmless from any and all losses,
damages, debts, expenses, liabilities or claims of any kind, including, but not
limited to, reasonable attorneys' fees, resulting from or incident to the
Sublease and the leasehold estate, provided the same arise out of acts or
omissions to act from and after the Effective Date.
4. Assignor shall indemnify Assignee against and hold Assignee harmless
from any and all losses, damages, debts, expenses, liabilities or claims of any
kind, including but not limited to, reasonable attorneys' fees, resulting from
or incident to the Sublease and the leasehold estate, provided the same arise
out of acts or omissions to act prior to the Effective Date.
5. Assignor covenants that it shall forever defend Assignee's title to the
leasehold estate created by the Sublease
-2-
against all persons whomsoever.
6. Assignor acknowledges that nothing herein shall relieve Assignor of its
liability to Max of Switzerland for the performance of the obligations of the
Lessee under the Sublease.
7. The rights, duties and obligations created hereunder shall inure to the
benefit of and be binding upon the parties hereto, their heirs, personal
representatives, successors and assigns.
IN WITNESS WHEREOF, the parties have executed this Assignment as of the
date first above written.
ASSIGNOR:
SPA AUTOMOTIVE, LTD., an Arizona
corporation
By: /s/ Xxxxxx Xxxxxxxxxxxxx
--------------------------------
Its: Chairman
ASSIGNEE:
SPA AUTOMOTIVE, LTD., an Arizona
corporation
-3-
By: /s/ Xxxxxx Xxxxxxxxxxxxx
--------------------------------
Its: Chairman
STATE OF ARIZONA )
) ss.
County of Maricopa )
The foregoing instrument was acknowledged before me this 8th day of June,
1989, by Xxxxxx Xxxxxxxxxxxxx, the Chairman of SPA Automotive, Ltd., an Arizona
corporation, on behalf of the corporation.
/s/ Xxxxx X. Xxxxxx
----------------------------------
Notary Public
My Commission Expires:
My Commission Expires March 31, 1990
------------------------------------
STATE OF ARIZONA )
) ss.
County of Maricopa )
The foregoing instrument was acknowledged before me this 8th day of June,
1989, by Xxxxxx Xxxxxxxxxxxxx, the Chairman of SL
-4-
Automotive, Ltd., an Arizona corporation, on behalf of the corporation.
/s/ Xxxxx X. Xxxxxx
----------------------------------
Notary Public
My Commission Expires:
My Commission Expires March 31, 1990
------------------------------------
The undersigned hereby approve the foregoing Assignment and Assumption of
Lease.
/s/ Xxxxxx Xxxxxxxxxxxxx
----------------------------------
Xxxxxx Xxxxxxxxxxxxx
/s/ Xxxxxx X. Xxxxxxxxxxxxx
----------------------------------
Xxxxxx X. Xxxxxxxxxxxxx
THIRD AMENDMENT TO SUBLEASE
DATE: November 30, 1992
-5-
LESSOR: MAX OF SWITZERLAND, an Arizona corporation
LESSEE: SPA AUTOMOTIVE, LTD., an Arizona corporation, formerly known as
Scottsdale Porsche+Audi, Ltd.
RECITALS:
A. Lessor and Lessee entered into a certain Sublease and various letter
amendments thereto, all dated August 11, 1980, which Sublease was amended by a
certain Amendment to Sublease dated June 7, 1985, and subsequently further
amended by a certain Agreement dated July 15, 1985 (collectively referred to as
the "Sublease").
B. The lessee's interest under the Sublease was previously assigned to
another party and then was reassigned to Lessee, and Lessee is the holder of the
lessee's interest under the Sublease.
X. Xxxxxx and Lessee are desirous of amending the Sublease on the terms
hereinafter set forth.
WHEREFORE, the parties hereto agree as follows:
I.
Paragraph 1 of the Sublease is amended by inserting at the very beginning
thereof the following: "Except as may be otherwise provided for herein,"
II.
Paragraph 33 of the Sublease is amended in its entirety
-2-
to read as follows:
"33. Options to Extend.
33.01 By written notice to Lessor given not later than August 11,
1998, and provided Lessee is not then in default hereunder, Lessee shall
have the right to extend the term hereof for an additional period of five
(5) years commencing August 11, 2000. All of the terms and provisions
hereof shall be applicable during the renewal term, except that a cost of
living adjustment shall be made in accordance with paragraph 2.02 hereof
(except at two year intervals) at the commencement of the renewal term for
the first two years of the renewal term, at the commencement of the third
year of the renewal term for years 3-4 of the renewal term and at the
commencement of the fifth year of the renewal term for year 5 of the
renewal term, and provided that the monthly rental shall not at any time be
greater than that set forth on the attached Extension Term Monthly Rent
Payment Schedule.
33.02 In addition to the renewal term set forth in subparagraph 33.01
hereof, by notice to Lessor given not later than one year prior to the
first day of each subsequent renewal term, and provided Lessee is not then
in default hereunder and Lessee has exercised all prior rights under this
paragraph to extend the term
-3-
hereof, Lessee shall have the right to extend the term hereof for three (3)
additional periods of five (5) years each, with such subsequent renewal
terms commencing August 11, 2005, August 11, 2010, and August 11, 2015 (the
"subsequent renewal terms"). All of the terms and provisions hereof shall
be applicable during each subsequent renewal term, except that during the
subsequent renewal terms a cost of living adjustment shall be made in
accordance with subparagraph 33.03 hereof at the commencement of the
following dates:
August 11, 2007
August 11, 2009
August 11, 2011
August 11, 2013
August 11, 2015
August 11, 2017
August 11, 2019
Notwithstanding the provisions of this paragraph or any other provision of
this Sublease, the monthly rental for the first two years of the renewal
term commencing August 11, 2005, shall be the Capitalization Rate (as
hereinafter defined) multiplied by the Appraised Amount (as hereinafter
defined), as such Capitalization Rate and such Appraised Amount are
established by the first Appraisal (as hereinafter defined) to be made
-4-
hereunder, with such amount being divided by 12 (hereinafter referred to as
the "Adjusted Base Rental").
33.03 Commencing with rent due on August 11, 2007, and on August llth
of each two (2) years thereafter for the remaining term of this Lease
(including any extensions provided for herein), the Adjusted Base Rental
shall be adjusted in accordance with the change in the Consumer Price Index
(the "Index"), plus any applicable taxes (the "adjustment"). The Index
shall mean the average shown on the "U.S. City Average for Urban Wage
Earners and Clerical Workers -- All Items", as promulgated by the Bureau of
Labor Statistics of the U.S. Department of Labor. No such adjustment shall
reduce the annual rental below the monthly rental as adjusted for the
preceding twelve (12) months. The adjustment shall be increased in the same
ratio as the increase in the Index for the month of July of the year the
adjustment is being made as compared with the Index for the month of July,
2005; provided, however, that the adjustment shall not exceed the following
percentages:
August 11, 2007 adjustment shall not exceed
the Adjusted Base Rental by more than 10%;
August 11, 2009 adjustment shall not exceed
-5-
the Adjusted Base Rental by more than 20%;
August 11, 2011 adjustment shall not exceed
the Adjusted Base Rental by more than 30%;
August 11, 2013 adjustment shall not exceed
the Adjusted Base Rental by more than 40%;
August 11, 2015 adjustment shall not exceed
the Adjusted Base Rental by more than 50%;
August 11, 2017 adjustment shall not exceed
the Adjusted Base Rental by more than 60%; and
August 11, 2019 adjustment shall not exceed
the Adjusted Base Rental by more than 70%.
Said adjustment shall be effective from the llth day of August of each year
in which the adjustment is to be made and shall govern the rental to be
paid during the next succeeding twenty-four (24) month period until the
next adjustment is to be made as set forth herein."
III.
The Sublease is amended by adding thereto the following paragraph 36:
"36. Appraisal and Option to Purchase. On or before April 1, 2005,
Lessee shall submit to Lessor an appraisal of the premises setting forth
the then fair
-6-
market value of the premises as determined by an independent M.A.I.
appraiser experienced in the appraisal of like properties in Maricopa
County, Arizona and designated by Lessee, which fair market value shall be
based on the then current use of the premises and which appraisal shall set
forth the appraiser's opinion of the then current capitalization rate for
comparable properties. If Lessor is dissatisfied with such appraisal, on or
before ninety (90) days after submittal of Lessee's appraisal, Lessor shall
submit to Lessee an appraisal of the premises setting forth the then fair
market value of the premises as determined by an independent M.A.I.
appraiser experienced in the appraisal of like properties in Maricopa
County, Arizona and designated by Lessor, which fair market value shall be
based on the then current use of the premises and which appraisal shall set
forth the appraiser's opinion of the then current capitalization rate for
comparable properties. "Appraisal" for purposes hereof shall be the
appraisal submitted by Lessee if Lessor does not timely submit an
appraisal, or the average (with regard to both the fair market value and
the capitalization rate) of the appraisals submitted by Lessee and Lessor
if Lessor timely submits an appraisal. "Appraised Amount" means the fair
market value determined by the Appraisal, and "Capitalization Rate" means
the
-7-
capitalization rate determined by the Appraisal.
As of any time on or after August 11, 2005, if any renewal term is
then in effect and Lessee is not then in default hereunder, Lessee shall
have the right to purchase the premises, exercisable by giving written
notice ("Election Notice") to Lessor at least ninety (90) days prior
thereto, for a purchase price equal to the Appraised Amount, which purchase
price shall be paid in full in cash at the close of escrow. If the Election
Notice is not given within six (6) months after April 1, 2005, then Lessee
shall proceed with obtaining a more current Appraisal under the procedure
set forth hereinabove. The parties hereto agree that the Appraised Amount
set forth in any Election Notice shall be established by an Appraisal(s)
performed within six (6) months immediately preceding the date of the
Election Notice.
Within fifteen (15) days after the Election Notice, an escrow shall be
opened with the title insurance company ("Escrow Agent") designated by
Lessee in the Election Notice. Such escrow shall close not later than one
hundred eighty (180) days after the Election Notice. If Lessee is not then
in default, Lessee shall be entitled to occupy the premises pursuant to the
terms hereof at the rental then in
-8-
effect until the close of escrow.
Escrow Agent, within ten (10) days after the opening of escrow, shall
deliver to Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx (the "Haechlers") and to
Lessee a preliminary title report or commitment for a standard owner's
title insurance policy (herein "Preliminary Report") to insure fee simple
title in Lessee as to the premises, under which the insured is Lessee and
in the amount of the purchase price. In addition to the Preliminary Report,
Escrow Agent shall simultaneously deliver to Lessee copies of all documents
identified in Schedule B of the Preliminary Report and in the Requirements
Section of the Preliminary Report. At any time prior to the scheduled close
of escrow, Lessee shall have the right to notify Escrow Agent and the
Haechlers in writing of any defect in the title of the premises and if the
Haechlers do not cause such defect to be eliminated or agreed to be insured
over within twenty (20) days of receipt of notice of such defect, Lessee,
at its option, shall be entitled to cancel the escrow, or accept title in
its then condition in which event the expense of eliminating such defects
and the amount of any such defects which are not eliminated shall be
treated as credits to Lessee and applied against the purchase price. A
defect in title for purposes hereof shall be any condition then customarily
-9-
deemed in Maricopa County, Arizona to render the premises unmarketable. At
close of escrow, the Haechlers shall provide to Lessee a standard coverage
owner's title insurance policy which shall show as exceptions no items
other than those permitted by Lessee according to the terms hereof, and
shall be in the form of the standard coverage owner's title insurance
policy usually then issued by the title insurer for Escrow Agent. At close
of escrow, the Haechlers shall execute a Warranty Deed to Lessee to be
recorded at close of escrow which shall warrant title subject only to those
exceptions permitted by Lessee pursuant to the terms hereof. At close of
escrow, Lessor shall execute a Quit Claim Deed to Lessee to be recorded at
close of escrow, the purpose of which shall be to terminate the master
lease on the premises between Haechlers and Lessor and to otherwise
transfer to Lessee any other interest Lessor may have in the premises.
Escrow charges, closing costs and prorations shall be borne by the parties
in accordance with the practice then prevailing in Maricopa County,
Arizona.
If Haechlers desire to effect a tax free exchange of the premises pursuant
to ss.1031 of the Internal Revenue Code or any similar section then in
effect, Lessee shall reasonably and promptly cooperate with Haechlers,
including Lessee entering into a contract for the
-10-
acquisition of real property which shall be acceptable to Haechlers which
shall subsequently be assigned and/or transferred to Haechlers, provided
however, that Lessee shall not be required to hold legal title to any other
property and Lessee shall not be required to undertake or assume any
liabilities or to incur any costs or expenses in connection therewith."
IV.
The Sublease is further amended by adding thereto the following new
paragraphs 37 and 38:
"37. Refinancing by Lessor. Lessor and Lessee acknowledge that at any
time during the term of this Sublease and any extensions thereof, Lessor
has the right to refinance the premises. Lessee hereby consents to Lessor
refinancing the premises, agrees to fully and promptly cooperate with
Lessor in Lessor seeking to perform the subject refinancing, and agrees to
provide and/or execute such documents as may be reasonably requested by
Lessor in connection therewith; provided however, that any such refinancing
documents shall contain a prepayment provision and a provision
incorporating by reference this Sublease and that any refinancing shall be
subject to Lessee's interest under this Sublease.
-11-
38. Hazardous Material Indemnification. Subject to the limitations and
other provisions contained in this Sublease, Lessee shall, and it hereby
does, indemnify and agree to pay, defend and hold harmless Lessor and
Haechlers from any and all losses, liabilities, damages, injuries,
obligations, actions, suits, administrative claims, remedial actions,
judgments, awards, fines, claims, demands or expenses (including attorneys'
fees) of any and every kind whatsoever, incurred or suffered by, or
asserted against, Lessor for, with respect to, or as a direct or indirect
result of, the presence on or under the premises of any Hazardous Material,
or the escape, seepage, leakage, spillage, discharge, emission, or release
from the premises into or upon any land, the atmosphere, or any
watercourse, body of water, or wetland of any Hazardous Material, which
presence, escape, seepage, leakage, spillage, discharge, emission, or
release first occurred during the period commencing August 11, 1980 and
terminating upon the termination of this Sublease, as may be extended from
time to time (the "Period"), including without limitation, any losses,
liabilities, damages, injuries, costs, expenses, or claims asserted or
arising under the Comprehensive Environmental Response, Compensation and
Liability Act, any so-called "Superfund" or "Superlien" law, or any other
federal, state, or local
-12-
statute, law, ordinance, code, rule, regulation, order, or decree
regulating, relating to, or imposing liability or standards of conduct
concerning any Hazardous Material or any underground storage tanks. For
purposes of this Sublease, "Hazardous Material" means and includes any
petroleum product and any hazardous substance or any pollutant or
contaminant defined as such in (or for purposes of) the Comprehensive
Environmental Response, Compensation, and Liability Act; any so-called
"Superfund" or "Superlien" law; the Toxic Substances Control Act; or any
other federal, state, or local statute, law, ordinance, code, rule,
regulation, order, or decree regulating, relating to, or imposing liability
or standards of conduct concerning any hazardous, toxic, or dangerous
waste, substance, or material, as now or at any time hereafter in effect;
and asbestos or any substance or compound containing asbestos, PCB's, or
any other hazardous, toxic, or dangerous waste, substance, or material.
Notwithstanding anything in this paragraph to the contrary, if Lessee
purchases the premises pursuant to paragraph 36 hereof, then the Period
shall include the time of Lessee's ownership of the premises."
X.
Xxxxxx and Lessee acknowledge that Lessee anticipates making alterations,
improvements and additions to the premises to
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satisfy the requirements of current and future distributors of new vehicles to
be sold from the premises. Lessor hereby consents to Lessee making such
alterations, improvements and additions to the premises as may be approved or
required by such distributors and as may be approved or required by applicable
governmental authorities. Lessor further agrees to cooperate promptly with
Lessee in Lessee's seeking the approval of governmental authorities for such
alterations, improvements and additions and to execute promptly such documents
as may be reasonably requested by Lessee in connection therewith, including
filings with and submissions to the City of Scottsdale.
VI.
The Sublease shall remain in full force and effect, as amended hereby.
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VII.
The rights, duties and obligations created hereunder shall inure to the
benefit of and be binding upon the parties hereto, their heirs, personal
representatives, successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Third Amendment
to Sublease as of the date indicated on the first page.
LESSOR: LESSEE:
MAX OF SWITZERLAND, SPA AUTOMOTIVE, LTD.,
an Arizona corporation an Arizona corporation
By /s/ By /s/
Xxx Xxxxxxxx Xxxxxx Xxxxxxxxxxxxx,
---------------------------- ----------------------------------
President Chairman
-15-
CONSENT
The undersigned guarantors hereby consent to the foregoing Third Amendment
to Sublease. The undersigned Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx further
agree to perform the obligations of Haechler under paragraph 36 of the Sublease.
DATED this 30 day of November, 1992.
/s/
-------------------------------------
Xxxxxx Xxxxxxxxxxxxx
"Guarantor"
/s/
-------------------------------------
Xxxxxx X. Xxxxxxxxxxxxx
"Guarantor"
/s/
-------------------------------------
Xxx Xxxxxxxx
/s/
-------------------------------------
Xxxxxxxxx X. Xxxxxxxx
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the 30 day of November, 1992, before me, the undersigned officer,
personally appeared Xxx Xxxxxxxx who acknowledged himself to be the President of
Max of Switzerland, and that he, as such officer, being authorized so to do,
executed the foregoing instrument for the purposes therein contained by signing
the name of the corporation by himself as such officer.
/s/
-------------------------------------
Notary Public
My Commission Expires:
06/30/93
----------------------
-16-
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the 30 day of November, 1992, before me, the undersigned officer,
personally appeared Xxxxxx Xxxxxxxxxxxxx who acknowledged himself to be the
Chairman of SPA Automotive, Ltd., and that he, as such officer, being authorized
so to do, executed the foregoing instrument for the purposes therein contained
by signing the name of the corporation by himself as such officer.
/s/
-------------------------------------
Notary Public
My Commission Expires:
----------------------
[Notarial Seal]
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this 30 day of November, 1992, before me, a Notary Public, personally
appeared Xxxxxx Xxxxxxxxxxxxx and Xxxxxx X. Xxxxxxxxxxxxx, who acknowledged that
they executed the within instrument for the purposes therein stated.
/s/
-------------------------------------
Notary Public
My Commission Expires:
----------------------
[Notarial Seal]
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this ____ day of November, 1992, before me, a Notary Public, personally
appeared Xxx Xxxxxxxx and Xxxxxxxxx X. Xxxxxxxx, who acknowledged that they
executed the within instrument for the purposes therein stated.
/s/
-------------------------------------
Notary Public
My Commission Expires:
06/30/96
----------------------
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EXTENSION TERM MONTHLY
RENT PAYMENT SCHEDULE
(Maximum Monthly Rent)
Monthly Rent Maximum
(the following percentage
of the base rental in year
Option Years 1 of the base term)
------------ --------------------------
1-2 297.24%
3-4 310.58%
5 323.91%
