EXHIBIT 10.1 (2)
LEASE AGREEMENT
by and between
BT (PA) QRS 12-25, INC.,
a Pennsylvania corporation
as LANDLORD
and
THE BON-TON DEPARTMENT STORES, INC.,
a Pennsylvania corporation,
as TENANT
Premises: Allentown, Pennsylvania
Johnstown, Pennsylvania
Dated as of: April 10, 1997
TABLE OF CONTENTS
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Page
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Parties..................................... 1
1. Demise of Premises.......................... 1
2. Certain Definitions......................... 1
3. Title and Condition......................... 9
4. Use of Leased Premises; Quiet Enjoyment..... 11
5. Term........................................ 12
6. Basic Rent.................................. 13
7. Additional Rent............................. 13
8. Net Lease; Non-Terminability................ 14
9. Payment of Impositions...................... 15
10. Compliance with Law; Environmental Matters.. 17
11. Liens; Recording and Title.................. 19
12. Maintenance and Repair...................... 19
13. Alterations and Improvements................ 20
14. Permitted Contests.......................... 21
15. Indemnification............................. 22
16. Insurance................................... 23
17. Casualty and Condemnation................... 27
18. Termination Events.......................... 28
19. Restoration; Reduction of Rent.............. 30
20. Procedures Upon Purchase.................... 32
21. Assignment and Subletting; Prohibition
against Leasehold Financing................. 33
22. Events of Default........................... 36
23. Remedies and Damages Upon Default........... 39
24. Notices..................................... 42
25. Estoppel Certificate........................ 43
26. Surrender................................... 44
27. No Merger of Title.......................... 44
28. Books and Records........................... 44
29. Determination of Value...................... 45
30. Non-Recourse as to Landlord................. 47
31. Financing................................... 47
32. Subordination............................... 48
33. Financial Covenants......................... 48
34. Tax Treatment; Reporting.................... 48
35. Right of First Refusal...................... 49
36. Sale of Related Premises by Landlord........ 51
37. Substitution and Exchange of Premises....... 51
38. Release of Excess Land...................... 53
39. Miscellaneous............................... 53
EXHIBITS
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Exhibit "A-1" - Premises
Exhibit "A-2" - Excess Land
Exhibit "B" - Machinery and Equipment
Exhibit "C" - Schedule of Permitted Encumbrances
Exhibit "D" - Rent Schedule
Exhibit "E" - Acquisition Costs
Exhibit "F" - Percentage Allocation of Basic Rent
Exhibit "G" - Financial Covenants
Exhibit "H" - Termination Values
Exhibit "I" - Post Closing Environmental and Land Use
Compliance Obligations
LEASE AGREEMENT, made as of this 10th day of April, 1997, between BT
(PA) QRS 12-25, INC., a Pennsylvania corporation ("Landlord"), with an address
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c/o W.P. Xxxxx & Co., Inc., 00 Xxxxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, and THE BON-TON DEPARTMENT STORES, INC., a Pennsylvania corporation
("Tenant"), with an address at 0000 X. Xxxxxx Xxxxxx, Xxxx, Xxxxxxxxxxxx 00000.
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In consideration of the rents and provisions herein stipulated to be
paid and performed, Landlord and Tenant hereby covenant and agree as follows:
I. Demise of Premises. Landlord hereby demises and lets to
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Tenant, and Tenant hereby takes and leases from Landlord, for the term and upon
the provisions hereinafter specified, the following described property
(hereinafter referred to collectively as the "Leased Premises" and individually
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as the "Allentown Premises", a distribution facility containing approximately
325,000 square feet, and the "Johnstown Premises", a retail facility containing
approximately 80,884 square feet, each of which premises is more particularly
described in the applicable description in Exhibit "A-1" attached hereto and
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made a part hereof and shall include the portions of items (a), (b) and (c) of
this Paragraph 1 located thereon or therein and appertaining thereto): (a) the
premises described in Exhibit "A-1" hereto, together with the Appurtenances
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(collectively, the "Land"); (b) the buildings, structures and other improvements
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now or hereafter constructed on the Land (collectively, the "Improvements"); and
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(c) the fixtures, machinery, equipment and other property described in Exhibit
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"B" hereto (collectively, the "Equipment").
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II. Certain Definitions.
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"Acquisition Cost" of each of the Related Premises shall mean the
amount set forth opposite such premises on Exhibit "E" hereto.
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"Additional Rent" shall mean Additional Rent as defined in
Paragraph 7.
"Adjoining Property" shall mean all sidewalks, driveways, curbs, gores
and vault spaces adjoining any of the Leased Premises.
"Affected Premises" shall mean the Affected Premises as
defined in Paragraph 18.
"Alterations" shall mean all changes, additions, improvements or
repairs to, all alterations, reconstructions, renewals, replacements or removals
of and all substitutions or
replacements for any of the Improvements or Equipment, both interior and
exterior, structural and non-structural, and ordinary and extraordinary.
"Appurtenances" shall mean all tenements, hereditaments, easements,
rights-of-way, rights, privileges in and to the Land, including (a) easements
over other lands granted by any Easement Agreement and (b) any streets, ways,
alleys, vaults, gores or strips of land adjoining the Land.
"Assignment" shall mean any assignment of rents and leases from
Landlord to a Lender which (a) encumbers any of the Leased Premises and (b)
secures Landlord's obligation to repay a Loan, as the same may be amended,
supplemented or modified from time to time.
"Basic Rent" shall mean Basic Rent as defined in Paragraph 6.
"Basic Rent Payment Dates" shall mean the Basic Rent Payment
Dates as defined in Paragraph 6.
"Casualty" shall mean any injury to or death of any person or any loss
of or damage to any property (including the Leased Premises) included within or
related to the Leased Premises or arising from the Adjoining Property.
"Commencement Date" shall mean Commencement Date as defined
in Paragraph 5.
"Complete Assignment" shall mean Complete Assignment as
defined in Paragraph 21(a).
"Condemnation" shall mean a Taking and/or a Requisition.
"Condemnation Notice" shall mean notice or knowledge of the
institution of or intention to institute any proceeding for Condemnation.
"Costs" of a Person or associated with a specified transaction shall
mean all reasonable costs and expenses incurred by such Person or associated
with such transaction (exclusive of any internal costs of such Person),
including without limitation, attorneys' fees and expenses, court costs,
brokerage fees, escrow fees, title insurance premiums, mortgage commitment fees,
mortgage points, recording fees and transfer taxes, as the circumstances
require.
"Covenants" shall mean the covenants and agreements
described on Exhibit "G".
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"CPI" shall mean CPI as defined in Exhibit "D" hereto.
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"Default Rate" shall mean the Default Rate as defined in
Paragraph 7(a)(iv).
"Easement Agreement" shall mean any conditions, covenants,
restrictions, easements, declarations, licenses and other agreements listed as
Permitted Encumbrances or as may hereafter affect either of the Related
Premises.
"Environmental Law" shall mean (i) whenever enacted or promulgated,
any applicable federal, state, foreign and local law, statute, ordinance, rule,
regulation, license, permit, authorization, approval, consent, court order,
judgment, decree, injunction, code, requirement or agreement with any
governmental entity, (x) relating to pollution (or the cleanup thereof), or the
protection of air, water vapor, surface water, groundwater, drinking water
supply, land (including land surface or subsurface), plant, aquatic and animal
life from injury caused by a Hazardous Substance or (y) concerning exposure to,
or the use, containment, storage, recycling, reclamation, reuse, treatment,
generation, discharge, transportation, processing, handling, labeling,
production, disposal or remediation of Hazardous Substances, Hazardous Condition
or Hazardous Activity, in each case as amended and as now or hereafter in
effect, and (ii) any common law or equitable doctrine (including, without
limitation, injunctive relief and tort doctrines such as negligence, nuisance,
trespass and strict liability) that may impose liability or obligations or
injuries or damages due to or threatened as a result of the presence of,
exposure to, or ingestion of, any Hazardous Substance. The term Environmental
Law includes, without limitation, the federal Comprehensive Environmental
Response Compensation and Liability Act of 1980, the Superfund Amendments and
Reauthorization Act, the federal Water Pollution Control Act, the federal Clean
Air Act, the federal Clean Water Act, the federal Resources Conservation and
Recovery Act of 1976 (including the Hazardous and Solid Waste Amendments to
RCRA), the federal Solid Waste Disposal Act, the federal Toxic Substance Control
Act, the federal Insecticide, Fungicide and Rodenticide Act, the federal
Occupational Safety and Health Act of 1970, the federal National Environmental
Policy Act and the federal Hazardous Materials Transportation Act, each as
amended and as now or hereafter in effect and any similar state or local Law.
"Environmental Violation" shall mean (a) any direct or indirect
discharge, disposal, spillage, emission, escape, pumping, pouring, injection,
leaching, release, seepage, filtration or transporting of any Hazardous
Substance at, upon, under, onto or within either Related Premises, or from
either Related Premises to the environment, in violation of any environmental
Law or in excess of any reportable quantity
established under any Environmental Law or which could result in any liability
to Landlord, Tenant or Lender for the costs of any removal or remedial action or
natural resources damage or for bodily injury or property damage, (b) any
deposit, storage, dumping, placement or use of any Hazardous Substance at, upon,
under or within the Leased Premises or which extends from the Leased Premises to
any Adjoining Property in violation of any Environmental Law or in excess of any
reportable quantity established under any Environmental Law or which could
result in any liability to Landlord, Tenant or Lender for the costs of any
removal or remedial action or natural resources damage or for bodily injury or
property damage, (c) the abandonment or discarding of any barrels, containers or
other receptacles containing any Hazardous Substances in violation of any
Environmental Laws, (d) any activity, occurrence or condition which could result
in any liability, cost or expense to Landlord or Lender or any other owner or
occupier of the Leased Premises, or which could result in a creation of a lien
on any Related Premises under any Environmental Law or (e) any violation of or
noncompliance with any Environmental Law.
"Equipment" shall mean the Equipment as defined in Paragraph 1.
"Event of Default" shall mean an Event of Default as defined
in Paragraph 22(a).
"Excess Land" shall mean Excess Land as described in Exhibit "A-2".
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"Exchange Premises" shall mean Exchange Premises as defined
in Paragraph 37.
"Fair Market Value" shall mean (a) with respect to a determination of
Fair Market Value under Paragraph 21(a) the fair market value of the Leased
Premises or either Related Premises, as the case may be, as of the Relevant Date
as affected and encumbered by this Lease and (b) with respect to a determination
of Fair Market Value under Paragraph 37 the fair market value of the Exchange
Premises as of the Relevant Date as if unaffected and unencumbered by this Lease
(value in use and value in exchange). For all purposes of this Lease, Fair
Market Value shall be determined in accordance with the procedure specified in
Paragraph 29.
"Fair Market Value Date" shall mean the date when the Fair
Market Value is determined in accordance with Paragraph 29.
"Federal Funds" shall mean federal or other immediately available
funds which at the time of payment are
legal tender for the payment of public and private debts in the United States
of America.
"Guarantor" shall mean The Bon-Ton Stores, Inc., a Pennsylvania
corporation.
"Guaranty" shall mean the Guaranty and Suretyship Agreement dated as
of the date hereof from Guarantor to Landlord guaranteeing the payment and
performance by Tenant of all of Tenant's obligations under the Lease.
"Hazardous Activity" means any activity, process, procedure or
undertaking which directly or indirectly (i) procures, generates or creates any
Hazardous Substance; (ii) causes or results in (or threatens to cause or result
in) the release, seepage, spill, leak, flow, discharge or emission of any
Hazardous Substance into the environment (including the air, ground water,
watercourses or water systems), (iii) involves the containment or storage of any
Hazardous Substance; or (iv) would cause any of the Leased Premises or any
portion thereof to become a hazardous waste treatment, recycling, reclamation,
processing, storage or disposal facility within the meaning of any Environmental
Law.
"Hazardous Condition" means any condition which would support any
claim or liability under any Environmental Law, including the presence of
underground storage tanks.
"Hazardous Substance" means (i) any substance, material, product,
petroleum, petroleum product, derivative, compound or mixture, mineral
(including asbestos), chemical, gas, medical waste, or other pollutant, in each
case whether naturally occurring, man-made or the by-product of any process,
that is toxic, harmful or hazardous or acutely hazardous to the environment or
public health or safety or (ii) any substance supporting a claim under any
Environmental Law, whether or not defined as hazardous as such under any
Environmental Law. Hazardous Substances include, without limitation, any toxic
or hazardous waste, pollutant, contaminant, industrial waste, petroleum or
petroleum-derived substances or waste, radon, radioactive materials, asbestos,
asbestos containing materials, urea formaldehyde foam insulation, lead,
polychlorinated biphenyls.
"Impositions" shall mean the Impositions as defined in Paragraph
9(a).
"Improvements" shall mean the Improvements as defined in
Paragraph 1.
"Indemnitee" shall mean an Indemnitee as defined in Paragraph 15.
"Initial Term" shall mean the Initial Term as defined in
Paragraph 5(a).
"Insurance Requirements" shall mean the requirements of all insurance
policies maintained in accordance with this Lease.
"Intended Assignment Offer" shall mean Intended Assignment
Offer as defined in Paragraph 21(a).
"Land" shall mean the Land as defined in Paragraph 1.
"Law" shall mean any constitution, statute, rule of law, code,
ordinance, order, judgment, decree, injunction, rule, regulation, policy,
requirement or administrative or judicial determination, even if unforeseen or
extraordinary, of every duly constituted governmental authority, court or
agency, now or hereafter enacted or in effect.
"Lease" shall mean this Lease Agreement.
"Lease Bifurcation" shall mean Lease Bifurcation as defined
in Paragraph 21(a).
"Lease Year" shall mean, with respect to the first Lease Year, the
period commencing on the Commencement Date and ending at midnight on the last
day of the twelfth (12th) consecutive calendar month following the month in
which the Commencement Date occurred, and each succeeding twelve (12) month
period during the Term.
"Leased Premises" shall mean the Leased Premises as defined
in Paragraph 1.
"Legal Requirements" shall mean the requirements of all present and
future Laws (including but not limited to Environmental Laws) and all covenants,
restrictions and conditions now or hereafter of record which may be applicable
to Tenant or to either Related Premises, or to the use, manner of use,
occupancy, possession, operation, maintenance, alteration, repair or restoration
of either Related Premises, even if compliance therewith necessitates structural
changes or improvements or results in interference with the use or enjoyment of
either Related Premises.
"Lender" shall mean any person or entity (and their respective
successors and assigns) which may, after the date hereof, make a Loan to
Landlord or is the holder of any Note.
"Loan" shall mean any loan made by one or more Lenders to Landlord,
which loan is secured by a Mortgage and an Assignment and evidenced by a Note.
"Monetary Obligations" shall mean Rent and all other sums payable by
Tenant under this Lease to Landlord, to any third party on behalf of Landlord or
to any Indemnitee.
"Mortgage" shall mean any first mortgage or deed of trust from
Landlord to a Lender which (a) encumbers any of the Leased Premises and (b)
secures Landlord's obligation to repay a Loan, as the same may be amended,
supplemented or modified.
"Net Award" shall mean (a) the entire award payable to Landlord or
Lender by reason of a Condemnation whether pursuant to a judgment or by
agreement or otherwise, or (b) the entire proceeds of any insurance required
under clauses (i), (ii) (to the extent payable to Landlord or Lender), (iv), (v)
or (vi) of Paragraph 16(a), as the case may be, less any expenses incurred by
Landlord and Lender in collecting such award or proceeds.
"Note" shall mean any promissory note evidencing Landlord's
obligation to repay a Loan, as the same may be amended, supplemented or
modified.
"Offer Amount" shall mean the greater of Fair Market Value or the sum
of the Acquisition Cost and any applicable Prepayment Premium.
"Partial Assignment" shall mean Partial Assignment as defined
in Paragraph 21(a).
"Partial Casualty" shall mean any Casualty which does not
constitute a Termination Event.
"Partial Condemnation" shall mean any Condemnation which
does not constitute a Termination Event.
"Permitted Encumbrances" shall mean those covenants, restrictions,
reservations, liens, conditions and easements and other encumbrances, other than
any Mortgage or Assignment, listed on Exhibit "C" hereto (but such listing shall
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not be deemed to revive any such encumbrances that have expired or terminated or
are otherwise invalid or unenforceable).
"Person" shall mean an individual, partnership, association,
corporation or other entity.
"Prepayment Premium" shall mean any payment (other than a payment of
principal and/or interest which Landlord is required to make under a Note or a
Mortgage) by reason of any prepayment by Landlord of any principal due under a
Note or Mortgage, and which may be (in lieu of such prepayment premium or
prepayment penalty) a "make whole" clause requiring a prepayment premium in an
amount sufficient to compensate the Lender for the loss of the benefit of the
Loan due to prepayment.
"Present Value" of any amount shall mean such amount discounted by a
rate per annum which is the lower of (a) the Prime Rate at the time such present
value is determined or (b) seven and one-half percent (7.5%) per annum.
"Prime Rate" shall mean the interest rate per annum as published, from
time to time, in The Wall Street Journal as the "Prime Rate" in its column
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entitled "Money Rate". The Prime Rate may not be the lowest rate of interest
charged by any "large U.S. money center commercial banks" and Landlord makes no
representations or warranties to that effect. In the event The Wall Street
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Journal ceases publication or ceases to publish the "Prime Rate" as described
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above, the Prime Rate shall be the average per annum discount rate (the
"Discount Rate") on ninety-one (91) day bills ("Treasury Bills") issued from
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time to time by the United States Treasury at its most recent auction, plus
three hundred (300) basis points. If no such 91-day Treasury Bills are then
being issued, the Discount Rate shall be the discount rate on Treasury Bills
then being issued for the period of time closest to ninety-one (91) days.
"Related Premises" shall mean any one of the Allentown
Premises and Johnstown Premises.
"Relevant Amount" shall mean the Termination Amount or the
Offer Amount, as the case may be.
"Relevant Date" shall mean (a) the date immediately prior to the date
on which Tenant makes the Intended Assignment Offer and (b) the date on which
Tenant and Landlord commence to determine the Fair Market Value of the Exchange
Premises under Paragraph 37(a) hereof.
"Remaining Premises" shall mean the Related Premises which are not
Affected Premises under Paragraph 18 or Assignment Premises under Paragraph 21.
"Renewal Date" shall mean Renewal Date as defined in
Paragraph 5(b).
"Rent" shall mean, collectively, Basic Rent and Additional Rent.
"Site Assessment" shall mean a Site Assessment as defined in
Paragraph 10(c).
"State" shall mean the Commonwealth of Pennsylvania.
"Surviving Obligations" shall mean any obligations of Tenant under
this Lease, actual or contingent, which arise on or prior to the expiration or
prior termination of this Lease or which survive such expiration or termination
by their own terms.
"Taking" shall mean (a) any taking or damaging of all or a portion of
any of the Leased Premises (i) in or by condemnation or other eminent domain
proceedings pursuant to any Law, general or special, or (ii) by reason of any
agreement with any condemnor in settlement of or under threat of any such
condemnation or other eminent domain proceeding, or (iii) by any other means, or
(b) any de facto condemnation. The Taking shall be considered to have taken
place as of the later of the date actual physical possession is taken by the
condemnor, or the date on which the right to compensation and damages accrues
under the law applicable to the applicable Related Premises.
"Term" shall mean the Term as defined in Paragraph 5.
"Termination Amount" shall mean the sum of the applicable Termination
Value and any Prepayment Premium which Landlord will be required to pay in
prepaying any Loan with proceeds of the Termination Amount.
"Termination Date" shall mean the Termination Date as
defined in Paragraph 18.
"Termination Event" shall mean a Termination Event as
defined in Paragraph 18.
"Termination Notice" shall mean Termination Notice as
defined in Paragraph 18(a).
"Termination Value" shall mean the Termination Value
specified in Exhibit "H" hereto for the applicable Lease Year.
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"Third Party Purchaser" shall mean the Third Party Purchaser
as defined in Paragraph 21(f).
III. Title and Condition.
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(a) The Leased Premises are demised and let subject to (i) the rights
of any Persons in possession of the
Leased Premises, (ii) the existing state of title of any of the Leased
Premises, including any Permitted Encumbrances, (iii) any state of facts which
an accurate survey or physical inspection of the Leased Premises might show,
(iv) all Legal Requirements, including any existing violation of any thereof,
and (v) the condition of the Leased Premises as of the commencement of the Term,
without representation or warranty by Landlord.
(b) Tenant acknowledges that the Leased Premises are in good
condition and repair at the inception of this Lease. LANDLORD LEASES AND WILL
LEASE AND TENANT TAKES AND WILL TAKE THE LEASED PREMISES AS IS. TENANT
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ACKNOWLEDGES THAT LANDLORD (WHETHER ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER
CAPACITY) HAS NOT MADE AND WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE
MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF
THE LEASED PREMISES, INCLUDING ANY WARRANTY OR REPRESENTATION AS TO (i) ITS
FITNESS, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE, (ii) THE QUALITY
OF THE MATERIAL OR WORKMANSHIP THEREIN, (iii) THE EXISTENCE OF ANY DEFECT,
LATENT OR PATENT, (iv) LANDLORD'S TITLE THERETO, (v) VALUE, (vi) COMPLIANCE WITH
SPECIFICATIONS, (vii) LOCATION, (viii) USE, (ix) CONDITION, (x) MERCHANTABILITY,
(xi) QUALITY, (xii) DESCRIPTION, (xiii) DURABILITY (xiv) OPERATION OR (xv) THE
EXISTENCE OF ANY HAZARDOUS SUBSTANCE; AND ALL RISKS INCIDENT THERETO ARE TO BE
BORNE BY TENANT. TENANT ACKNOWLEDGES THAT THE LEASED PREMISES ARE OF ITS
SELECTION AND TO ITS SPECIFICATIONS AND THAT THE LEASED PREMISES HAVE BEEN
INSPECTED BY TENANT AND ARE SATISFACTORY TO IT. IN THE EVENT OF ANY DEFECT OR
DEFICIENCY IN ANY OF THE LEASED PREMISES OF ANY NATURE, WHETHER LATENT OR
PATENT, LANDLORD SHALL NOT HAVE ANY RESPONSIBILITY OR LIABILITY WITH RESPECT
THERETO OR FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING STRICT
LIABILITY IN TORT). THE PROVISIONS OF THIS PARAGRAPH 3(b) HAVE BEEN NEGOTIATED,
AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY WARRANTIES BY
LANDLORD, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES,
ARISING PURSUANT TO THE UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW OR
HEREAFTER IN EFFECT OR ARISING OTHERWISE.
(c) Tenant represents to Landlord that Tenant has examined the title
to the Leased Premises prior to the execution and delivery of this Lease and has
found the same to be satisfactory for the purposes contemplated hereby. Tenant
acknowledges that (i) fee simple title (both legal and equitable) to the Leased
Premises is in Landlord and, except as provided in Paragraph 35 hereof with
respect to certain rights of refusal to purchase the Leased Premises, that
Tenant has only the leasehold right of possession and use of the Leased Premises
as provided herein, (ii) this Lease is a single Lease for multiple properties
and shall not be terminable with respect to less than all of the Leased Premises
or severable with respect to any one or more Related Premises except as
specifically provided herein, (iii) the Improvements conform to all material
Legal Requirements and all Insurance Requirements, (iv) all easements necessary
or
appropriate for the use or operation of the Leased Premises have been
obtained, (v) all contractors and subcontractors who have performed work on or
supplied materials to the Leased Premises have been fully paid to the extent
required by their respective contracts, and all materials and supplies have been
fully paid for, (vi) the Improvements have been fully completed in all material
respects and are of a quality equal to comparable properties operated by Tenant,
and (vii) all Equipment necessary or appropriate for the use or operation of the
Leased Premises has been installed and is presently fully operative in all
material respects.
D. Landlord hereby assigns to Tenant, without recourse or warranty
whatsoever, all warranties, guaranties, indemnities and similar rights which
Landlord may have against any manufacturer, seller, engineer, contractor or
builder in respect of any of the Leased Premises. Such assignment shall remain
in effect until an Event of Default occurs or until the expiration or earlier
termination of this Lease, whereupon such assignment shall cease and all of said
warranties, guaranties, indemnities and other rights shall automatically revert
to Landlord.
IV. Use of Leased Premises; Quiet Enjoyment.
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A. Tenant may occupy and use the Allentown Premises for
distribution, assembly, warehousing, retail and light manufacturing and the
Johnstown Premises for a retail facility and for no other purpose without the
prior written consent of Landlord, which shall not be unreasonably withheld.
Tenant shall not use or occupy or permit any of the Leased Premises to be used
or occupied, nor do or permit anything to be done in or on any of the Leased
Premises, in a manner which would or might (i) violate any Law or Legal
Requirement, (ii) make void or voidable or cause any insurer to cancel any
insurance required by this Lease, or make it difficult or impossible to obtain
any such insurance at commercially reasonable rates, (iii) cause structural
injury to any of the Improvements or (iv) constitute a public or private
nuisance or waste.
B. Subject to the provisions hereof, so long as no Event of Default
has occurred and is continuing, Tenant shall quietly hold, occupy and enjoy the
Leased Premises throughout the Term, without any hindrance, ejection or
molestation by Landlord with respect to matters that arise after the date
hereof, provided that Landlord or its agents may enter upon and examine any of
the Leased Premises at such reasonable times as Landlord may select and upon
reasonable notice to Tenant (except in the case of any emergency, in which event
no notice shall be required) for the purpose of inspecting the Leased Premises,
verifying compliance or non-compliance by Tenant with its obligations hereunder
and the existence or non-existence of an Event of Default or event which with
the passage of time and/or
notice would constitute an Event of Default, showing the Leased Premises to
prospective Lenders and purchasers and taking such other action with respect to
the Leased Premises as is permitted by any provision hereof.
V. Term.
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A. Subject to the provisions hereof, Tenant shall have and hold the
Leased Premises for an initial term (the "Initial Term" and the Initial Term, as
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extended or renewed in accordance with the provisions hereof, being called the
"Term") commencing on the date hereof (the "Commencement Date") and ending on
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the last day of the two hundred fortieth (240th) calendar month next following
the date hereof (the "Expiration Date").
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B. Provided that if, on or prior to the Expiration Date or any other
Renewal Date (as hereinafter defined) this Lease shall not have been terminated
pursuant to any provision hereof, then on the Expiration Date and on the fifth
(5th), tenth (10th), fifteenth (15th), twentieth (20th) and twenty-fifth (25th)
anniversaries of the Expiration Date (the Expiration Date and each such
anniversary being a "Renewal Date"), the Term shall be deemed to have been
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automatically extended for an additional period of five (5) years with respect
to both of the Allentown Premises and the Johnstown Premises, unless Tenant
shall notify Landlord in writing at least twelve (12) months prior to the next
Renewal Date that Tenant is terminating this Lease as of the next Renewal Date
with respect to either one or both of the Allentown Premises and the Johnstown
Premises. Unless Landlord receives any such notification Tenant shall, if
requested by Landlord, and upon notice to Tenant, execute a document in
recordable form evidencing the extension of the Term with respect to one or both
of the Allentown Premises or Johnstown Premises, as applicable. Any such
extension of the Term shall be subject to all of the provisions of this Lease,
as the same may be amended, supplemented or modified; provided, however, if the
Term is extended with respect to one but not both Related Premises, the Lease
shall, as of the applicable Renewal Date, terminate as to the Related Premises
for which the Term was not extended, and shall continue in effect only with
respect to the Related Premises for which the Term is extended.
C. If Tenant exercises its option pursuant to Paragraph 5(b) not to
have the Term automatically extended, or if an Event of Default occurs, then
Landlord shall have the right during the remainder of the Term then in effect
and, in any event, Landlord shall have the right during the last year of the
Term, to (i) advertise the availability of any of the Leased Premises for sale
or reletting and to erect upon the Allentown Premises signs indicating such
availability and (ii) show any of the Leased Premises to prospective purchasers
or tenants or their agents at such reasonable times as Landlord may select.
VI. Basic Rent. Tenant shall pay to Landlord, as annual rent for the
----------
Leased Premises during the Term, the amounts determined in accordance with
Exhibit "D" hereto ("Basic Rent"), commencing on the first day of May, 1997, and
---------- -----------
continuing on the first day of each August, November, February and May
thereafter during the Term (each such day being a "Basic Rent Payment Date").
-----------------------
Each such rental payment shall be made, at Landlord's sole discretion, (a) to
Landlord at its address set forth above and/or to such other Persons, at such
addresses and in such proportions as Landlord may direct by fifteen (15) days'
prior written notice to Tenant (in which event Tenant shall give Landlord notice
of each such payment concurrent with the making thereof and provided Landlord
shall not change the address to which payments shall be sent and/or the payee
more than twice in any Lease Year), and (b) by a check hand delivered at least
three (3) business days before or mailed at least five (5) days before the
applicable Basic Rent Payment Date, or in Federal Funds. Pro rata Basic Rent
for the period from the date hereof through the last day of the month hereof
shall be paid on the date hereof.
VII. Additional Rent.
---------------
A. Tenant shall pay and discharge, as additional rent (collectively,
"Additional Rent"):
------------------
1. except as otherwise specifically provided herein, all costs and
expenses of Tenant, Landlord and any other Persons specifically referenced
herein which are incurred in connection or associated with (A) the ownership,
use, non-use, occupancy, possession, operation, condition, design, construction,
maintenance, alteration, repair or restoration of any of the Leased Premises,
(B) the performance of any of Tenant's obligations under this Lease, (C) any
sale or other transfer of any of the Leased Premises to Tenant under this Lease,
(D) any Condemnation proceedings, (E) the adjustment, settlement or compromise
of any insurance claims involving or arising from any of the Leased Premises,
(F) the prosecution, defense or settlement of any litigation involving or
arising from any of the Leased Premises, this Lease, or the sale of the Leased
Premises by Tenant to Landlord, (G) the exercise or enforcement by Landlord, its
successors and assigns, of any of its rights under this Lease, (H) any amendment
to or modification or termination of this Lease made at the request of Tenant or
any Complete Assignment or Partial Assignment (and Lease Bifurcation and Loan
bifurcation in connection therewith), (I) Costs of Landlord's counsel incurred
in connection with the preparation, negotiation and execution of this Lease, or
incurred in connection with any act undertaken by Landlord (or its counsel) at
the request of Tenant, or incurred in connection with any act of Landlord
performed on behalf of Tenant, and (J) any other items specifically required to
be paid by Tenant under this Lease;
2. after the date all or any portion of any installment of Basic Rent
is due and not paid, an amount equal to five percent (5%) of the amount of such
unpaid installment or portion thereof ("Late Charge"); provided, however, that
-----------
with respect to the first late payment of all or any portion of any installment
of Basic Rent in any Lease Year, the Late Charge shall not be due and payable
unless the Basic Rent has not been paid within two (2) days following notice
from Landlord that such payment or portion thereof has not been received;
3. a sum equal to any additional sums (including any late charge,
default penalties, interest and fees of Lender's counsel) which are payable by
Landlord to any Lender under any Note by reason of Tenant's late payment or non-
payment of Basic Rent or by reason of an Event of Default; and
4. interest at the rate (the "Default Rate") of five percent (5%) over
the Prime Rate per annum on the following sums until paid in full: (A) all
overdue installments of Basic Rent from the respective due dates thereof, (B)
all overdue amounts of Additional Rent relating to obligations which Landlord
shall have paid on behalf of Tenant, from the date of payment thereof by
Landlord, and (C) all other overdue amounts of Additional Rent, from the date
when any such amount becomes overdue.
B. Tenant shall pay and discharge (i) any Additional Rent referred
to in Paragraph 7(a)(i) when the same shall become due, provided that amounts
which are billed to Landlord or any third party, but not to Tenant, shall be
paid within five (5) days after Landlord's demand for payment thereof, and (ii)
any other Additional Rent, within five (5) days after Landlord's demand for
payment thereof.
C. In no event shall amounts payable under Paragraph 7(a)(ii), (iii)
and (iv) exceed the maximum amount permitted by applicable Law.
VIII. Net Lease; Non-Terminability.
-----------------------------
A. This is a net lease and all Monetary Obligations shall be paid
without notice or demand and without set-off, counterclaim, recoupment,
abatement, suspension, deferment, diminution, deduction, reduction or defense
(collectively, a "Set-Off").
--------
B. Except as otherwise expressly provided herein, this Lease and the
rights of Landlord and the obligations of Tenant hereunder shall not be affected
by any event or for any reason, including the following: (i) any damage to or
theft,
loss or destruction of any of the Leased Premises, (ii) any Condemnation,
(iii) Tenant's acquisition of ownership of any of the Leased Premises other than
pursuant to an express provision of this Lease, (iv) any default on the part of
Landlord hereunder or under any Note, Mortgage, Assignment or any other
agreement, (v) any latent or other defect in any of the Leased Premises, (vi)
the breach of any warranty of any seller or manufacturer of any of the
Equipment, (vii) any violation of Paragraph 4(b) or any other provision of this
Lease by Landlord, (viii) the bankruptcy, insolvency, reorganization,
composition, readjustment, liquidation, dissolution or winding-up of, or other
proceeding affecting Landlord, (ix) the exercise of any remedy, including
foreclosure, under any Mortgage or Assignment, (x) any action with respect to
this Lease (including the disaffirmance hereof) which may be taken by Landlord,
any trustee, receiver or liquidator of Landlord or any court under the Federal
Bankruptcy Code or otherwise, (xi) any interference with Tenant's use of the
Leased Premises, (xii) market or economic changes or (xiii) any other cause,
whether similar or dissimilar to the foregoing, any present or future Law to the
contrary notwithstanding.
C. The obligations of Tenant hereunder shall be separate and
independent covenants and agreements, all Monetary Obligations shall continue to
be payable in all events (or, in lieu thereof, Tenant shall pay amounts equal
thereto), and the obligations of Tenant hereunder shall continue unaffected
unless the requirement to pay or perform the same shall have been terminated
pursuant to an express provision of this Lease. All Rent payable by Tenant
hereunder shall constitute "rent" for all purposes (including Section 502(b)(6)
of the Bankruptcy Code).
D. Except as otherwise expressly provided herein, Tenant shall have
no right and hereby waives all rights which it may have under any Law (i) to
quit, terminate or surrender this Lease or any of the Leased Premises, or (ii)
to any Set-Off of any Monetary Obligations.
IX. Payment of Impositions.
-----------------------
A. Tenant shall, before interest or penalties are due thereon, pay
and discharge all taxes (including real and personal property, franchise, sales
and rent taxes), all charges for any easement or agreement maintained for the
benefit of any of the Leased Premises, all assessments and levies, all permit,
inspection and license fees, all rents and charges for water, sewer, utility and
communication services relating to any of the Leased Premises, all ground rents
and all other public charges whether of a like or different nature, even if
unforeseen or extraordinary, imposed upon or assessed against (i) Tenant, (ii)
Tenant's possessory interest in the Leased Premises, (iii) any of the Leased
Premises, (iv) Landlord as a result of or arising in respect of the acquisition,
ownership, occupancy, leasing, use, possession or sale of any of the Leased
Premises, any activity
conducted on any of the Leased Premises, or the Rent, or
(v) any Lender by reason of any Note, Mortgage, Assignment or other document
evidencing or securing a Loan and which (as to this clause (v)) are normal and
customary and Landlord has agreed to pay (collectively, the "Impositions");
-----------
provided, that nothing herein shall obligate Tenant to pay (A) income, excess
profits or other taxes of Landlord (or Lender) which are determined on the basis
of Landlord's (or Lender's) net income or net worth (unless such taxes are in
lieu of or a substitute for any other tax, assessment or other charge upon or
with respect to the Leased Premises which, if it were in effect, would be
payable by Tenant under the provisions hereof or by the terms of such tax,
assessment or other charge), (B) any estate, inheritance, succession, gift or
similar tax imposed on Landlord, (C) any capital gains tax imposed on Landlord
in connection with the sale of the Leased Premises or either Related Premises to
any Person or (D) any transfer tax imposed on Landlord in connection with the
sale of the Leased Premises or either Related Premises to any Person except for
a sale to Tenant or its assignee or designee. If any Imposition may be paid in
installments without interest or penalty, Tenant shall have the option to pay
such Imposition in installments; in such event, Tenant shall be liable only for
those installments which accrue or become due and payable during the Term.
Tenant shall prepare and file all tax reports required by governmental
authorities which relate to the Impositions. Tenant shall deliver to Landlord
receipts for payment of all taxes required to be paid by Tenant hereunder within
forty-five (45) days after the due date thereof and within ten (10) days after
written request from Landlord copies of all settlements and notices pertaining
to the Impositions which may be issued by any governmental authority and
receipts for payment of all other Impositions. In no event shall Tenant have
any obligation to pay Impositions applicable to a period extending beyond the
expiration of the Term.
B. Landlord shall have the right if required by the terms of any
Mortgage and, in any event, during the occurrence of an Event of Default to
require Tenant to pay to Landlord an additional monthly sum (each an "Escrow
------
Payment") sufficient to pay the Escrow Charges (as hereinafter defined) as they
--------
become due. As used herein, "Escrow Charges" shall mean real estate taxes on
--------------
the Leased Premises or payments in lieu thereof and premiums on any insurance
required by this Lease. Landlord shall determine the amount of the Escrow
Charges and of each Escrow Payment. The Escrow Payments may be commingled with
other funds of Landlord or other Persons and no interest thereon shall be due or
payable to Tenant. Landlord shall apply the Escrow Payments to the payment of
the Escrow Charges in such order or priority as required by law or any Lender.
If at any time the Escrow Payments theretofore paid to Landlord shall be
insufficient for the payment of the Escrow Charges, Tenant, within ten (10) days
after Landlord's demand therefor, shall pay the amount of the deficiency to
Landlord.
X. Compliance with Laws and Easement Agreements; Environmental
-----------------------------------------------------------
Matters.
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A. Tenant shall, at its expense, comply with and conform to, and
cause any other Person occupying any part of the Leased Premises to comply with
and conform to, all Insurance Requirements and Legal Requirements (including all
applicable Environmental Laws). Tenant shall not at any time (i) cause, permit
or suffer to occur any Environmental Violation or (ii) permit any sublessee,
assignee or other Person occupying the Leased Premises under or through Tenant
to cause, permit or suffer to occur any Environmental Violation.
B. Tenant, at its sole cost and expense, will at all times promptly
and faithfully (i) abide by, discharge and perform all of the covenants,
conditions and agreements contained in any Easement Agreement on the part of
Landlord or the occupier to be kept and performed thereunder and (ii) enforce
the obligations of any other Persons under any Easement Agreement. Tenant will
not alter, modify, amend or terminate any Easement Agreement, give any consent
or approval thereunder, or enter into any new Easement Agreement without, in
each case, prior written consent of Landlord, which consent shall not be
unreasonably withheld or delayed provided, however, as to the Johnstown Premises
no such consent of Landlord shall be required unless the alteration,
modification or amendment shall (i) reduce the required parking ratio at the
Johnstown Premises, (ii) impair vehicular or pedestrian access to or visibility
of the Johnstown Premises, (iii) permit in the shopping center in which the
Johnstown Premises are located construction of additional improvements
containing 75,000 square feet or more of floor area in excess of the floor area
permitted under the Easement Agreement prior to such alteration, modification or
amendment or (iv) otherwise adversely impact the value of the Johnstown Premises
for its intended use. It is further agreed that Landlord's consent shall not be
required to the entry by Tenant into any new Easement Agreement so long as such
Easement Agreement is terminable at any time by Landlord upon not more than
ninety (90) days notice.
C. upon prior written notice from Landlord, Tenant shall permit
such persons as Landlord may designate ("Site Reviewers") to visit the Leased
--------------
Premises and perform environmental site investigations and assessments ("Site
----
Assessments") on the Leased Premises for the purpose of determining whether
-----------
there exists on the Leased Premises any Environmental Violation or any condition
which could result in any Environmental Violation. Such Site Assessments may
include both above and below the ground testing for Environmental Violations and
such other tests as may be necessary, in the opinion of the Site Reviewers, to
conduct the Site Assessments. Tenant shall supply to the Site Reviewers such
historical and
operational information regarding the Leased Premises as may be
reasonably requested by the Site Reviewers to facilitate the Site Assessments,
and shall make available for meetings with the Site Reviewers appropriate
personnel having knowledge of such matters. The cost of performing and reporting
Site Assessments shall be paid by Tenant if such Site Assessment shall disclose
an Environmental Violation; otherwise the cost shall be paid by Landlord and
shall not be Additional Rent.
D. If an Environmental Violation occurs or is found to exist and, in
Landlord's reasonable judgment, the cost of remediation of the same is likely to
exceed $100,000, Tenant shall provide to Landlord, within thirty (30) days after
Landlord's request therefor, adequate financial assurances that Tenant will
effect such remediation in accordance with applicable Environmental Laws. Such
financial assurances shall be a bond or letter of credit satisfactory to
Landlord in form and substance and in an amount equal to or greater than
Landlord's reasonable estimate, based upon a Site Assessment performed pursuant
to Paragraph 10(c), of the anticipated cost of such remedial action.
E. Notwithstanding any other provision of this Lease, if an
Environmental Violation occurs or is found to exist and the Term would otherwise
terminate or expire, then, at the option of Landlord, the Term shall be
automatically extended beyond the date of termination or expiration and this
Lease shall remain in full force and effect beyond such date until the earlier
to occur of (i) the completion of all remedial action in accordance with
applicable Environmental Laws or (ii) the date specified in a written notice
from Landlord to Tenant terminating this Lease.
F. If Tenant fails to comply with any requirement of any
Environmental Law in connection with any Environmental Violation which occurs or
is found to exist, Landlord shall have the right (but no obligation) to take any
and all actions as Landlord shall deem necessary or advisable in order to cure
such Environmental Violation.
G. Tenant shall notify Landlord immediately after becoming aware of
any Environmental Violation (or alleged Environmental Violation) or
noncompliance with any of the covenants contained in this Paragraph 10 and shall
forward to Landlord immediately upon receipt thereof copies of all orders,
reports, notices, permits, applications or other communications relating to any
such violation or noncompliance.
H. All future leases, subleases or concession agreements relating to
the Allentown Premises entered into by Tenant shall contain covenants of the
other party thereto which are similar to the covenants of Tenant contained in
subparagraphs (a) and (g) of this Paragraph 10.
I. Tenant shall have performed or cause to be performed the post
closing obligations described in Exhibit "I" attached hereto and made a part
----------
hereof.
XI. Liens; Recording.
-----------------
A. Tenant shall not, directly or indirectly, create or permit to be
created or to remain and shall promptly discharge or remove any lien, levy or
encumbrance on any of the Leased Premises or on any Rent or any other sums
payable by Tenant under this Lease, other than any Mortgage or Assignment, the
Permitted Encumbrances and any mortgage, lien, encumbrance or other charge
created by or resulting solely from any act or omission of Landlord. NOTICE IS
HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE FOR ANY LABOR, SERVICES OR
MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT OR TO ANYONE HOLDING OR
OCCUPYING ANY OF THE LEASED PREMISES THROUGH OR UNDER TENANT, AND THAT NO
MECHANICS' OR OTHER LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL ATTACH
TO OR AFFECT THE INTEREST OF LANDLORD IN AND TO ANY OF THE LEASED PREMISES.
LANDLORD MAY AT ANY TIME POST ANY NOTICES ON THE LEASED PREMISES REGARDING SUCH
NON-LIABILITY OF LANDLORD.
B. Tenant shall execute, deliver and record, file or register
(collectively, "record") all such instruments as may be required or permitted by
-------
any present or future Law in order to evidence the respective interests of
Landlord and Tenant in any of the Leased Premises, and shall cause a memorandum
of this Lease (or, if such a memorandum cannot be recorded, this Lease), and any
supplement hereto or thereto, to be recorded in such manner and in such places
as may be required or permitted by any present or future Law in order to protect
the validity and priority of this Lease.
XII. Maintenance and Repair.
-----------------------
A. Tenant shall at all times maintain or cause to be maintained each
Related Premises and the Adjoining Property in as good repair and appearance as
each is in on the date hereof and fit to be used for their intended use in
accordance with the better of the practices generally recognized as then
acceptable by other companies in its industry or observed by Tenant with respect
to similar properties in comparable retail environments that are owned or
operated by it, and, in the case of the Equipment, in as good mechanical
condition as it was on the later of the date hereof or the date of its
installation, except for ordinary wear and tear. Tenant shall take every other
action reasonably necessary or appropriate for the preservation and safety of
each Related Premises. Tenant shall promptly make all Alterations of every kind
and nature, whether foreseen or unforeseen, which may be required to comply with
the foregoing requirements of this Paragraph 12(a). Landlord shall not be
required to make any Alteration, whether foreseen or unforeseen,
or to maintain any of the Related Premises or Adjoining Property in any way, and
Tenant hereby expressly waives any right which may be provided for in any Law
now or hereafter in effect to make Alterations at the expense of Landlord or to
require Landlord to make Alterations. Any Alteration made by Tenant pursuant to
this Paragraph 12 shall be made in conformity with the provisions of Paragraph
13.
B. If any Improvement, now or hereafter constructed, shall (i)
encroach upon any setback or any property, street or right-of-way adjoining any
of the Leased Premises, (ii) violate the provisions of any restrictive covenant
affecting any of the Leased Premises, (iii) hinder or obstruct any easement or
right-of-way to which any of the Leased Premises is subject or (iv) impair the
rights of others in, to or under any of the foregoing, Tenant shall, promptly
after receiving notice or otherwise acquiring knowledge thereof, either (A)
obtain from all necessary parties waivers or settlements of all claims,
liabilities and damages resulting from each such encroachment, violation,
hindrance, obstruction or impairment, whether the same shall affect Landlord,
Tenant or both, or (B) take such action as shall be reasonably necessary to
remove all such encroachments, hindrances or obstructions and to end all such
violations or impairments, including, if necessary, making Alterations.
XIII. Alterations and Improvements.
-------------------------------
A. Tenant shall have the right, without having obtained the prior
written consent of Landlord and Lender, to make (i) Alterations or a series of
related Alterations that, as to any such Alterations or series of related
Alterations, do not cost in excess of $250,000 in any Lease Year with respect to
either of the Related Premises and (ii) to install Equipment in the Improvements
or accessions to the Equipment that, as to such Equipment or accessions, do not
cost in excess of $250,000 as to either of the Related Premises in any Lease
Year, so long as at the time of construction or installation of any such
Equipment or Alterations no Event of Default exists and the value and utility of
the Leased Premises is not diminished thereby. If the cost of any Alterations
or series of related Alterations as to either of the Related Premises in any
Lease Year or if the Equipment or accessions thereto installed in either of the
Related Premises in any Lease Year is in excess of $250,000, the prior written
approval of Landlord and Lender shall be required, such approval not to be
unreasonably withheld, delayed or conditioned. Tenant shall not construct upon
the Land any additional buildings without having first obtained the prior
written consent of Landlord and Lender, which approval shall not be unreasonably
withheld or delayed.
B. If Tenant makes any Alterations pursuant to this Paragraph 13 or
as required by Paragraph 12 or 17 (such Alterations and actions being
hereinafter collectively referred
to as "Work"), then (i) the market value of the Leased Premises shall not be
----
lessened by any such Work or its usefulness impaired, (ii) all such Work shall
be performed by Tenant in a good and workmanlike manner, (iii) all such Work
shall be expeditiously completed in compliance with all Legal Requirements, (iv)
all such Work shall comply with the requirements of all insurance policies
required to be maintained by Tenant hereunder, (v) if any such Work involves the
replacement of Equipment or parts thereto, all replacement Equipment or parts
shall have (A) a value in use equivalent to the greater of (1) the value in use
on the date hereof of the Equipment being replaced immediately prior to the
occurrence of the event which required its replacement (assuming such Replaced
Equipment was then in the condition required by this Lease) or (2) the value in
use on the date hereof of the Equipment being replaced and (B) where appropriate
a useful life equal to the greater of the useful life on the date hereof of the
Equipment being replaced or the useful life of the Equipment being replaced
immediately prior to the occurrence of the event which required its replacement
(assuming such Replaced Equipment was then in the condition required by this
Lease), (vi) Tenant shall promptly discharge or remove all liens filed against
any of the Leased Premises arising out of such Work, (vii) Tenant shall procure
and pay for all permits and licenses required in connection with any such Work,
(viii) all such Work shall be the property of Landlord and shall be subject to
this Lease, and Tenant shall execute and deliver to Landlord any document
requested by Landlord evidencing the assignment to Landlord of all estate,
right, title and interest (other than the leasehold estate created hereby) of
Tenant or any other Person thereto or therein, and (ix) Tenant shall comply, to
the extent required by this Lease, with the provisions of Paragraphs 12(a) and
19(a), whether or not such Work involves restoration of the Leased Premises.
XIV. Permitted Contests. Notwithstanding any other provision of this
------------------
Lease, Tenant shall not be required to (a) pay any Imposition, (b) discharge or
remove any lien referred to in Paragraph 11 or 13 or (c) take any action with
respect to any encroachment, violation, hindrance, obstruction or impairment
referred to in Paragraph 12(b) (such non-compliance with the terms hereof being
hereinafter referred to collectively as "Permitted Violations"), so long as at
--------------------
the time of such non-compliance no Event of Default exists and so long as Tenant
shall contest, in good faith, the existence, amount or validity thereof, the
amount of the damages caused thereby, or the extent of its or Landlord's
liability therefor by appropriate proceedings which shall operate during the
pendency thereof to prevent or stay (i) the collection of, or other realization
upon, the Permitted Violation so contested, (ii) the sale, forfeiture or loss of
any of the Leased Premises or any Rent to satisfy or to pay any damages caused
by any Permitted Violation, (iii) any interference with the use or occupancy of
any of the Leased Premises, (iv) any interference with the payment of any Rent,
or
(v) the cancellation or increase in the rate of any insurance policy or a
statement by the carrier that coverage will be denied. Tenant shall provide
Landlord security which is satisfactory, in Landlord's reasonable judgment, to
assure that such Permitted Violation is corrected, including all Costs, interest
and penalties that may be incurred or become due in connection therewith. While
any proceedings which comply with the requirements of this Paragraph 14 are
pending and the required security is held by Landlord, Landlord shall not have
the right to correct any Permitted Violation thereby being contested unless
Landlord is required by law to correct such Permitted Violation and Tenant's
contest does not prevent or stay such requirement as to Landlord. Each such
contest shall be promptly and diligently prosecuted by Tenant to a final
conclusion, except that Tenant, so long as the conditions of this Paragraph 14
are at all times complied with, has the right to attempt to settle or compromise
such contest through negotiations. Tenant shall pay any and all losses,
judgments, decrees and Costs in connection with any such contest and shall,
promptly after the final determination of such contest, fully pay and discharge
the amounts which shall be levied, assessed, charged or imposed or be determined
to be payable therein or in connection therewith, together with all penalties,
fines, interest and Costs thereof or in connection therewith, and perform all
acts the performance of which shall be ordered or decreed as a result thereof.
No such contest shall subject Landlord to the risk of any civil or criminal
liability.
XV. Indemnification.
------------------
A. Tenant shall pay, protect, indemnify, defend, save and hold
harmless Landlord, Lender and all other Persons described in Paragraph 30 (each
an "Indemnitee") from and against any and all liabilities, losses, damages
----------
(including punitive damages), penalties, Costs (including attorneys' fees and
costs), causes of action, suits, claims, demands or judgments of any nature
whatsoever, howsoever caused, without regard to the form of action and whether
based on strict liability, gross negligence, negligence or any other theory of
recovery at law or in equity, arising from (i) any matter pertaining to the
acquisition (or the negotiations leading thereto), ownership, leasing, use, non-
use, occupancy, operation, management, condition, design, construction,
maintenance, repair or restoration of any of the Leased Premises or Adjoining
Property, (ii) any casualty in any manner arising from any of the Leased
Premises or Adjoining Property, whether or not Indemnitee has or should have
knowledge or notice of any defect or condition causing or contributing to said
casualty, (iii) any violation by Tenant of any provision of this Lease, any
contract or agreement to which Tenant is a party, any Legal Requirement or any
Permitted Encumbrance or any encumbrance Tenant consented to or (iv) any
alleged, threatened or actual Environmental Violation, including (A) liability
for response costs and for costs of
removal and remedial action incurred by the United States Government, any state
or local governmental unit or any other Person, or damages from injury to or
destruction or loss of natural resources, including the reasonable costs of
assessing such injury, destruction or loss, incurred pursuant to Section 107 of
CERCLA, or any successor section or act or provision of any similar state or
local Law, (B) liability for costs and expenses of abatement, correction or
clean-up, fines, damages, response costs or penalties which arise from the
provisions of any of the other Environmental Laws and (C) liability for personal
injury or property damage arising under any statutory or common-law tort theory,
including damages assessed for the maintenance of a public or private nuisance
or for carrying on of a dangerous activity.
B. In case any action or proceeding is brought against any
Indemnitee by reason of any such claim, (i) Tenant may, except in the event of a
conflict of interest or a dispute between Tenant and any such Indemnitee or
during the continuance of an Event of Default, retain its own counsel and defend
such action (it being understood that Landlord, at its sole cost and expense
which shall not be Additional Rent, may employ counsel of its choice to monitor
the defense of any such action) and (ii) such Indemnitee shall notify Tenant to
resist or defend such action or proceeding by retaining counsel reasonably
satisfactory to such Indemnitee, and such Indemnitee will cooperate and assist
in the defense of such action or proceeding if reasonably requested to do so by
Tenant. In the event of a conflict of interest or dispute or during the
continuance of an Event of Default, Landlord shall have the right to select
counsel, and the cost of such counsel shall be paid by Tenant.
C. The obligations of Tenant under this Paragraph 15 shall survive
any termination, expiration or rejection in bankruptcy of this Lease.
XVI. Insurance.
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A. Tenant shall maintain the following insurance on or in connection
with the Leased Premises:
1. Insurance against physical loss or damage to the Improvements and
Equipment as provided under a standard "All Risk" property policy including but
not limited to flood (to the extent that a Related Premises is in a flood zone)
and earthquake coverage in amounts not less than the actual replacement cost of
the Improvements and Equipment. Such policies shall contain Replacement Cost
and Agreed Amount Endorsements and shall contain deductibles not more than
$150,000 per occurrence.
2. Commercial General Liability Insurance (including but not limited
to Incidental Medical Malpractice and Host Liquor Liability if required) against
claims for personal and bodily injury, death or property damage occurring on, in
or as a result of the use of the Leased Premises, in an amount not less than
$10,000,000 per occurrence/annual aggregate and all other coverage extensions
that are usual and customary for properties of this size and type provided,
however, that the Landlord shall have the right to require such higher limits as
may be reasonable and customary for properties of this size and type.
3. Worker's compensation insurance covering all persons employed by
Tenant in connection with any work done on or about any of the Leased Premises
for which claims for death, disease or bodily injury may be asserted against
Landlord, Tenant or any of the Leased Premises or, in lieu of such Worker's
Compensation Insurance, a program of self-insurance complying with the rules,
regulations and requirements of the appropriate agency of the State or States in
which the Leased Premises are located.
4. Comprehensive Boiler and Machinery Insurance on any of the
Equipment or any other equipment on or in the Leased Premises in an amount not
less than $5,000,000 per accident for damage to property. Such policies shall
include at least $250,000 per accident for Off-Premises Service Interruption,
Expediting Expenses, Ammonia Contamination, and Hazardous Materials Clean-up
Expense and may contain a deductible not to exceed $150,000.
5. Business Income/Extra Expense Insurance to include loss of rents at
limits sufficient to cover 100% of the annual rent payable to Landlord with a
period of indemnity not less than one year from time of loss. Such insurance
shall name Landlord as additional insured solely with respect to Rent payable to
or for the benefit of Landlord under this Lease Agreement.
6. During any period in which substantial Alterations at any Related
Premises are being undertaken, builder's risk insurance (which may be provided
by the contractor performing the work) covering the total completed value
including any "soft costs" with respect to the Improvements being altered or
repaired (on a completed value, non-reporting basis), replacement cost of work
performed and equipment, supplies and materials furnished in connection with
such construction or repair of Improvements or Equipment, together with such
"soft cost" endorsements and such other endorsements as Landlord may reasonably
require and general liability, worker's compensation and automobile liability
insurance with respect to the Improvements being constructed, altered or
repaired.
7. Such other insurance (or other terms with respect to any insurance
required pursuant to this Paragraph 16, including without limitation amounts of
coverage, deductibles, form of mortgagee clause) on or in connection with any of
the Leased Premises as Landlord or Lender may reasonably require, which at the
time is usual and commonly obtained in connection with properties similar in
type of building size, use and location to the Leased Premises.
B. The insurance required by Paragraph 16(a) shall be written by
companies which have a Best's rating of A:X or above and are admitted in, or
approved to write insurance policies by, the State Insurance Department for the
states in which the Leased Premises are located. The insurance policies shall
be in amounts sufficient at all times to satisfy any coinsurance requirements
thereof. The insurance referred to in Paragraphs 16(a)(i), 16(a)(iv) and
16(a)(vi) shall name Tenant as insured and Landlord as Owner and Lender as loss
payee, each as its interest may appear. The insurance referred to in Paragraph
16(a)(ii) shall name Landlord and Lender as additional insureds, and the
insurance referred to in Paragraph 16(a)(v) shall name Landlord as additional
insured and Lender and Landlord as loss payee, each as its interest may appear.
If said insurance or any part thereof shall expire, be withdrawn, become void,
voidable, unreliable or unsafe for any reason, including a breach of any
condition thereof by Tenant or the failure or impairment of the capital of any
insurer, Tenant shall immediately obtain new or additional insurance reasonably
satisfactory to Landlord.
C. Each insurance policy referred to in clauses (i), (iv), (v) and
(vi) of Paragraph 16(a) shall contain standard non-contributory mortgagee
clauses in favor of and reasonably acceptable to Lender. Each policy required
by any provision of Paragraph 16(a), except clause (iii) thereof, shall provide
that it may not be cancelled except after thirty (30) days' prior notice to
Landlord and Lender. Each such policy shall also provide that any loss
otherwise payable thereunder to Landlord, Lender or any third Person shall be
payable notwithstanding (i) any act or omission of Tenant which might, absent
such provision, result in a forfeiture of all or a part of such insurance
payment, (ii) the occupation or use of any of the Leased Premises for purposes
more hazardous than those permitted by the provisions of such policy, (iii) any
foreclosure or other action or proceeding taken by Lender pursuant to any
provision of the Mortgage, Note, Assignment or other document evidencing or
securing the Loan upon the happening of an event of default therein or (iv) any
change in title to or ownership of any of the Leased Premises.
D. Tenant shall pay as they become due all premiums for the
insurance required by Paragraph 16(a), shall renew or replace each policy and,
upon Landlord's request,
deliver to Landlord evidence of the payment of the full
premium therefor or installment then due prior to the expiration date of such
policy, and shall promptly deliver to Landlord original certificates of
insurance signed by an authorized representative of the applicable insurance
company.
E. Anything in this Paragraph 16 to the contrary notwithstanding,
any insurance which Tenant is required to obtain pursuant to Paragraph 16(a) may
be carried under a "blanket" or umbrella policy or policies covering other
properties or liabilities of Tenant, provided that such "blanket" or umbrella
policy or policies otherwise comply with the provisions of this Paragraph 16.
Original Certificates of insurance for each such "blanket" or umbrella policy
signed by an authorized representative of the applicable insurance company shall
promptly be delivered to Landlord.
F. Tenant shall have the replacement cost and insurable value of the
Improvements and Equipment determined from time to time as required by the
replacement cost and agreed amount endorsements and shall deliver to Landlord
the new replacement cost and agreed amount endorsement or certificate evidencing
such endorsement promptly upon Tenant's receipt thereof.
G. Tenant shall promptly comply with and conform to (i) all
provisions of each insurance policy required by this Paragraph 16 and (ii) all
reasonable requirements of the insurers thereunder applicable to Landlord,
Tenant or any of the Leased Premises or to the use, manner of use, occupancy,
possession, operation, maintenance, alteration or repair of any of the Leased
Premises, even if such compliance necessitates Alterations or results in
interference with the use or enjoyment of any of the Leased Premises.
H. Tenant shall not carry separate insurance concurrent in form or
contributing in the event of a Casualty with that required in this Paragraph 16
unless (i) Landlord and Lender are included therein as additional insureds, with
loss payable as provided herein, and (ii) such separate insurance complies with
the other provisions of this Paragraph 16. Tenant shall immediately notify
Landlord of such separate insurance and shall deliver to Landlord the original
policies or certified copies therefor.
I. All policies shall contain full waivers of subrogation against
the Landlord.
J. All proceeds of any insurance required under Paragraph 16(a)
shall be payable as follows:
1. Except for proceeds payable to a Person other than Landlord, Tenant
or Lender, all proceeds of insurance required under clauses (ii), (iv), (v) and
(vii) of Paragraph 16(a) and proceeds attributable to the general liability
coverage provisions of Builder's Risk insurance under clause (vi) of Paragraph
16(a) shall be payable to Landlord or, if required by the Mortgage, to Lender,
as their interests may appear.
2. Proceeds of insurance required under clause (i) of Paragraph 16(a)
and proceeds attributable to Builder's Risk insurance (other than its general
liability coverage provisions) under clause (vi) of Paragraph 16(a) shall be
payable by Landlord (or Lender) and applied as set forth in Paragraph 17.
Tenant shall apply the Net Award to restoration of the Leased Premises in
accordance with the applicable provisions of this Lease.
XVII. Casualty and Condemnation.
--------------------------
A. If any Casualty to either of the Related Premises occurs, Tenant
shall give Landlord and Lender immediate notice thereof. So long as no Event of
Default exists Tenant is hereby authorized to adjust, collect and compromise all
claims under any of the insurance policies required by Paragraph 16(a) (except
public liability insurance claims payable to a Person other than Tenant,
Landlord or Lender) and to execute and deliver on behalf of Landlord all
necessary proofs of loss, receipts, vouchers and releases required by the
insurers and Landlord shall have the right to join with Tenant therein. Any
final adjustment, settlement or compromise of any such claim shall be subject to
the prior written approval of Landlord, which shall not be unreasonably withheld
or delayed, and Landlord shall have the right to prosecute or contest, or to
require Tenant to prosecute or contest, any such claim, adjustment, settlement
or compromise. If an Event of Default exists, Tenant shall not be entitled to
adjust, collect or compromise any such claim or to participate with Landlord in
any adjustment, collection and compromise of the Net Award payable in connection
with a Casualty. Tenant agrees to sign, upon the request of Landlord, all such
proofs of loss, receipts, vouchers and releases. Each insurer is hereby
authorized and directed to make payment under said policies, including return of
unearned premiums, directly to Landlord or, if required by the Mortgage, to
Lender instead of to Landlord and Tenant jointly, and Tenant hereby appoints
each of Landlord and Lender as Tenant's attorneys-in-fact to endorse any draft
therefor. The rights of Landlord under this Paragraph 17(a) shall be extended
to Lender if and to the extent that any Mortgage so provides.
B. Tenant, immediately upon receiving a Condemnation Notice, shall
notify Landlord and Lender thereof. So long as no Event of Default exists,
Tenant is authorized to collect, settle and compromise the amount of any Net
Award and
Landlord shall have the right to join with Tenant therein. If an
Event of Default exists, Landlord shall be authorized to collect, settle and
compromise the amount of any Net Award and Tenant shall not be entitled to
participate with Landlord in any Condemnation proceeding or negotiations under
threat thereof or to contest the Condemnation or the amount of the Net Award
therefor. No agreement with any condemnor in settlement or under threat of any
Condemnation shall be made by Tenant without the written consent of Landlord and
Lender. Subject to the provisions of this Paragraph 17(b), Tenant hereby
irrevocably assigns to Landlord any award or payment to which Tenant is or may
be entitled by reason of any Condemnation, whether the same shall be paid or
payable for Tenant's leasehold interest hereunder or otherwise; but nothing in
this Lease shall impair Tenant's right to any award or payment on account of
Tenant's trade fixtures, equipment or other tangible property which is not part
of the Equipment, moving expenses or loss of business, if available, to the
extent that and so long as (i) Tenant shall have the right to make, and does
make, a separate claim therefor against the condemnor and (ii) such claim does
not in any way reduce either the amount of the award otherwise payable to
Landlord for the Condemnation of Landlord's fee interest in the Leased Premises
or the amount of the award (if any) otherwise payable for the Condemnation of
Tenant's leasehold interest hereunder. The rights of Landlord under this
Paragraph 17(b) shall also be extended to Lender if and to the extent that any
Mortgage so provides.
C. If any Partial Casualty (whether or not insured against) or
Partial Condemnation shall occur to any Related Premises, this Lease shall
continue, notwithstanding such event, and there shall be no abatement or
reduction of any Monetary Obligations. Promptly after such Partial Casualty or
Partial Condemnation, Tenant, as required in Paragraph 12(a), shall commence and
diligently continue to restore the Leased Premises as nearly as possible to
their value, condition and character immediately prior to such event (assuming
the Leased Premises to have been in the condition required by this Lease). So
long as no Event of Default exists, any Net Award up to and including $250,000
shall be paid by Landlord to Tenant and Tenant shall restore the Leased Premises
in accordance with the requirements of Paragraph 13(b) of this Lease. Any Net
Award in excess of $250,000 shall (unless such Casualty resulting in the Net
Award is a Termination Event) be made available by Landlord (or Lender if the
terms of the Mortgage so require) to Tenant for the restoration of any of the
Leased Premises pursuant to and in accordance with and subject to the provisions
of Paragraph 19 hereof. If any Casualty or Condemnation which is not a Partial
Casualty or Partial Condemnation shall occur, Tenant shall comply with the terms
and conditions of Paragraph 18.
XVIII. Termination Events.
------------------
A. If (i) all of either Related Premises shall be taken by a Taking
or (ii) any substantial portion of either Related Premises shall be taken by a
Taking or all or any substantial portion of either Related Premises shall be
totally damaged or destroyed by a Casualty and, in any such case, Tenant
certifies and covenants to Landlord that it will forever abandon operations at
the Related Premises, (any one or all of the Related Premises described in the
above clauses (i) and (ii) above being hereinafter referred to as the "Affected
--------
Premises" and each of the events described in the above clauses (i) and (ii)
--------
shall hereinafter be referred to as a "Termination Event"), then (x) in the case
-----------------
of (i) above, Tenant shall be obligated, within thirty (30) days after Tenant
receives a Condemnation Notice and (y) in the case of (ii) above, Tenant shall
have the option, within sixty (60) days after Tenant receives a Condemnation
Notice or sixty (60) days after the Casualty, as the case may be, to give to
Landlord written notice (a "Termination Notice") of the Tenant's option to
------------------
terminate this Lease as to the Affected Premises in the form described in
Paragraph 18(b).
B. A Termination Notice shall contain (i) notice of Tenant's
intention to terminate this Lease as to the Affected Premises on the first Basic
Rent Payment Date which occurs at least ninety (90) days after the date of the
Termination Notice (the "Termination Date"), (ii) a binding and irrevocable
----------------
offer of Tenant to pay the Termination Amount and (iii) if the Termination Event
is an event described in Paragraph 18(a)(ii), the certification and covenant
described therein and a certified resolution of the Board of Directors of Tenant
authorizing the same.
C. If Landlord shall reject such offer to terminate this Lease as to
the Affected Premises by written notice to Tenant (a "Rejection"), which
---------
Rejection shall contain the written consent of Lender, not later than thirty
(30) days following the date on which Landlord receives the Termination Notice,
then this Lease shall terminate as to the Affected Premises on the Termination
Date; provided that, if Tenant has not satisfied all Monetary Obligations and
all other obligations and liabilities under this Lease which have arisen as to
the Affected Premises (collectively, "Remaining Obligations") on or prior to the
---------------------
Termination Date, then Landlord may, at its option, extend the date on which
this Lease may terminate as to the Affected Premises to a date which is no later
than the first Basic Rent Payment Date after the Termination Date on which
Tenant has satisfied all Remaining Obligations. Upon such termination (i) all
obligations of Tenant hereunder as to the Affected Premises shall terminate
except for any Surviving Obligations, (ii) Tenant shall immediately vacate and
shall have no further right, title or interest in or to any of the Affected
Premises and (iii) the Net Award shall be retained by Landlord. Notwithstanding
anything to the contrary hereinabove contained, if Tenant shall have received a
Rejection and, on the date when
this Lease would otherwise terminate as provided above, if Tenant has not
satisfied all Remaining Obligations on such date, then Landlord may, at its
option, extend the date on which this Lease may terminate to a date which is no
later than the first Basic Rent Payment Date after such date on which Tenant has
satisfied all such Remaining Obligations.
D. Unless Tenant shall have received a Rejection not later than the
thirtieth (30th) day following the date of the Termination Notice, Landlord
shall be conclusively presumed to have accepted such offer. If such offer is
accepted by Landlord then, on the Termination Date, Tenant shall pay to Landlord
the Termination Amount and all Remaining Obligations and Landlord shall convey
to Tenant or its designee the Affected Premises or the remaining portion
thereof, if any, all in accordance with Paragraph 20, and shall assign to Tenant
(or pay over to Tenant) the Net Award.
E. In the event of the termination of this Lease as to the Affected
Premises as hereinabove provided, this Lease shall remain in full force and
effect as to the Remaining Premises; provided, that the Basic Rent for the
Remaining Premises to be paid after such termination shall be the Basic Rent
otherwise payable hereunder with respect to the Leased Premises multiplied by
the percentage set forth on Exhibit "F" for the Remaining Premises.
----------
XIX. Restoration.
------------
A. Landlord (or Lender if required by any Mortgage) shall hold any
Net Award in excess of $250,000 in a fund (the "Restoration Fund") and disburse
----------------
amounts from the Restoration Fund only in accordance with the following
conditions:
1. prior to commencement of restoration, (A) the architects,
contracts, contractors, plans and specifications for the restoration shall have
been approved by Landlord, such approval not to be unreasonably withheld, (B)
Landlord and Lender shall be provided with acceptable performance and payment
bonds which insure satisfactory completion of and payment for the restoration,
are in an amount and form and have a surety acceptable to Landlord, and name
Landlord and Lender as additional dual obligees, and (C) appropriate waivers of
mechanics' and materialmen's liens shall have been filed;
2. at the time of any disbursement, no Event of Default shall exist
and no mechanics' or materialmen's liens shall have been filed against any of
the Leased Premises and remain undischarged or unbonded;
3. disbursements shall be made from time to time in an amount not
exceeding the cost of the work completed since the last disbursement, upon
receipt of (A) satisfactory evidence, including architects' certificates, of the
stage of completion, the estimated total cost of completion and performance of
the work to date in a good and workmanlike manner in accordance with the
contracts, plans and specifications, (B) waivers of liens, (C) contractors' and
subcontractors' sworn statements as to completed work and the cost thereof for
which payment is requested and (D) a satisfactory bringdown of title insurance;
4. each request for disbursement shall be accompanied by a certificate
of Tenant, signed by the president or a vice president of Tenant, describing the
work for which payment is requested, stating the cost incurred in connection
therewith, stating that Tenant has not previously received payment for such work
and, upon completion of the work, also stating that the work has been fully
completed and complies with the applicable requirements of this Lease;
5. Landlord may retain ten percent (10%) of the Restoration Fund until
the restoration is fully completed;
6. the Restoration Fund shall not be commingled with Landlord's other
funds and shall bear interest at a rate agreed to by Landlord and Tenant; and
7. such other reasonable conditions as Landlord or Lender may impose.
B. Prior to commencement of restoration and at any time during
restoration, if the estimated cost of completing the restoration work free and
clear of all liens, as determined by Landlord, exceeds the amount of the Net
Award available for such restoration, the amount of such excess shall, upon
demand by Landlord, be paid by Tenant to Landlord to be added to the Restoration
Fund. Any sum so added by Tenant which remains in the Restoration Fund upon
completion of restoration shall be refunded to Tenant. For purposes of
determining the source of funds with respect to the disposition of funds
remaining after the completion of restoration, the Net Award shall be deemed to
be disbursed prior to any amount added by Tenant.
C. If any sum remains in the Restoration Fund after completion of
the restoration and any refund to Tenant pursuant to Paragraph 19(b), such sum
(the "Remaining Sum") shall be retained by Landlord or, if required by a Note or
-------------
Mortgage, paid by Landlord to a Lender.
D. Any Net Award not in excess of $250,000 shall be paid over to
Tenant by Landlord or Lender promptly upon
receipt and shall be used by Tenant to restore the applicable Related Premises
in accordance with the provisions of Paragraph 17(c).
XX. Procedures Upon Purchase.
-------------------------
A. If the Leased Premises or any of the Related Premises are
purchased by Tenant pursuant to any provision of this Lease, Landlord need not
convey any better title thereto than that which was conveyed to Landlord, and
Tenant or its designee shall accept such title, subject, however, to the
Permitted Encumbrances and to all other liens, exceptions and restrictions on,
against or relating to any of the Leased Premises or the applicable Related
Premises and to all applicable Laws, but free of the lien of and security
interest created by any Mortgage or Assignment and liens, exceptions and
restrictions on, against or relating to the Leased Premises or the applicable
Related Premises which have been created by or resulted solely from acts of
Landlord after the date of this Lease, unless the same are Permitted
Encumbrances or customary utility easements benefiting the Leased Premises or
were created with the concurrence of Tenant or as a result of a default by
Tenant under this Lease.
B. Upon the date fixed for any such purchase of the Leased Premises
or any of the Related Premises pursuant to any provision of this Lease (any such
date the "Purchase Date"), Tenant shall pay to Landlord, or to any Person to
-------------
whom Landlord directs payment, the Relevant Amount therefor specified herein, in
Federal Funds, less any credit of the Net Award received and retained by
Landlord or a Lender allowed against the Relevant Amount, and Landlord shall
deliver to Tenant (i) a special warranty deed which describes the premises being
conveyed and conveys the title thereto as provided in Paragraph 20(a), (ii) such
other instruments as shall be necessary to transfer to Tenant or its designee
any other property (or rights to any Net Award not yet received by Landlord or a
Lender) then required to be sold by Landlord to Tenant pursuant to this Lease
and (iii) any Net Award received by Landlord, not credited to Tenant against the
Relevant Amount and required to be delivered by Landlord to Tenant pursuant to
this Lease; provided, that if any Monetary Obligations remain outstanding on
such date, then Landlord may deduct from the Net Award the amount of such
Monetary Obligations. If on the Purchase Date any Monetary Obligations remain
outstanding and no Net Award is payable to Tenant by Landlord or the amount of
such Net Award is less than the amount of the Monetary Obligations, then Tenant
shall pay to Landlord on the Purchase Date the amount of such Monetary
Obligations. Upon the completion of such purchase, this Lease and all
obligations and liabilities of Tenant hereunder with respect to the applicable
Related Premises (but not with respect to the Remaining Premises) shall
terminate, except any Surviving Obligations.
C. If the completion of such purchase shall be delayed after (i) the
Termination Date, in the event of a purchase pursuant to Paragraph 18 or, (ii)
the date scheduled for such purchase, in the event of a purchase under any other
provision of this Lease then (x) Rent shall continue to be due and payable until
completion of such purchase and (y) at Landlord's sole option, Fair Market Value
shall be redetermined and the Relevant Amount payable by Tenant pursuant to the
applicable provision of this Lease shall be adjusted to reflect such
redetermination.
D. Any prepaid Monetary Obligations paid to Landlord shall be
prorated as of the Purchase Date, and the prorated unapplied balance shall be
deducted from the Relevant Amount due to Landlord; provided, that no
apportionment of any Impositions shall be made upon any such purchase.
XXI. Assignment and Subletting; Prohibition against Leasehold
--------------------------------------------------------
Financing.
----------
A. (i) Except as specifically provided in this Paragraph 21 and
subject to the terms hereof, Tenant shall not assign this Lease, voluntarily or
involuntarily, whether by operation of law or otherwise. Tenant shall have the
right, upon thirty (30) days prior written notice to Landlord and Lender, with
no consent of Landlord or Lender being required or necessary ("Preapproved
-----------
Assignment") (A) to assign this Lease either in its entirety ("Complete
----------- --------
Assignment") or (B) to cause Landlord to bifurcate this Lease into two leases
-----------
("Lease Bifurcation"), one for each Related Premises (each, a "Bifurcated
------------------ ----------
Lease"), provided that the Basic Rent under each such Bifurcated Lease shall be
------
allocated between each of the Related Premises as provided in Exhibit "F", and
----------
to assign this Lease with respect to either Related Premises ("Partial
-------
Assignment"), provided that any such Complete Assignment or Partial Assignment
-----------
is to a Person ("Preapproved Assignee"), that immediately following such
--------------------
assignment has a publicly traded unsecured senior debt rating of "A" or better
from Xxxxx'x Investors Services, Inc. or a rating of "A" or better from Standard
& Poor's Corporation, and in the event all of such rating agencies cease to
furnish such ratings, then a comparable rating by any rating agency reasonably
acceptable to Landlord and Lender.
(ii) If Tenant desires to assign this Lease through either a Complete
Assignment or a Partial Assignment to a Person ("Non-Preapproved Assignee") who
------------------------
would not be a Preapproved Assignee ("Non-Preapproved Assignment") then Tenant
--------------------------
shall, not less than sixty (60) days prior to the date on which it desires to
make a Non-Preapproved Assignment submit to Landlord and Lender information
regarding the following with respect to the Non-Preapproved Assignee (the
"Criteria"): (A) credit, (B) capital structure, (C) management, (D) operating
--------
history, (E) proposed use of the Leased Premises and (F) risk factors associated
with the proposed use of the Leased Premises by the Non-Preapproved Assignee,
taking into account factors such as environmental concerns, product liability
and the like. Landlord and Lender shall review such Criteria and shall approve
or disapprove the Non-Preapproved Assignee no later than the thirtieth (30th)
day following receipt of all such Criteria, and Landlord and Lender shall be
deemed to have acted reasonably in granting or withholding consent if such grant
or disapproval is based on their review of the Criteria.
(iii) If Landlord and Lender withhold consent to the Non-Preapproved
Assignment and Tenant desires to complete the Non-Preapproved Assignment, Tenant
shall make a rejectable offer (the "Intended Assignment Offer") to purchase the
-------------------------
Leased Premises or applicable Related Premises for a purchase price equal to the
Offer Amount and to consummate the purchase on the first Basic Rent Payment Date
occurring thirty (30) days after the determination of Fair Market Value (the
"Intended Assignment Purchase Date"). Notwithstanding the foregoing, if the
---------------------------------
Intended Assignment Offer is accepted by Landlord and the Non-Preapproved
Assignment occurs on a date (the "Assignment Date") that is prior to the
---------------
Intended Assignment Purchase Date, then no later than the Assignment Date,
Tenant shall deposit in escrow with Lender an amount (the "Deposit Amount")
--------------
equal to one hundred ten percent (110%) of the sum of the applicable Acquisition
Cost and any Prepayment Premium. The Deposit Amount shall be held by and
invested by Landlord and the Deposit Amount, together with any interest earned
thereon, shall be applied on the Intended Assignment Purchase Date to payment of
the Assignment Offer Amount. Any part of the Deposit Amount and interest earned
thereon in excess of the Assignment Offer Amount shall be refunded to Tenant.
(iv) If Landlord shall reject the Intended Assignment Offer by notice
to Tenant, such notice to contain the written consent of Lender to such
rejection, no later than the thirtieth (30th) day following receipt of the
Intended Assignment Offer by Landlord, then this Lease shall remain in full
force and effect and Landlord and Lender shall be deemed to have consented to
the Non-Preapproved Assignment (notwithstanding their original withholding of
consent). Nothing provided herein shall constitute a waiver by Landlord of the
obligation of Tenant to comply with the requirements of this Paragraph 21(a)(iv)
if a subsequent Non-Preapproved Assignment arises. No rejection of the Intended
Assignment offer shall be effective for any purpose unless consented to in
writing by Lender.
(v) Unless Landlord shall have rejected the Intended Assignment Offer
by the foregoing notice to Tenant not later than the thirtieth (30th) day
following receipt of the information described in the foregoing Paragraph
21(a)(ii), Landlord shall be conclusively presumed to have accepted the
Intended Assignment Offer. If the Intended Assignment Offer is accepted by
Landlord, Tenant shall pay to Landlord the Offer Amount (less the Deposit Amount
and interest thereon paid to Landlord) on the Intended Assignment Purchase Date
and, provided that no Rent or any other charge is due and unpaid under this
Lease as of the Intended Assignment Purchase Date and Tenant is otherwise in
compliance with the terms of this Lease, Landlord shall convey to Tenant the
Leased Premises in accordance with the provisions of Paragraph 20 of this Lease.
B. Tenant shall have the right, upon thirty (30) days prior written
notice to Landlord and Lender, to enter into one or more subleases that demise,
in the aggregate, up to but not in excess of thirty-five percent (35%) of the
gross space in the Allentown Premises and to enter into one or more subleases or
license agreements for the Johnstown Premises for customary full service
department store licensed operations with no consent or approval of Landlord
being required or necessary ("Preapproved Sublet"). Other than pursuant to a
------------------
Preapproved Sublet, no portion of the Leased Premises shall be subleased during
the Term to any other Person without the prior written consent of Landlord and
Lender, which consent shall be granted or withheld based on a review of the
Criteria. Landlord and Lender shall be deemed to have acted reasonably in
granting or withholding consent if such grant or disapproval is based on their
reasonable review of the Criteria.
C. If Tenant assigns all its rights and interest under this Lease
either in a Partial Assignment with respect to a Related Premises or a Complete
Assignment with respect to the Leased Premises, the assignee under any such
assignment shall expressly assume all the obligations of Tenant hereunder,
actual or contingent, including obligations of Tenant which may have arisen on
or prior to the date of such assignment, by a written instrument delivered to
Landlord at the time of such assignment. Each sublease or license agreement of
either of the Related Premises shall be subject and subordinate to the
provisions of this Lease. Upon any assignment (i) to a Preapproved Assignee or
(ii) any assignment to a Non-Preapproved Assignee that is consented to by
Landlord and Lender and that, immediately following such assignment has a
publicly traded unsecured senior debt rating of "Baa" or better from Xxxxx'x
Investors Services, Inc. or a rating "BBB" from Standard & Poor's Corporation,
or a Replacement Agency, Tenant shall be released from all of its obligations
hereunder which arise after the date of such assignment, except for Surviving
Obligations. No other assignment and no sublease shall affect or reduce any of
the obligations of Tenant hereunder, and all such obligations shall continue in
full force and effect as obligations of a principal and not as obligations of a
guarantor, as if no assignment or sublease had been made. No assignment or
sublease shall impose any additional obligations on Landlord under this Lease.
D. Tenant shall, within ten (10) days after the execution and
delivery of any assignment or sublease consented to by Landlord, deliver a
duplicate original copy thereof to Landlord which, in the event of an
assignment, shall be in recordable form.
E. As security for performance of its obligations under this Lease,
Tenant hereby grants, conveys and assigns to Landlord all right, title and
interest of Tenant in and to all subleases now in existence or hereafter entered
into for any or all of the Leased Premises, any and all extensions,
modifications and renewals thereof and all rents, issues and profits therefrom.
Landlord hereby grants to Tenant a license to collect and enjoy all rents and
other sums of money payable under any sublease of any of the Leased Premises,
provided, however, that if an Event of Default has occurred and is continuing,
Landlord shall have the absolute right upon notice to Tenant and any subtenants
to revoke said license and to collect such rents and sums of money and to apply
the same against the Rent due under the Lease. Tenant shall not accept any
rents more than thirty (30) days in advance of the accrual thereof.
F. Tenant shall not have the power to mortgage, pledge or otherwise
encumber its interest under this Lease or any sublease of any of the Related
Premises, and any such mortgage, pledge or encumbrance made in violation of this
Paragraph 21 shall be void and of no force and effect.
G. If required by any Lender, Landlord may cause a Lease Bifurcation
to occur and subject to the provisions of Xxxxxxxxx 00, Xxxxxxxx may sell or
transfer the Leased Premises at any time without Tenant's consent to any third
party (each a "Third Party Purchaser"). In the event of any such transfer,
---------------------
Tenant shall attorn to any Third Party Purchaser as Landlord so long as such
Third Party Purchaser and Landlord notify Tenant in writing of such transfer.
At the request of Landlord, Tenant will execute such documents confirming the
agreement referred to above and such other agreements as Landlord may reasonably
request, provided that such agreements do not increase the liabilities and
obligations of Tenant hereunder.
XXII. Events of Default.
-----------------
A. The occurrence of any one or more of the following (after
expiration of any applicable cure period as provided in Paragraph 22(b)) shall,
at the sole option of Landlord, constitute an "Event of Default" under this
----------------
Lease:
1. a failure by Tenant to make any payment of any Monetary Obligation,
regardless of the reason for such failure;
2. a failure by Tenant duly to perform and observe, or a violation or
breach of, any provision hereof not otherwise specifically mentioned in this
Paragraph 22(a);
3. any representation or warranty made by Tenant herein or in any
certificate, demand or request made pursuant hereto proves to be incorrect, now
or hereafter, in any material respect;
4. a default beyond any applicable cure period or at maturity by
Tenant or Guarantor in any payment of principal or interest on any obligations
for borrowed money having an original principal balance of $10,000,000 or more
in the aggregate, or in the performance of any other provision contained in any
instrument under which any such obligation is created or secured (including the
breach of any covenant thereunder), (x) if such payment is a payment at maturity
or a final payment, or (y) if an effect of such default is to cause, or permit
any person to cause, such obligation to become due prior to its stated maturity;
5. a default by Tenant or Guarantor beyond any applicable cure period
in the payment of rent under, or in the performance of any other material
provision of, any other lease or leases that have, in the aggregate, rental
obligations over the terms thereof of $5,000,000 or more (less any amounts
payable from the proceeds of insurance) if the Landlord under any such lease or
leases commences to exercise its remedies thereunder;
6. a final, non-appealable judgment or judgments for the payment of
money in excess of $5,000,000 in the aggregate shall be rendered against Tenant
or Guarantor and the same shall remain undischarged for a period of sixty (60)
consecutive days;
7. Tenant shall (A) voluntarily be adjudicated a bankrupt or
insolvent, (B) seek or consent to the appointment of a receiver or trustee for
itself or for any of the Related Premises, (C) file a petition seeking relief
under the bankruptcy or other similar laws of the United States, any state or
any jurisdiction, (D) make a general assignment for the benefit of creditors, or
(E) be unable to pay its debts as they mature;
8. a court shall enter an order, judgment or decree appointing,
without the consent of Tenant, a receiver or trustee for it or for any of the
Related Premises or approving a petition filed against Tenant which seeks relief
under the bankruptcy or other similar laws of the United States, any state or
any jurisdiction, and such order, judgment or decree
shall remain undischarged or unstayed sixty (60) days after it is entered;
9. either of the Related Premises shall remain vacant for a period
that exceeds twelve (12) consecutive months or shall be abandoned;
10. Tenant shall be liquidated or dissolved or shall begin proceedings
towards its liquidation or dissolution;
11. the estate or interest of Tenant in any of the Related Premises
shall be levied upon or attached in any proceeding and such estate or interest
is about to be sold or transferred or such process shall not be vacated or
discharged within sixty (60) days after it is made;
12. a failure by Tenant to perform or observe, or a violation or breach
of, or a misrepresentation by Tenant under, any provision of any Assignment or
any other document between Tenant and Lender with respect to a Loan, if such
failure, violation, breach or misrepresentation gives rise to a default beyond
any applicable cure period with respect to any Loan;
13. the breach of any Covenant shall occur; or
14. an Event of Default (as defined in the Guaranty) beyond any
applicable cure period shall occur under the Guaranty.
B. No notice or cure period shall be required in any one or more of
the following events: (A) the occurrence of an Event of Default under clause
(i) (except as otherwise set forth below), (iii), (iv), (v), (vi), (vii),
(viii), (ix), (x), (xi), (xii), (xiii) or (xiv) of Paragraph 22(a); (B) the
default consists of a failure to provide any insurance required by Paragraph 16
or an assignment or sublease entered into in violation of Paragraph 21; or (C)
the default is such that any delay in the exercise of a remedy by Landlord could
reasonably be expected to cause irreparable harm to Landlord. If the default
consists of the failure to pay any Monetary Obligation under clause (i) of
Paragraph 22(a), the applicable cure period shall be three (3) days from the
date on which notice is given, but Landlord shall not be obligated to give
notice of, or allow any cure period for, any such default more than one (1) time
within any consecutive twelve (12) month period. If the default consists of a
default under clause (ii) of Paragraph 22(a), other than the events specified in
clauses (B) and (C) of the first sentence of this Paragraph 22(b), the
applicable cure period shall be twenty (20) days from the date on which notice
is given
or, if the default cannot be cured within such twenty (20) day period
and delay in the exercise of a remedy would not (in Landlord's reasonable
judgment) cause any material adverse harm to Landlord or any of the Leased
Premises, the cure period shall be extended for the period required to cure the
default (but such cure period, including any extension, shall not in the
aggregate exceed sixty (60) days), provided that Tenant shall commence to cure
the default within the said twenty-day period and shall actively, diligently and
in good faith proceed with and continue the curing of the default until it shall
be fully cured.
XXIII. Remedies and Damages Upon Default.
----------------------------------
A. If an Event of Default shall have occurred and is continuing,
Landlord shall have the right, at its sole option, then or at any time
thereafter, to exercise its remedies and to collect damages from Tenant in
accordance with this Paragraph 23, subject in all events to applicable Law,
without demand upon or notice to Tenant except as otherwise provided in
Paragraph 22(b) and this Paragraph 23.
1. Landlord may give Tenant notice of Landlord's intention to
terminate this Lease on a date specified in such notice. Upon such date, this
Lease, the estate hereby granted and all rights of Tenant hereunder shall expire
and terminate. Upon such termination, Tenant shall immediately surrender and
deliver possession of the Leased Premises to Landlord in accordance with
Paragraph 26. If Tenant does not so surrender and deliver possession of all of
the Leased Premises, Landlord may re-enter and repossess any of the Leased
Premises not surrendered, with or without legal process, by peaceably entering
any of the Leased Premises and changing locks or by summary proceedings,
ejectment or any other lawful means or procedure. Upon or at any time after
taking possession of any of the Leased Premises, Landlord may, by peaceable
means or legal process, remove any Persons or property therefrom. Landlord
shall be under no liability for or by reason of any such entry, repossession or
removal. Notwithstanding such entry or repossession, Landlord may (A) exercise
the remedy set forth in and collect the damages permitted by Paragraph
23(a)(iii) or (B) collect the damages set forth in Paragraph 23(b)(i) or
23(b)(ii).
2. After repossession of any of the Leased Premises pursuant to clause
(i) above, Landlord shall have the right to relet any of the Leased Premises to
such tenant or tenants, for such term or terms, for such rent, on such
conditions and for such uses as Landlord in its sole discretion may determine,
and collect and receive any rents payable by reason of such reletting. Landlord
may make such Alterations in connection with such reletting as it may deem
advisable in its sole discretion. Notwithstanding any such reletting, Landlord
may collect the damages set forth in Paragraph 23(b)(ii).
3. Landlord may declare by notice to Tenant the entire Basic Rent (in
the amount of Basic Rent then in effect) for the remainder of the then current
Term to be immediately due and payable. Tenant shall immediately pay to
Landlord all such Basic Rent discounted to its Present Value, all accrued Rent
then due and unpaid, all other Monetary Obligations which are then due and
unpaid and all Monetary Obligations which arise or become due by reason of such
Event of Default (including any Costs of Landlord). Upon receipt by Landlord of
all such accelerated Basic Rent and Monetary Obligations, this Lease shall
remain in full force and effect and Tenant shall have the right to possession of
the Leased Premises from the date of such receipt by Landlord to the end of the
Term, and subject to all the provisions of this Lease, including the obligation
to pay all increases in Basic Rent and all Monetary Obligations that
subsequently become due, except that (A) no Basic Rent which has been prepaid
hereunder shall be due thereafter during the said Term and (B) Tenant shall have
no option to extend or renew the Term.
B. The following constitute damages to which Landlord shall be
entitled if Landlord exercises its remedies under Paragraph 23(a)(i) or
23(a)(ii):
1. If Landlord exercises its remedy under Paragraph 23(a)(i) but not
its remedy under Paragraph 23(a)(ii) (or attempts to exercise such remedy and is
unsuccessful in reletting the Leased Premises) then, upon written demand from
Landlord, Tenant shall pay to Landlord, as liquidated and agreed final damages
for Tenant's default and in lieu of all current damages beyond the date of such
demand (it being agreed that it would be impracticable or extremely difficult to
fix the actual damages), an amount equal to the Present Value of the excess, if
any, of (A) all Basic Rent from the date of such demand to the date on which the
Term is scheduled to expire hereunder in the absence of any earlier termination,
re-entry or repossession over (B) the then fair market rental value of the
Leased Premises for the same period. Tenant shall also pay to Landlord all of
Landlord's Costs in connection with the repossession of the Leased Premises and
any attempted reletting thereof, including all brokerage commissions, legal
expenses, reasonable attorneys' fees, employees' expenses, costs of Alterations
and expenses and preparation for reletting.
2. If Landlord exercises its remedy under Paragraph 23(a)(i) or its
remedies under Paragraph 23(a)(i) and 23(a)(ii), then Tenant shall, until the
end of what would have been the Term in the absence of the termination of the
Lease, and whether or not any of the Leased Premises shall have been relet, be
liable to Landlord for, and shall pay to Landlord, as liquidated and agreed
current damages on the date on which the same are due and payable under the
terms of this Lease all
Monetary Obligations which would be payable under this
Lease by Tenant in the absence of such termination less the net proceeds, if
any, of any reletting pursuant to Paragraph 23(a)(ii), after deducting from such
proceeds all of Landlord's Costs (including the items listed in the last
sentence of Paragraph 23(b)(i) hereof) incurred in connection with such
repossessing and reletting; provided, that if Landlord has not relet the Leased
Premises, such Costs of Landlord shall be considered to be Monetary Obligations
payable by Tenant. Tenant shall be and remain liable for all sums aforesaid,
and Landlord may recover such damages from Tenant and institute and maintain
successive actions or legal proceedings against Tenant for the recovery of such
damages. Nothing herein contained shall be deemed to require Landlord to wait
to begin such action or other legal proceedings until the date when the Term
would have expired by its own terms had there been no such Event of Default.
C. Notwithstanding anything to the contrary herein contained, in
lieu of or in addition to any of the foregoing remedies and damages, Landlord
may exercise any remedies and collect any damages available to it at law or in
equity. If Landlord is unable to obtain full satisfaction pursuant to the
exercise of any remedy, it may pursue any other remedy which it has hereunder or
at law or in equity.
D. Landlord shall not be required to mitigate any of its damages
hereunder unless required to by applicable Law. If any Law shall validly limit
the amount of any damages provided for herein to an amount which is less than
the amount agreed to herein, Landlord shall be entitled to the maximum amount
available under such Law.
E. No termination of this Lease, repossession or reletting of any of
the Leased Premises, exercise of any remedy or collection of any damages
pursuant to this Paragraph 23 shall relieve Tenant of any Surviving Obligations.
F. WITH RESPECT TO ANY REMEDY OR PROCEEDING OF LANDLORD HEREUNDER,
TENANT WAIVES ANY RIGHT TO A TRIAL BY JURY.
G. Upon the occurrence of any Event of Default, Landlord shall have
the right (but no obligation) to perform any act required of Tenant hereunder
and, if performance of such act requires that Landlord enter the Leased
Premises, Landlord may enter the Leased Premises for such purpose.
H. No failure of Landlord (i) to insist at any time upon the strict
performance of any provision of this Lease or (ii) to exercise any option,
right, power or remedy contained in this Lease shall be construed as a waiver,
modification or relinquishment thereof. A receipt by Landlord of any sum in
satisfaction of any Monetary Obligation with knowledge of the breach of any
provision hereof shall not be deemed a waiver of
such breach, and no waiver by Landlord of any provision hereof shall be deemed
to have been made unless expressed in a writing signed by Landlord.
I. Tenant hereby waives and surrenders, for itself and all those
claiming under it, including creditors of all kinds, (i) any right and privilege
which it or any of them may have under any present or future Law to redeem any
of the Leased Premises or to have a continuance of this Lease after termination
of this Lease or of Tenant's right of occupancy or possession pursuant to any
court order or any provision hereof, and (ii) the benefits of any present or
future Law which exempts property from liability for debt or for distress for
rent.
J. Except as otherwise provided herein, all remedies are cumulative
and concurrent and no remedy is exclusive of any other remedy. Each remedy may
be exercised at any time an Event of Default has occurred and is continuing and
may be exercised from time to time. No remedy shall be exhausted by any
exercise thereof.
XXIV. Notices. All notices, demands, requests, consents, approvals,
-------
offers, statements and other instruments or communications required or permitted
to be given pursuant to the provisions of this Lease shall be in writing and
shall be deemed to have been given and received for all purposes when delivered
in person or by Federal Express or other reliable 24-hour delivery service or
five (5) business days after being deposited in the United States mail, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to the other party at its address hereinafter provided or when
delivery is refused. Notice shall be sent to:
If to Tenant by certified U.S. Mail:
The Bon-Ton Department Stores, Inc.
X.X. Xxx 0000
Xxxx, Xxxxxxxxxxxx 00000-0000
Attn: Senior Vice President and Real Estate
Legal and Governmental Affairs
If to Tenant by other delivery service:
The Bon-Ton Department Stores, Inc.
0000 X. Xxxxxx Xxxxxx
Xxxx, Xxxxxxxxxxxx 00000-0000
Attn: Senior Vice President and Real Estate
Legal and Governmental Affairs
With a duplicate copy delivered in either
case, by certified U.S. Mail to:
The Bon-Ton Department Stores, Inc.
X.X. Xxx 0000
Xxxx, Xxxxxxxxxxxx 00000-0000
Attn: Vice President - Real Estate
and Corporate Counsel
If to Landlord:
BT (PA) QRS 12-25, Inc.
c/o W.P. Xxxxx & Co., Inc.
00 Xxxxxxxxxxx Xxxxx
Xxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Property Manager
With a duplicate copy:
Xxxx Xxxxx Xxxx & XxXxxx
0000 Xxx Xxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Chairman, Real Estate Department
For the purposes of this Paragraph, any party may substitute another
address stated above (or substituted by a previous notice) for its address by
giving fifteen (15) days' notice of the new address to the other party, in the
manner provided above.
XXV. Estoppel Certificate. At any time upon not less than fifteen
--------------------
(15) days' prior written request by either Landlord or Tenant (the "Requesting
----------
Party") to the other party (the "Responding Party"), the Responding Party shall
----- ----------------
deliver to the Requesting Party a statement in writing, executed by an
authorized officer of the Responding Party, certifying (a) that, except as
otherwise specified, this Lease is unmodified and in full force and effect, (b)
the dates to which Basic Rent, Additional Rent and all other Monetary
Obligations have been paid, (c) that, to the knowledge of the signer of such
certificate and except as otherwise specified, no default by either Landlord or
Tenant exists hereunder, (d) such other matters as the Requesting Party may
reasonably request, and (e) if Tenant is the Responding Party that, except as
otherwise specified, there are no proceedings pending or, to the knowledge of
the signer, threatened, against Tenant before or by an court or administrative
agency which, if adversely decided, would materially and adversely affect the
financial condition and operations of Tenant. Any such statements by the
Responding Party may be relied upon by the Requesting Party, any Person whom the
Requesting Party notifies the Responding Party in its request
for the Certificate is an intended recipient or beneficiary of the Certificate,
any Lender or their assignees and by any prospective purchaser or mortgagee of
any of the Leased Premises.
XXVI. Surrender. Upon the expiration or earlier termination of this
----------
Lease, Tenant shall peaceably leave and surrender the Leased Premises to
Landlord in the same condition in which the Leased Premises was at the
commencement of this Lease, except as repaired, rebuilt, restored, altered,
replaced or added to as permitted or required by any provision of this Lease,
and except for ordinary wear and tear. Upon such surrender, Tenant shall (a)
remove from the Leased Premises all property which is owned by Tenant or third
parties other than Landlord and (b) repair any damage caused by such removal.
Property not so removed shall become the property of Landlord, and Landlord may
thereafter cause such property to be removed from the Leased Premises. The cost
of removing and disposing of such property and repairing any damage to any of
the Leased Premises caused by such removal shall be paid by Tenant to Landlord
upon demand. Landlord shall not in any manner or to any extent be obligated to
reimburse Tenant for any such property which becomes the property of Landlord
pursuant to this Paragraph 26.
XXVII. No Merger of Title. There shall be no merger of the leasehold
------------------
estate created by this Lease with the fee estate in any of the Leased Premises
by reason of the fact that the same Person may acquire or hold or own, directly
or indirectly, (a) the leasehold estate created hereby or any part thereof or
interest therein and (b) the fee estate in any of the Leased Premises or any
part thereof or interest therein, unless and until all Persons having any
interest in the interests described in (a) and (b) above which are sought to be
merged shall join in a written instrument effecting such merger and shall duly
record the same.
XXVIII. Books and Records.
-----------------
A. Tenant shall keep adequate records and books of account with
respect to the finances and business of Tenant generally and, consistent with
the operation of its business, with respect to the Leased Premises in accordance
with generally accepted accounting principles ("GAAP") consistently applied,
----
and shall permit Landlord and Lender by their respective agents, accountants and
attorneys, upon reasonable notice to Tenant, to visit and inspect the Leased
Premises and examine (and make copies of) the records and books of account and
to discuss the finances and business with the officers of Tenant, at such
reasonable times as may be requested by Landlord. Upon the request of Landlord
(either telephonically or in writing), Tenant shall provide Landlord with copies
of any information to which Landlord would be entitled in the course of a
personal visit.
B. Tenant shall deliver to Landlord and to Lender within ninety (90)
days of the close of each fiscal year of Tenant, annual audited financial
statements of Tenant prepared by nationally recognized independent certified
public accountants. Tenant shall also furnish to Landlord within forty-five
(45) days after the end of each of the three remaining quarters unaudited
financial statements and all other quarterly reports of Tenant, certified by
Tenant's chief financial officer, and all filings, if any, of Form 10-K, Form
10-Q and other required filings with the Securities and Exchange Commission
pursuant to the provisions of the Securities Exchange Act of 1934, as amended,
or any other Law. All financial statements of Tenant shall be prepared in
accordance with GAAP consistently applied. All annual financial statements
shall be accompanied (i) by an opinion of said accountants stating that (A)
there are no qualifications as to the scope of the audit and (B) the audit was
performed in accordance with GAAP and (ii) by the affidavit of the president or
a vice president of Tenant, dated within five (5) days of the delivery of such
statement, stating that (C) the affiant knows of no Event of Default, or event
which, upon notice or the passage of time or both, would become an Event of
Default which has occurred and is continuing hereunder or, if any such event has
occurred and is continuing, specifying the nature and period of existence
thereof and what action Tenant has taken or proposes to take with respect
thereto and (D) except as otherwise specified in such affidavit, that Tenant has
fulfilled all of its obligations under this Lease which are required to be
fulfilled on or prior to the date of such affidavit. Tenant shall not be
required to comply with the requirements of Paragraph 28(b) for so long as
Tenant's financial statements are consolidated with the financial statement of
Guarantor and Guarantor provides to Landlord the financial statements required
under Section 2.02 of the Guaranty, except that Tenant shall, in all events,
provide to Landlord monthly profit and loss statements for the Leased Premises.
XXIX. Determination of Value.
-----------------------
A. If a determination of Fair Market Value is required pursuant to
any provision of this Lease, such Fair Market Value shall be determined in
accordance with the following procedure:
1. Landlord and Tenant shall endeavor to agree upon such Fair Market
Value within thirty (30) days after the date (the "Applicable Initial Date") on
-----------------------
which (A) Tenant makes the Intended Assignment Offer under Paragraph 21(a) or
(B) Tenant makes an offer with respect to the Allentown Premises pursuant to
Paragraph 37. Upon reaching such agreement, the parties shall execute an
agreement setting forth the amount of such Fair Market Value.
2. If the parties shall not have signed such agreement within thirty
(30) days after the Applicable Initial Date, Tenant shall within fifty (50) days
after the Applicable Initial Date select an appraiser and notify Landlord in
writing of the name, address and qualifications of such appraiser. Within
twenty (20) days following Landlord's receipt of Tenant's notice of the
appraiser selected by Tenant, Landlord shall select an appraiser and notify
Tenant of the name, address and qualifications of such appraiser. Such two
appraisers shall endeavor to agree upon Fair Market Value based on a written
appraisal made by each of them as of the Relevant Date (and given to Landlord by
Tenant). If such two appraisers shall agree upon a Fair Market Value, the
amount of such Fair Market Value as so agreed shall be binding and conclusive.
3. If such two appraisers shall be unable to agree upon a Fair Market
Value within twenty (20) days after the selection of an appraiser by Landlord,
then such appraisers shall advise Landlord and Tenant of their respective
determination of Fair Market Value and shall select a third appraiser to make
the determination of Fair Market Value. The selection of the third appraiser
shall be binding and conclusive upon Landlord and Tenant.
4. If such two appraisers shall be unable to agree upon the
designation of a third appraiser within ten (10) days after the expiration of
the twenty (20) day period referred to in clause (iii) above, or if such third
appraiser does not make a determination of Fair Market Value within twenty (20)
days after his selection, then such third appraiser or a substituted third
appraiser, as applicable, shall, at the request of either party hereto (with
respect to the other party), be appointed by the President or Chairman of the
American Arbitration Association in New York, New York. The determination of
Fair Market Value made by the third appraiser appointed pursuant hereto shall be
made within twenty (20) days after such appointment.
5. If a third appraiser is selected, Fair Market Value shall be the
average of the determination of Fair Market Value made by the third appraiser
and the determination of Fair Market Value made by the appraiser (selected
pursuant to Paragraph 29(a)(ii) hereof) whose determination of Fair Market Value
is nearest to that of the third appraiser. Such average shall be binding and
conclusive upon Landlord and Tenant.
6. All appraisers selected or appointed pursuant to this Paragraph
29(a) shall (A) be independent qualified MAI appraisers (B) have no right, power
or authority to alter or modify the provisions of this Lease, (C) utilize the
definition of Fair Market Value hereinabove set forth above, and (D) be
registered in the State if the State provides for or requires such registration.
7. The Cost of the procedure described in this Paragraph 29(a) above
shall be borne by Tenant.
B. If, by virtue of any delay, Fair Market Value is not determined
by the expiration or termination of the then current Term, then the date on
which the Term would otherwise expire or terminate shall be extended with
respect to the Leased Premises or the Related Premises, as applicable, to the
date specified for termination in the particular provision of this Lease
pursuant to which the determination of Fair Market Value is being made.
C. In determining Fair Market Value as defined in clause (a) of the
definition of Fair Market Value, the appraisers shall add (i) the present value
of the Rent for the remaining Term (with assumed increases in the CPI to be
determined by the appraisers) using a discount rate (which may be determined by
an investment banker retained by each appraiser) based on the creditworthiness
of Tenant and (ii) the present value of the Leased Premises as of the end of
such Term. The appraisers shall further assume that no default then exists
under the Lease, that Tenant has complied (and will comply) with all provisions
of the Lease, and that Guarantor and Tenant have not violated (and will not
violate) any of the Covenants.
XXX. Non-Recourse as to Landlord. Anything contained herein to the
---------------------------
contrary notwithstanding, any claim based on or in respect of any liability of
Landlord under this Lease shall be enforced only against the Leased Premises and
not against any other assets, properties or funds of (a) Landlord, (b) any
director, officer, general partner, limited partner, employee or agent of
Landlord, or any general partner of Landlord, any of its general partners or
shareholders (or any legal representative, heir, estate, successor or assign of
any thereof), (c) any predecessor or successor partnership or corporation (or
other entity) of Landlord, or any of its general partners, either directly or
through Landlord or its general partners or any predecessor or successor
partnership or corporation or their shareholders, officers, directors, employees
or agents (or other entity), or (d) any other Person (including Xxxxx Property
Advisors, Xxxxx Fiduciary Advisors, Inc., W.P. Xxxxx & Co., Inc., W.P. Xxxxx
Incorporated and any Person affiliated with any of the foregoing, or any
director, officer, employee or agent of any thereof).
XXXI. Financing.
---------
A. Tenant agrees to pay all costs and expenses incurred by Landlord
in connection with the purchase, leasing and initial financing of the Leased
Premises including, without limitation, the cost of appraisals, environmental
reports, title
insurance, surveys, legal fees and expenses and Lender's commitment fees.
B. If Landlord desires to obtain or refinance any Loan, Tenant shall
negotiate in good faith with Landlord concerning any request made by any Lender
or proposed Lender for changes or modifications in this Lease. In particular,
Tenant shall agree, upon request of Landlord, to supply any such Lender with
such notices and information as Tenant is required to give to Landlord hereunder
and to extend the rights of Landlord hereunder to any such Lender and to consent
to such financing if such consent is requested by such Lender. Tenant shall
provide any other consent or statement and shall execute any and all other
documents that such Lender reasonably requires in connection with such
financing, including any environmental indemnity agreement and subordination,
non-disturbance and attornment agreement, so long as the same do not materially
adversely affect any right, benefit or privilege of Tenant under this Lease or
materially increase Tenant's obligations under this Lease. Such subordination,
nondisturbance and attornment agreement may require Tenant to confirm that (a)
Lender and its assigns will not be liable for any misrepresentation, act or
omission of Landlord and (b) Lender and its assigns will not be subject to any
counterclaim, demand or offsets which Tenant may have against Landlord.
XXXII. Subordination. This Lease and Tenant's interest hereunder shall
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be subordinate to any Mortgage or other security instrument hereafter placed
upon the Leased Premises by Landlord, and to any and all advances made or to be
made thereunder, to the interest thereon, and all renewals, replacements and
extensions thereof, provided that any such Mortgage or other security instrument
(or a separate instrument in recordable form duly executed by the holder of any
such Mortgage or other security instrument and delivered to Tenant) shall
provide for the recognition of this Lease and all Tenant's rights hereunder
unless and until an Event of Default exists or Landlord shall have the right to
terminate this Lease pursuant to any applicable provision hereof.
XXXIII. Financial Covenants. Tenant hereby covenants and agrees to
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comply with all the Covenants to the extent the Covenants are applicable to
Tenant.
XXXIV. Tax Treatment; Reporting. Landlord and Tenant each acknowledge
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that each shall treat this transaction as a true lease for state law purposes
and shall report this transaction as a Lease for Federal income tax purposes.
For Federal income tax purposes each shall report this Lease as a true lease
with Landlord as the owner of the Leased Premises and Equipment and Tenant as
the lessee of such Leased Premises and Equipment including: (1) treating
Landlord as the owner of the property eligible to claim depreciation deductions
under Section 167 or
168 of the Internal Revenue Code of 1986 (the "Code") with
respect to the Leased Premises and Equipment, (2) Tenant reporting its Rent
payments as rent expense under Section 162 of the Code, and (3) Landlord
reporting the Rent payments as rental income.
XXXV. Right of First Refusal.
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A. Landlord shall provide notice ("Market Notice") to Tenant if
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Landlord intends to market the Leased Premises or either Related Premises for
sale. Except as otherwise provided in Paragraph 35(e), and provided an Event of
Default does not then exist, if Landlord shall enter into a contract (the "Sale
Contract") for the sale of the entire Leased Premises or for either of the
Related Premises with a Third Party Purchaser, which Sale Contract shall be
conditioned upon Tenant's failure to exercise its right under this Paragraph 35,
then promptly following the execution thereof, Landlord shall give written
notice to Tenant, together with a copy of the executed Sale Contract.
B. For a period equal to the greater of (i) thirty (30) days
following receipt of such executed Sale Contract or (ii) ninety (90) days
following a market receipt of a Market Notice, Tenant shall have the right and
option, exercisable by written notice to Landlord given within said thirty (30)
day period, to elect to purchase the Premises which are the subject of such Sale
Contract (the "Sale Premises") at the purchase price and upon all the terms and
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conditions set forth in the Sale Contract except that no contingencies contained
in such Sale Contract as to environmental assessments, engineering studies,
inspection of the Sale Premises, availability of financing, sale of other
property, state of the title to or encumbrances on the Sale Premises, or any
other condition or contingency to the Third Party Purchaser's obligation to
purchase the Sale Premises which pertains to the physical condition of the Sale
Premises, shall apply to Tenant's obligation to purchase the Sale Premises under
this Paragraph 35, and Tenant shall be obligated to purchase the Sale Premises
without any such condition or contingency.
C. If at the expiration of the aforesaid thirty (30) day period
Tenant shall have failed to exercise the aforesaid option, Landlord may sell the
Sale Premises to such Third Party Purchaser upon the terms set forth in such
contract.
D. Except as otherwise specifically provided herein, the closing
date for any purchase of the Sale Premises by Tenant pursuant to this Paragraph
35 shall be the later to occur of (i) ninety (90) days after the date of
Tenant's notice to Landlord of its intention to purchase the Sale Premises upon
the terms of a Sale Contract with a Third Party Purchaser or (ii) the closing
date provided in such Sale Contract. At such closing Landlord shall convey the
Sale Premises to Tenant in accordance
with, and Tenant shall pay to Landlord the purchase price and other
consideration set forth in, the applicable Sale Contract.
E. Tenant shall have the right to exercise the foregoing right of
first refusal upon (i) each proposed sale of the Leased Premises prior to the
fifteenth (15th) anniversary of this Lease and (ii) notwithstanding the lack of
exercise by Tenant in (i) above, one (1) time after the fifteenth (15th)
anniversary of this Lease; provided, that if, following compliance with the
procedure described in this Paragraph 35, a Third Party Purchaser does not
purchase the Leased Premises, such event shall not count as an exercise of
Tenant's right of first refusal. Notwithstanding anything to the contrary, if
Tenant fails to exercise the right of first refusal granted pursuant to this
Paragraph (c), subsection (ii), after the fifteenth (15th) anniversary of this
Lease and the sale to the Third Party Purchaser is consummated, or if the Term
of this Lease shall terminate or expire or a Lease Bifurcation occurs that is
requested by, or a result of Tenant's act, such rights of first refusal granted
pursuant to this Paragraph 36 shall terminate and be null and void and of no
further force and effect. In such event Tenant shall execute a quitclaim deed
and such other documents as Landlord shall reasonably request evidencing the
termination of its right of first refusal.
F. If Tenant does not exercise its right of first refusal to
purchase the Sale Premises and the Sale Premises are transferred to a Third
Party Purchaser, Tenant will attorn to any Third Party Purchaser as Landlord so
long as such Third Party Purchaser and Landlord notify Tenant in writing of such
transfer. At the request of Landlord, Tenant will execute such documents
confirming the agreement referred to above and such other agreements as Landlord
may reasonably request, provided that such agreements do not increase the
liabilities and obligations of Tenant hereunder.
G. The provisions of this Paragraph 35 shall not apply to or
prohibit (i) any mortgaging, subjection to deed of trust or other hypothecation
of Landlord's interest in the Leased Premises, (ii) any sale of the Leased
Premises pursuant to a private power of sale under or judicial foreclosure of
any Mortgage or other security instrument or device to which Landlord's interest
in the Leased Premises is now or hereafter subject, (iii) any transfer of
Landlord's interest in the Leased Premises to a Lender, beneficiary under deed
of trust or other holder of a security interest therein or their designees by
deed in lieu of foreclosure, (iv) any transfer of the Leased Premises to any
governmental or quasi-governmental agency with power of condemnation, (v) any
transfer of the Leased Premises to any affiliate of Landlord or to any entity
for whom W.P. Xxxxx & Co., Inc., W.P. Xxxxx Incorporated or any of their
affiliates provides management services or investment advice, (vi) any Person to
whom Landlord sells all or substantially all of its assets, or
(vii) any transfer of the Leased Premises to any of the successors or assigns of
any of the Persons referred to in the foregoing clauses (i) through (vi).
XXXVI. Sale of Related Premises by Landlord. If at any time or from
------------------------------------
time to time Landlord sells either Related Premises (any such premises, a
"Landlord Sale Premises") either to Tenant or to a Third Party Purchaser, then
----------------------
Landlord and Tenant agree that (i) the Lease shall be bifurcated with respect to
the remaining Related Premises and the Landlord Sale Premises; (ii) Tenant will
attorn to any purchaser with respect to the Landlord Sale Premises purchased so
long as such purchaser assumes the obligations of Landlord under the Lease with
respect to the Landlord Sale Premises; and (iii) the terms of the Lease will
remain in full force and effect with respect to the Landlord Sale Premises
except that the Basic Rent will be the percentage of the then Basic Rent which
is allocated to the Landlord Sale Premises as set forth on Exhibit "F" attached
-----------
hereto and made a part hereof; and (iv) the terms of the Lease will remain in
full force and effect with respect to the remaining Related Premises except that
the Basic Rent will be the percentage of the then Basic Rent which is allocated
to the remaining Related Premises as set forth on Exhibit "F" attached hereto
-----------
and made a part hereof. At the request of Landlord, Tenant will execute such
documents confirming the agreements referred to above and such other agreements
as Landlord may reasonably request provided that such agreements will not result
in any cost to Tenant and will not increase the liabilities and obligations of
Tenant hereunder.
XXXVII. Substitution and Exchange of Premises.
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A. If at any time after the end of the second (2nd) Lease Year,
Tenant in its reasonable business judgment determines that the Allentown
Premises has become uneconomic for Tenant's continued use and occupancy in its
business operations, then Tenant shall have the right to make a rejectable offer
to convey to Landlord a substitute property (the "Exchange Premises") and lease
-----------------
the Exchange Premises back from Landlord on the terms and conditions provided
herein in exchange for the conveyance to Tenant of the Allentown Premises and
the termination of the Lease with respect to the Allentown Premises (the
"Exchange"). In the event that Tenant elects to exercise such right, Tenant
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shall deliver to Landlord (i) a certificate of Tenant stating that the Allentown
Premises are no longer economic or suitable for Tenant's continued use and
occupancy in its business operations, specifying in reasonable detail the
reasons therefore, and further certifying that Tenant intends forever to abandon
its operations at the Allentown Premises, which certificate shall be accompanied
by a resolution of the board of directors of Tenant authorizing the delivery of
such notice and the Exchange; (ii) a description and an appraisal of the
Exchange Premises by an appraiser and in such form as are satisfactory to
Landlord; (iii) such other relevant data as Landlord may request demonstrating
the economic viability of the Exchange Premises,
the marketability of title to the Exchange Premises and the environmental status
of the Exchange Premises; (iv) Tenant's rejectable offer to convey the Exchange
Premises to Landlord and lease back the Exchange Premises in exchange for
Landlord conveying the Allentown Premises to Tenant and terminating the Lease
with respect to the Allentown Premises and (v) a statement of Tenant's intention
to affect the Exchange on the first Basic Rent Payment Date occurring at least
ninety (90) days following determination of Fair Market Value of the Exchange
Premises (the "Exchange Date"). Landlord and Tenant shall promptly commence to
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determine the Fair Market Value of the Exchange Premises.
B. Landlord, with the written consent of Lender, shall accept or
reject such offer not later than sixty (60) days following determination of Fair
Market Value of the Exchange Premises. If Landlord, with the written consent of
Lender, shall reject Tenant's offer then this Lease shall remain in full force
and effect with respect to the Allentown Premises. If Landlord, with the
written consent of Lender, shall accept Tenant's offer and if on the Exchange
Date all conditions and requirements imposed by Landlord and Lender in
connection with the acceptance of Tenant's offer of substitution have been
satisfied, including, but not limited to, (i) the approval of Landlord, Lender
and their respective counsel of all documents relating to the Exchange; (ii)
payment in full by Tenant of all installments of annual Basic Rent, Additional
Rent and all other charges due and unpaid hereunder; (iii) compliance by Tenant
with all other obligations and liabilities, actual or contingent, under this
Lease which have arisen on or prior to the Exchange Date and Tenant not then
being in default hereunder; (iv) delivery to Landlord and Lender, respectively,
of ALTA "owner" and "mortgagee" title insurance policies insuring Landlord's fee
title to the Exchange Premises and Lender's first lien thereon subject only to
such matters as Landlord and Lender shall approve; (v) Tenant's conveyance of
the Exchange Premises to Landlord, the lease back of the Exchange Premises to
Tenant in accordance with and subject to the terms and conditions of this Lease
as the same shall be amended accordingly, and (vi) the mortgaging of the
Exchange Premises in accordance with and subject to the terms of the Mortgage as
the same shall be amended to reflect the substitution of the Exchange Premises
for the Allentown Premises; then the Allentown Premises shall be conveyed to
Tenant in accordance with the provisions of Paragraph 20 and all obligations
hereunder with respect to the Allentown Premises shall terminate, except for any
obligations or liabilities of Tenant, actual or contingent, arising prior to
such conveyance.
Tenant shall pay charges incident to the Exchange, regardless of whether or not
the Exchange occurs, including, but not limited to, Landlord's and Lender's
counsel fees, escrow fees, recording fees, brokerage fees incurred by Tenant,
title insurance and all federal, state and local taxes which may be incurred or
imposed
by reason of such conveyance and transfer and/or by delivery of any deed or
other instrument.
XXXVIII. Release of Excess Land. Landlord acknowledges that Tenant has
----------------------
committed to convey the Excess Land to the Township of Whitehall, and Landlord
shall, upon Tenant's request, convey the Excess Land to Tenant or Tenant's
designee; provided, that the following conditions are satisfied: the Leased
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Premises shall have been subdivided in compliance with all applicable
subdivision laws, Legal Requirements and Easement Agreements so that the Excess
Land and the remainder of the Leased Premises (the "Retained Premises") are
-----------------
separate tracts, (ii) after such sale both the Excess Land and the Retained
Premises shall comply with all applicable Laws, Legal Requirements and Easement
Agreements, and (iii) all Costs of Landlord, Lender and Tenant in connection
with the transfer of the Excess Land and in complying with the above conditions,
including reasonable attorneys' fees, shall be borne solely by Tenant. If
Landlord conveys the Excess Land, then this Lease and any Mortgage granted by
Landlord shall terminate with respect to the Excess Land, but shall remain in
full force and effect with respect to the Retained Premises, provided, however,
that in no event will the release of the Excess Land from this Lease amend,
reduce or modify any of the obligations and liabilities of Tenant hereunder,
including the obligation to pay Basic Rent in the amount set forth in Exhibit
-------
"D" hereto.
---
XXXIX. Miscellaneous.
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A. The paragraph headings in this Lease are used only for
convenience in finding the subject matters and are not part of this Lease or to
be used in determining the intent of the parties or otherwise interpreting this
Lease.
B. As used in this Lease, the singular shall include the plural and
any gender shall include all genders as the context requires and the following
words and phrases shall have the following meanings: (i) "including" shall mean
"including without limitation"; (ii) "provisions" shall mean "provisions, terms,
agreements, covenants and/or conditions"; (iii) "lien" shall mean "lien, charge,
encumbrance, title retention agreement, pledge, security interest, mortgage
and/or deed of trust"; (iv) "obligation" shall mean "obligation, duty,
agreement, liability, covenant and/or condition"; (v) "any of the Leased
Premises" shall mean "the Leased Premises or any part thereof or interest
therein"; (vi) "any of the Land" shall mean "the Land or any part thereof or
interest therein"; (vii) "any of the Improvements" shall mean "the Improvements
or any part thereof or interest therein"; (viii) "any of the Equipment" shall
mean "the Equipment or any part thereof or interest therein"; and (ix) "any of
the Adjoining Property" shall mean "the Adjoining Property or any part thereof
or interest therein".
C. Any act which Landlord is permitted to perform under this Lease
may be performed at any time and from time to time by Landlord or any person or
entity designated by Landlord. Each appointment of Landlord as attorney-in-fact
for Tenant hereunder is irrevocable and coupled with an interest. Except as
otherwise specifically provided herein, Landlord shall have the right, at its
sole option, to withhold or delay its consent whenever such consent is required
under Paragraph 21 of this Lease for any reason or no reason. In all other
cases, Landlord shall not unreasonably withhold its consent, provided that
Lender consents to any such request. Time is of the essence with respect to the
performance by Tenant of its obligations under this Lease.
D. Landlord shall in no event be construed for any purpose to be a
partner, joint venturer or associate of Tenant or of any subtenant, operator,
concessionaire or licensee of Tenant with respect to any of the Leased Premises
or otherwise in the conduct of their respective businesses.
E. This Lease and any documents which may be executed by Tenant on
or about the effective date hereof at Landlord's request constitute the entire
agreement between the parties and supersede all prior understandings and
agreements, whether written or oral, between the parties hereto relating to the
Leased Premises and the transactions provided for herein. Landlord and Tenant
are business entities having substantial experience with the subject matter of
this Lease and have each fully participated in the negotiation and drafting of
this Lease. Accordingly, this Lease shall be construed without regard to the
rule that ambiguities in a document are to be construed against the drafter.
F. This Lease may be modified, amended, discharged or waived only by
an agreement in writing signed by the party against whom enforcement of any such
modification, amendment, discharge or waiver is sought.
G. The covenants of this Lease shall run with the land and bind
Tenant, its successors and assigns and all present and subsequent encumbrancers
and subtenants of any of the Leased Premises, and shall inure to the benefit of
Landlord, its successors and assigns. If there is more than one Tenant, the
obligations of each shall be joint and several.
H. Notwithstanding any provision in this Lease to the contrary, all
Surviving Obligations of Tenant shall survive the expiration or termination of
this Lease with respect to any Related Premises.
I. If any one or more of the provisions contained in this Lease
shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Lease, but this
Lease shall be construed as if such invalid, illegal or unenforceable provision
had never been contained herein.
J. All exhibits attached hereto are incorporated herein as if fully
set forth.
K. This Lease shall be governed by and construed and enforced in
accordance with the Laws of the State.
IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be
duly executed under seal as of the day and year first above written.
LANDLORD:
BT (PA) QRS 12-25, INC., a
Pennsylvania corporation
By: /s/ Xxxx X. Xxxxxxxx
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Title: Second Vice President
ATTEST: TENANT:
THE BON-TON DEPARTMENT STORES,
INC., a Pennsylvania corporation
By: /s/ Xxxxxx X. Xxxxx By: /s/ H. Xxxxxxx Xxxxx
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Title: Secretary Title: Senior Vice President
[Corporate Seal]