Exhibit 10.94
Lease Agreement for Store-Concord Xxxxx (Play Co.)
LEASE
TOYS INTERNATIONAL, INC., a California corporation
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Tenant
THE PLAY COMPANY
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Trade Name
N/A
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Guarantor
Concord Xxxxx
TABLE OF CONTENTS
Page
ARTICLE I.........................................................................................................4
GRANT AND TERM...........................................................................................4
Section 1.1 Leased Premises....................................................................4
Section 1.2 Term...............................................................................5
Section 1.3 Opening............................................................................6
Section 1.4 Late Opening.......................................................................6
ARTICLE II........................................................................................................7
RENT AND DEPOSIT.........................................................................................7
Section 2.1. Minimum Rent......................................................................7
Section 2.2. Percentage Rent...................................................................7
Section 2.3. Payments By Tenant................................................................9
Section 2.4. Security Deposit. [Intentionally deleted] 9
Section 2.5. Late Charge.......................................................................9
ARTICLE III......................................................................................................10
PREPARATION OF LEASED PREMISES..........................................................................10
Section 3.1. Landlord's Work..................................................................10
Section 3.2. Delivery of Possession...........................................................10
Section 3.3. Tenant's Work....................................................................10
Section 3.4. Alterations by Tenant............................................................12
Section 3.5. Removal by Tenant................................................................12
ARTICLE IV.......................................................................................................13
CONDUCT OF BUSINESS.....................................................................................13
Section 4.1. Use and Trade Name...............................................................13
Section 4.2. Operation of Business............................................................13
Section 4.3. Sign.............................................................................13
Section 4.4. Tenant's Warranties..............................................................14
Section 4.5. Storage and Office Space.........................................................14
Section 4.6. Care of Premises.................................................................15
Section 4.7. Notice by Tenant.................................................................15
Section 4.8. Radius...........................................................................15
ARTICLE V........................................................................................................15
COMMON AREA.............................................................................................15
Section 5.1. Use of Common Area...............................................................15
Section 5.2. Common Area Maintenance Expenses.................................................16
ARTICLE VI.......................................................................................................17
REPAIRS AND MAINTENANCE.................................................................................17
Section 6.1. Repairs and Maintenance by Landlord..............................................17
Section 6.2. Repairs and Maintenance by Tenant................................................18
ARTICLE VII......................................................................................................19
TAXES ...............................................................................................19
Section 7.1. Tax Liability....................................................................19
Section 7.2. Method of Payment................................................................19
ARTICLE VIII.....................................................................................................20
INSURANCE, INDEMNITY AND LIABILITY......................................................................20
Section 8.1. Landlord's Insurance Obligations.................................................20
Section 8.2. Tenant's Insurance Obligations...................................................20
SECTION 8.3. MUTUAL COVENANT..................................................................21
SECTION 8.4. COVENANT TO HOLD HARMLESS........................................................22
Section 8.5. Loss and Damage..................................................................22
ARTICLE IX.......................................................................................................23
DESTRUCTION OF LEASED PREMISES..........................................................................23
Section 9.1. Continuance of Lease.............................................................23
Section 9.2. Reconstruction...................................................................23
ARTICLE X........................................................................................................24
CONDEMNATION............................................................................................24
Section 10.1. Eminent Domain..................................................................24
Section 10.2. Rent Apportionment..............................................................24
Section 10.3. Temporary Taking................................................................25
ARTICLE XI.......................................................................................................25
ASSIGNMENT, SUBLETTING AND ENCUMBERING LEASE............................................................25
Section 11.1. No Assignment, Subletting or Encumbering of Lease 25
Section 11.2. Assignment or Sublet............................................................27
Section 11.3. Transfer of Landlord's Interest.................................................27
ARTICLE XII......................................................................................................27
SUBORDINATION, ATTORNMENT, FINANCING AND ESTOPPEL CERTIFICATE 27
Section 12.1. Subordination...................................................................27
Section 12.2. Attornment......................................................................27
Section 12.3. Financing.......................................................................27
Section 12.4. Estoppel Certificate............................................................28
Section 12.5. Remedies........................................................................28
ARTICLE XIII.....................................................................................................28
ADVERTISING AND PROMOTION...............................................................................28
Section 13.1. Promotion Fund..................................................................28
Section 13.2. Promotion Fund Contribution.....................................................28
Section 13.3. Advertisements..................................................................29
Section 13.4. Network.........................................................................29
ARTICLE XIV......................................................................................................29
DEFAULT AND REMEDIES....................................................................................29
Section 14.1. Elements of Default.............................................................29
Section 14.2. Landlord's Remedies.............................................................30
Section 14.3. Bankruptcy......................................................................32
Section 14.4. Additional Remedies and Waivers.................................................33
Section 14.5. Landlord's Cure of Default......................................................33
Section 14.6. Security Interest [Intentionally Deleted] 33
ARTICLE XV.......................................................................................................33
RIGHT OF ACCESS.........................................................................................33
ARTICLE XVI......................................................................................................34
DELAYS ...............................................................................................34
ARTICLE XVII.....................................................................................................34
END OF TERM.............................................................................................34
Section 17.1. Return of Leased Premises.......................................................34
Section 17.2. Holding Over....................................................................34
ARTICLE XVIII....................................................................................................35
COVENANT OF QUIET ENJOYMENT.............................................................................35
ARTICLE XIX......................................................................................................35
UTILITIES...............................................................................................35
Section 19.1. Utilities.......................................................................35
Section 19.2. Electricity, Telephone and Gas..................................................35
Section 19.3. Trash and Garbage Removal.......................................................35
Section 19.4. Water and Sewer.................................................................35
Section 19.5. Grease Interceptors.............................................................36
ARTICLE XX.......................................................................................................36
MISCELLANEOUS...........................................................................................36
Section 20.1. Entire Agreement...............................................................36
Section 20.2. Notices........................................................................36
Section 20.3. Governing Law..................................................................36
Section 20.4. Successors.....................................................................36
Section 20.5. Liability of Landlord..........................................................37
Section 20.6. Brokers........................................................................37
Section 20.7. Transfer by Landlord...........................................................37
Section 20.8. No Partnership.................................................................37
SECTION 20.9. WAIVER OF COUNTERCLAIMS........................................................37
SECTION 20.10. WAIVER OF JURY TRIAL...........................................................37
Section 20.11. Severability...................................................................37
SECTION 20.12. NO WAIVER......................................................................38
Section 20.13. Consumer Price Index...........................................................38
Section 20.14. Interest.......................................................................38
Section 20.15. Excavation.....................................................................38
Section 20.16. Rules and Regulations..........................................................38
Section 20.17. Financial Statements...........................................................38
Section 20.18. General Rules of Construction..................................................38
Section 20.19. Recording......................................................................39
Section 20.20. Effective Date.................................................................39
Section 20.21. Headings.......................................................................39
Section 20.22. Managing Agent.................................................................39
EXHIBITS: Addendum
Exhibit A Site Plan
Exhibit B Measurement of Leased Premises
Exhibit C Landlord's Work
Exhibit D Tenant's Work
Exhibit E Sign Criteria
Exhibit F Commencement and Expiration Date Declaration
Exhibit G Waiver of Sales Tax Confidentiality
Exhibit H Agreement of Subordination Non-Disturbance and Attornment
Exhibit H-1 Tenant Estoppel Certificate
THIS LEASE dated as of this ____ day of ________________, 19___ (the
"Lease") by and between CONCORD XXXXX LIMITED PARTNERSHIP, a Delaware limited
partnership, the address of which is c/o The Xxxxx Corporation, 0000 Xxxxxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000 (hereinafter referred to as
"Landlord") and TOYS INTERNATIONAL, INC., a California corporation, the address
of which is 000 Xxxxxxxxx Xxxxx, Xxx Xxxxxx, Xxxxxxxxxx 00000 (hereinafter
referred to as "Tenant").
R E C I T A L
Landlord hereby leases to Tenant and Tenant hereby hires and takes from
Landlord, the Leased Premises, for the Term commencing on the Commencement Date,
subject to the terms, covenants, conditions and provisions of this Lease.
Landlord shall have the right, at any time prior to the Delivery of Possession
Date of the Leased Premises, by written notice to Tenant, to relocate the Leased
Premises in either direction (from side to side from the outside boundary of the
Leased Premises) by not more than forty (40) feet, and upon any such relocation,
the size and description of the Leased Premises shall be appropriately modified
to reflect any resulting proportional adjustment in the Rent based upon the
change in size of the Leased Premises, provided, however, the square footage and
the frontage shall remain the same. If the Commencement Date is not the first
day of a month, Minimum Rent for the month in which the Commencement Date occurs
shall be prorated to the end of the month and paid as the second monthly
installment of Minimum Rent on the first day of the next month and, after the
expiration of the number of years in the Term, the Term shall expire on the last
day of the same month in which the Commencement Date of the Term occurred, it
being the intention of the parties that the Term expire on the last day of a
month. Neither this Lease nor the obligations of Tenant hereunder shall be
affected by a postponement and Landlord shall not be subject to any liability
for failure to make possession of the Leased Premises available on the
Commencement Date. When the Commencement Date has been determined, Landlord and
Tenant shall execute, acknowledge and deliver a written statement in recordable
form specifying the Commencement and Expiration Dates of the Term and, if there
shall have been any changes in the floor area of the Leased Premises, such
statement shall reflect such change or changes. Said statement upon execution
and delivery shall be deemed to be a part of this Lease.
DATA SHEET
The following references furnish data to be incorporated in the
specified Sections of this Lease and shall be construed to incorporate all of
the terms of the entire Section as stated in this Lease:
(1) Section 1.1: Description of Leased Premises:
Store number: 718, consisting of approximately 4,594 square feet of floor
area as shown on Exhibits A and B attached hereto and made a part hereof.
(2) Section 1.2: Term:
Commencement Date:
The earlier of (i) Grand Opening, (ii) the date following the expiration of
a sixty (60) day fixturing period ("Fixturing Period") following the Delivery of
Possession Date (as defined in Section 3.2), or (iii) the date the Leased
Premises is open for business to the public.
Original Term: Ten (10) years.
Option Period: N/A
(3) Section 2.1: Minimum Rent:
Original Term:
From the Commencement Date and continuing through the fifth (5th) year of
the Original Term, the sum of $105,662.00 annually ($23.00 psf), payable in
equal consecutive monthly installments of $8,805.17 each;
Beginning with the sixth (6th) year and continuing through the expiration
of the Original Term, the sum of $114,850.00 annually ($25.00 psf), payable in
equal consecutive monthly installments of $9,570.83 each.
(4) Section 2.2: Percentage Rent:
Percentage Factor: 6%
Sales Break Point for the Original Term:
From the Commencement Date through the fifth (5th) year of the Original
Term: $1,761,033.33;
Beginning with the sixth (6th) year and continuing through the expiration
of the Original Term: $1,914,166.67.
(5) Section 2.4: Security Deposit: N/A
(6) Section 4.1: Permitted Use:
Tenant shall use the Leased Premises for the use set forth below and for no
other purpose:
For the sale, at discount, of toys and toy related merchandise. Tenant=s
merchandise offered from the Leased Premises shall not duplicate by fifty
percent (50%) or more the merchandise sold in Tenant=s Toy Co. Store located
within the Shopping Center.
Trade Name: The Play Company
(7) Section 13.2: Fund Contribution: $1.25 per square foot of floor area of
the Leased Premises.
Grand Opening Fee (Initial Contribution):$1.25 per square foot of floor
area of the Leased Premises.
(8) Guarantor: N/A
(9) Grand Opening Date: To be determined.
(10) Temporary Charges: $1.00 per square foot of floor area of the Leased
Premises.
(11) Construction Chargebacks: N/A
(12) Tenant Allowance: $10.00 per square foot of floor area of the Leased
Premises.
ARTICLE I
GRANT AND TERM
Section 1.1 Leased Premises. (a) Landlord, in consideration of the Rent (as
defined in Section 2.3) to be paid and the covenants to be performed by Tenant,
does hereby lease and demise to Tenant, and Tenant hereby rents and hires from
Landlord for the Term herein set forth, the Leased Premises which are described
as set forth in the Data Sheet attached hereto, in the retail development
designated as Concord Xxxxx or by such other name as Landlord may from time to
time hereafter designate (hereinafter "Retail Development"). The term "State" as
used herein shall mean the State or Commonwealth of North Carolina. For all
purposes in this Lease, a "Major Tenant" is any occupant of 20,000 square feet
or more of floor area in the Retail Development and a AMajor Tenant Space@ is
any space in the Retail Development containing 20,000 square feet or more. It is
agreed that, wherever the term "Shopping Center" is used herein, it shall mean
the Retail Development excluding the Major Tenant Spaces, except as otherwise
specifically stated herein. Exhibit A sets forth the general layout of the
Retail Development. Landlord does not warrant or represent that the Retail
Development or the Leased Premises will be constructed exactly as shown thereon
or that it will be completed by a specific date. Notwithstanding anything
contained in this Lease to the contrary, Landlord shall have the right, at any
time and from time to time, without notice to or consent of Tenant, and without
in any manner diminishing Tenant's obligations under this Lease, to make
alterations or additions to, and build additional stories on the building in
which the Leased Premises are located and to build adjoining the same, to
construct other buildings and improvements of any type in the Retail Development
or the common areas, or any part thereof, including the right to locate and/or
erect thereon permanent or temporary kiosks and structures, to enlarge the
Retail Development, and to make alterations therein or additions thereto, to
build additional stories on any building or buildings within the Retail
Development, and to build adjoining thereto, to construct decks or elevated
parking facilities and free standing buildings within the parking lot areas of
the Retail Development, and to change the size, location, elevation and nature
of any of the stores in the Retail Development or the common areas, or any part
thereof. In the event Landlord elects to enlarge the Retail Development, or any
part thereof, any additional area may be included by Landlord in the definition
of the Retail Development for purposes of this Lease. Landlord shall also have
the general right from time to time to include within and/or to exclude from the
defined Shopping Center any existing or future areas and the floor area of the
Shopping Center shall be accordingly adjusted. The premises leased to Tenant are
herein referred to as the "Leased Premises". The approximate location of the
Leased Premises is cross-hatched on the lease plan of the Retail Development
attached hereto and made a part hereof as Exhibit A. This Lease of the Leased
Premises is subject to all applicable building restrictions, planning and zoning
ordinances, governmental rules and regulations, existing underlying leases, and
all other encumbrances, covenants, restrictions, easements and agreements
affecting the Retail Development and the terms and provisions of certain master
declaration, reciprocal easement and operating agreements now or hereafter
entered into by Landlord.
Subject to the provisions of Section 5.1, Tenant shall enjoy a
non-exclusive easement, right and privilege for Tenant and its customers,
employees and invitees and the customers, employees and invitees of any
assignee, sublessee, concessionaire or licensee of Tenant, to use the common
areas of the Shopping Center, with Landlord and the other tenants and occupants
of floor area within the Shopping Center and their respective customers,
employees and invitees. Furthermore, Landlord agrees that any additions,
alterations or modifications to the Shopping Center by Landlord shall not
adversely affect access to, or visibility of the Leased Premises and, except as
otherwise provided for herein, Tenant shall retain substantially the same
relative position with respect to Major Tenants of the Shopping Center as of the
Commencement Date.
(b) After the Delivery of Possession Date (as defined in Section 3.2),
Landlord reserves the right to relocate Tenant. Landlord shall provide Tenant
with not less than thirty (30) days written notice of such relocation (the
"Relocation Period") during which Landlord shall offer to Tenant such
alternative location(s) (with approximately the same floor area) as may be
available. In the event the parties agree on a specific location, then this
Lease shall be amended by substituting the new location for the present location
and the square footage, Minimum Rent and Sales Break Point shall be
proportionately adjusted based upon the change in the size of the Leased
Premises. Landlord shall, at Landlord's cost and expense, complete the leasehold
improvements to the new location in accordance with the working drawings
originally approved by Landlord with respect to Tenant's Work in the original
Leased Premises and Tenant shall relocate to the new location and, within
fifteen (15) days after delivery of the new location to Tenant, open for
business in the new location ("Relocation Date"). In the event Landlord and
Tenant are unable to agree on an alternative location, this Lease shall
terminate at the end of the said thirty (30) day period ("Termination Date"). In
the event of such termination, Landlord shall pay to Tenant, within thirty (30)
days following the Termination Date, a sum equal to the then unamortized cost of
Tenant's leasehold improvements which have been paid for by Tenant, such
amortization to be on a straight line basis over the Original Term, provided
Tenant shall furnish to Landlord such backup information as Landlord may
reasonably require. Tenant shall deliver possession of the Leased Premises to
Landlord on or before the Termination Date and/or the Relocation Date in "as is"
condition excepting the provisions of Sections 3.5 and 17.1. Tenant shall pay
all charges which are due and owing or which shall accrue up to such Termination
Date or Relocation Date (which charges shall be paid to Landlord within thirty
(30) days of such Termination Date or Relocation Date) and Tenant shall be
released from any and all further obligations pursuant to this Lease accruing
after such Termination Date or Relocation Date with respect to the vacated
Leased Premises, except as otherwise provided in Articles V and VII; however, in
the event of relocation, Tenant shall remain liable for all obligations accruing
under this Lease after the Relocation Date.
(c) The square footage of the Leased Premises (sometimes herein referred to
as the gross leasable floor area or GLA) shall be measured as defined in Exhibit
B. The actual square footage in the Leased Premises shall be determined by
Landlord's architect. The certificate of Landlord's architect as to actual
square footage shall be binding upon both parties hereto, and such determined
square footage shall be used in all calculations based on square footage
throughout this Lease. If the floor area determined in accordance with the
preceding sentence varies from the square foot floor area originally set forth
in the Data Sheet, the Minimum Rent set forth in Section 2.1 hereof shall be
adjusted by multiplying the Minimum Rent by a fraction, the numerator of which
is the square foot floor area determined by Landlord's architect and the
denominator of which is the square foot floor area originally set forth in the
Data Sheet, and Tenant shall be obligated to pay such Minimum Rent, as adjusted,
from the Commencement Date, subject to further adjustments as provided in this
Lease. Each monthly installment provided for in Section 2.1 shall be recomputed
and shall be that dollar amount which results from dividing the adjusted Minimum
Rent by twelve (12). Any and all references in this Lease to Minimum Rent (or
the monthly installments thereof) shall be deemed to be references to the
Minimum Rent as computed by application of this Section 1.1, subject, however,
to the adjustments set forth elsewhere in this Lease. For purposes of this
Lease, in determining the gross leasable floor area or the gross leased and
occupied floor area of the Shopping Center, there shall be excluded therefrom
project areas and offices, common areas and/or areas under Landlord's control
(e.g., electrical/utility rooms, etc.). The exterior walls, roof, storefront and
the area beneath the Leased Premises are not demised hereunder, and the use
thereof, together with the right to install, maintain, use, repair and replace
pipes, ducts, conduits, wires, people counters, tunnels, sewers and structural
elements leading through the Leased Premises in locations which will not
materially interfere with Tenant's use thereof and serving other parts of the
Retail Development are hereby reserved to Landlord. Landlord reserves an
easement above Tenant's finished ceiling or light line to the roof for general
access purposes and in connection with the exercise of Landlord's other rights
under this Lease.
Section 1.2 Term. The Term of this Lease shall be for a period commencing
on the Commencement Date, and expiring at 11:59 p.m. local time on the final day
of the month in which the Original Term or the Option Period, if exercised,
expires or other specified date as set forth in the Data Sheet, unless sooner
terminated in accordance with the provisions hereof (the "Expiration Date").
Unless otherwise specified in this Lease, the use of the word "Term" shall be
deemed to include both the Original Term and the Option Period, if exercised.
The term "full year" and "year" as used in this Lease shall mean consecutive
periods of twelve (12) months each following the Commencement Date. For all
purposes of this Lease, the term "Lease Year" shall have the following meaning:
the first Lease Year shall be a period beginning with the Commencement Date and
ending on the 31st day of December next following the Commencement Date, and
after the first Lease Year, the term Lease Year shall mean a fiscal period of
twelve (12) consecutive calendar months commencing on January 1 of each calendar
year, except that the last Lease Year shall terminate on the Expiration Date or
sooner termination of this Lease. Lease Years containing 365 days or more shall
be referred to as "full Lease Years." If the Leased Premises are not delivered
to Tenant on or before the expiration of thirty-six (36) months after the date
of Landlord's execution of this Lease then either party may cancel and terminate
this Lease upon sixty (60) days prior written notice to the other, in which
event neither party shall have any further obligation or liability to the other;
provided, however, that if Landlord has commenced construction of the Shopping
Center, then Tenant shall not be permitted to terminate in the foregoing manner.
Following the Commencement Date of this Lease, Landlord may submit to Tenant a
Commencement and Expiration Date Declaration in the form attached hereto as
Exhibit F, specifying the information called for in said form, and Tenant shall
execute such Declaration within thirty (30) days following submission for
purposes of certifying such information; provided, however, that the Declaration
shall not be rendered ineffective by Tenant's failure to execute same.
Notwithstanding the foregoing, in the event Tenant does not achieve Gross
Sales (as hereinafter defined) of at least One Million Four Hundred Sixty-Five
Thousand and 00/100ths Dollars ($1,465,000.00) during the third (3rd) full Lease
Year of the Term hereof, then Landlord, for a period of sixty (60) days
following the end of the third (3rd) full Lease Year, shall have the option,
upon one hundred eighty (180) days prior written notice to Tenant, of
terminating this Lease ("Termination Option"). In the event Tenant fails to
submit a certified report of annual Gross Sales within the time period required
pursuant to Section 2.2 of this Lease, then Landlord shall use such information
as Landlord shall have available to permit Landlord to make a determination as
to the amount of Gross Sales achieved by Tenant during the period covered by
Landlord's option to terminate and such information shall be the basis for
Landlord exercising its Termination Option and Tenant shall not be permitted to
reinstate this Lease after termination for any reason or cause whatsoever,
including, but not limited to, the submittal by Tenant of a subsequent sales
report either certified or uncertified. In the event that Landlord does not
exercise its Termination Option within the required time period, then each such
Termination Option shall, upon expiration of the applicable period, become null
and void and be of no further force or effect. In the event Landlord exercises
the foregoing Termination Option within the required time period, this Lease
shall terminate upon expiration of the one hundred eighty (180) day period
subject, however, to the payment by Tenant to Landlord of all sums then due and
owing or having accrued to Landlord.
Section 1.3 Opening. Tenant covenants and agrees to complete its
construction within the Leased Premises in accordance with the provisions of
this Lease, to satisfy the requirements for issuance of a certificate of
acceptance pursuant to Exhibit D attached hereto and made a part hereof, and to
open its store for business to the public not later than the Commencement Date.
Notwithstanding the foregoing, Landlord hereby notifies Tenant that the
anticipated date of the grand opening of the Shopping Center (the "Grand
Opening") is the date set forth on the Data Sheet, and Tenant shall be obligated
to open its store for business to the public on such date or such other date as
Landlord may establish from time to time for the Grand Opening upon written
notice to Tenant. Tenant shall not be permitted to open for business to the
public prior to the Grand Opening without the prior written consent of Landlord
which consent shall be at Landlord's sole discretion.
Section 1.4 Late Opening. Except for delays, as described in Article XVI
and provided that Tenant has been given the sixty (60) day Fixturing Period, in
the event Tenant shall fail to open its store for business to the public upon
the Commencement Date, then in order to compensate Landlord for its loss, Tenant
shall pay to Landlord as additional rent (as defined in Section 2.3) over and
above the Minimum Rent and all other charges to be paid by Tenant to Landlord
pursuant to this Lease, a sum in an amount equal to One Hundred and 00/100ths
Dollars ($100.00) per day for the Commencement Date and each day after the
Commencement Date that Tenant shall have failed to open its store for business.
This remedy shall be in addition to any and all other remedies provided for in
this Lease in the event of such failure to open. Such additional late opening
rent shall be deemed to be in lieu of any Percentage Rent that might have been
earned during the period of Tenant's failure to open.
ARTICLE II
RENT AND DEPOSIT
Section 2.1. Minimum Rent. During the entire Term of this Lease, Tenant
shall pay annual minimum rental ("Minimum Rent") for the Leased Premises from
the Commencement Date of this Lease in the amount set forth in the Data Sheet
attached hereto, which sum shall be payable by Tenant in equal consecutive
monthly installments in the sum set forth in the Data Sheet attached hereto, on
or before the first day of each month, in advance. The Minimum Rent and each of
the monthly installments called for hereunder shall be payable to Landlord,
without demand, deduction, set-off or counter-claim. The first installment of
Minimum Rent shall be paid by Tenant within ten (10) days of Tenant's receipt of
Landlord's notice of the Delivery of Possession Date. If the Commencement Date
occurs on other than the first day of a month, the second installment of Minimum
Rent shall be prorated at a daily rate on the basis of a thirty (30) day month.
Section 2.2. Percentage Rent. (a) During and for each Lease Year, Tenant
shall pay annual percentage rent ("Percentage Rent") equal to the Percentage
Factor (see Data Sheet) multiplied by all "Gross Sales" resulting from business
conducted in, on or from the Leased Premises during such Lease Year in excess of
the applicable Sales Break Point set forth in the Data Sheet. In any Lease Year
where there is more than one applicable Sales Break Point, for purposes of
computing annual Percentage Rent the following calculation shall be used: each
Sales Break Point which was effective during any such Lease Year shall be
multiplied by a fraction, the numerator of which is the number of days in the
Lease Year that such Sales Break Point was effective and the denominator of
which is the actual number of days in such Lease Year (herein the "Adjusted
Break Point") and the sum of the Adjusted Break Points shall be the Sales Break
Point for such Lease Year. "Gross Sales" is defined to mean the total amount of
the actual sales price, whether for cash or otherwise, of all sales of
merchandise or services arising out of or payable on account of (and all other
receipts or amounts receivable whatsoever with respect to) all the business
conducted in, on, or from the Leased Premises by or on account of Tenant or any
sublessee, assignee or concessionaire of Tenant for cash or otherwise, including
all orders for merchandise taken from or filled at or from the Leased Premises,
including all deposits not refunded to customers. A "sale" shall be deemed to
have been consummated for purposes of this Lease, and the entire amount of the
sale price shall be included in Gross Sales, at such time as (i) the transaction
is initially reflected in the books or records of Tenant, or any sublessee,
assignee or concessionaire of Tenant, or (ii) Tenant or such other entity
receives all or any portion of the sales price, or (iii) the applicable goods or
services are delivered to the customer, whichever first occurs, irrespective of
whether payment is made in installments, the sale is for cash or credit or
otherwise, or all or any portion of the sales price has actually been paid at
the time of inclusion in Gross Sales or at any other time. Tenant shall record
at the time of each sale or transaction, in the presence of the customer, all
receipts from such sale or other transaction, whether for cash, credit or
otherwise, in a cash register or cash registers having a cumulative total, which
shall be sealed in a manner approved by Landlord and which shall possess such
other features as shall be required by Landlord. There shall be no deduction
allowed for direct or indirect discounts, rebates, or other reductions on sales,
unless generally offered to the public on a uniform basis. Tenant may deduct
from Gross Sales discount sales to employees, bad debts when written off the
books of Tenant and charges paid to credit card companies provided, however,
that in the aggregate such deductions do not exceed three percent (3%) of Gross
Sales in any Lease Year. Tenant may also exclude from Gross Sales any transfer
of goods between Tenant's other stores and returns to shippers or manufacturers.
The term "Gross Sales" shall exclude, however, proceeds from any sales tax,
gross receipts tax or similar tax, by whatever name called which are separately
stated and in addition to the purchase price, bona fide transfers of merchandise
from the Leased Premises to any other stores or warehouses of Tenant, refunds
given to customers for merchandise purchased at the Leased Premises and returned
or exchanged, and sales of Tenant's fixtures and equipment not in the ordinary
course of Tenant's business. The term "merchandise" as used in this Lease shall
include food and beverages if Tenant is permitted to sell such items pursuant to
Section 4.1 hereof.
(b) Tenant shall keep at the Leased Premises or at Tenant's executive
offices within the continental United States a full and accurate set of books
and records adequately showing the amount of Gross Sales in each Lease Year. The
books and records to be kept by Tenant shall include, without limitation, (i)
cash register tapes, including tapes from temporary registers; (ii) serially
pre-numbered sales slips; (iii) detailed original records of any exclusions or
deductions from Gross Sales; (iv) sales tax records; and (v) such other records,
if any, which would normally be examined by an independent accountant pursuant
to accepted auditing standards in performing an audit of Tenant's sales. Such
books and records shall be kept in accordance with generally accepted accounting
principles and practices and shall be retained by Tenant for a period of not
less than two (2) years following the end of the Lease Year to which they have
reference. When and as Landlord may reasonably require, Tenant shall also
furnish to Landlord any and all statements, information, and copies of sales and
income tax reports and returns which separately show financial data for the
Leased Premises, and inventory records and other data evidencing Gross Sales.
Within ten (10) days following the end of each calendar month of the Term hereof
Tenant shall submit to Landlord an unaudited statement of Gross Sales for such
calendar month. All Gross Sales statements to be supplied by Tenant to Landlord
shall be in such form and with such detail as Landlord shall deem necessary or
desirable. Within ten (10) days following the end of the month in which Tenant's
Gross Sales for the Lease Year to date exceed the Sales Break Point, and each
month thereafter, Tenant shall pay to Landlord Percentage Rent and shall submit
to Landlord a statement certified by Tenant setting forth the Gross Sales for
each such period. Within forty-five (45) days after the close of each Lease
Year, Tenant shall furnish to Landlord a statement certified by an authorized
representative or financial officer of Tenant setting forth the amount of Gross
Sales during such Lease Year and showing the amount of Percentage Rent required
to be paid by Tenant for such Lease Year. The full amount of the Percentage Rent
due shall be paid to Landlord no later than sixty (60) days after the end of
each Lease Year and any excess Percentage Rent paid shall be credited against
Tenant's next due Percentage Rent payment, except for the final Lease Year of
the Term for which any excess shall be refunded to Tenant. Landlord and/or
Landlord's auditor shall have the right, at any time after ten (10) business
days notice, to inspect and/or audit the records of Tenant relating to Gross
Sales. If the Gross Sales exceed those reported, Tenant shall immediately pay
any deficiency in Percentage Rent owing to Landlord. If Gross Sales vary from
those reported by three percent (3%) or more, Tenant shall pay Landlord's cost
of inspection and audit. If Gross Sales vary from those reported by (i) five
percent (5%) or more in any one (1) Lease Year, or (ii) three percent (3%) or
more for any two (2) Lease Years out of any five (5) Lease Years, then Landlord
shall have the right, at its sole option, to terminate this Lease, with Tenant
remaining liable for sums due and owing under this Lease for the balance of the
Term. Tenant agrees that in the event Tenant shall fail to timely submit a Gross
Sales statement as required by this Section 2.2(b), Tenant shall pay on demand a
late fee of Fifty and 00/100ths Dollars ($50.00) per late statement, as
additional rent.
(c) In the event that Tenant shall fail to operate its business in the
Leased Premises in the manner and on each day as required pursuant to Article IV
hereof, then, for the purpose of computing the Percentage Rent for such Lease
Year affected by Tenant's failure to operate, the Sales Break Point for such
Lease Year shall be adjusted by multiplying the Sales Break Point otherwise
applicable for such Lease Year by a fraction, the numerator of which shall be
the actual number of days in such short Lease Year or the actual number of days
in such Lease Year during which Tenant was open for business and operating in
accordance with Article IV, and the denominator of which shall be "360".
In the event that the first Lease Year is less than six (6) months in
length, then the Percentage Rent covering such Lease Year shall be paid on Gross
Sales in excess of the Sales Break Point computed on a pro rated basis for the
period beginning on the Commencement Date of the Term and ending on the
succeeding December 31st.
(d) The parties hereto understand and agree that the Percentage Factor
specified in subparagraph (a) above for the purpose of computing Percentage Rent
has been determined based on Tenant's representation that it will sell
substantially all merchandise from the Leased Premises at discount prices,
namely prices that are at least twenty percent (20%) less than the prices
charged by the majority of other retailers in the metropolitan area in which the
Shopping Center is located who sell the same or substantially similar
merchandise at full retail markup. Tenant hereby acknowledges that Tenant has
represented to Landlord that it will operate its business in the Leased Premises
as one of the following: (i) a factory direct outlet; or (ii) a discounter; or
(iii) an off-price operation, selling all its merchandise at discount prices (as
herein defined), and that such representation was a material inducement for
Landlord to enter into this Lease with Tenant on the rental terms herein
contained, which rental provisions are predicated on the typically lower profit
margins of such businesses, as compared to those selling at full retail markup.
Within forty-five (45) days after the end of each Lease Year (together with the
annual Gross Sales statement) Tenant shall provide reasonable information that
Tenant has sold substantially all its merchandise at discount prices on a
continuous basis. Landlord may, at its option, at any time and from time to
time, obtain an independent study and review of the prices charged by Tenant and
the prices charged by the majority of retailers in the metropolitan area in
which the Shopping Center is located who sell the same or substantially similar
merchandise as that sold in the Leased Premises (herein "Study"). If a Study
reveals that Tenant is failing or failed to sell its merchandise at discount
prices on a continuous basis, Tenant shall pay Landlord's cost and expense
incurred for such Study.
Section 2.3. Payments By Tenant. Throughout the Term of this Lease, Tenant
shall pay to Landlord, without demands, deductions, set-offs or counterclaims,
the Rent, which is hereby defined as the sum of the Minimum Rent, Percentage
Rent and all additional rent, when and as the same shall be due and payable
hereunder. Unless otherwise stated, all sums of money or charges of any kind or
nature, in addition to Minimum Rent and Percentage Rent, payable by Tenant to
Landlord pursuant to this Lease or the Exhibits attached hereto are defined as
"additional rent" and are due thirty (30) days after the rendering of an invoice
therefor, without any deductions, set-offs or counterclaims, and failure to pay
such sums of money or charges shall carry the same consequences as Tenant's
failure to pay Rent. All payments and charges required to be made by Tenant to
Landlord hereunder shall be payable in United States funds, at the address
indicated on page 1 of this Lease, unless otherwise specified by written notice
from Landlord to Tenant. No payment by Tenant or receipt by Landlord of a lesser
amount than the correct Rent shall be deemed to be other than a payment on
account and no endorsement or statement on any check or other communication
accompanying a check for payment of any amounts payable hereunder shall be
deemed an accord and satisfaction, and Landlord may accept such check in payment
without prejudice to Landlord's right to recover the balance of any sums owed by
Tenant hereunder or to pursue any other remedy available in this Lease, or under
law, against Tenant.
Section 2.4. Security Deposit. [Intentionally deleted]
Section 2.5. Late Charge. In the event any Rent or sums required hereunder
to be paid are not received on or before the tenth (10th) calendar day after the
same are due, then, for each and every late payment, Tenant shall immediately
pay, as additional rent, a late charge equal to the greater of (a) Fifty and
00/100ths Dollars ($50.00), (b) Ten and 00/100ths Dollars ($10.00) per day for
each day after the date due that such payment has not been received by Landlord
or (c) four percent (4%) per month of the total receivable balance of Tenant
outstanding. In the event of Tenant's failure to pay the foregoing late charge,
Landlord may deduct said charge from the Security Deposit set forth in Section
2.4 hereof. The provisions herein for late charges shall not be construed to
extend the date for payment of any sums required to be paid by Tenant hereunder
or to relieve Tenant of its obligation to pay all such sums at the time or times
herein stipulated. Notwithstanding the imposition of such late charges pursuant
to this Section 2.5, Tenant shall be in default under this Lease if any or all
payments required to be made by Tenant are not made on or before the time due
and as stipulated in Article XIV, and neither the demand for, nor collection by,
Landlord of such late charges shall be construed as a cure of such default on
the part of Tenant. It is agreed that the said late charge is a fair and
reasonable charge under the circumstances and shall not be construed as interest
on a debt payment. In the event any charge imposed hereunder or under any other
section of this Lease is either stated to be or construed as interest, then no
such interest charge shall be calculated at a rate which is higher than the
maximum rate which is allowed under the usury laws of the State, which maximum
rate of interest shall be substituted for the rate in excess thereof, if any,
computed pursuant to this Lease.
ARTICLE III
PREPARATION OF LEASED PREMISES
Section 3.1. Landlord's Work. Landlord shall construct the building wherein
the Leased Premises are to be located and perform the work described in Exhibit
C attached hereto and made a part hereof ("Landlord's Work") at Landlord's cost
and expense, except as otherwise provided in Exhibit C. All work, in addition to
the work described in Exhibit C, done by Landlord at Tenant's request shall be
paid for by Tenant within thirty (30) days after the presentation to Tenant of a
xxxx for such work. Acceptance of possession by Tenant shall be conclusive
evidence that Landlord's Work has been fully performed in the manner required.
Any items of Landlord's Work which are not completed as of delivery of
possession shall be identified by Tenant on a punch list to be submitted to
Landlord within thirty (30) days after the date of possession and Landlord shall
thereafter complete the same. Any items of Landlord's Work which are not timely
identified on such a punch list shall be deemed completed.
Section 3.2. Delivery of Possession. (a) Landlord, or Landlord's
supervising architect, shall give Tenant at least ten (10) days' prior written
notice of the date on which Landlord's Work will be substantially completed in
accordance with Exhibit C and the Leased Premises will be available for the
performance of Tenant's Work (as defined in Section 3.3) to the extent that
Tenant shall be able to perform its work in the Leased Premises without
substantial interference resulting from the conduct of Landlord's Work
("Delivery of Possession Date") provided, however, that in the event the
Shopping Center shall have initially opened for business prior to the
Commencement Date of this Lease, then the foregoing notice requirement shall
automatically be deemed to be reduced to a five (5) day notice requirement.
Tenant covenants and agrees to take physical possession of the Leased Premises
on the Delivery of Possession Date provided that Landlord's Work is
"substantially complete." The Delivery of Possession Date shall be subsequently
confirmed by Landlord, or Landlord's supervising architect, by written notice to
Tenant. Failure of Landlord to deliver possession of the Leased Premises within
the time and in the condition provided for in this Lease will not give rise to
any claim for damages by Tenant against Landlord or permit Tenant to rescind or
terminate this Lease.
(b) Tenant may, provided Tenant shall not interfere with the conduct of
Landlord's Work, and subject to Landlord's reasonable rules and regulations,
enter the Leased Premises during normal working hours during the course of
Landlord's Work for the purpose of inspecting the Leased Premises and making
measurements. At such time prior to the Delivery of Possession Date that
Landlord's Work has progressed sufficiently to permit Tenant to perform its work
without interfering with Landlord's Work, Landlord may, but shall not be
required to, notify Tenant of the same, and Tenant may then enter the Leased
Premises in order to begin to install its store fixtures and perform such other
work as may be required under the provisions of this Lease in order to ready the
store for opening. Throughout the period of Tenant's Work, Tenant shall schedule
its work so as not to interfere with any work being performed by Landlord or by
any other tenant in the Shopping Center.
Section 3.3. Tenant's Work. (a) Tenant agrees, prior to the commencement of
the Term of this Lease, at Tenant's sole cost and expense, to diligently perform
all work of whatever nature in accordance with Tenant's obligations set forth in
Exhibit D ("Tenant's Work") and all other related work necessary to prepare for
the opening to the public of Tenant's store in the Leased Premises in accordance
with the provisions of this Lease. Tenant agrees to furnish to Landlord the
Store Design Drawings and Working Drawings and Specifications with respect to
the Leased Premises prepared in the manner and within the time periods required
in Exhibit D. If such Store Design Drawings or Working Drawings and
Specifications are not furnished by Tenant to Landlord within the required time
period(s) in form to permit approval by Landlord, then the Fixturing Period (as
described in the Data Sheet) shall be reduced by one (1) day for each day of
delay by Tenant in submitting said Store Design Drawings or Working Drawings and
Specifications. Landlord shall exercise reasonable efforts to respond to such
Store Design Drawings or Working Drawings and Specifications submitted by Tenant
pursuant to this Lease within seven (7) business days following Landlord's
receipt from Tenant. In the event of Landlord's failure to respond within such
seven (7) business day period, the Fixturing Period as described in the Data
Sheet shall be extended by one (1) day for each day of additional delay by
Landlord.
Provided Tenant is not in default hereof, Landlord hereby agrees to
contribute towards the cost of Tenant's Work a Construction Allowance of Ten and
00/100ths Dollars ($10.00) per square foot of floor area of the Leased Premises.
The aforesaid Construction Allowance shall be paid thirty (30) days after the
date Tenant opens for business in the Leased Premises, provided Tenant shall
have received a Certificate of Acceptance pursuant to Exhibit D hereof and the
applicable lien waivers from all contractors and subcontractors. In the event
that this Lease is terminated prior to the expiration of the Term hereof, Tenant
shall repay said Construction Allowance to Landlord in cash upon termination;
provided, however, that Tenant's liability for said Construction Allowance shall
be reduced at the rate of one-tenth (1/10th) each anniversary of the
Commencement Date occurring during the Term hereof.
No material deviations from the final Store Design Drawings or Working
Drawings and Specifications, once approved by Landlord, shall be permitted
unless necessary to comply with applicable governmental requirements. Landlord's
approval of Tenant's Store Design Drawings and Working Drawing and
Specifications shall not constitute the assumption of such items. Tenant's Work
shall include the installation of fixtures and equipment and the stocking of the
Leased Premises with suitable merchandise. Tenant covenants that all such
fixtures and equipment visible to customers shall be new and otherwise
acceptable to Landlord in appearance. In addition to conforming to the
requirements specified in Exhibit D, all work performed by Tenant shall comply
with such rules and regulations as Landlord and its representatives may make,
provided that such rules and regulations are uniformly applied to all similarly
situated Shopping Center tenants under construction. Unless Landlord otherwise
directs in writing, Tenant shall not open the Leased Premises for business until
all construction has been completed pursuant to the provisions of Exhibit D. It
is further understood and agreed that: (i) Landlord shall have no responsibility
or liability whatsoever for any loss of, or damage to, any fixtures, equipment,
merchandise, or other property belonging to Tenant, installed or left in the
Leased Premises except to the extent resulting from the negligence or
intentional acts of Landlord, its agents or employees; and (ii) Tenant's entry
upon and occupancy of the Leased Premises prior to the Commencement Date shall
be governed by and subject to all the provisions, covenants and conditions of
this Lease. Tenant shall obtain at its sole cost and immediately thereafter
furnish to Landlord all certificates and approvals with respect to work done and
installations made by Tenant that may be required for the issuance of a
certificate of occupancy for the Leased Premises, so that such certificate of
occupancy shall be issued and the Leased Premises shall be ready for the opening
of Tenant's business on the Commencement Date. Upon the issuance of the
certificate of occupancy, a copy thereof shall be immediately delivered to
Landlord. Promptly upon the completion of its work, Tenant, at Tenant's cost,
shall repair, clean and restore all portions of the Shopping Center affected by
Tenant's Work to their prior condition.
(b) The interest of Landlord in the Leased Premises and the Retail
Development shall not be subject to liens for improvements made by or on behalf
of Tenant. Nothing contained in this Lease shall be construed as a consent on
the part of Landlord to subject Landlord's estate in the Leased Premises or the
Retail Development to any lien or liability under applicable law. In the event
that any mechanic's, materialman's or other lien or any notices of claim,
including without limitation, stop notices (herein "lien") is filed against the
Leased Premises or Retail Development as a result of any work, labor, services
or materials performed or furnished, or alleged to have been performed or
furnished to or for Tenant or to or for anyone holding the Leased Premises
through or under Tenant, Tenant, at its expense, shall cause the lien to be
discharged or fully bonded to the satisfaction of Landlord within thirty (30)
days after notice of the filing thereof. If Tenant fails to discharge or bond
against said mechanic's, materialman's or other lien, Landlord may, in addition
to any other remedies Landlord may have, but without obligation to do so, bond
against or pay the lien without inquiring into the validity or merits of such
lien and all sums so advanced, including reasonable attorney fees incurred by
Landlord in defending against such lien, procuring the bond or in the discharge
of such lien, shall be paid by Tenant on demand as additional rent. It shall be
Tenant's continuing obligation to keep and maintain the Leased Premises and all
other parts of the Retail Development free from any and all liens arising out of
any work performed, materials furnished or obligations incurred by or for Tenant
in connection with the Leased Premises. In addition, Tenant shall replace any
bonds posted by Landlord pursuant hereto with a suitable bond of equivalent
amount within twenty (20) days after Landlord's demand therefor.
Tenant, subject to Landlord's consent not to be unreasonably withheld,
conditioned or delayed, may grant a security interest, encumber or pledge its
equipment, personal property, inventory and movable trade fixtures located on or
about the Leased Premises, with respect to financing which benefits this store
location. In no event, however, shall Tenant be permitted to mortgage,
hypothecate, encumber or pledge the leasehold interest in the Leased Premises.
(c) Upon the expiration of each five (5) year period of the Term of this
Lease, Tenant shall, within thirty (30) days after direction from Landlord,
submit drawings and specifications showing the work to be performed by Tenant to
completely refurbish the interior portions of Leased Premises. Tenant shall not
be required, pursuant to this Section 3.3(c), to reconstruct the Leased
Premises. The work required of Tenant hereunder shall specifically include work
with respect to the following items: wall covering, floor covering, ceiling,
storefront sign and surfaces visible to customers. Tenant will cause such work
to be performed not later than ninety (90) days following the date of Landlord's
direction in accordance with drawings and specifications approved by Landlord
specifying the refurbishing work to be done by Tenant. All such work shall be
carried out in accordance with the provisions of this Lease, including the
provisions of this Section 3.3 governing construction of the Leased Premises.
Section 3.4. Alterations by Tenant. Tenant shall not make or cause to be
made any alterations, repairs, additions or improvements in or to the Leased
Premises (for example, but without limiting the generality of the foregoing,
Tenant shall not install or cause to be installed any exterior signs or interior
signs visible from the exterior except as permitted by Section 4.3 hereof, floor
covering, interior or exterior lighting, plumbing fixtures, shades, canopies or
awnings or make any changes to the storefront, mechanical, electrical or
sprinkler systems) without the prior written consent thereto by Landlord. Tenant
shall submit to Landlord plans and specifications for such work at the time
consent is sought, in accordance with the criteria and procedures as provided in
Exhibit D. In the event Landlord grants such consent, such alterations, repairs,
additions or improvements shall be performed in good and workmanlike manner and
in accordance with all applicable legal and insurance requirements and all
drawings or specifications approved by Landlord, and in accordance with the
provisions of this Lease, including the provisions of Section 3.3 governing
construction of the Leased Premises. Any work performed by Tenant shall be
subject to Landlord's inspection and approval after completion to determine
whether the same complies with the requirements of this Lease. Prior to the
commencement of any such work by Tenant, Tenant shall obtain the insurance
required in Section 8.2. Tenant agrees that Landlord shall have the right, at no
expense to Landlord, to require Tenant to furnish Landlord with payment and
performance bonds guaranteeing the completion of any repairs, alterations,
additions or improvements (structural or otherwise) required or permitted to be
performed by Tenant under any provision of this Lease.
Tenant may from time to time make non-structural alterations to the Leased
Premises without Landlord's prior written approval, the aggregate total cost of
which shall not exceed Ten Thousand and 00/100ths Dollars ($10,000.00) in any
Lease Year; provided, however, that Tenant shall not be permitted to alter the
sign or the storefront without the prior written consent of Landlord, and
provided further that any such non-structural alterations shall not change the
overall appearance of the Leased Premises as originally approved by Landlord.
Section 3.5. Removal by Tenant. All repairs, alterations, decorations,
additions and improvements made by Tenant shall be deemed to be attached to the
leasehold and to have become the property of Landlord upon such attachment, and,
upon the Expiration Date or sooner termination of this Lease, Tenant shall not
remove any of such alterations, decorations, additions and improvements;
provided that trade fixtures installed by Tenant may be removed if all Rent due
herein are paid in full and Tenant is not otherwise in default hereunder;
provided further, however, that Landlord may designate by written notice to
Tenant those alterations, decorations, additions and improvements which shall be
removed by Tenant at the Expiration Date or sooner termination of this Lease and
Tenant shall, at Tenant's cost, promptly remove the same and repair any damage
to the Leased Premises caused by such removal.
ARTICLE IV
CONDUCT OF BUSINESS
Section 4.1. Use and Trade Name. Tenant shall continuously use and occupy
the Leased Premises during the Term solely for the purpose of conducting the
business specifically set forth in the Data Sheet and for no other purpose or
purposes. Throughout the Term hereof, Tenant shall (a) operate its business in
the Leased Premises under the Trade Name specifically set forth in the Data
Sheet and under no other so long as such name shall not be held to be in
violation of any applicable law, (b) not change the advertised name or character
of the business operated in the Leased Premises, (c) refer to the Shopping
Center by name in designating the location of the Leased Premises in all
newspaper and other advertising within the Shopping Center market area and in
all other references to the location of the Leased Premises, and (d) during the
period from the Delivery of Possession Date through sixty (60) days following
the Commencement Date, include in all Tenant's newspaper advertising within the
Shopping Center market area the designation that Tenant is opening for business
in the Shopping Center. If any governmental license(s) or permit(s) shall be
required for the proper and lawful conduct of Tenant's business or other
activity carried on in the Leased Premises, or if a failure to procure such a
license or permit might or would in any way, adversely affect Landlord or the
Shopping Center, then Tenant, at Tenant's expense, shall duly procure and
thereafter maintain such license(s) or permit(s) and submit the same for
inspection by Landlord. Tenant, at Tenant's expense, shall at all times, comply
with the requirements of such license(s) or permit(s). Except as provided in
Section 1.3, Tenant shall open its store in the Leased Premises for business to
the public on the Commencement Date, and shall thereafter diligently conduct its
regular business operations in the Leased Premises as required by the terms of
this Lease.
Section 4.2. Operation of Business. Tenant shall open for business in the
Leased Premises and remain open during the entire Term and continuously operate
its business in the entire area of the Leased Premises during the entire Term.
Tenant shall conduct its business at all times in a high class and reputable
manner, maintaining at all times a full staff of employees and a complete stock
of merchandise. Tenant shall install and maintain at all times a display of
merchandise in the display windows (if any) of the Leased Premises and shall
keep the Leased Premises well lighted during all hours that the Shopping Center
is open to the public and during such other hours as may be reasonably
designated by Landlord but in no event more than one (1) hour after the close of
business. In no event shall Tenant conduct or advertise any auction, fire sale,
going out of business sale, or bankruptcy sale in or about the Leased Premises
without Landlord's prior written consent in each instance, which consent may be
withheld by Landlord in its sole and absolute discretion. Tenant shall conduct
its business in the Leased Premises in a lawful manner and in good faith during
all days and hours specified by Landlord from time to time. Tenant shall not use
or allow the Leased Premises to be used for any improper, immoral or
objectionable purposes, as determined by Landlord, and Tenant shall not do any
act tending to injure the reputation of the Shopping Center as determined by
Landlord.
Section 4.3. Sign. Tenant shall install and maintain one (1) sign affixed
to the front of the Leased Premises, subject to the prior written approval of
Landlord as to design and location and conforming to all applicable legal and
insurance requirements. Tenant's sign shall conform to the specifications and
requirements contained in Exhibit E attached hereto. Tenant shall keep its
approved storefront sign lighted during all hours that the Shopping Center is
open to the public and during such other hours as may be reasonably designated
by Landlord but in no event more than one (1) hour after the close of business.
Tenant shall pay for all costs in connection with such sign and shall be
responsible for the cost of proper installation and removal thereof and any
damage caused to the Leased Premises thereby. In the event Landlord deems it
necessary to remove such sign, then Landlord shall have the right to do so,
provided, however, that if the sign has received Landlord's prior written
approval and is consistent with the specifications and requirements of Exhibit
E, Landlord shall replace said sign as soon as practicable. Except as mentioned
above, Tenant shall not place or cause to be placed, erected or maintained on
any exterior door, wall or window of the Leased Premises, or the glass of any
window or door of the Leased Premises, or on any sidewalk or within any display
window space in the Leased Premises, or within five (5) feet of the front of the
storefront lease line or opening, or within any entrance to the Leased Premises
or otherwise visible from the enclosed mall, any sign (flashing, moving,
hanging, handwritten or otherwise), decal, placard, flashing, moving or hanging
lights, lettering or any other advertising matter of any kind or description. No
symbol, design, name, xxxx or insignia adopted by Landlord for the Retail
Development shall be used without the prior written approval of Landlord. Any
interior signs must be in good taste and prepared professionally (not
hand-lettered) so as not to detract from the appearance of the Leased Premises
or the Shopping Center. Any sign or display visible from the exterior of the
Leased Premises which does not meet the above criteria may be removed at any
time by Landlord without Landlord incurring any liability therefor, and without
such removal constituting a breach of this Lease or entitling Tenant to claim
damages on account thereof.
Section 4.4. Tenant's Warranties. Tenant warrants, represents, covenants
and agrees that, in the operation of its business within the Leased Premises,
Tenant shall: (a) pay before delinquency any and all taxes, assessments and
public charges levied, assessed or imposed upon Tenant's business, or upon
Tenant's fixtures, furnishings or equipment in the Leased Premises, or upon any
leasehold interest or personal property of any kind, owned by or placed in or
about the Leased Premises by Tenant or by anyone claiming by, through or under
Tenant, including, without limitation, any transfer taxes, and pay when and as
due all license fees, permit fees and charges of a similar nature required for
the conduct by Tenant or any subtenant or concessionaire of any business or
undertaking authorized hereunder to be conducted in or from the Leased Premises;
(b) observe all reasonable requirements promulgated by Landlord at any time and
from time to time relating to delivery vehicles, the delivery of merchandise,
and the storage and removal of trash and garbage; (c) not use any space outside
the Leased Premises for sale, storage or any other undertaking; (d) not use the
plumbing facilities in the Leased Premises for any purpose other than that for
which they were constructed, nor dispose of any foreign substances therein; (e)
not use any advertising medium or sound devices inside or adjacent to the Leased
Premises which produce or transmit sounds which are audible beyond the interior
of the Leased Premises; (f) not permit any odor to emanate from the Leased
Premises which is objected to by Landlord or by any tenant or occupant of the
Retail Development (and, upon written notice from Landlord, Tenant shall
immediately cease and desist from causing such odor, and Landlord may deem the
failure by Tenant to do so, a material breach of this Lease); (g) keep the
Leased Premises and any platform, loading dock or service area used by Tenant in
a neat, clean, safe and sanitary condition; (h) promptly comply with all present
and future laws, ordinances, orders, rules, regulations and requirements of all
governmental authorities having jurisdiction, and observe and comply with all
covenants and restrictions of record and all notices from Landlord's mortgagee,
affecting or applicable to the Retail Development or affecting or applicable to
the Leased Premises or the cleanliness, safety, occupancy and use of the same,
whether or not any such law, ordinance, order, rule, regulation, covenant,
restriction, or other requirement is substantial, or foreseen or unforeseen, or
ordinary or extraordinary, or shall necessitate structural changes or
improvements, shall interfere with the use or enjoyment of the Leased Premises,
or shall be directed to or imposed upon Tenant or Landlord, and Tenant shall
hold Landlord harmless from any and all cost or expense on account thereof (as
used in this Lease, the term "legal requirements" shall include the requirements
set forth in this subparagraph); (i) not use the parking areas or sidewalks,
common areas or any space on or about the Retail Development (outside the Leased
Premises) for display, sale, handbilling, advertising, solicitation, or any
other similar undertaking; (j) maintain and operate the heating, ventilating and
air conditioning system and equipment servicing the Leased Premises so as to
adequately heat and cool the same and to maintain at all times, whether or not
Tenant is open for business, temperatures in the Leased Premises which will not
drain heat or ventilation or air conditioning from the enclosed mall or other
interior areas into the Leased Premises and shall not discharge heat,
ventilation or air conditioning from the Leased Premises into the enclosed mall
or other interior areas; and (k) be authorized to do business in the State,
evidence of which must be delivered to Landlord on or before the earlier of (I)
the Commencement Date or (II) the date that Tenant opens for business in the
Leased Premises.
Section 4.5. Storage and Office Space. Tenant shall store or stock in the
Leased Premises only such goods, wares and merchandise as Tenant intends to
offer for sale at, in, from, or upon the Leased Premises. This shall not
preclude occasional emergency transfers of merchandise to the other stores of
Tenant, if any, not located in the Shopping Center. Tenant shall use for office,
clerical or other non-selling purposes only such space in the Leased Premises as
is from time to time reasonably required for Tenant's business therein, and
Tenant shall not perform any office or clerical function in the Leased Premises
for any store located elsewhere.
Section 4.6. Care of Premises. Tenant shall keep the Leased Premises
(including the exterior and interior portions of all windows, doors and all
other glass and signs) orderly, neat, safe and clean and free from rubbish or
dirt at all times and shall store all trash and garbage only in the areas
reasonably designated by Landlord for such storage and accumulation. Tenant
shall not move any safe, heavy machinery, heavy equipment, or fixtures into or
out of the Leased Premises without Landlord's prior written consent. Tenant
agrees that it will not place a load on any floor exceeding the floor load per
square foot which such floor was designed to carry, and will not install,
operate or maintain in the Leased Premises any heavy equipment except in such
manner as to achieve a proper distribution of weight.
Section 4.7. Notice by Tenant. Tenant shall give immediate notice to
Landlord in case of fire or accidents in the Leased Premises, or in the building
of which the Leased Premises are a part of, or of defects therein or in any
fixtures or equipment.
Section 4.8. Radius. Tenant acknowledges that the Retail Development draws
it customers from a large geographic area, relying in part on regional and
international tourism, and that the success of the Retail Development and income
of the Landlord therefrom are dependent upon maximum customer traffic within the
Retail Development. In addition, Tenant acknowledges that Landlord is relying on
the generation of Percentage Rent from Tenant=s Gross Sales at the Leased
Premises. During the Term, in the event Tenant, or any person, firm or
corporation who or which controls or is controlled by Tenant (an "Affiliate")
shall directly or indirectly, either individually or as a partner or stockholder
or otherwise, own, operate, or become financially interested in any business
similar to or in competition with the business of Tenant described in Article IV
("competing business"), which business is conducted within the Area (as said
term is herein defined), then the Gross Sales (as said term is defined in this
Lease) of any such competing business within said Area shall be included in
Tenant's Gross Sales made from the Leased Premises and the Percentage Rent
hereunder shall be computed upon the aggregate of Tenant's Gross Sales made from
the Leased Premises and made from each such competing business then conducted
within said Area. Tenant shall be obligated to provide Landlord with full and
complete Gross Sales information and reports with respect to any competing
business within the Area in accordance with the requirements of Article II of
this Lease and Tenant shall be obligated to include the applicable portion of
the Gross Sales of such competing business with the Gross Sales of the Leased
Premises and to pay Percentage Rent thereon in accordance with the terms of this
Lease. The "Area" shall be defined as the area falling within a radius of
fifteen (15) miles for outlet stores only measured from the outside boundary of
the Retail Development. This Section 4.8 shall not apply to any competing
business which is open and is being operated by Tenant within said Area on the
Effective Date or other stores operated by Tenant within the Shopping Center.
ARTICLE V
COMMON AREA
Section 5.1. Use of Common Area. Landlord agrees to cause to be operated,
managed and maintained during the Term all of the common areas of the Shopping
Center. The term "common areas", as used in this Lease, shall mean the parking
areas, pedestrian sidewalks and bridges, truckways, loading docks, delivery
areas, park areas, pedestrian malls and courts, elevators and escalators, if
any, and stairs not contained in leased areas, public restrooms and comfort
stations, if any, service areas, fire, service and exit corridors, passageways,
landscaped areas, berms and all other areas or improvements which may be
provided for the convenience and use of the occupants and tenants of the Retail
Development and their respective agents, employees, customers, invitees, and the
licensees and invitees of Landlord. The use and occupancy by Tenant of the
Leased Premises shall include the non-exclusive use, in common with all others
to whom Landlord has or may hereafter grant rights to use the same (including,
but not limited to, the owners, tenants and occupants of the Shopping Center),
of the common areas and of such other facilities as may be designated by
Landlord from time to time; subject, however, to rules and regulations for the
use thereof which will be uniformly applicable to all Shopping Center tenants as
prescribed from time to time by Landlord. In particular, Tenant and its
employees shall park their cars only in the areas specifically designated from
time to time by Landlord for that purpose. Tenant covenants that it will enforce
the parking by its employees in such designated areas. Automobile license
numbers of employees' cars shall be furnished by Tenant to Landlord within five
(5) days after Landlord's request. In the event any vehicle is parked by an
employee of Tenant in a non-employee parking area, Landlord shall have the right
to cause the vehicle to be towed to a location designated by Landlord and Tenant
shall be obligated to reimburse Landlord for all towing charges. TENANT FURTHER
AGREES TO HOLD HARMLESS LANDLORD AND DEFEND LANDLORD, ITS AGENTS AND EMPLOYEES
AGAINST ANY AND ALL CLAIMS OF THE EMPLOYEE AND/OR OWNER OF THE VEHICLE TOWED.
Landlord may at any time close temporarily any common area to make repairs or
changes, to prevent the acquisition of public rights in such areas and to
discourage non-customer use, provided the same shall not materially adversely
affect access to or visibility of the Leased Premises. In addition, Landlord may
modify, from time to time, the traffic flow pattern and layout of parking spaces
and the entrances-exits to adjoining public streets or walkways, utilize
portions of the common areas for entertainment, displays and charitable
activities and may do such other acts in and to the common areas as in its
judgment may be desirable to improve the convenience or attraction thereof.
Landlord agrees to maintain all common areas of the Shopping Center in good
order, condition and repair and in a safe, clean, sightly and sanitary condition
in accordance with good and accepted shopping center practices. The maintenance
obligations of Landlord shall include, without limitation, the re-striping of
parking areas when required, repairing of common areas and adequate lighting of
all exterior common areas during all hours of darkness during which Tenant shall
be open for business and for one (1) hour thereafter.
Section 5.2. Common Area Maintenance Expenses. (a) Tenant agrees to pay to
Landlord each Lease Year, in the manner hereinafter provided, Tenant's
proportionate share of all costs and expenses (the "Common Area Maintenance
Expenses") of every kind and nature paid or incurred by Landlord, or for which
Landlord is obligated, during each Lease Year, for operating, equipping,
policing and protecting, heating, air conditioning, providing sanitation and
sewer and other services, lighting, insuring, repairing, replacing and
maintaining (i) the common areas, and (ii) all buildings and roofs within the
Retail Development, and (iii) all other areas, facilities and buildings used in
connection with the maintenance and/or operation of, and whether located within
or outside of, the Retail Development, including without limitation, all roads
and driveways serving the Retail Development which are maintained or repaired by
Landlord or at Landlord's expense. The Common Area Maintenance Expenses shall
include, but are not limited to, costs and expenses of: water, gas, sewage,
electricity, refuse disposal, air conditioning, heating and other utilities
(without limitation), including all usage, service, hook-up, connection,
availability and/or standby fees or charges pertaining to same, and the utility
costs; illumination and maintenance of signs, whether located on or off the
Retail Development property; salaries of all management personnel; maintenance,
repair and replacement of directories, electronic or otherwise, cleaning,
lighting, snow removal and landscaping; security control and fire protection;
uniforms for maintenance, administrative and security personnel for the Retail
Development; management fees; maintenance for wooded areas, retention ponds,
wetlands, rivers and riverbank areas; premiums for insurance to the extent
maintained by Landlord, for liability, casualty and property damage, including,
without limitation, insurance against vandalism, plate glass breakage, fire and
extended coverage insurance and such other coverage as determined by Landlord,
and liability for defamation and claims of false arrest occurring in and about
such areas; personal property taxes; maintaining and replacing the equipment, if
any, supplying music to such areas; the reasonable depreciation of equipment
used in the operation and maintenance of such areas; total compensation and
benefits (including premiums for workers' compensation and other insurance) paid
to or on behalf of persons involved in the performance or
administration/technical support of the work specified in this Section 5.2;
repair, maintenance and cleaning of such areas; operation, repair, maintenance
and reasonable depreciation of all temporary and permanent utility systems for
the Retail Development, including, without limitation, heating, ventilating and
air conditioning systems (HVAC systems), gas system(s), plumbing system(s),
electrical equipment and irrigational pumping system(s); operation, repair,
maintenance and reasonable depreciation of emergency water and sprinkler main
system(s) and security alarm system(s); operation maintenance, repair and
replacement of mechanical equipment including any automatic door openers,
elevators, escalators, lighting fixtures (including replacement of poles, tubes
and bulbs) and all other items of equipment used in connection with such areas;
paper supplies in restrooms located in or about such areas, cleaning, lighting,
striping and landscaping, curbs, gutters, sidewalks, drainage and irrigation
ditches, conduits, pipes and canals serving the Retail Development; and there
shall also be added to the foregoing costs and expenses an amount equal to
fifteen percent (15%) of the total of all of the ongoing costs and expenses as
Landlord's administrative fee. As stated throughout this Lease, whenever Tenant
is obligated to pay its "proportionate share" of a cost, expense or Taxes (as
hereinafter defined) such share shall be based on gross leased and occupied
floor area in the Shopping Center, and Tenant's proportionate share shall be
that fraction, the numerator of which is the total square footage of floor area
in the Leased Premises, and the denominator of which is the total square footage
of gross leased and occupied floor area (including the Leased Premises) in the
Shopping Center. As used throughout this Lease, the "gross leased and occupied
floor area" in effect for the whole of any Lease Year shall be the average of
the gross leased and occupied floor area in effect on the first day of each
calendar month in such Lease Year.
Notwithstanding anything to the contrary contained herein, Tenant=s share
of Common Area Maintenance Expenses from the Commencement Date through December
31, 2000 shall not exceed Nine and 50/100ths Dollars ($9.50) per square foot of
floor area of the Leased Premises per Lease Year, proportionately reduced for a
partial Lease Year.
Prior to the proration of such Common Area Maintenance Expenses to Tenant,
there shall be deducted from the total of such Common Area Maintenance Expenses
any amounts specifically contributed by the Major Tenants toward such Common
Area Maintenance Expenses. It is further agreed that in no event shall Tenant be
obligated for the capital costs of initially constructing the Retail Development
or the capital costs of subsequent expansion construction for the Retail
Development (i.e., adding new Major Tenants to the development or expanding the
Shopping Center or the common areas).
(b) Tenant's proportionate share of such Common Area Maintenance Expenses
for each Lease Year shall be paid in advance, in equal monthly installments, in
the same manner and at the same time as the monthly installments of Minimum Rent
are payable hereunder without deduction, offset or diminution of any kind, based
on an amount estimated in advance from time to time by Landlord to be Tenant's
obligation under this Section 5.2. Notwithstanding the above, in the event
Landlord at any time determines that the amount of Common Area Maintenance
Expenses actually being paid or incurred by Landlord exceeds the estimate upon
which Tenant's proportionate share of Common Area Maintenance Expenses was
computed, then Tenant, following a request from Landlord, shall commence to pay
with the next monthly installment of Minimum Rent due an amount sufficient to
result in Tenant's paying its full proportionate share of Common Area
Maintenance Expenses as computed on the basis of Landlord's revised estimate of
Common Area Maintenance Expenses. Subsequent to the end of each Lease Year,
Landlord shall furnish Tenant with a statement of the actual amount of Tenant's
proportionate share of such Common Area Maintenance Expenses for such period
which statement shall be in reasonable detail, provided, however, Landlord shall
be permitted to describe areas of expenditure by category and shall not be
obligated to enumerate each specific expenditure. If the total amount paid by
Tenant under this Section 5.2 for any Lease Year shall be less than the actual
amount due from Tenant for such Lease Year as shown on such statement, Tenant
shall pay Landlord the difference between the amount paid by Tenant and the
actual amount due, such deficiency to be paid within thirty (30) days after the
furnishing of each such statement, and if the total amount paid by Tenant
hereunder for any such Lease Year shall exceed the actual amount due from Tenant
for such Lease Year, such excess shall be credited against the next installment
due from Tenant to Landlord under this Section 5.2.
ARTICLE VI
REPAIRS AND MAINTENANCE
Section 6.1. Repairs and Maintenance by Landlord. Landlord agrees to keep
in good order, condition and repair the roof (including keeping the roof
watertight), foundations, exterior (including exterior painting and finish), all
structural portions of the Leased Premises (and of the building in which the
Leased Premises are located) and all plumbing and utility lines not installed by
Tenant or exclusively serving the Leased Premises. Should any repairs,
modifications or alterations be required by reason of applicable law, the same
shall be made by Landlord at Landlord's cost and expense unless the need for
such repairs, modifications or alterations shall result from Tenant's failure to
perform its obligations under this Lease or from Tenant's use of the Leased
Premises for other than general merchandising purposes. In addition, for the
first twelve (12) months only following the Delivery of Possession Date,
Landlord shall, upon written notice from Tenant of the necessity therefor,
correct any defects in Landlord's Work within the Leased Premises. All costs and
expenses incurred by Landlord under this Section 6.1 shall be included in Common
Area Maintenance Expenses, other than costs and expenses for Landlord's
correction of defects in Landlord's Work.
Section 6.2. Repairs and Maintenance by Tenant. (a) Except for the repairs
and maintenance that Landlord is specifically obligated to make or perform
pursuant to Section 6.1 above, throughout the entire Term of this Lease, Tenant,
at its expense, shall promptly make all repairs and replacements and perform
maintenance in and to the Leased Premises and all equipment and fixtures therein
or appurtenant thereto, that are necessary or desirable in order to keep the
Leased Premises in good order, condition and repair and in safe, dry and
tenantable condition. Without limiting the generality of the foregoing, Tenant,
at its expense, shall maintain and promptly make any and all necessary repairs
to or replacements of: (i) that portion of any pipes, lines, ducts, wires or
conduits which are installed by Tenant or that exclusively serve the Leased
Premises; (ii) the glass windows, plate glass doors, and all fixtures or
appurtenances composed of glass that are located in or about the Leased
Premises; (iii) Tenant's signs; (iv) the floors and floor coverings, doors and
door frames, windows and window frames, walls, storefront including security
gates, grilles or enclosures, locks and closing devices, partitions and ceilings
in the Leased Premises; (v) heating, ventilating, air conditioning, electrical
and plumbing system(s) equipment and fixtures (whether contained within or
outside the Leased Premises) which are installed by Tenant or which exclusively
serve the Leased Premises; and (vi) the Leased Premises or any part of the
Shopping Center when repairs thereto are necessitated by any act or omission
(negligent or otherwise) of Tenant or any of Tenant's agents, employees or
invitees, or by the failure of Tenant to perform any of its obligations under
this Lease. Notwithstanding the foregoing, Landlord shall be responsible for
repairs and maintenance necessitated by the negligence or intentional acts of
Landlord, its agents or employees. Notwithstanding any contrary provision of
this Article VI, Tenant, at its expense, shall make any and all repairs to the
Leased Premises as may be necessitated by any break-in, forcible entry or other
trespass into or upon the Leased Premises, regardless of whether or not such
entry and damage is caused by the negligence or fault of Tenant or occurs during
or after business hours. Tenant, at its expense, shall change all air
conditioning filters at least five (5) times per year and shall have the air
conditioning system professionally inspected and generally serviced at least
twice per year.
(b) Tenant shall keep and maintain the Leased Premises in a clean, sanitary
and safe condition in accordance with the laws of the State and in accordance
with all directions, rules and regulations of the health officer, building
inspector, the National Fire Protection association and any other officials of
the governmental agencies having jurisdiction, at the sole cost and expense of
Tenant, and Tenant shall comply with all requirements of laws, ordinances,
rules, regulations and orders of any lawful authority having jurisdiction
affecting the Leased Premises or Tenant's use thereof. Tenant, at its expense,
shall install and maintain fire extinguishers and other fire protection devices
as may be required by reason of the conduct of Tenant's business, from time to
time by any agency having jurisdiction or the underwriters insuring the building
in which the Leased Premises are located. If any bureau, department or official
of the Federal or State government requires or recommends the installation of
any changes, modifications or alterations in the sprinkler system or additional
sprinkler heads or other equipment (hereinafter in this subsection (b)
collectively "changes") by reason of Tenant's business, or the location of
partitions, trade fixtures, or other contents of the Leased Premises, or for any
other reason, or if any such changes become necessary to prevent the imposition
of a penalty or charge against the full allowance for a sprinkler system in the
fire insurance rates set by any fire insurance company, Tenant, at Tenant's
expense, shall promptly make such changes as required.
(c) Tenant agrees that Tenant's use of electrical current will at no time
exceed the capacity of the electric distribution system and that Tenant will not
make any alteration or addition to Tenant's electrical system without Landlord's
prior written consent. If Tenant installs any electrical equipment that
overloads the electrical lines in the Leased Premises or the Retail Development,
Tenant shall, at Tenant's sole cost and expense, be required to make whatever
changes to such electrical equipment and in the electric wiring in the Leased
Premises (but only after obtaining Landlord's written approval) as may be
necessary in order to remedy such overloading and be in compliance with all
insurance and legal requirements. All changes required to be made hereby shall
result in the continued conformance with the provisions of Exhibit D and this
Lease.
(d) If Tenant refuses or neglects to properly maintain the Leased Premises,
or to commence or to complete repairs promptly and adequately, or if Landlord
finds it necessary to make any repairs or replacements otherwise required to be
made by Tenant, then Landlord may, after notice to Tenant, in addition to all
other remedies, but without obligation to do so, enter the Leased Premises and
proceed forthwith to have such maintenance, repairs or replacements made and
Tenant shall pay to Landlord, on demand, the cost and expenses therefor plus a
charge of fifteen percent (15%) of such costs and expenses.
ARTICLE VII
TAXES
Section 7.1. Tax Liability. Tenant agrees to pay to Landlord Tenant's
proportionate share of all taxes and assessments and service payments in lieu of
taxes of every nature and kind which may be levied or assessed by, or payable
to, any lawful authority during or with respect to each fiscal tax year falling
in whole or in part during the Term of this Lease against any or all or any part
of the land, buildings and improvements comprising the Retail Development and
any other taxes which Landlord becomes obligated to pay with respect to the
Retail Development, whether or not the same are assessed as real or personal
property or are payable in advance or in arrears (the "Taxes"). If due to a
future change in the method of taxation, any tax, excise or assessment shall be
levied or assessed against Landlord, directly or indirectly, in lieu of, in
substitution for or as a supplement to any present Taxes or future (real estate
or personal property) tax, in whole or in part, including any new tax, excise or
assessment upon rentals payable to Landlord by occupants of the Retail
Development or upon gross receipts or other income of Landlord derived by
Landlord from or upon the interest in the Retail Development of Landlord (or any
individuals or entities comprising Landlord), such tax, excise or assessment
shall constitute a tax respecting which Tenant is obligated to pay its
proportionate share to Landlord as provided herein. If any Taxes or assessed
valuation(s) are contested by Landlord, then Tenant's proportionate share of
Taxes shall also include Tenant's proportionate share of the cost and expense of
consultation services incurred in evaluating and contesting such Taxes or
assessed valuation(s).
The term "Taxes" shall also include any form of assessment, special
assessment, license fee, license tax, business license fee, business license
tax, commercial rental tax, levy, charge, tax or similar imposition, imposed by
any authority having the direct power to tax, including without limitation any
city, county, State or Federal government, or any school, agricultural,
lighting, drainage or other improvement or special assessment district or any
other agency or other public body, whether or not consented to or joined in by
Landlord and whether or not retroactive, payable by Landlord thereof as against
the land and improvements comprising, or any legal or equitable interest of the
Landlord in, the Retail Development.
Section 7.2. Method of Payment. Tenant's proportionate share of Taxes shall
be paid, in advance, in monthly installments on or before the first day of each
calendar month, in the same manner and at the same time as the monthly
installments of Minimum Rent are payable hereunder without deduction, offset or
diminution of any kind, based on an amount estimated by Landlord. Following
receipt of all bills for Taxes attributable to any calendar or fiscal year
during the Term hereof, Landlord shall furnish Tenant with a written statement
of the actual amount of Tenant's proportionate share of Taxes for such year. If
any xxxx for any such Taxes is not available, Landlord will estimate the amount
of such tax. If the total amount paid by Tenant hereunder for any calendar or
fiscal year during the Term of this Lease shall be less than the actual amount
due from Tenant for such year, as shown on such statement, Tenant shall pay to
Landlord the difference between the amount paid by Tenant and the actual amount
due, such deficiency to be paid within thirty (30) days after demand therefor by
Landlord; and if the total amount paid by Tenant hereunder for any such calendar
or fiscal year shall exceed such actual amount due from Tenant for such year,
such excess shall be credited against the next installment of Taxes due from
Tenant to Landlord hereunder. For the calendar or fiscal years in which this
Lease commences and terminates, Tenant's liability for its proportionate share
of any Taxes for such years shall be subject to a pro rata adjustment based on
the number of days of said calendar or fiscal years during which the Term of
this Lease is in effect. A copy of any such xxxx for Taxes shall at all times be
sufficient evidence of the amount of Taxes assessed or levied against the
property to which such xxxx relates. Prior to or at the commencement of the Term
of this Lease and from time to time thereafter throughout the Term hereof,
Landlord shall notify Tenant in writing of Landlord's estimate of Tenant's
monthly installments due hereunder. Tenant's obligations under this Article VII
shall survive the Expiration Date or sooner termination of this Lease.
ARTICLE VIII
INSURANCE, INDEMNITY AND LIABILITY
Section 8.1. Landlord's Insurance Obligations. Landlord agrees to obtain
and maintain during the Term hereof, to the extent the same is available, fire
and extended coverage insurance, in amounts and coverages and with such special
endorsements as Landlord shall determine from time to time, insuring the
building in which the Leased Premises are located and the improvements to the
Leased Premises provided by Tenant pursuant to this Lease (exclusive of Tenant's
merchandise, trade fixtures, furnishings, equipment, plate glass, signs and
personal property of Tenant). Landlord shall also carry rental interruption
insurance in amounts at least equal to Tenant's total rental obligation for
twelve (12) full months under this Lease including the total of the estimated
costs to Tenant of Taxes and Common Area Maintenance Expenses (including
insurance) for such twelve (12) month period. Tenant shall reimburse Landlord
for its proportionate share of the insurance costs incurred by Landlord under
this Section 8.1 as part of Tenant's Common Area Maintenance Expenses as
provided in Section 5.2 hereof.
Section 8.2. Tenant's Insurance Obligations. (a) Provided Tenant is the
Tenant named on the Recital Page and a wholly-owned subsidiary of the Guarantor,
if any, and Tenant's and Guarantor's, if any, combined net worths are or
Tenant's net worth is at least equal to Ten Million and 00/100ths Dollars
($10,000,000.00), Tenant shall have the right to self-insure for any loss or
damage of the type covered by standard fire and extended coverage insurance with
respect to personal property located on or within the Leased Premises including
alterations and improvements made by Tenant to the extent the same are not
covered by Landlord's fire and extended coverage insurance. Tenant and Guarantor
shall at their sole expenses, without regard to fault on the part of any person,
make and perform any repairs or restorations which are required as a result of a
casualty which would be covered by insurance of the type described in this
Section 8.2(a). Tenant, at Tenant's sole cost and expense, shall obtain and
maintain in effect commencing with the Delivery of Possession Date and
continuing throughout the Term of this Lease, insurance policies providing for
the following coverage: (i) all risk property insurance against fire, theft,
vandalism, malicious mischief, sprinkler leakage and such additional perils as
now are or hereafter may be included in a standard extended coverage endorsement
from time to time in general use in the State, insuring Tenant's merchandise,
trade fixtures, furnishings, equipment and all items of personal property of
Tenant and of anyone claiming by, through or under Tenant located on or in the
Leased Premises, and the amount of such insurance will be set forth in an
"agreed value endorsement" to the policy of such insurance, not less than one
hundred percent (100%) of the full replacement value thereof without deduction
for depreciation, and with a deductible amount of not more than Fifty Thousand
and 00/100ths Dollars ($50,000.00), provided, however, any and all proceeds of
such insurance, so long as this Lease shall remain in effect, shall be used only
to repair or replace or pay for the items so insured; (ii) a commercial general
liability policy, including insurance protecting against any and all claims for
injury to persons or property occurring in or about the Leased Premises and
protecting against assumed or contractual liability under this Lease with
respect to the Leased Premises and the operations of Tenant and any subtenant of
Tenant in, on or about the Leased Premises, with such policy to be in the
minimum amount of Three Million and 00/100ths Dollars ($3,000,000) single limit
coverage; (iii) products liability insurance for merchandise offered for sale or
lease from the Leased Premises, including (if this Lease covers leased premises
in which food and/or beverages are sold and/or consumed) liquor liability
coverage (if applicable to Tenant's business) and coverage for liability arising
out of the consumption of food and/or alcoholic beverages on or obtained at the
Leased Premises, of not less than Two Million and 00/100ths Dollars ($2,000,000)
per occurrence for personal injury and death and property damage; (iv) workers'
compensation coverage as required by law; (v) with respect to alterations,
improvements and the like required or permitted to be made by Tenant hereunder,
contingent liability and builders risk insurance in amounts satisfactory to
Landlord; and (vi) the insurance required under Exhibit D.
(b) All insurance policies herein to be procured by Tenant shall: (i) be
issued by insurance companies reasonably satisfactory to Landlord and authorized
to do business in the State; (ii) be written as primary policy coverage and
non-contributing with respect to any coverage which Landlord may carry and that
any coverage carried by Landlord shall be excess insurance; (iii) insure and
name Landlord, Landlord's managing agent, any mortgagee of the Shopping Center
and any parties in interest designated by Landlord as additional insured, as
their respective interests may appear (except with respect to workers'
compensation insurance); and (iv) contain any express waiver of any right of
subrogation by the insurance company against Landlord, Landlord's managing agent
and their respective agents, employees and representatives which arises or might
arise by reason of any payment under such policy or by reason of any act or
omission of Landlord, its agents, employees or representatives. Neither the
issuance of any insurance policy required hereunder, nor the minimum limits
specified herein with respect to Tenant's insurance coverage, shall be deemed to
limit or restrict in any way Tenant's liability arising under or out of this
Lease. With respect to each and every one of the insurance policies herein
required to be procured by Tenant, on or before the Commencement Date and at
least thirty (30) days before any such insurance policy shall expire, Tenant
shall deliver to Landlord upon Landlord's written request a duplicate original
or certified copy of each such policy or a certificate of the insurer,
certifying that such policy has been issued, providing the coverage required by
this Section 8.2 and containing provisions specified herein, together with
evidence of payment of all applicable premiums. Any insurance required to be
carried hereunder may be carried under a blanket policy covering the Leased
Premises and other locations of Tenant. Each and every insurance policy required
to be carried hereunder by or on behalf of Tenant shall provide (and any
certificate evidencing the existence of each such insurance policy shall
certify) that, unless Landlord shall first have been given thirty (30) days'
prior written notice thereof, the insurer will not cancel, materially change or
fail to renew the coverage provided by such insurance policy. The term
"insurance policy" as used herein shall be deemed to include any extensions or
renewals of such insurance policy. In the event that Tenant shall fail to
promptly furnish any insurance coverage hereunder required to be procured by
Tenant, Landlord, at its sole option, shall have the right after ten (10) days
prior written notice to Tenant to obtain the same and pay the premium therefor
for a period not exceeding one (1) year in each instance, and the premium so
paid by Landlord shall be immediately due and payable by Tenant to Landlord as
additional rent.
(c) Tenant shall not do or permit to be done any act or thing upon the
Leased Premises that will invalidate or be in conflict with fire insurance
policies covering the building containing the Leased Premises or any part
thereof, including all common areas, or fixtures and property therein, or any
other insurance policies or coverage referred to above in this Article VIII; and
Tenant shall promptly comply with all rules, orders, regulations, or
requirements relating to such insurance policies, and shall not do, or permit
anything to be done, in or upon the Leased Premises, or bring or keep anything
therein, which shall increase the rate of fire insurance on the building in
which the Leased Premises are located or on any property, including all common
areas, located therein, or increase the rate or rates of any other insurance
referred to hereinabove. If any act or omission of Tenant, its agents, employees
or contractors shall result in any increase in the premium rates applicable to
any such insurance policies carried by Landlord, or other increased costs to
Landlord in connection therewith, then Tenant shall reimburse Landlord on demand
as additional rent for the amount of any such increased rates or costs. In
particular, if Tenant uses the Leased Premises for the preparation of food,
Tenant shall reimburse Landlord on demand, for any part of the premium for
insurance coverage under Section 8.1 hereof required to be paid on account of
such use of the Leased Premises.
SECTION 8.3. MUTUAL COVENANT. NOTWITHSTANDING ANY PROVISION OF THIS LEASE
TO THE CONTRARY, LANDLORD AND TENANT EACH HEREBY RELEASES THE OTHER, ITS
OFFICERS, DIRECTORS, EMPLOYEES, AND AGENTS FROM ANY AND ALL LIABILITY OR
RESPONSIBILITY FOR ANY LOSS, DAMAGE OR INJURY CAUSED BY FIRE OR OTHER CASUALTY
FOR WHICH INSURANCE CONTAINING A WAIVER OF SUBROGATION IS CARRIED BY THE INJURED
PARTY AT THE TIME OF SUCH LOSS, DAMAGE OR INJURY REGARDLESS OF THE EXTENT OF ANY
RECOVERY BY THE INJURED PARTY UNDER SUCH INSURANCE. BOTH PARTIES AGREE TO CARRY
CASUALTY INSURANCE CONTAINING SUCH WAIVER OF SUBROGATION.
ADDITIONALLY, DURING ANY TIME WHEN TENANT IS SELF-INSURING ITS INSURANCE
OBLIGATIONS HEREUNDER, TENANT HEREBY RELEASES THE LANDLORD, ITS OFFICERS,
DIRECTORS, EMPLOYEES AND AGENTS FROM ANY AND ALL LIABILITY OR RESPONSIBILITY FOR
ANY LOSS, DAMAGE OR INJURY CAUSED BY FIRE OR OTHER CASUALTY, EVEN IF SUCH LOSS,
DAMAGE OR CASUALTY IS CAUSED IN WHOLE OR IN PART BY LANDLORD OR BY ANY PARTY FOR
WHOM LANDLORD MAY BE RESPONSIBLE.
SECTION 8.4. COVENANT TO HOLD HARMLESS. EXCEPT WITH RESPECT TO THE
NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD, ITS AGENTS OR EMPLOYEES (UNLESS
COVERED OR REQUIRED TO BE COVERED BY TENANT'S INSURANCE), TENANT HEREBY
INDEMNIFIES AND AGREES TO HOLD HARMLESS LANDLORD, ITS OFFICERS, DIRECTORS,
PARTNERS, EMPLOYEES AND AGENTS AND ANY MORTGAGEE OR MASTER LESSOR OF THE
SHOPPING CENTER, FROM AND AGAINST ANY AND ALL CLAIMS, ACTIONS, DAMAGES,
LIABILITIES, COSTS AND EXPENSES, INCLUDING ATTORNEYS' FEES, THAT (I) ARISE FROM
OR ARE IN CONNECTION WITH THE POSSESSION, USE, OCCUPANCY, MANAGEMENT, REPAIR,
MAINTENANCE OR CONTROL OF THE LEASED PREMISES, OR ANY PORTION THEREOF, OR (II)
ARISE FROM OR ARE IN CONNECTION WITH ANY ACT OR OMISSION OF TENANT OR TENANT'S
AGENTS, EMPLOYEES, CONTRACTORS, LICENSEES OR INVITEES, OR (III) RESULT FROM ANY
DEFAULT, BREACH, VIOLATION OR NONPERFORMANCE OF THIS LEASE OR ANY PROVISION
HEREOF BY TENANT, OR (IV) RESULT FROM INJURY TO PERSON OR PROPERTY OR LOSS OF
LIFE SUSTAINED IN OR ABOUT THE LEASED PREMISES. TENANT SHALL, AT ITS OWN COST
AND EXPENSE, DEFEND ANY AND ALL ACTIONS, SUITS AND PROCEEDINGS WHICH MAY BE
BROUGHT AGAINST LANDLORD OR ANY MORTGAGEE OR MASTER LESSOR OF THE SHOPPING
CENTER WITH RESPECT TO THE FOREGOING. TENANT SHALL PAY, SATISFY AND DISCHARGE
ANY AND ALL JUDGMENTS, ORDERS AND DECREES WHICH MAY BE RECEIVED AGAINST LANDLORD
OR ANY SUCH MORTGAGEE OR MASTER LESSOR IN CONNECTION WITH THE FOREGOING. IN THE
EVENT LANDLORD OR ANY OTHER PARTY SO INDEMNIFIED, SHALL, WITHOUT FAULT, BE MADE
A PARTY TO ANY LITIGATION COMMENCED BY OR AGAINST TENANT, OR IF LANDLORD OR ANY
SUCH PARTY SHALL, IN ITS SOLE DISCRETION, INTERVENE IN SUCH LITIGATION TO
PROTECT ITS INTEREST HEREUNDER, THEN TENANT SHALL PROTECT AND HOLD THEM HARMLESS
AND SHALL PAY ALL COSTS, EXPENSES AND ATTORNEYS' FEES INCURRED OR PAID BY SUCH
PARTY(IES) IN CONNECTION WITH SUCH LITIGATION. LANDLORD HEREBY INDEMNIFIES AND
AGREES TO SAVE HARMLESS TENANT, ITS OFFICERS, DIRECTORS, PARTNERS, EMPLOYEES AND
AGENTS FROM AND AGAINST ANY AND ALL CLAIMS, ACTIONS, DAMAGES, LIABILITIES, COSTS
AND EXPENSES, INCLUDING ATTORNEYS' FEES, IN CONNECTION WITH LOSS OF LIFE,
PERSONAL INJURY AND/OR DAMAGE TO PROPERTY ARISING FROM OR OUT OF ANY OCCURRENCE
IN THE COMMON AREAS OF THE SHOPPING CENTER UNLESS CAUSED BY THE NEGLIGENCE OR
WILLFUL MISCONDUCT OF TENANT, ITS AGENTS, CONTRACTORS, EMPLOYEES, OFFICERS,
DIRECTORS, PARTNERS, SUBTENANTS OR CONCESSIONAIRES.
Section 8.5. Loss and Damage. All Tenant's property of every kind and
description which may at any time be in the Leased Premises shall be kept at
Tenant's sole risk, and Landlord shall not be liable except to the extent
resulting from the negligence or intentional acts of Landlord, its agents or
employees to Tenant, its agents, employees or customers, for any damage, loss,
compensation, accident, or claims whatsoever resulting to Tenant or its property
from the necessity of repairing any portion of the Shopping Center; any
interruption in the use of the Leased Premises; the use or operation (by
Landlord, Tenant, or any other person or persons whatsoever) of any elevators,
heating, cooling, electrical or plumbing equipment or apparatus; the termination
of this Lease by reason of the destruction of the Leased Premises; any fire,
robbery, theft, or any other casualty; any leakage in any part or portion of the
Leased Premises or the Shopping Center; any water, wind, rain or snow that may
leak into, or flow from part of the Leased Premises or the Shopping Center; any
acts or omissions of any occupant of any space adjacent to or adjoining all or
any part of the Leased Premises or any part of the building of which the Leased
Premises are a part; any explosion, casualty, utility failure or malfunction, or
falling plaster; the bursting, stoppage or leakage of any pipes, sewer pipes,
drains, conduits, appliance or plumbing works; or any other cause whatsoever.
ARTICLE IX
DESTRUCTION OF LEASED PREMISES
Section 9.1. Continuance of Lease. In the event of any damage to the Leased
Premises by fire or other casualty, this Lease shall not be terminated or
otherwise affected; except that, (a) if more than twenty-five percent (25%) of
the square footage of the Leased Premises shall be damaged by any such fire or
other casualty during the last three (3) years of the Term of this Lease (not
including any Option Periods) or during any renewal or extension of the Term
hereof and the cost of repair or restoration exceeds Ten Thousand and 00/100ths
Dollars ($10,000.00) as estimated by Landlord, or (b) if Landlord is unable to
rebuild any portion of the building in which the Leased Premises are located or
of the Shopping Center due to any inability to obtain any required governmental
approval in connection therewith, or (c) if more than thirty-five percent (35%)
of the floor area of the building in which the Leased Premises are located or of
the Shopping Center shall be damaged or destroyed by fire or other casualty, or
(d) if all or any part of the building in which the Leased Premises are located
or if the Shopping Center or the Leased Premises shall be damaged or destroyed
at any time by the occurrence of any risk not insured under the insurance
required to be carried under Article VIII hereof, then Landlord shall have the
option to terminate this Lease within ninety (90) days following the occurrence
of such fire or other casualty by giving written notice to Tenant during such
period. In the event Landlord exercises any of the foregoing options to
terminate, this Lease shall immediately terminate upon Landlord's written notice
to Tenant and (i) the entire proceeds of the insurance provided for in Section
8.1 hereof shall be paid by the insurance company or companies directly to
Landlord and shall belong to, and be the sole property of Landlord, (ii) the
portion of the proceeds of the insurance provided for in Section 8.2 which is
allocable to equipment, fixtures and other items, which, by the terms of this
Lease, rightfully belong to Landlord upon the termination of this Lease by
whatever cause, shall be paid by the insurance company or companies directly to
Landlord, and shall belong to, and be the sole property of, Landlord, and (iii)
Landlord and Tenant shall be relieved from any and all further liability or
obligation accruing under this Lease from and after the date of such
termination. TENANT HEREBY WAIVES ANY AND ALL RIGHTS WHICH IT MAY HAVE TO
TERMINATE THIS LEASE BY REASON OF DAMAGE TO THE LEASED PREMISES BY FIRE OR OTHER
CASUALTY PURSUANT TO ANY PRESENTLY EXISTING OR HEREAFTER ENACTED STATUTE OR
PURSUANT TO ANY OTHER LAW.
Section 9.2. Reconstruction. If the Leased Premises are damaged by fire or
other casualty and this Lease is not terminated in accordance with Section 9.1
hereof, then all fire and extended coverage insurance proceeds from policies
carried pursuant to Section 8.1 hereof, however recovered, shall be held in
escrow and made available for payment of the cost of repairing, replacing and
rebuilding the Leased Premises, the damage to the Leased Premises shall be
promptly repaired, and the Minimum Rent and other charges payable by Tenant to
Landlord shall be abated in proportion to the floor area of the Leased Premises
rendered untenantable, and the Sales Break Point shall likewise be
proportionately reduced. Payment of Minimum Rent and all other charges so abated
shall commence and Tenant shall be obligated to reopen for business sixty (60)
days following the date that Landlord advises Tenant that the Leased Premises
are tenantable and Landlord has substantially completed Landlord's
Reconstruction Work, unless Tenant opens at an earlier time in the damaged area
or remains open in such area following destruction or damage, in which event
there shall be no abatement or any such abatement shall terminate as of the date
of Tenant's earlier reopening. Landlord shall be obligated to commence
Landlord's Reconstruction Work and shall diligently pursue the completion of
Landlord's Reconstruction Work and shall cause the same to be completed as soon
thereafter as possible under the attendant circumstances, but in any event all
such Landlord's Reconstruction Work shall be completed and the Leased Premises
reopened for business within one hundred eighty (180) days following such fire
or casualty. After Landlord has completed Landlord's Reconstruction Work, Tenant
shall commence such Tenant's Reconstruction Work, at its expense. Tenant shall
comply with all laws, ordinances and governmental rules or regulations, and
shall perform all work or cause such work to be performed with due diligence and
in a first-class manner. All permits required in connection with said repairs,
restoration and reconstruction shall be obtained by Tenant at Tenant's sole cost
and expense. Any amount expended by Tenant in excess of any insurance proceeds
received by Tenant shall be the sole obligation of Tenant. the Leased Premises
in accordance with the working drawings originally approved by Landlord pursuant
to Exhibit C and Exhibit D or with (at Landlord's sole election) new drawings
prepared by Tenant and acceptable to Landlord and Tenant. In no event shall
Landlord be required to repair or replace Tenant's merchandise, trade fixtures,
furnishings or equipment. If Landlord repairs or rebuilds, Tenant, at Tenant's
sole cost, shall repair or replace Tenant's merchandise, trade fixtures,
furnishings and equipment in a manner and to at least a condition equal to that
prior to the damage or destruction thereof (ATenant=s Reconstruction Work@).
Except as may be specifically set forth in this Article IX, Landlord shall not
be liable or obligated to Tenant to any extent whatsoever by reason of any fire
or other casualty damage to the Leased Premises, or any damages suffered by
Tenant by reason thereof, or the deprivation of Tenant's possession of all or
any part of the Leased Premises.
In the event Landlord has not commenced restoration or rebuilding of the
Leased Premises within ninety (90) days of the date of such fire or casualty
loss, or diligently proceeded to complete such restoration or rebuilding so that
the Leased Premises are restored/rebuilt to its former condition prior to such
fire or casualty loss within one hundred eighty (180) days of the date of such
fire or casualty loss, Tenant will have the right, in either case, to terminate
this Lease by providing Landlord notice of such election and Tenant will vacate
and surrender the Leased Premises pursuant to Section 17.1.
ARTICLE X
CONDEMNATION
Section 10.1. Eminent Domain. If fifty percent (50%) or more of the floor
area of the Leased Premises shall be taken or condemned by any governmental
authority (including, for purposes of this Article X, any purchase by such
governmental authority in lieu of a taking), then either party may elect to
terminate this Lease by giving notice to the other party not more than ninety
(90) days after the date on which such title shall vest in the authority. If the
parking facilities are reduced below the minimum parking requirements imposed by
the applicable authorities, Landlord may elect to terminate this Lease by giving
Tenant notice within one hundred eighty (180) days after such taking. In
addition, if any Major Tenant shall terminate its lease with Landlord, pursuant
to a taking of its store, Landlord may terminate this Lease by written notice to
Tenant within ninety (90) days after notice to Landlord that such Major Tenant
is terminating its lease. In the case of any taking or condemnation, whether or
not the Term of this Lease shall cease and terminate, the entire award shall be
the property of Landlord; provided, however, Tenant shall be entitled to any
award as may be made for trade fixtures and other equipment (not including any
Tenant's Work required or permitted under this Lease) which under the terms of
this Lease would not have become the property of Landlord; further provided,
that any such award to Tenant shall not be in diminution of any award otherwise
to be made to Landlord in the absence of such award to Tenant.
Section 10.2. Rent Apportionment. In the event of any taking or
condemnation, the then current Minimum Rent, Sales Break Point and the square
foot floor area in the Leased Premises as determined pursuant to Section 1.1
shall be apportioned as of the date when possession of the Leased Premises is
required to be delivered to the condemning authority or termination of this
Lease, as the case may be, and, if the Term of this Lease shall not have ceased
and have been terminated as of said date, Tenant shall be entitled to a pro rata
reduction in the Minimum Rent payable and Sales Break Point hereunder, or, if
Tenant has prepaid Minimum Rent, Tenant shall be entitled to a pro rata credit
for the Minimum Rent paid hereunder, based on the proportion which the floor
area taken from the Leased Premises bears to the entire floor area of the Leased
Premises immediately prior to such taking.
Section 10.3. Temporary Taking. Notwithstanding anything to the contrary in
this Article X, the requisitioning of the Leased Premises or any part hereof by
military or other public authority for purposes arising out of a temporary
emergency or other temporary situation or circumstances shall constitute a
taking of the Leased Premises by eminent domain when the use or occupancy by the
requisitioning authority is expressly provided to continue, or shall in fact
have continued, for a period of one hundred eighty (180) days or more, and if
this Lease is not thereafter terminated under the foregoing provisions of this
Article X, then for the duration of any period of use and occupancy of the
Leased Premises by the requisitioning authority, all the terms and provisions of
this Lease and obligations of Tenant hereunder shall remain in full force and
effect, except that the Minimum Rent and Sales Break Point shall be reduced in
the same proportion that the floor area of the Leased Premises so requisitioned
bears to the total floor area of the Leased Premises, and Landlord shall be
entitled to whatever compensation may be payable from the requisitioning
authority for the use and occupation of the Leased Premises for the period
involved.
ARTICLE XI
ASSIGNMENT, SUBLETTING AND ENCUMBERING LEASE
Section 11.1. No Assignment, Subletting or Encumbering of Lease. (a) Except
as otherwise provided in this Article XI and notwithstanding any references to
assignees, subtenants, concessionaires or other similar entities in this Lease,
Tenant shall not (i) assign or otherwise transfer, or mortgage or otherwise
encumber, this Lease, in whole or in part, or any of its rights hereunder, (ii)
sublet the Leased Premises or any part thereof, or permit the use of the Leased
Premises or any part thereof by any persons other than Tenant or its agents. Any
such attempted or purported transfer, assignment, mortgaging or encumbering of
this Lease or any of Tenant's interest hereunder and any attempted or purported
subletting or grant of a right to use or occupy all or a portion of the Leased
Premises in violation of the foregoing sentence, whether voluntary or
involuntary or by operation of law or otherwise, shall be null and void and
shall not confer any rights upon any purported transferee, assignee, mortgagee,
or occupant, and shall, at Landlord's option, terminate this Lease without
relieving Tenant of any of its obligations hereunder for the balance of the
stated Term. Nothing contained elsewhere in this Lease shall authorize Tenant to
enter into any franchise, concession, license, permit, subtenancy, departmental
operation arrangements or the like, except pursuant to the provisions of this
Article XI.
Notwithstanding the provisions of this Article XI to the contrary,
Landlord's consent shall not be unreasonably withheld or delayed to an
assignment of this Lease or a sublease for all or any portion of the Leased
Premises (by merger, consolidation or otherwise) to another entity (the
"Transferee") to which Tenant shall simultaneously be transferring all or
substantially all of its stock or all or substantially all of its assets,
provided that: (1) Tenant shall not at the time of such transfer be in default
under any of the terms, covenants and conditions of this Lease beyond any
applicable grace period, (2) such Transferee shall agree in writing to perform
all of the unperformed terms, covenants and conditions of this Lease and (3)
Tenant shall at all times remain primarily obligated for the performance of the
terms, covenants and conditions of this Lease.
Notwithstanding anything to the contrary set forth in this Article XI and
without application of any prior provisions of this Article XI, Tenant shall
have the right, without Landlord's consent but with prior written notice to
Landlord, to assign this Lease or sublet the Leased Premises to its parent
corporation or any of its wholly-owned subsidiaries, or any affiliate or
subsidiary of Tenant's parent corporation provided that Tenant shall at all
times remain primarily obligated for the performance of the terms, covenants and
conditions of this Lease.
In addition, Tenant may, without violating the provisions of this Article
XI, sell or offer for sale its voting stock to the public in accordance with the
qualifications or registration requirements of the state where Tenant is
incorporated and the Securities Act of 1933, as amended.
(b) If Tenant is a corporation, the sale, issuance or transfer of any
voting capital stock of Tenant or of any corporate entity which directly or
indirectly controls Tenant (unless Tenant is a corporation whose stock is
publicly traded which shall result in a change in the voting control of Tenant
or the corporate entity which controls Tenant shall be deemed to be a prohibited
assignment of this Lease within the meaning of this Article XI. If Tenant is a
partnership or an unincorporated association, then the sale, issuance or
transfer of a majority interest therein, or the transfer of a majority interest
in or a change in the voting control of any partnership or unincorporated
association or corporation which directly or indirectly controls Tenant, or the
transfer of any portion or all of any general partnership or managing
partnership interest, shall be deemed to be a prohibited assignment of this
Lease within the meaning of this Article XI. The consent by Landlord to any
assignment, transfer, or subletting to any party shall not be construed as a
waiver or release of Tenant under the terms of any covenant or obligation under
this Lease or as a waiver or release of the non-assignability covenants in their
future application, nor shall the collection or acceptance of Rent from any such
assignee, transferee, subtenant or occupant constitute a waiver or release of
Tenant of any covenant or obligation contained in this Lease.
(i) Notwithstanding anything herein contained to the contrary, a sale or
transfer of any voting capital stock of Tenant when caused by death (e.g.,
testamentary transfer) or for estate planning purposes (e.g. inter vivos trust)
will not be deemed a prohibited assignment of this Lease.
(ii) The provisions of this Section 11.1 (b) shall not be deemed to
prohibit transfer of limited partnership interests among existing limited or
general partners; however, if either general partner ceases to remain a general
partner of Tenant such occurrence shall be deemed a prohibited assignment of
this Lease under the meaning of this Article XI.
(c) Without conferring any rights upon Tenant not otherwise provided in
this Article XI, should Tenant desire to enter into an assignment, sublease or
transfer of this Lease or Tenant's rights hereunder, Tenant shall request in
writing Landlord's consent to the assignment at least thirty (30) days before
the proposed effective date of the assignment, providing the following: (i) the
full particulars of the proposed assignment, sublease or transfer of this Lease
or Tenant's rights hereunder, including its nature, effective date, terms and
conditions, and copies of any offers, draft agreements, subleases, letters of
commitment or intent and other documents pertaining to the proposed assignment;
(ii) a description of the identity, net worth and previous business experience
of the proposed transferee, including, without limitation, copies of the
proposed transferee's latest income, balance sheet and changes in financial
position statements (with accompanying notes and disclosures of all material
changes thereto) in audited form, if available, and certified as accurate by the
proposed transferee; and (iii) any further information relevant to the proposed
assignment which Landlord shall request after receipt of Tenant's request for
consent. Tenant shall, concurrently with any request for Landlord's consent, pay
to Landlord a fee in the sum of One Thousand and 00/100ths Dollars ($1,000.00)
for Landlord's review and processing of such request and Landlord shall not be
obligated to review such request prior to Landlord's receipt of such fee. All
requests for assignment, sublease or transfer shall be forwarded to Landlord at
the address provided above and to the on-site mall management office.
(d) Except for a permitted assignment or subletting as specified in Section
11.1(a) and (b) and without conferring any rights upon Tenant not otherwise
provided in this Article XI, in the event of an assignment or transfer of
Tenant's interest in this Lease, or a sublease of all or a portion of the Leased
Premises, to a third party, any monthly rent or other payment accruing to Tenant
as the result of any such assignment, transfer, or sublease, including any lump
sum or periodic payment in any manner relating to such assignment, transfer or
sublease, which is in excess of the Rent then payable by Tenant under this Lease
shall be paid one-half (1/2) of such excess by Tenant to Landlord monthly as
additional rent. Landlord may require a certificate from Tenant specifying the
full amount of any such payment of whatsoever nature. Notwithstanding any
assignment, subletting or transfer of this Lease or Tenant's rights hereunder,
Tenant shall remain fully liable on this Lease and for the performance of all
terms, covenants and provisions of this Lease.
(e) All reasonable costs and expenses, including attorney's fees (which
shall include the cost of any time expended by Landlord's attorneys including
in-house counsel) incurred by Landlord in connection with any proposed or
purported assignment, transfer or sublease shall be borne by Tenant and shall be
payable to Landlord as additional rent. It is understood and agreed that the
restrictions set forth in this Article XI are of primary importance in enabling
Landlord to control the mix of tenants in the Shopping Center.
Section 11.2. Assignment or Sublet. If this Lease is transferred or
assigned, in whole or in part, as aforesaid, or if the Leased Premises or any
part thereof be sublet or occupied by any person or entity other than Tenant,
whether as a result of any act or omission by Tenant, or operation of law, or
otherwise, then Landlord, whether before or after default by Tenant, may, in
addition to, and not in diminution of or substitution for, any other rights and
remedies under this Lease or pursuant to law to which Landlord may be entitled
as a result thereof, collect rent from the transferee, assignee, subtenant or
occupant and apply the net amount collected to the Rent herein reserved, but no
such transfer, assignment, subletting, occupancy or collection shall be deemed a
waiver of the covenants contained herein or the acceptance of the transferee,
assignee, subtenant, or occupant as Tenant, or a release of Tenant from the
further performance by Tenant of covenants on the part of Tenant set forth in
this Lease.
Section 11.3. Transfer of Landlord's Interest. In the event of any transfer
of Landlord's interest in the Leased Premises, including a sale or lease, the
transferor shall be automatically relieved of any and all obligations on the
part of Landlord accruing from and after the date of such transfer, provided
that (a) the interest of the transferor, as Landlord, in any funds then in the
hands of Landlord in which Tenant has an interest shall be turned over, subject
to such interest, to the then transferee; and (b) notice of such sale, transfer
or lease shall be delivered to Tenant as required by law.
ARTICLE XII
SUBORDINATION, ATTORNMENT, FINANCING AND ESTOPPEL CERTIFICATE
Section 12.1. Subordination. Tenant agrees that this Lease shall, at the
request of Landlord, be subordinate to any mortgages or deeds of trust that are
now, or may hereafter be, placed upon the Leased Premises and to any and all
advances to be made thereunder, and to the interest thereon, and all renewals,
replacements and extensions thereof, provided that the mortgagees or
beneficiaries named in said mortgages or deeds of trust shall agree to recognize
the interests of Tenant under this Lease in the event of foreclosure, if Tenant
is not then in default. Tenant also agrees that any mortgagee or beneficiary may
elect to have this Lease constitute a prior lien to its mortgage or deed of
trust, and in the event of such election and upon notification by such mortgagee
or beneficiary to Tenant to that effect, this Lease shall be deemed prior in
lien to such mortgage or deed of trust, whether this Lease is dated prior to or
subsequent to the date of said mortgage or deed of trust. Tenant agrees that
upon the request of Landlord, or any mortgagee or beneficiary, Tenant shall
execute whatever reasonable instruments may be required to carry out the intent
of this Section 12.1 and Section 12.2.
Section 12.2. Attornment. In the event any proceedings are brought for the
foreclosure of, or in the event of the conveyance by deed in lieu of foreclosure
of, or in the event of exercise of the power of sale under, any mortgage and/or
deed of trust made by Landlord covering the Leased Premises, or in the event
Landlord sells, conveys or otherwise transfers its interest in the Shopping
Center or any portion thereof containing the Leased Premises, this Lease shall
remain in full force and effect and Tenant hereby attorns to, and covenants and
agrees to execute an instrument in writing reasonably satisfactory to the new
owner whereby Tenant attorns to such successor in interest and recognizes such
successor as Landlord under this Lease. Payment by or performance of this Lease
by any person, firm or corporation claiming an interest in this Lease or the
Leased Premises by, through or under Tenant without Landlord's consent in
writing shall not constitute an attornment or create any interest in this Lease
or the Leased Premises.
Section 12.3. Financing. In the event any construction lender, land lessor,
or the permanent lender for the Shopping Center requires, as a condition to
financing, modifications to this Lease, then, provided such modifications do not
materially alter the approved working plans and do not increase the Rent to be
paid hereunder, Landlord shall submit to Tenant a written amendment with such
required modifications and if Tenant fails to execute and return the same within
thirty (30) days after the amendment has been submitted, Landlord shall be
entitled to its remedies as specified in Section 12.5.
Nothing herein shall require Tenant to execute an amendment or amendments
to accomplish changes which would change (i) the Minimum Rent, additional rent
or Percentage Rent payable by Tenant; (ii) the permitted use; (iii) the size,
dimensions or location of the Leased Premises; (iv) the length of the Term; (v)
Landlord's construction obligations; or (vi) the conditions precedent as to
Tenant's initial opening requirements, or which would place a lien on Tenant's
assets.
Section 12.4. Estoppel Certificate. Tenant shall, without charge therefor,
at any time and from time to time, within thirty (30) days after request
therefor by Landlord, execute, acknowledge and deliver to Landlord a written
estoppel certificate, in reasonable form, certifying to Landlord, any mortgagee,
or any purchaser of the Shopping Center or any other person designated by
Landlord, as of the date of such estoppel certificate: (i) that Tenant is in
possession of the Leased Premises and has unconditionally accepted the same;
(ii) that this Lease is unmodified and in full force and effect (or if there has
been modification, that the same is in full force and effect as modified and
setting forth such modifications); (iii) whether or not there are then existing
any set-offs or defenses against the enforcement of any right or remedy of
Landlord, or any duty or obligation of Tenant, hereunder (and, if so, specifying
the same in detail); (iv) that Rent is paid currently without any offset or
defense thereto, (v) the dates, if any, to which any Rent has been paid in
advance; (vi) whether or not there is then existing any claim of Landlord's
default under this Lease and if so, specifying the same in detail; (vii) that
Tenant has no knowledge of any event having occurred that authorized the
termination of this Lease by Tenant (or if Tenant has such knowledge, specifying
the same in detail); and (viii) any other matters relating to the status of this
Lease that Landlord or its mortgagee may request be confirmed, provided that
such facts are accurate and ascertainable.
Landlord shall, within thirty (30) days after written request from Tenant,
no more often than once in any Lease Year and provided Tenant is not then in
default hereunder, deliver to Tenant or such persons as Tenant may designate, a
statement in writing certifying to the extent true that: (i) Tenant is in
possession of the Leased Premises; (ii) this Lease is in full force and effect
(as later modified, if such be the case); (iii) the Rent due hereunder is
current; and (iv) that to the best of Landlord's knowledge, information and
belief, Tenant is not in default hereunder.
Section 12.5. Remedies. Any failure by Tenant to execute any certificate,
statement or instrument in accordance with the foregoing provisions of this
Article XII or any financing statement in accordance with the provisions of
Section 14.2(a), within the time period provided or if no time period is
specified, then within thirty (30) days after written request, shall constitute
an irrevocable power of attorney appointing and designating Landlord or its
successors or assigns as attorney-in-fact for Tenant, to execute and deliver any
such certificate, statement, instrument or financing statement.
ARTICLE XIII
ADVERTISING AND PROMOTION
Section 13.1. Promotion Fund. Landlord shall establish an advertising and
promotion fund (the "Fund"). The object of the Fund shall be to advertise the
Retail Development in the local metropolitan statistical area and to provide a
program of events, all of which shall, in Landlord's judgment, serve to enhance
and promote the Retail Development and its occupants. Such program of events may
include the promotion of coach traffic to the Retail Development and the
development of a mall video network within the Retail Development offering a
program of information, entertainment and advertisements. The Fund shall be
administered by Landlord and the costs and expenses of such administration shall
be charged to the Fund. Landlord shall expend all amounts paid to the Fund by
the tenants in the Retail Development for the purposes herein set forth.
Section 13.2. Promotion Fund Contribution. Tenant's annual contribution to
the Fund shall be the Fund Contribution (reduced proportionately for a partial
Lease Year) as defined in the Data Sheet. Upon Grand Opening, Tenant shall also
pay Tenant's one-time initial contribution or Grand Opening Fee which is equal
to the annual Fund Contribution. The Fund Contribution payable by Tenant for
each Lease Year shall be increased commencing with the second Lease Year of the
Term of this Lease, and each Lease Year thereafter, by a percentage equal to the
percentage increase from the "base period" of the Consumer Price Index ("Index")
to the "current period" of the Index of the Lease Year for which the adjustment
is being made; provided, however, if the first Lease Year is less than six (6)
months, the first adjustment to the Fund Contribution shall be after the first
full Lease Year. Except as herein expressly provided, the term "base period"
shall initially refer to the Index published for the month of October
immediately preceding the Commencement Date. Following the initial increase in
the Fund Contribution hereunder, the term "base period" shall refer to the Index
published for the month of October immediately preceding the Lease Year for
which the Fund Contribution was last adjusted hereunder. The "current period" of
the Index shall refer to the Index published for the month of October
immediately preceding the Lease Year for which an adjustment is being made. In
the event the Index shall not be published for any of the above-described
months, then the Index published for the month closest, but prior, to the
described month shall be used in its place. The annual Fund Contribution shall
be payable by Tenant to Landlord, or as Landlord may direct, in twelve (12)
equal monthly installments, commencing on the Commencement Date, at the same
time and in the same manner as the monthly installments of Minimum Rent are
payable.
Section 13.3. Advertisements. Not more than once each Lease Year, Landlord
may require Tenant at Tenant's cost to either (i) place a one-quarter (1/4) page
tabloid advertisement, or (ii) contribute funds to cover the cost and expense of
an advertisement prepared by Landlord in an advertising mailer, newspaper insert
or other media ad coordinated by Landlord. In the event that Tenant fails to
submit its proposed advertisement within thirty (30) days after Landlord's
request, then ---- Landlord shall have the right to include Tenant in the
advertising promotion and to charge Tenant for the advertisement. Such charge
shall be payable by Tenant within ten (10) days after written notice by
Landlord.
Section 13.4. Network. Landlord may cause to be developed a mall video
network within the Retail Development (the "Network"). The object of the Network
shall be to provide a program of information, entertainment and advertisements,
which shall, in Landlord's judgment, serve to enhance or promote the Retail
Development and its occupants. The Network shall have the right to sell
available time and access on the Network for advertisements or other uses. The
Network shall be under the sole and exclusive direction of Landlord and shall be
administered by Landlord. The costs and expenses paid or incurred by Landlord
for administering, operating, equipping, staffing, protecting, insuring,
repairing, replacing and maintaining the Network shall be charged to the Fund.
Any production by Landlord of advertising messages for Tenant and any air time
on or access to the Network is subject to availability, as determined solely by
Landlord, and shall be at the then applicable rates and fees set by Landlord.
Landlord shall have the right to reject, remove or discontinue showing any video
taped advertising message of the business conducted, or to be conducted, in the
Leased Premises (herein "Tenant Video") or advertising message on the Network
the content of which is, in the opinion of Landlord, unethical, misleading, in
bad taste, or shall tend to injure the reputation of the Retail Development or
its occupants, or shall be deemed to be detrimental to the Retail Development or
is in violation of any applicable rule, law or existing agreement with
occupant(s) of the Retail Development. Tenant acknowledges that Tenant shall be
solely responsible for the content of its Tenant Video and except with respect
to the gross negligence of Landlord and the Network, Tenant agrees to save
harmless Landlord, its officers, directors, partners, employees and agents from
and against any and all claims, actions, damages, liability, cost or expense,
including attorneys' fees that arise from or with respect to the content of such
advertising message, including without limitation any claims for infringement of
the intellectual property rights of others or actions for unfair competition.
Landlord reserves the right at any time to dissolve the Network and cease
providing its promotional services as well as Tenant Videos and in lieu thereof,
to provide, or cause to be provided, a program of advertising and promotional
events which in Landlord's sole judgment, will serve to promote the Retail
Development and its occupants.
ARTICLE XIV
DEFAULT AND REMEDIES
Section 14.1. Elements of Default. If any one or more of the following
events occur, said event or events shall hereby be classified as a "default":
(a) (i) the failure of Tenant to take possession of the Leased Premises at the
Delivery of Possession Date, or (ii) the failure of Tenant to open its doors for
business on the date specified in Section 1.3 hereof, or (iii) if Tenant vacates
or abandons the Leased Premises and permits the same to remain unoccupied and
unattended, or (iv) if Tenant fails to maintain normal inventory levels and
employee staff for the conduct of its normal business activities in the Leased
Premises, or (v) the failure of Tenant to continuously operate its business in
compliance with Section 4.2 for the purposes specified in Section 4.1, or (vi)
in the event of the sale or removal of a substantial portion of Tenant's
property located in the Leased Premises in a manner which is outside the
ordinary course of Tenant's business; (b) the failure of Tenant to pay any Rent
or other charges required to be paid by Tenant when same shall become due and
payable hereunder and such failure continues for ten (10) days after written
notice; (c) the failure of Tenant to perform or observe any term or condition of
this Lease and such failure shall continue for thirty (30) days after written
notice; (d) ; (e) if any writ of execution, levy, attachment or other legal
process of law shall occur upon Tenant's assets, merchandise, fixtures, or
Tenant's estate or interest in the Leased Premises; (f) Tenant shall be
liquidated or dissolved or shall begin proceedings toward such liquidation or
dissolution, or shall in any manner permit the divestiture of all, or any
substantial part of Tenant's assets. In the event of (i) a default which results
in a total monetary outstanding balance in excess of $20,000.00 or (ii) a
default pursuant to Section 14.1 (a) (iii) of this Lease, which shall not be
remedied within the applicable grace period, if any, by Tenant under this Lease
or by the tenant in any of the "other leases" (as hereinafter defined), then
Landlord may, upon ten (10) days prior notice in writing to Tenant, declare such
default to be a default of this Lease (unless the default is cured within the
ten day period after notice) and, at Landlord's option, a default of any of the
"other leases," as the case may be. Landlord and Tenant acknowledge that Tenant
or the parent, subsidiary or affiliate of Tenant (by virtue of common ownership
or control, direct or indirect) has presently, or may in the future, enter into
lease agreements with Landlord (or with any person or entity which is affiliated
with Landlord, or which directly or indirectly controls or is controlled by, or
is under common control with Landlord, or which is managed by the managing agent
utilized by Landlord for the Shopping Center) for the shopping centers commonly
referred to as Ontario Xxxxx, Potomac Xxxxx, Xxxxxxxx Xxxxx, Gurnee Xxxxx,
Sawgrass Xxxxx, Grapevine Xxxxx, Arizona Xxxxx, and The Block at Orange and Xxxx
Xxxxx (such leases to be referred to as "other leases"). Nothing contained
herein shall be deemed a limitation of the rights of Landlord as set forth in
this Lease or any of the "other leases."
Section 14.2. Landlord's Remedies. In the event of any such default or
breach by Tenant, Landlord may at any time thereafter, with or without further
notice or demand and without limiting Landlord in the exercise of any right or
remedy which Landlord may have by reason of such default or breach:
(a) Perform, on behalf and at the expense of Tenant, any obligation of
Tenant under this Lease which Tenant has failed to perform and of which Landlord
shall have given at least three (3) days' notice (except in the case of
emergency, in which event no such notice shall be required), the cost of which
performance by Landlord, together with interest therein at the interest rate (as
specified in Section 20.14 hereof) from the date of such expenditure, shall be
deemed additional rent and shall be payable by Tenant to Landlord upon demand.
(b) Without further notice, re-enter and repossess the Leased Premises, by
summary proceedings or otherwise, and remove Tenant and all other persons and
property from the Leased Premises, and store such property in a public warehouse
or elsewhere at the cost of and for the account of Tenant without resort to
legal process and without Landlord being deemed guilty of trespass or conversion
or becoming liable for any loss or damage occasioned thereby. In connection
herewith, Landlord shall have, in addition to any other remedies, any and all
self-help remedies, including but not limited to a forcible entry into the
Leased Premises or a "lock-out" accomplished by changing the locks on the Leased
Premises. No re-entry of the Leased Premises shall be construed as an election
by Landlord to accept Tenant=s surrender of the Leased Premises or to terminate
this Lease unless a written notice of such intention is given by Landlord to
Tenant.
(c) Declare the entire balance of the Rent, and all other amounts to be
paid by Tenant hereunder for the remainder of the Term to be due and payable
immediately, and collect such balance in any manner not inconsistent with
applicable law. The amount of additional rent and Percentage Rent payable with
respect to each Lease Year remaining in the Term after such default (including
the Lease Year during which such default occurred) shall be conclusively
presumed to be equal to the average additional rent and Percentage Rent payable
with respect to each completed Lease Year preceding such default; provided,
however, that if such default occurs before the expiration of two (2) Lease
Years, then the amount of additional rent and Percentage Rent payable with
respect to each Lease Year remaining in the Term after such default (including
the Lease Year or partial Lease Year during which such default occurred) shall
be conclusively presumed to be equal to twelve (12) times the average monthly
additional rent and Percentage Rent payable prior to such default.
(d) Terminate this Lease by giving written notice of such termination to
Tenant, which termination shall be effective as of the date of such notice or
any later date therefor specified by Landlord in such notice (provided, that
without limiting the generality of the foregoing provisions, Landlord shall not
be deemed to have accepted any abandonment or surrender by Tenant of any or all
of the Leased Premises or Tenant's leasehold estate under this Lease unless
Landlord has so advised Tenant expressly and in writing, regardless of whether
Landlord has re-entered or relet any or all of the Leased Premises or exercised
any or all of Landlord's other rights under this Lease or applicable law).
(e) In Landlord's own name or otherwise, relet any or all of the Leased
Premises with or without any additional premises, for any or all of the
remainder of the Term (or, if this Lease has then been terminated, for any or
all of the period which would, but for such termination, have constituted the
remainder of the Term) or for a period exceeding such remainder, on such terms
and subject to such conditions as are acceptable to Landlord (including, by way
of example rather than of limitation, the alteration of any or all of the Leased
Premises in any manner which, in Landlord's judgment, is necessary or desirable
in connection with such reletting, and the allowance of one or more concessions
or "free-rent" or reduced-rent periods), and collect and receive the rents
thereof. Tenant shall pay to Landlord, at the times and in the manner specified
by the provisions of this Lease (unless Landlord has elected to accelerate Rent
as provided above in subparagraph(d), in which event Tenant shall be obligated
to pay such accelerated amount as provided in such subparagraph), (i) the
installments of the Minimum Rent, additional rent and Percentage Rent accruing
during such remainder (or, if this Lease has then been terminated, damages
equalling the respective amounts of such installments (determined as provided in
subparagraph 14.2(c) which would have accrued during such remainder, had this
Lease not been terminated)), plus (ii) the cost to Landlord of any such
reletting (including, by way of example rather of limitation, any attorneys's
fees, leasing or brokerage commissions, repair or improvement expenses and the
expense of any other actions taken in connection with such reletting) less any
monies received by Landlord with respect to such remainder from such reletting
of any or all of the Leased Premises.
(f) Recover from Tenant, an amount equal to (i) all items of accrued and
unpaid Rent, including, without limitation, the then unamortized amount of the
Construction Allowance; (ii) all reasonable expenses (including, by way of
example rather than of limitation, all repossession costs, management expenses,
operating expenses, legal expenses and attorney's fees) incurred by Landlord in
curing or seeking to cure any default or in exercising or seeking to exercise
any of Landlord's rights and remedies under the provisions of this Lease or at
law or in equity on account of any default, plus (iii) interest on all such
expenses, at the rate provided in Section 20.14, all of which expenses and
interest shall be payable by Tenant immediately on demand therefor by Landlord.
(g) Without terminating this Lease, maintain Tenant's right to possession,
in which case this Lease shall continue in effect whether or not Tenant shall
have vacated the Leased Premises. In such event, Landlord shall be entitled to
enforce all of Landlord's rights and remedies under this Lease, including the
right to recover Rent as it becomes due hereunder.
(h) Any damage or loss of Rent sustained by Landlord may be recovered by
Landlord, at Landlord's option, at the time of the reletting or termination, in
a single action or in separate actions, from time to time, as said loss of Rent
or damages shall accrue, or in a single proceeding deferred by Landlord or with
jurisdiction reserved by the court, until the expiration of the Term of this
Lease (in which event Tenant hereby agrees that, at Landlord's option, the cause
of action shall not be deemed to have accrued until the date of expiration of
said Term).
(i) Nothing contained herein shall prevent the enforcement of any claim
Landlord may have against Tenant for anticipatory breach of this Lease. In the
event of any anticipatory breach by Tenant of any of the covenants or provisions
hereof or in the event of Tenant's default, Landlord shall have the right of
injunction and the right to invoke any remedy allowed at law or in equity as if
re-entry, summary proceedings and other remedies were not provided for herein.
Mention in this Lease of any particular remedy shall not preclude Landlord from
any other remedy under this Lease or, at law or in equity. TENANT HEREBY
EXPRESSLY WAIVES FOR ITSELF AND ALL PERSONS CLAIMING BY OR THROUGH TENANT, ANY
AND ALL RIGHTS TO REDEEM, REINSTATE OR RESTORE, OR OBTAIN RELIEF FROM FORFEITURE
OF THIS LEASE GRANTED BY OR UNDER ANY PRESENT OR FUTURE LAW IN THE EVENT OF
TENANT BEING EVICTED OR DISPOSSESSED FOR ANY CAUSE, OR IN THE EVENT OF LANDLORD
OBTAINING POSSESSION OF THE LEASED PREMISES BY REASON OF THE VIOLATION BY TENANT
OF ANY OF THE COVENANTS AND CONDITIONS OF THIS LEASE.
(j) In case suit shall be brought for recovery of the Leased Premises, for
the recovery of Rent or any other amount due under the provisions of this Lease,
or because of the breach of any other covenant herein contained on the part of
Tenant to be kept and performed, and a breach shall be established, Tenant shall
pay to Landlord all costs and expenses incurred therefor, including Landlord's
attorney's reasonable fees and expenses.
(k) Nothing herein contained shall limit or prejudice Landlord's right to
prove and obtain as damages, by reason of any default by Tenant, an amount equal
to the maximum allowed by statute or rule of law in effect at the time when, and
governing the proceedings in which, such damages are to be proved. No expiration
or termination of this Lease, abandonment, re-entry by Landlord or vacancy,
shall relieve Tenant of any of its liabilities and obligations under this Lease
(whether or not any or all of the Leased Premises are relet), and Tenant shall
remain liable to Landlord for all damages resulting from any default by Tenant,
including any damage resulting from the breach by Tenant of any of its
obligations to pay Minimum Rent, Percentage Rent, additional rent and any other
sums which Tenant is obligated to pay hereunder.
(l) The rights and remedies of Landlord under this Lease shall be deemed to
be cumulative, and no one of such rights or remedies shall be exclusive at law
or in equity of the other rights and remedies of Landlord on account of a
default by Tenant, and the exercise of any one such right or remedy by Landlord
shall not impair Landlord's standing, right or power to exercise any other right
or remedy.
Section 14.3. Bankruptcy. (a) Neither Tenant's interest in this Lease, nor
any estate hereby created in Tenant nor any interest herein or therein, shall
pass to any trustee or receiver or assignee for the benefit of creditors or
otherwise by operation of law, except as may specifically be provided pursuant
to the Bankruptcy Code (11 USC '101 et seq.), as the same may be amended from
time to time. -- ---
(b) It is understood and agreed that this Lease is a lease of real property
in a shopping center as such lease is described in Section 365 of the Bankruptcy
Code, as the same may be amended from time to time. Upon the filing of a
petition by or against Tenant under the Bankruptcy Code, Tenant, as debtor and
as debtor-in-possession, and any trustee who may be appointed with respect to
the assets of or estate in bankruptcy of Tenant, agree to pay monthly in advance
on the first day of each month, as reasonable compensation for the use and
occupancy of the Leased Premises, an amount equal to all Minimum Rent,
additional rent and other charges otherwise due pursuant to this Lease, and to
pay Percentage Rent monthly, at the percentage factor set forth in this Lease
for the Lease Year in which such month falls, on all of the Gross Sales during
such month in excess of one-twelfth (1/12th) of the Sales Break Point for such
Lease Year; payment of all such Percentage Rent to be made by the tenth (10th)
day of the succeeding month. Included within and in addition to any other
conditions or obligations imposed upon Tenant or its successor in the event of
the assumption and/or assignment of this Lease are the following: (i) the cure
of any monetary defaults and reimbursement of pecuniary loss within not more
than thirty (30) days of assumption and/or assignment; (ii) the deposit of an
additional sum equal to not less than three (3) months' Minimum Rent and
additional rent to be held pursuant to the terms of Section 2.4 of this Lease,
which sum shall be determined by Landlord, in its sole discretion, to be a
necessary deposit to secure the future performance under this Lease by Tenant or
its assignee; (iii) the use of the Leased Premises as set forth in Section 4.1
of this Lease and the quality, quantity and/or lines of merchandise, goods or
services required to be offered for sale are unchanged; and (iv) the prior
written consent of any mortgagee to which this Lease has been assigned as
collateral security.
Section 14.4. Additional Remedies and Waivers. Notwithstanding any other
provision contained in this Lease to the contrary, all rights and remedies of
Landlord set forth herein (including but not limited to Landlord=s rights
respecting lockout, re-entry, self-help, repossession, security interests and
lien rights and foreclosure) shall be in addition to (and not in substitution
of) any and all other rights and remedies now or hereafter provided by law,
including but not limited to rights and remedies provided by the statutes,
rules, regulations, laws and judicial decisions of the State, and all such
rights and remedies shall be cumulative; and none of such rights and remedies so
provided by law shall be conditioned or limited by any conditions or limitations
on the remedies granted to Landlord under the terms of this Lease, nor upon any
notice and/or passage of time that may be required hereunder in order for an
event or condition to constitute a default or an event of default as that term
is defined in this Lease.
Section 14.5. Landlord's Cure of Default. If Tenant shall be in default
hereunder, Landlord shall have the option, but not the obligation, upon three
(3) days written notice to Tenant (except in the event of an emergency, in which
event no notice shall be required), to cure the act or failure constituting said
default for the account of and at the expense of Tenant. Landlord's cure or
attempt to cure any act or failure constituting the default by Tenant shall not
result in a waiver or release of Tenant. Tenant agrees to pay the costs incurred
by Landlord pursuant to this Section 14.5 plus interest, in accordance with
Section 20.14 hereof, on all sums expended by Landlord pursuant to this Section
14.5 from the date of such expenditure plus a charge of fifteen percent (15%) of
such costs, to Landlord upon demand, as additional rent.
Section 14.6. Security Interest [Intentionally Deleted].
ARTICLE XV
RIGHT OF ACCESS
Landlord may, at any reasonable time or times, upon prior notice to Tenant
(except in the event of an emergency, or if Tenant is in default under this
Lease, in which event no notice shall be required), before and after the
Commencement Date, enter upon the Leased Premises, any portion thereof and any
appurtenance thereto (with men and materials, if required) for the purpose of:
(a) inspecting the same; (b) making such repairs, replacements or alterations
which Landlord may be required to perform as herein provided or which it may
deem desirable for the Leased Premises; and (c) showing the Leased Premises to
prospective purchasers, lenders or lessees. Landlord hereby expressly reserves
the right, exercisable at any time and from time to time, to erect, use,
maintain and repair pipes, conduits, plumbing, vents, ducts and wires in, to,
under and through the Leased Premises as and to the extent that Landlord may now
or hereafter deem to be necessary or appropriate for the proper operation and
maintenance of the Shopping Center. Any redecorating or repair necessitated by
reason of location of same within the Leased Premises shall be the
responsibility of Landlord. Landlord agrees to hold Tenant harmless from any
damage or injury to person or property to the extent resulting from Landlord
exercising its rights under this Article XV.
In the exercise of its rights under this Article XV, Landlord shall use
reasonable efforts to avoid material interference with the operation of Tenant's
business within the Leased Premises. Landlord agrees that except in the event of
an emergency, and provided Tenant shall make an employee of Tenant available to
accompany Landlord following Landlord's notice to Tenant of the necessity
therefor, Landlord shall not enter the Leased Premises during the Term of this
Lease without an employee of Tenant accompanying Landlord's representative.
ARTICLE XVI
DELAYS
If Landlord or Tenant is delayed or prevented from performing any of
their respective obligations during the Term of this Lease because of strikes,
lockouts, labor troubles, inability to procure materials, failure of power,
governmental restrictions or delays in issuing permits (provided that the delays
do not result from Tenant=s actions or failure to act) or reasons of a like
nature not the fault of the party delayed in performing such obligation, then
the period of such delays shall be deemed added to the time herein provided for
the performance of any such obligation and the defaulting party shall not be
liable for losses or damages caused by such delays; provided, however, that,
subsequent to the Commencement Date, this Article XVI shall not apply to the
payment of any sums of money required to be paid by Tenant hereunder or any
obligation of Landlord or Tenant that can be satisfied by the payment of money,
and shall not excuse Tenant from its obligation to continuously operate its
business within the Leased Premises in accordance with the provisions of
Sections 4.1 and 4.2 hereof.
ARTICLE XVII
END OF TERM
Section 17.1. Return of Leased Premises. Upon the Expiration Date or
earlier termination of this Lease, Tenant shall quit and surrender to Landlord
the Leased Premises, broom-clean, in good order and condition, ordinary wear and
tear excepted, and shall surrender to Landlord all keys to or for the Leased
Premises and inform Landlord of all combinations of locks, safes and vaults, if
any, in the Leased Premises. Subject to the provisions of Section 3.5 hereof,
Tenant, at its expense, shall promptly remove all personal property of Tenant,
repair all damage to the Leased Premises caused by such removal and restore the
Leased Premises to the condition which existed prior to the installation of the
property so removed. Any personal property of Tenant not removed within ten (10)
days following the Expiration Date or earlier termination of this Lease shall be
deemed to have been abandoned by Tenant and to have become the property of
Landlord, and may be retained or disposed of by Landlord, as Landlord shall
desire. Tenant's obligation to observe or perform the covenants set forth in
this Section 17.1 shall survive the Expiration Date or earlier termination of
this Lease.
Section 17.2. Holding Over. If Tenant shall hold possession of the Leased
Premises after the Expiration Date or earlier termination of this Lease at
Landlord's option (a) Tenant shall be deemed to be occupying the Leased Premises
as a tenant from month-to-month, at double the Minimum Rent and other charges in
effect during the last Lease Year immediately preceding such holdover and
otherwise subject to all of the terms and conditions of this Lease, or (b)
Landlord may exercise any other remedies it has under this Lease or at law or in
equity including an action for wrongfully holding over.
Notwithstanding the foregoing, if Tenant is negotiating in good faith with
Landlord to renew or extend the Term of this Lease for the Leased Premises (or a
relocation within the Shopping Center), then Tenant may occupy the Leased
Premises on a month-to-month tenancy at one-twelfth (1/12th) of the annual
Minimum Rent for the last year of the Term of the Lease.
ARTICLE XVIII
COVENANT OF QUIET ENJOYMENT
Landlord covenants that if and so long as Tenant pays the Rent and all
other charges provided for herein, and performs all of its obligations provided
for herein, Tenant shall at all times during the Term hereof peaceably have,
hold and enjoy the Leased Premises, without any interruption or disturbance from
Landlord, or anyone lawfully or equitably claiming through or under Landlord,
subject to the terms hereof and any mortgage or deed of trust to which this
Lease shall be subordinate.
ARTICLE XIX
UTILITIES
Section 19.1. Utilities. Tenant agrees to connect to and use the utilities
(including electricity, water, gas, cooling and/or heating system, telephone and
any other utility) supplied to the Leased Premises in accordance with the
criteria set forth in the Exhibits attached to this Lease, Landlord's schedule
of mechanical and electrical design criteria, Landlord's rules and regulations,
and the rules and regulations of the utility companies supplying the service.
Tenant shall be solely responsible for and promptly pay all costs and charges,
including installation thereof where applicable, for all water, gas, cooling,
heat, electricity, sewer and other utilities provided or used in or at the
Leased Premises, commencing with the Delivery of Possession Date and continuing
throughout the Term of this Lease. If Landlord shall elect to supply any of the
utilities used upon or furnished to the Leased Premises, Tenant agrees to pay as
additional rent a per square foot charge based on Tenant's estimated usage, as
reflected on a monthly invoice to be provided by Landlord; provided, however, in
no event shall Tenant's total charges for utilities provided by Landlord exceed
what Tenant would be charged by the local utility company if it were billed
directly by such utility as a direct retail customer. Landlord shall not be
liable to Tenant for any loss, damage or expense which Tenant may sustain if the
utilities, or the quality or character of utilities used upon or furnished to
the Leased Premises are no longer available or suitable for Tenant's
requirements, or if the supply of any such utility ceases or is interrupted as a
result of any cause and no such change, interruption or cessation of service
shall constitute an eviction of Tenant. Any furnishing by Landlord of light,
cooling and/or heat or power shall be conditioned upon the availability of
adequate energy sources. Landlord shall have the right to reduce heat, lighting
and air conditioning within the Shopping Center, including, without limitation,
the Leased Premises and the common areas, as required by any mandatory or
voluntary fuel or energy saving allocation, or any similar statute, regulation,
order or program.
Section 19.2. Electricity, Telephone and Gas. All telephone, electric and
gas (with gas being available only to food service tenants) utility required by
Tenant for the Leased Premises shall (if available) be obtained by Tenant in
accordance with Exhibit D and shall be installed by the appropriate company or
utility. All charges for such utility service (including the installation
thereof) shall be paid by Tenant directly to the company or utility providing
any such service, as and when they --------- become due and payable.
Section 19.3. Trash and Garbage Removal. Tenant shall be solely responsible
for trash and garbage removal from the Leased Premises including the placing of
all trash and garbage in containers provided by Landlord or Landlord's
contractor for such purpose. In the event Landlord elects to furnish such
service to the tenants in the Shopping Center, Tenant agrees to use only the
service provided by Landlord and to pay for such service (including both the
cost of leasing containers and the cost of removal) monthly, as additional rent,
in accordance with the uniform schedule of charges to be established by
Landlord. In no event shall Tenant be obligated to pay Landlord more for such
trash and garbage removal service than the prevailing competitive rates of
reputable independent trash removal contractors for service similar to that
provided by Landlord.
Section 19.4. Water and Sewer. The cost of water and sanitary sewer for
usage in the Shopping Center shall be included in Common Area Maintenance
Expenses, except for food service tenants which may be billed directly by
Landlord or by the supplier of water and sanitary service and any other tenants
which are billed directly by Landlord or such supplier. Landlord reserves the
right to install a water meter in the Leased Premises at any time or from time
to time to measure Tenant's consumption of water therein and xxxx Tenant
directly for the cost of such consumption. Tenant shall pay, as additional rent,
the amount of each xxxx within fifteen (15) days after such xxxx is rendered.
Section 19.5. Grease Interceptors. Landlord, in its commercially reasonable
judgment, will arrange for regular periodic service and cleaning of all grease
interceptors at Tenant's expense. Cost of service and cleaning of grease
interceptors will be allocated among grease interceptors serving food court(s)
and grease interceptors serving individual tenants in proportion to grease trap
size. Tenants served by individual grease traps will pay their pro rata share of
the cost for their grease trap. The share of grease trap service and cleaning
cost apportioned to food court grease traps will be paid by food court tenants
as part of the food court common facilities expenses.
ARTICLE XX
MISCELLANEOUS
Section 20.1. Entire Agreement. This Lease together with the Exhibits,
attached hereto and incorporated herein contains the entire agreement between
the parties hereto and there are no promises, agreements, conditions,
undertakings, or warranties, or representations, oral or written, express or
implied, between them other than as herein set forth. No change or modification
of this Lease or of any of the provisions hereof shall be valid or effective
unless the same is in writing and signed by the parties hereto. No alleged or
contended waiver of any of the provisions of this Lease shall be valid or
effective unless in writing signed by the party against whom it is sought to be
enforced.
Section 20.2. Notices. No notice or other communication given under this
Lease shall be effective unless the same is in writing and is delivered in
person or mailed by registered or certified mail, return receipt requested,
first class, postage prepaid, or delivered by Federal Express or a comparably
reliable national air courier service (i.e. one which delivers service in at
least 48 states) provided that any such courier service provides written
evidence of delivery. Any such notice or communication shall be addressed:
(a) If to Landlord, at 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx,
Xxxxxxxx 00000, Attention: General Counsel, or to such other address as Landlord
shall designate by giving notice thereof to Tenant, with a copy for
informational purposes only to the Mall Manager of the Retail Development.
(b) If to Tenant, at the address set forth for Tenant on page 1 of this
Lease or at the Leased Premises, or such other address as Tenant shall designate
by giving notice thereof to Landlord.
The date of service of any notice or other communication given by mail
shall be the date on which such notice is deposited in the U.S. mails. The date
of service of any notice given by courier service (as described above) shall be
one (1) day after deposit with such courier service.
Section 20.3. Governing Law. It is the intent of the parties hereto that
all questions with respect to the construction of this Lease and the rights and
the liabilities of the parties hereto shall be determined in accordance with the
laws of the jurisdiction in which the Leased Premises is located and that all
disputes arising hereunder shall be heard and decided in the local jurisdiction
where the Leased Premises is located.
Section 20.4. Successors. All rights and liabilities herein given to, or
imposed upon, the respective parties hereto shall extend to and bind the several
respective heirs, executors, administrators, successors, and assigns of the said
parties; and if there shall be more than one Tenant, or more than one person or
entity acting collectively as Tenant, they shall all be bound jointly and
severally by the terms, covenants and agreements herein. Any restriction on or
requirement imposed upon Tenant hereunder shall be deemed to extend to Tenant's
Guarantor, Tenant's sublessees, Tenant's assignees and Tenant's invitees, and it
shall be Tenant's obligation to cause the foregoing persons to comply with such
restrictions or requirements. No rights, however, shall inure to the benefit of
any assignee or other transferee of Tenant, and no rights or benefits shall be
conferred upon any such assignee or transferee by reason of this Section 20.4,
unless such rights or benefits shall be expressly otherwise set forth in this
Lease.
Section 20.5. Liability of Landlord. Neither Landlord, Landlord's
beneficiaries, any persons or entities comprising Landlord, nor any successor in
interest to Landlord (or to such persons or entities) shall have any personal
liability for any failure by Landlord to perform any term, covenant or condition
of this Lease. If Landlord shall fail to perform any covenant, term or condition
of this Lease upon Landlord's part to be performed, and if as a consequence of
such default Tenant shall recover a money judgment against Landlord, such
judgment shall be satisfied only out of the proceeds of sale received upon
execution of such judgment and levied thereon against the right, title and
interest of Landlord in the Shopping Center and out of rents or other income
from such property receivable by Landlord, or out of the consideration received
by Landlord from the sale or other disposition of all or any part of Landlord's
right, title and interest in the Shopping Center, subject, nevertheless, to the
rights of Landlord's mortgagee, and neither Landlord nor any of the co-partners
comprising the partnership which is Landlord herein shall be liable for any
deficiency. The foregoing limitation of liability shall be noted in any judgment
secured against Landlord and in the judgment index.
Section 20.6. Brokers. Tenant warrants and represents that there was no
broker or agent instrumental in consummating this Lease. Tenant agrees to
indemnify and hold Landlord harmless against any claims for brokerage or other
commissions arising by reason of a breach by Tenant of this representation and
warranty.
Section 20.7. Transfer by Landlord. Landlord hereunder shall have the right
to freely assign this Lease without notice to or the consent of Tenant.
Section 20.8. No Partnership. Notwithstanding the fact that a portion of
the Rent reserved hereunder may be a percentage of Tenant's Gross Sales, and
notwithstanding anything else to the contrary, Landlord shall not be deemed to
be a partner of Tenant or a joint venturer with Tenant.
SECTION 20.9. WAIVER OF COUNTERCLAIMS. TENANT SHALL NOT IMPOSE ANY
COUNTERCLAIM OR COUNTERCLAIMS IN A SUMMARY PROCEEDING OR OTHER ACTION BASED ON
TERMINATION OR HOLDOVER, IT BEING THE INTENT OF THE PARTIES HERETO THAT TENANT
BE STRICTLY LIMITED IN SUCH INSTANCE TO BRINGING A SEPARATE ACTION IN THE COURT
OF APPROPRIATE JURISDICTION. THE FOREGOING WAIVER IS A MATERIAL INDUCEMENT TO
LANDLORD MAKING, EXECUTING AND DELIVERING THIS LEASE AND TENANT'S WAIVER OF ITS
RIGHT TO COUNTERCLAIM IN ANY SUMMARY PROCEEDING OR OTHER ACTION BASED ON
TERMINATION OR HOLDOVER IS DONE SO KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY.
SECTION 20.10. WAIVER OF JURY TRIAL. LANDLORD AND TENANT HEREBY WAIVE TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE
PARTIES HERETO AGAINST THE OTHER ON, OR IN RESPECT OF, ANY MATTER WHATSOEVER
ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF
LANDLORD AND TENANT HEREUNDER, TENANT'S USE OR OCCUPANCY OF THE LEASED PREMISES
AND/OR ANY CLAIM OF INJURY OR DAMAGE.
Section 20.11. Severability. If any provision of this Lease or the
application thereof to any person or circumstances shall to any extent be
invalid or unenforceable, the remainder of this Lease, or the application of
such provision to persons or circumstances other than those as to which it is
invalid or unenforceable, shall not be affected thereby, and each provision of
this Lease shall be valid and be enforced to the fullest extent permitted by
law.
SECTION 20.12. NO WAIVER. NO FAILURE BY LANDLORD TO INSIST UPON THE STRICT
PERFORMANCE OF ANY TERM, COVENANT, AGREEMENT, PROVISION, CONDITION OR LIMITATION
OF THIS LEASE TO BE KEPT, OBSERVED OR PERFORMED BY TENANT, AND NO FAILURE BY
LANDLORD TO EXERCISE ANY RIGHT OR REMEDY AVAILABLE UPON A BREACH OF ANY SUCH
TERM, COVENANT, AGREEMENT, PROVISION, CONDITION OR LIMITATION OF THIS LEASE,
SHALL CONSTITUTE A WAIVER OF ANY SUCH BREACH OR OF ANY SUCH TERM, COVENANT,
AGREEMENT, PROVISION, CONDITION OR LIMITATION.
Section 20.13. Consumer Price Index. As used herein, "Consumer Price Index"
or "Index" shall mean the Consumer Price Index for All Urban Consumers (1982-84
= 100), U.S. City Average, All Items, published by the United States Department
of Labor, Bureau of Labor Statistics (or such comparable index as may be
utilized in substitution for or as the successor to the stated Index). If such
Index is not published by the Bureau of Labor Statistics or by another similar
governmental agency at any time during the Term of this Lease, then the most
closely comparable statistics on the purchasing power of the consumer dollar as
published by a responsible financial authority and selected by Landlord shall be
utilized in lieu of such Index.
Section 20.14. Interest. Any amount due from Tenant to Landlord herein
which is not paid when due shall bear interest at a rate per annum equal to the
Federal Reserve Bank discount rate as published in the Wall Street Journal on
the 25th day of the month preceding the date upon which the obligation is
incurred (or the next business day thereafter if the 25th is not a weekday) plus
five percent (5%) unless otherwise specifically provided herein, but the payment
of such interest shall not excuse or cure any default by Tenant under this
Lease. In no event shall any interest calculated hereunder be at a rate which is
higher than the maximum rate which is allowed under the usury laws of the State,
which maximum rate of interest shall be substituted for the rate in excess
thereof, if any, computed pursuant to this Section 20.14.
Section 20.15. Excavation. If an excavation shall be made upon land
adjacent to the Leased Premises, or shall be authorized to be made, Tenant shall
afford to the person causing or authorized to cause such excavation, license to
enter upon the Leased Premises for the purpose of doing such work as said person
shall deem necessary to preserve the wall or the building of which the Leased
Premises form a part from injury or damage and to support the same by proper
foundation, without any claim for damages or indemnity from Landlord, or
diminution or abatement of Rent.
Section 20.16. Rules and Regulations. Tenant agrees to comply with and
observe all reasonable rules and regulations established by Landlord for the
Shopping Center from time to time. Tenant's failure to keep and observe such
rules and regulations shall constitute a default pursuant to the terms of this
Lease in the manner as if the same were contained herein as covenants, which
shall carry with it the same consequences under Article XIV hereof as Tenant's
failure to pay rent.
Section 20.17. Financial Statements. Upon Landlord's written request from
time to time, but not more than once per Lease Year, Tenant shall, within ten
(10) days after Landlord's request therefor, furnish Landlord financial
statements outlining Tenant's then current financial condition and shall furnish
financial statements outlining the current financial condition of any Guarantor
of this Lease. Landlord shall maintain all financial information provided in a
confidential manner; provided, however, that Landlord may disclose such
financial statements to Landlord's mortgagees or prospective mortgagees or
purchasers.
Section 20.18. General Rules of Construction. (a) This Lease may be
executed in several counterparts and the counterparts shall constitute one and
the same instrument. (b) Landlord may act under this Lease by its attorney or
agent. (c) Wherever a requirement is imposed on Tenant hereunder, Tenant shall
be required to perform such requirement at its sole cost and expense unless it
is specifically otherwise provided herein. (d) (i) Wherever appropriate herein,
the singular includes the plural and the plural includes the singular; (ii)
whenever the word "including" is used herein, it shall be deemed to mean
"including, but not limited to"; and (iii) the words "re-enter" and "re-entry"
as used herein shall not be restricted to their technical legal meaning. (e)
Anything in this Lease to the contrary notwithstanding: (i) any provision hereof
which permits or requires a party to take any particular action shall be deemed
to permit or require, as the case may be, such party to cause such action to be
taken; and (ii) any provision hereof which requires any party not to take any
particular action shall be deemed to require such party to prevent such action
to be taken by any person or by operation of law. (f) Whenever costs or expenses
are required to be assessed to or paid by Tenant, such costs and expenses shall
be reasonable.
Section 20.19. Recording. Neither this Lease nor any memorandum hereof may
be recorded without the express written consent of Landlord.
Section 20.20. Effective Date. For all purposes hereof, the "Effective
Date" of this Lease shall be the date upon which this Lease shall have been
executed by both parties and physically delivered by Landlord to Tenant or its
attorney. Prior to the Effective Date, neither this Lease nor anything hereunder
contained shall be legally binding on either Landlord or Tenant, and the
submission of this Lease by Landlord to Tenant prior to such Effective Date for
examination or consideration by Tenant or discussion between Landlord and Tenant
shall not constitute a reservation of or option for the Leased Premises or
create any legal obligation or liability whatsoever on Landlord.
Section 20.21. Headings. The captions, section numbers, article numbers and
index appearing in this Lease are inserted only as a matter of convenience and
in no way define, limit, construe, or describe the scope of intent of such
sections or articles of this Lease nor in any way affect this Lease.
Section 20.22. Managing Agent. Landlord has advised Tenant that it has
appointed MillsServices Corp., a Delaware corporation, as managing agent of the
Retail Development (said managing agent and any successor or substitute managing
agent is hereinafter referred to as "Managing Agent"). Tenant shall, until
otherwise notified by Landlord, make all payments of Rent required to be made
pursuant to this Lease to the Managing Agent payable to Landlord and direct all
notices, inquires or other communications to the Managing Agent, 0000 Xxxxxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000.
IN WITNESS WHEREOF, Landlord and Tenant have signed this Lease as of the
day and year first above written.
WITNESS: LANDLORD:
CONCORD XXXXX LIMITED PARTNERSHIP,
a Delaware limited partnership
By: Concord Xxxxx, L.L.C., a Delaware limited liability company Its:
General Partner
By: The Xxxxx Limited Partnership, a Delaware limited partnership
Its: Manager
By: The Xxxxx Corporation, a Delaware corporation
Its: General Partner
By: _________________________
Xxxxxx Xxxxxx
Executive Vice President
TENANT:
By: ____________________
TOYS INTERNATIONAL, INC., a California corporation
By: ____________________
By: __________________
WITNESS/ATTEST:
Name:____________________
By: ____________________
Its: ____________________
By: ____________________
By: ____________________ By: __________________
By: ____________________ Name:____________________
Its: ____________________
Tenant's Corporate Seal:
ACKNOWLEDGMENT OF LANDLORD
COMMONWEALTH OF VIRGINIA )
) ss.
COUNTY OF ARLINGTON )
On this ____ day of ____________________, 19____, before me personally
appeared Xxxxxx Xxxxxx, to me known to be the person who executed the foregoing
Lease and acknowledged before me that she was duly authorized and did execute
same on behalf of CONCORD XXXXX LIMITED PARTNERSHIP, a Delaware limited
partnership.
-----------------------------------
Notary Public
My Commission expires:_____________
[Notarial Seal]
ACKNOWLEDGMENT OF CORPORATE TENANT
STATE OF )
) ss.
CITY/COUNTY OF )
On ____________________, 19____, before me _____________________, a
Notary Public in and for said state aforesaid, personally appeared
_______________________________, as _______________________ and
_________________________ as _____________________of TOYS INTERNATIONAL, INC., a
California corporation, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which
the person(s) acted, executed the instrument.
-----------------------------------
Notary Public, ____________ County,
My Commission expires:_____________
[Notarial Seal]
ADDENDUM ATTACHED TO AND MADE A PART OF LEASE DATED ___________, 199__, BY AND
BETWEEN CONCORD XXXXX LIMITED PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP, AS
"LANDLORD," AND TOYS INTERNATIONAL, INC., A CALIFORNIA CORPORATION, AS "TENANT."
The Lease is hereby modified and supplemented as set forth herein. Any
conflict between a term, condition or provision contained in this Addendum with
any term, condition or provision contained in the printed Lease shall be
resolved in favor of this Addendum.
Add as a new Section 7.3:
"Section 7.3. Sales Tax Rebate. Landlord has determined that financial
assistance from the City of Concord and/or the State of North Carolina in the
form of a sales tax rebate will better enable Landlord to develop the Shopping
Center in a manner beneficial to both Landlord and Tenant. Therefore, in order
to provide Landlord with the sales tax information from the State of North
Carolina comptroller or such other office as maintains sales tax information
("Comptroller") pertaining to Tenant's sales at the Leased Premises, Tenant
agrees to provide Landlord with certified copies of all sales tax returns filed
with the Comptroller for Tenant's retail operations at the Leased Premises
during the Term of this Lease. In addition thereto, Tenant shall provide
Landlord with a power of attorney letter addressed to, and in a form
satisfactory to, the Comptroller authorizing the Comptroller to release to
Landlord all sales tax information for Tenant's retail operations at the Leased
Premises during the Term of this Lease. Such letter shall be in the form
attached hereto and made a part hereof as Exhibit G, or such other or additional
forms as required from time to time by the Comptroller in order to release such
information to Landlord. Landlord agrees to maintain the confidentiality of any
proprietary information received by Landlord pursuant to this Section 7.3.
Section 12.1: At the end of Section 12.1, insert:
"In accordance with the provisions of this Section 12.1, Tenant agrees to
execute the Agreement of Subordination, Non-Disturbance and Attornment attached
hereto as Exhibit H and the Tenant Estoppel Certificate attached hereto as
Exhibit H-1 or such other reasonable form of subordination agreement within
twenty (20) days of a request from Landlord=s lender to do so.@
Add as a new Section 20.23:
"Section 20.23. Lease Contingencies. This Lease is contingent and conditioned
upon (a) acquisition of the Retail Development property by the Landlord; it
being understood that as of the date of this Lease, Landlord has only a
contractual right to said property and (b) the securing by Landlord of financing
for the Retail Development on terms and conditions, and at a rate of interest
and in a loan amount, satisfactory to Landlord in its sole and absolute
discretion (both of said conditions (a) and (b) being herein collectively
referred to as the "Lease Contingencies"). In the event the foregoing Lease
Contingencies have not been satisfied on or before December 31, 1999, then
Landlord shall thereafter have the right to terminate and cancel this Lease upon
thirty (30) days prior written notice to Tenant. If the Lease Contingencies
shall be satisfied prior to the expiration of the aforesaid thirty (30) day
notice period, then the notice to terminate and cancel shall be voided and this
Lease shall remain in full force and effect. In the event of termination of this
Lease as herein provided, this Lease shall cease and come to an end, Landlord
shall reimburse Tenant for any advance Rent paid, and there shall thereupon be
no further liability or obligations upon either party under or with respect to
this Lease. Each party will, at the other's request, execute an instrument in
recordable form containing a release and surrender of all right, title and
interest in and to this Lease."
IN WITNESS WHEREOF, Landlord and Tenant have signed and sealed this Addendum as
of the day and year first above written.
WITNESS: LANDLORD:
CONCORD XXXXX LIMITED PARTNERSHIP, a Delaware limited partnership
By: Concord Xxxxx, L.L.C., a Delaware limited liability company
Its: General Partner
By: The Xxxxx Limited Partnership, a Delaware limited partnership
Its: Manager
By: The Xxxxx Corporation, a Delaware corporation
Its: General Partner
By: _____________________
Xxxxxx Xxxxxx
Executive Vice President
By: ____________________ TENANT:
By: ____________________ TOYS INTERNATIONAL, INC., a California corporation
WITNESS/ATTEST: By:____________________________
Its:____________________________
By:____________________________
By: ____________________
Its:____________________________
By: ____________________
Tenant's corporate seal: ________
By: ____________________
By: ____________________
ACKNOWLEDGMENT OF LANDLORD
COMMONWEALTH OF VIRGINIA )
) ss.
COUNTY OF ARLINGTON )
On this ____ day of ____________________, 19____, before me personally
appeared Xxxxxx Xxxxxx, to me known to be the person who executed the foregoing
Addendum and acknowledged before me that she was duly authorized and did execute
same on behalf of CONCORD XXXXX LIMITED PARTNERSHIP, a Delaware limited
partnership.
-------------------------------
Notary Public, Commonwealth of Virginia
My Commission expires:____________
ACKNOWLEDGMENT OF TENANT
STATE OF )
)ss.
COUNTY OF )
On ____________________, 19____, before me _____________________, a Notary
Public in and for said state aforesaid, personally appeared
_______________________________, as _______________________ and
_________________________ as _____________________of TOYS INTERNATIONAL, INC., a
California corporation, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which
the person(s) acted, executed the instrument.
-----------------------------------
Notary Public
My Commission expires:_____________
EXHIBIT G
WAIVER OF SALES TAX CONFIDENTIALITY
Date: _________________
I authorize the Comptroller of Public Accounts to release sales tax
information pertaining to the taxpayer indicated below to Concord Xxxxx Limited
Partnership, c/o The Xxxxx Corporation, 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000,
Xxxxxxxxx, Xxxxxxxx 00000. I understand that this waiver applies only at our
retail store located in Concord Xxxxx in Concord, North Carolina.
Please print or type the following information as shown below on your North
Carolina Sales and Use Tax Permit:
------------------------------------------------------------------------------
Name of Taxpayer Listed on North Carolina Sales Tax Permit
------------------------------------------------------------------------------
Name Under Which Taxpayer is Doing Business (d/b/a or Outlet Name)
------------------------------------------------------------------------------
Taxpayer Mailing Address
-------------------------------------------------------------------------------
Physical Location of Business Permitted for Sales Tax in Concord, North Carolina
------------------------------------------------------------------------------
North Carolina Taxpayer ID Number Tax Outlet Number
(As Shown on North Carolina Sales Tax Permit)
--------------------------------
Authorized Signature
--------------------------------
Print Name of Authorized Signature
--------------------------------
Position of Authorized Signature
--------------------------------
Phone Number of Authorized Signature
EXHIBIT H
AGREEMENT OF SUBORDINATION
NON-DISTURBANCE AND ATTORNMENT
THIS AGREEMENT is made this __________ day of ____________, 199_, by and
among CONCORD XXXXX LIMITED PARTNERSHIP, a Delaware limited partnership having
an office c/o The Xxxxx Corporation, 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000,
Xxxxxxxxx, XX 00000 ("Lessor"),TOYS INTERNATIONAL, INC., a California
corporation, having an office at 000 Xxxxxxxxx Xxxxx, Xxx Xxxxxx, Xxxxxxxxxx
00000 ("Lessee") and ________________ having offices at _____________ ("Agent"),
as agent for, and as co-lender with such other lenders ------ ------ -----
(collectively, the "Lenders") under the credit facility secured by the
hereinafter described Deed of Trust, their successors and assigns or affiliate.
-------
W I T N E S S E T H:
WHEREAS, Lenders have provided financing for CONCORD XXXXX shopping
center in Concord, North Carolina (the "Property");
WHEREAS, under a certain lease (the "Lease") Lessor did lease, let, and
demise a portion of the Property (such portion of the Property is hereinafter
called the "Premises") to Lessee:
WHEREAS, Lenders have or will become the owners of indebtedness secured
by, among other things, a deed of trust, granted by Lessor to __________,
trustee, for the benefit of Agent, on behalf of the Lenders, as beneficiary (the
"Deed of Trust");
NOW, THEREFORE, in consideration of the covenants, terms, conditions
and agreements herein contained, and in consideration of other good and valuable
consideration, the sufficiency and receipt of which are hereby acknowledged, the
parties hereto agree as follows:
1. The Lease and all rights and liens created thereby shall be subject and
subordinate in all respects to the Deed of Trust and the lien created thereby,
to any advancements made thereunder, and to any increases, extensions,
modifications or renewals thereof.
2. So long as Lessee is not in default under the Lease beyond any
applicable grace or cure period, Agent, on behalf of the Lenders, hereby
covenants to Lessee that in the event Lenders obtain title to the Premises,
either by foreclosure or by deed in lieu of foreclosure, and thereafter obtains
the right of possession of the Premises, that the Lease will continue in full
force and effect, and Lenders shall recognize the Lease and Lessee's rights
thereunder, subject to the provisions of this Agreement.
3. Lessee agrees that from and after the date hereof in the event of any
act or omission by Lessor under the Lease which would give Lessee the right,
either immediately or after the lapse of a period of time, to terminate the
Lease, or to claim a partial or total eviction, Lessee will not exercise any
such right (a) until it has given written notice of such act or omission to
Agent by certified mail, return receipt requested, and (b) until and unless
Lenders fail to remedy such act or omission within thirty (30) days for any act
or omission which can be cured by the payment of money, or in the case of any
other act or omission, as long as necessary to remedy such act or omission,
provided (i) Lenders cause such remedy to be commenced within thirty days, and
(ii) Lenders cause completion of such remedy to be pursued with due diligence
following such giving of notice and following the time when Lenders shall have
become entitled under the Deed of Trust to remedy the same. It is specifically
agreed that Lessee shall not, as to Lenders, be entitled to require cure of any
such default which is personal to Lessor, and therefore not susceptible of cure
by Lenders, and that no such uncured default shall entitle Lessee to exercise
any rights under the Lease with respect to Lenders.
4. That in the event the interests of Lessor under the Lease shall be
transferred to Lenders or Agent or any nominee, designee, assignee of Lenders or
any purchaser at foreclosure sale (Lenders, Agent or such other party referred
to as a "Lender Party") by reason of foreclosure, deed in lieu of foreclosure,
or similar transaction, Lessee hereby covenants and agrees to make, for the
benefit and reliance of Lenders, full and complete attornment to the Lender
Party as substitute lessor upon the same terms, covenants and conditions as
provided in the Lease, except to the extent otherwise set forth herein.
5. The provisions of this Agreement are real property covenants running
with the Property, and shall be binding upon and inure to the benefit of the
respective parties hereto and their respective heirs, executors, administrators,
beneficiaries, successors and assigns, including without limitation any Lender
Party.
6. Notwithstanding anything contained herein to the contrary, or anything
to the contrary in the Lease, Lenders and any Lender Party shall not be:
(a) Liable for any act, omission or the breach of any warranty of Lessor,
including without limitation, any delay in opening the Project or the Premises
for occupancy and any failure to complete the construction of the Premises or
the Project or any improvements therein;
(b) Subject to any offsets, claims of defenses which Lessee might have as
Lessor;
(c) Required or obligated to credit Lessee with any rent for any period
beyond the then current rental period which Lessee might have paid Lessor;
(d) Bound by any amendments or modifications or voluntary termination of
the Lease made without Lenders' prior written consent, other than exercise of
rights, options or elections contained in the Lease; or
(e) Bound to or liable for refund of any security deposit except to the
extent actually received by Lenders or a Lender Party.
7. Lessee shall not, without the express written consent of Lenders:
(a) Cancel, terminate or surrender the Lease, except as provided therein or
in any modification or amendment specified herein or hereafter consented to by
Lenders;
(b) After the date hereof, enter into any agreement with Lessor or its
successors or assigns, which grants any concession with respect to the Lease or
which materially compromises, discounts or otherwise reduced the rent called for
thereunder; or
(c) After the date hereof, prepay rent more than one (1) month in advance.
8. Lessor and Lessee hereby jointly and severally agree for the benefit and
reliance of Lenders, that neither this Agreement, nor any assignment of the
Lease for collateral purposes, nor anything to the contrary in the aforesaid
Lease or in any modifications or amendment thereto shall, prior to Lenders'
acquisition of Lessor's interest in and possession of the Property (and
thereafter, only to the extent of the Property and not personally), operate to
give rise or create any responsibility or liability upon Agent or Lenders for
the control, care, management or repair of the Property by any party whatsoever
or for any dangerous or defective condition of the Property; or impose
responsibility for the carrying out by Agent or Lenders of any of the covenants,
terms and conditions of the Lease or any modification or amendment whether or
not hereafter consented to by Lenders, or for any negligence in the management,
upkeep, repair or control of said Property resulting in loss, injury or death to
any lessee, licensee, invitee, guest, employee, agent or stranger.
Notwithstanding anything to the contrary in the Lease, Lenders, their successors
and assigns (and any Lender Party, as appropriate), shall be responsible for
performance of only those covenants and obligations of the Lease accruing after
Lenders', their successors' and assigns' (or Lender Party's, as appropriate),
acquisition of Lessor's interests in and possession of the Property; and in the
event that Lenders or any Lender Party shall acquire title to the Premises or
the Property, Lenders or any Lender Party shall have no obligation, nor incur
any liability, beyond Lenders' or any Lender Party's then equity interest, if
any, in the Property or the Premises.
9. Lessee covenants and agrees to make rental payments according to the
terms of such Assignment of Leases upon written demand by Agent in the event of
any default (as described therein). Lessor consents to payments being so made.
10. Lessee agrees that this Agreement satisfies any condition or
requirement in the Lease relating to the granting of a non-disturbance
agreement.
11. Lessee agrees to execute and deliver from time to time, upon the
request of Lessor or of any holder(s) of any of the indebtedness or other
obligations secured by the Deed of Trust, a certificate regarding the status of
the Lease in the form set forth in Schedule A attached hereto and incorporated
herein by reference for all purposes. ----------
12. THIS AGREEMENT AND ITS VALIDITY, ENFORCEMENT AND INTERPRETATION SHALL
BE GOVERNED BY THE LAWS OF THE STATE OF NORTH CAROLINA AND APPLICABLE UNITED
STATES FEDERAL LAW.
13. If any bankruptcy proceedings shall hereafter commence with respect to
Lessor, and if the Lease is rejected by the trustee pursuant to Xxxxxxx 000 xx
xxx Xxxxxx Xxxxxx Bankruptcy Code, Lessee agrees with Lenders (i) not to treat
such lease as terminated or to execute a new lease with Lenders or any Lender
Party on the same terms as the Lease, and (ii) to remain in possession of the
Premises.
14. Any notices hereunder shall be effective upon mailing by certified
mail, return receipt requested, or delivery by Federal Express addressed to the
recipient at its address set forth in the preambles hereof or as to each party,
to such other address as the party may designate by a notice given in accordance
with the requirements contained herein.
15. This Agreement contains the entire agreement between the parties
hereto. This instrument may be executed in multiple counterparts, all of which
shall be deemed originals and with the same document. Signature and
acknowledgment pages may be detached from the counterparts and attached to a
single copy of this document to physically form one document.
EXECUTED as of the date first above written.
LESSOR: CONCORD XXXXX LIMITED PARTNERSHIP, a Delaware limited partnership
By: CONCORD XXXXX, L.L.C., a Delaware limited liability company, its general partner
By: THE XXXXX LIMITED PARTNERSHIP, a Delaware limited partnership, its manager
By: THE XXXXX CORPORATION, a Delaware corporation, its general partner
By:
Its:
LENDER: ___________________________, as Agent
By:
Authorized Signatory
LESSEE: TOYS INTERNATIONAL, INC., a California corporation
By:
Its:
EXHIBIT H-1
TENANT ESTOPPEL CERTIFICATE
