LEASE AGREEMENT BY AND BETWEEN NEW RIVER ASSOCIATES AS LANDLORD AND SANDSTROM AS SEEN ON TV FRANCHISING COMPANY doing business as As Seen On TV AS TENANT FOR PREMISES LOCATED WITHIN Arrowhead Towne Center Glendale, Arizona
BY
AND
BETWEEN
NEW
RIVER ASSOCIATES
AS
LANDLORD
AND
XXXXXXXXX
AS SEEN ON TV FRANCHISING COMPANY
doing
business as
As
Seen On TV
AS
TENANT
FOR
PREMISES LOCATED WITHIN
Arrowhead
Towne Center
Glendale,
Arizona
1
TABLE
OF CONTENTS
Article
Page
1.
FUNDAMENTAL LEASE PROVISIONS
|
1
|
2.
PREMISES
|
2
|
3.
CONSTRUCTION OF IMPROVEMENTS
|
3
|
4.
TERM .
|
3
|
5.
RENT.
|
3
|
6.
SECURITY DEPOSIT
|
5
|
7.
GROSS SALES .
|
6
|
8.
INDEMNITY AND INSURANCE
|
6
|
9.
UTILITIES
|
8
|
10.
USE AND OPERATION
|
8
|
11.
SIGNS
|
9
|
12.
REPAIRS, MAINTENANCE, IMPROVEMENTS AND COMPLIANCE WITH LAW
|
9
|
13.
SURRENDER OF PREMISES
|
11
|
14.
ASSIGNMENT AND SUBLETTING
|
11
|
15.
TRANSFER OF LANDLORD’S XXXXXXXX
|
00
|
00.
XXXXXX XXXX
|
00
|
00.
LANDLORD’S RESERVATION OF RIGHTS
|
13
|
18.
NOTICES
|
15
|
19.
DEFAULTS BY TENANT
|
15
|
20.
LANDLORD’S REMEDIES
|
16
|
21.
DEFAULTS BY XXXXXXXX
|
00
|
00.
XXXXX XX XXXX
|
00
|
00.
DAMAGE AND DESTRUCTION
|
17
|
24.
CONDEMNATION
|
18
|
25.
HAZARDOUS MATERIALS
|
18
|
26.
SUBORDINATION AND ESTOPPEL
|
19
|
27.
MISCELLANEOUS
|
19
|
Exhibits
A
Depiction of Center B Depiction of Premises C Provisions for the Design and
Construction of the Premises D Certain Defined Terms E Center Rider F
Intentionally Omitted G Monthly and Annual Sales Statement Form
2
THIS
LEASE AGREEMENT
(“Lease”) is made as of this day of 2007 (“Effective Date”) by and between
NEW
RIVER ASSOCIATES,
an
Arizona general partnership (“Landlord”) and SANDSTROOM
AS SEEN ON TV FRANCHISING COMPANY,
a
Nevada corporation (“Tenant”).
W
I T N E S S E T H:
In
consideration of the rents to be paid and the covenants to be performed by
Tenant, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
the following described Premises, upon the following terms and conditions
(capitalized terms used herein without definition shall have the meanings
ascribed to such terms in Exhibit
D):
1. |
FUNDAMENTAL
LEASE PROVISIONS
|
1.1. |
Center:
Arrowhead
Towne Center, located in the City of (Section
2.1) Glendale,
County of Maricopa, State of Arizona
|
1.2. |
Premises: Space
#2136 (Section
2.2)
|
1.3. |
Floor
Area of the 532
square feet (Section
2.2) Premises:
|
1.4. |
Term:
From
the Delivery Date until the Expiry Date, unless (Section
4.1) sooner
terminated pursuant to the terms of this Lease.
|
1.5. |
Required
Opening January
1, 2007 (Section
3.2) Date:
|
1.6. |
Rent
January
1, 2007 Commencement
Date:
|
1.7.
|
Expiry
Date:
|
December
31, 2008
|
|||||
1.8.
|
Fixed
Minimum
|
Annual
Fixed
|
Monthly
|
(Section
5.5)
|
|||
Rent:
|
Dates
|
Minimum
Rent
|
*
Fixed Minimum Rent
|
*
|
|||
†-Expiry
Date
|
$47,880.00
|
$3,990.00
|
|||||
†From
the Rent Commencement Date
|
|||||||
*Subject
to the provisions of Section 5.5.1.
|
|||||||
1.9.
|
Percentage
Rent
|
6%
|
(Section
5.6)
|
||||
Rate:
|
|||||||
1.10.
|
Annual Base Sales: Annual Monthly (Section 5.6) Dates Base Sales** Base Sales** | ||||||
‡
-Expiry Date $798,000.00 $66,500.00
‡From
the Rent Commencement Date **Subject to increase pursuant to Section
5.6.1
|
1.11. |
Permitted
Use: The
Premises shall be used only for the sale at retail (Section
10.1) of
"As Seen On TV" merchandise, which shall include but not be limited
to
apparel and jewelry; provided, the Floor Area devoted to the display
of
the apparel and jewelry shall not exceed, in the aggregate, five
percent
(5%) of the sales Floor Area of the Premises. The Premises shall
be used
for no other use or purpose.
|
1.12. |
Trade
Name: As
Seen On TV (Section
10.1)
|
1.13. |
Security
Deposit: None
(Article
6)
|
1.14.
|
Marketing
Fund $1,596.00
per annum, subject to increases pursuant (Section
5.8) Charge:
to
Section 5.8
|
1.15. |
Center
Hours: Monday
through Saturday: 10:00 am to 9:00 pm and Sunday: 11:00 am to 6:00
pm, or
such other hours that the Center is open for business as such hours
are
designated from time-to-time by Landlord.
|
3
1.16.
|
Radius:
|
5
miles, measured from the outside boundaries of the Center, as the
Center
is constituted on the Effective Date.
|
(Section
10.4)
|
1.17.
|
Landlord’s
Address For Notices:
|
New
River Associates 0000 Xxxx Xxxxxxxxx Xxxxx Xxxxxx Xxxxxxxx, Xxxxxxx
00000
Attention: Center Manager
|
(Section
18.1)
|
With
a copy of notices to:
|
|||
New
River Associates j Macerich Company X.X. Xxx 0000 000 Xxxxxxxx Xxxxxxxxx,
Xxxxx 000 Xxxxx Xxxxxx, Xxxxxxxxxx 00000 Attention: Legal Department
|
|||
1.18.
|
Tenant’s
Address For Notices:
|
XXXXXXXXX
As Seen On TV Franchising Company 00000 Xxxxx 00xx Xxxxxx, Xxxxx
000
Xxxxxxxxxx, XX 00000 Attention: Xxxxxxx X. XxXxxxxx
|
(Section
18.1)
|
1.19.
|
Address
For Payment of Rent:
|
New
River Associates X.X. Xxx 00000 Xxxxxxx, Xxxxxxx 00000-0000
|
|
1.20.
|
Landlord’s
Broker(s):
|
Westcor
Partners, LLC
|
(Section
27.6)
|
1.21.
|
Tenant’s
Broker(s):
|
None
|
(Section
27.6)
|
1.22.
|
Guarantor(s):
|
Tradeshow
Marketing Co Ltd.
|
|
1.23.
|
Rent
Inquiry Address:
|
Landlord:
Phone: (000) 000-0000 Email: xxxxxxxxxxxxxxxxxxx_xx@xxxxxxx.xxx
|
(Section
5.1)
|
Tenant:
XXXXXXXXX As Seen On TV Franchising Company, dba As Seen On TV 00000
Xxxxx
00xx Xxxxxx, Xxxxx 000 Xxxxxxxxxx, XX 00000 Attention: Xxxxxxx X.
XxXxxxxx
480.254.6112
|
|||
1.24.
|
Landlord’s
Statement Address:
|
New
River Associates Macerich Shared Services Arrowhead Towne Center
Attention: Sales Associate X.X. Xxx 0000 Xxxxx Xxxxxx, XX 00000-0000
Phone: (000) 000-0000 Facsimile: (000) 000-0000 Email:
xxxxxxxxxxxxxxxxxxxx_xxxxxxxxxxxxxx@xxxxxxx.xxx
|
(Section
5.6)
|
1.25.
|
Fixed
Costs:
|
$9,310.00
per annum, subject to increases beginning January 1, 2008 (“First Fixed
Costs Adjustment Date”) pursuant to Section 5.7.1.
|
(Section
5.7.1)
|
2.
PREMISES
2.1.
Center.
The
Center, as of the Effective Date, is known by the name set forth in Section
1.1.
Exhibit
A
is an
approximate depiction of the Center; however, the depiction of the Center on
Exhibit
A
is not a
representation, warranty or covenant of any kind by Landlord that all or any
part of the Center is, will be, or will continue to be configured as indicated
on Exhibit
A.
1 Premises
and Floor Area.
The
approximate location of the Premises is depicted by crosshatching on
Exhibit
B.
Notwithstanding the depiction of the approximate location of the Premises as
set
forth at Exhibit
B,
the
Floor Area of the Premises for all purposes is stipulated to be the square
feet
of Floor Area specified at Section 1.3 and in no event shall the Floor Area
of
the Premises as set forth at Section 1.3 be remeasured or otherwise adjusted.
2 CONSTRUCTION
OF IMPROVEMENTS
4
3.1.
|
Condition
of Premises.
The Premises shall be delivered to Tenant in the condition set forth
at
Exhibit
C.
|
3.2. |
Tenant’s
Work.
There is no initial Tenant’s Work required pursuant to this Lease.
|
2 TERM
1 Term.
This
Lease shall be for the Term, unless sooner terminated pursuant to the terms
of
this Lease.
2 RENT
5.1.
Payment
of Rent.
Tenant
shall pay all Rent to Landlord on the day(s) specified therefor, without notice,
demand, deduction or offset, in lawful money of the United States of America,
to
the Address for Payment of Rent or at such other place as Landlord may from
time-to-time designate in writing to Tenant. If Landlord so notifies Tenant
in
writing (and Tenant is able to reasonably comply), Rent payments shall be made
by electronic money transfers in accordance with Landlord’s written directive
therefor. Tenant shall be obligated to pay Rent when due regardless of whether
Tenant receives a statement therefor. If Fixed Minimum Rent or any item of
Additional Rent increases or decreases during the Term and if the amount of
such
increase or decrease has not been determined as of the date such Rent is to
be
paid, then (a) Tenant shall continue to pay such Rent in the amount payable
for
the immediately preceding month (or other period for which such Rent is due)
and
(b) within thirty (30) days after the date Landlord notifies Tenant of such
adjusted Rent, Tenant shall pay to Landlord any additional amount owed due
to
such adjusted Rent or if Tenant has paid Rent in excess of the adjusted Rent,
such excess shall be credited against the next monthly payment(s) of Rent until
such excess has been exhausted; however, within thirty (30) days following
the
Refund Date, any such excess shall be refunded to Tenant. Landlord and Tenant
may each use the other’s Rent Inquiry Address to communicate to the other party
any inquiries relating to the calculation of the various components constituting
Rent or the payment of Rent.
5.2.
Prorations.
If the
Rent Commencement Date begins on a day other than the first day of a month
or if
the Term expires on a day other than the last day of a month, then Fixed Minimum
Rent, Costs, Marketing Fund Charges and Monthly Base Sales for such month shall
be prorated. Unless otherwise provided, all prorations of Rent for fractional
periods shall be based on the actual number of days in such month and the actual
number of days in such year. If the Lease Year is less than twelve
(12)
full
calendar months, then Annual Base Sales for such Lease Year shall be an amount
equal to the product obtained by multiplying the Annual Base Sales by a
fraction, the numerator of which shall be the number of days in such Lease
Year
and the denominator of which shall be three hundred sixty-five (365). If the
Premises are closed for any full or partial day during Center Hours, then
Monthly Base Sales shall be prorated for the month, and Annual Base Sales shall
be prorated for the Lease Year, in which such closure occurs.
5.3.
Late
Payments.
If
Tenant fails to pay any Rent to Landlord when due, Landlord shall be entitled
to
(a) interest on the unpaid Rent at the Agreed Rate from the date payment is
due
until the date payment is made and (b) a service charge equal to ten percent
(10%) of the overdue amount. If payment is made by a check which is dishonored
by the drawing bank, Tenant shall pay to Landlord a service charge equal to
Fifty Dollars ($50.00) and, in addition, Landlord may require that all future
payments of Rent shall be made by cashier’s check. Tenant acknowledges the late
payment of Rent or the use of a dishonored check by Tenant will cause Landlord
to incur costs and expenses not contemplated by this Lease, the exact amounts
of
which will be extremely difficult to ascertain, and that such service charges
represent fair estimates of the costs and expenses which Landlord would incur
by
reason of Tenant’s late payment of Rent or use of a dishonored check. The
imposition of such interest and service charges shall neither constitute a
waiver of Tenant’s default with respect to such overdue amount nor prevent
Landlord from exercising any other right or remedy available to Landlord.
5.4.
Acceptance.
The
acceptance by Landlord of partial payment of any sum due from Tenant shall
not
be deemed a waiver by Landlord of any of its rights to the full amount due
or an
admission by Landlord of the accuracy of any Monthly Sales Statement or any
Annual Sales Statement submitted by Tenant. Any endorsement or statement on
any
check or accompanying letter from Tenant shall not be deemed an accord and
satisfaction. Any Rent payments received from Tenant or any other person shall
be conclusively presumed to have been paid on Tenant’s behalf; however, in no
event shall the foregoing be construed as requiring Landlord to accept any
Rent
from any person other than Tenant. The acceptance by Landlord of payment from
any person other than Tenant shall not be deemed to be a waiver by Landlord
of
any provision of this Lease or to be a consent to any Transfer or to be a
release of Tenant from any obligation under this Lease. The acceptance by
Landlord of delinquent payment shall not constitute a waiver of any default
and
shall not constitute a waiver of timely payment of the particular payment
involved. The acceptance by Landlord of any Rent shall not constitute a consent
by Landlord or a waiver of any of Landlord’s rights under this Lease.
5
5.5.
Fixed
Minimum Rent
5.5.1.
Fixed
Minimum Rent.
From
and after the Rent Commencement Date, Tenant shall pay in equal monthly
installments, in advance on the first day of each month (except for the first
installment, which shall be paid on the Rent Commencement Date), the Fixed
Minimum Rent. Commencing on the first day of January next following the Rent
Commencement Date and on each January 1st
thereafter (each such date is sometimes referred to as the “Rent Adjustment
Date”) the Fixed Minimum Rent then in effect (or which would then have been in
effect absent any abatement or reductions in Fixed Minimum Rent, except for
permanent reductions in Fixed Minimum Rent due to a permanent Taking) shall
be
increased (but not decreased) by a percentage equal to two and one-half (21/2)
times the percentage increase in the Index published for the month which is
four
(4) months prior to the Rent Adjustment Date compared to the Index published
for
the month which is sixteen (16) months prior to such Rent Adjustment Date;
however, in no event shall Fixed Minimum Rent be increased on any Rent
Adjustment Date by more than 3%, calculated on a Cumulative Basis.
5.5.2.
Grand
Opening Event.
From
and after the date of each Grand Opening Event, Fixed Minimum Rent (including
all increases) shall be increased by ten percent (10%).
5.6.
Percentage
Rent
5.6.1.
Percentage
Rent.
From
and after the Rent Commencement Date, in addition to Fixed Minimum Rent to
be
paid by Tenant, Tenant shall pay Percentage Rent to Landlord. Percentage Rent
shall be payable monthly in arrears and adjustments for any overpayment or
underpayment shall be made each year, all as more particularly described in
this
Section 5.6. If Fixed Minimum Rent during any Lease Year is reduced pursuant
to
a provision in this Lease or by express written agreement between Landlord
and
Tenant, then the Annual Base Sales and Monthly Base Sales shall likewise be
reduced by a percentage equal to the percentage decrease in the Fixed Minimum
Rent payable for the period during which the change in Fixed Minimum Rent is
in
effect. On each Rent Adjustment Date, (a) Annual Base Sales shall be adjusted
to
the sum determined by dividing the Annual Fixed Minimum Rent (as adjusted
pursuant to Section 5.5.1 on such Rent Adjustment Date) by the Percentage Rent
Rate and (b) Monthly Base Sales shall be adjusted to the sum determined by
dividing the Annual Base Sales, as hereinabove adjusted, by twelve (12).
5.6.2.
Monthly
Sales Statements.
Within
ten (10) days after the end of each calendar month, Tenant shall (a) deliver
to
Landlord at Landlord’s Statement Address a Monthly Sales Statement specifying
the Gross Sales made for the preceding calendar month together with details
of
any Permitted Exclusions and (b) shall pay to Landlord at the Address for
Payment of Rent an amount equal to the product obtained by multiplying the
Percentage Rent Rate by the amount of Gross Sales during the preceding calendar
month that are in excess of the Monthly Base Sales for such month.
5.6.3.
Annual
Sales Statements.
Within
twenty (20) days after the end of each Lease Year (including, without
limitation, the last Lease Year of the Term), Tenant shall (a) deliver to
Landlord at Landlord’s Statement Address an Annual Sales Statement specifying
the Gross Sales for each month of the preceding Lease Year together with details
of any Permitted Exclusions and
(b)
pay
to Landlord at the Address for Payment of Rent any additional Percentage Rent
owed to Landlord as a result of the following annual adjustment. The aggregate
amount of Percentage Rent payable by Tenant for all months of such Lease Year
as
set forth in the Annual Sales Statement shall be compared to the total amount
of
Percentage Rent paid by Tenant during each month of such Lease Year covered
by
the Annual Sales Statement. If Tenant shall owe any additional Percentage Rent,
the same shall be paid as hereinabove set forth. If Tenant has overpaid to
Landlord any Percentage Rent, then Tenant shall be credited the amount of such
overpayment against the next monthly payment(s) of Percentage Rent until such
overpayment has been exhausted; however, within thirty (30) days following
the
Refund Date, any such excess sums not previously credited shall be refunded
to
Tenant. If Landlord so notifies Tenant in writing (and Tenant is able to
reasonably comply), Monthly Sales Statements and Annual Sales Statements shall
be submitted by Tenant to Landlord electronically, in accordance with Landlord’s
written directive therefor.
5.7.
Costs
5.7.1.
Fixed
Costs.
From
and after the Rent Commencement Date, Tenant shall pay in equal monthly
installments, in advance on the first day of each month (except for the first
installment, which shall be paid on the Rent Commencement Date), the Fixed
Costs. Commencing on the First Fixed Costs Adjustment Date and on each January
1st
thereafter (each such date is sometimes referred to as the “Fixed Costs
Adjustment Date”), the Fixed Costs then in effect (or which would then have been
in effect absent any abatement or reductions in Fixed Costs) shall be increased
(but not decreased) by a percentage equal to two and one-half (21/2) times
the
percentage increase in the Index published for the month which is four (4)
months prior to the Fixed Costs Adjustment Date compared to the Index published
for the month which is sixteen (16) months prior to such Fixed Costs Adjustment
Date (whether or not Tenant is in occupancy of the Premises or this Lease is
in
effect as of any Fixed Costs Adjustment Date); however, in no event shall Fixed
Costs be increased on any Fixed Costs Adjustment Date by more than 5%,
calculated on a Cumulative Basis.
6
5.7.2.
Tenant’s
Share of Variable Costs.
From
and after the Rent Commencement Date, Tenant shall pay to Landlord Tenant’s
Share of Variable Costs in the time frames and in the manner herein set forth
in
this Section 5.7. Landlord shall notify Tenant from time-to-time of Landlord’s
estimate of the monthly installments payable by Tenant as Tenant’s Share of
Variable Costs. From and after the date of any such notice, Tenant shall pay
to
Landlord such estimated monthly amounts, in advance, on or before the first
day
of each month. Following the end of each Lease Year, Landlord shall submit
to
Tenant a statement containing the amount of Tenant’s Share of Variable Costs for
such Lease Year. If such statement discloses that there was an underpayment
of
Tenant’s Share of Variable Costs for such Lease Year, Tenant shall pay to
Landlord the amount of such underpayment within ten (10) days after the date
such statement is delivered to Tenant. If such statement discloses that Tenant
made an overpayment of Tenant’s Share of Variable Costs for such Lease Year,
Landlord shall apply the amount of the overpayment against the next
installment(s) of Tenant’s Share of Variable Costs then due until such
overpayment has been exhausted; however, within thirty (30) days following
the
Refund Date, any such excess sums not previously credited shall be refunded
to
Tenant.
5.7.3.
Variable
Cost Pool.
Landlord shall have the right, from time to time, to equitably allocate some
or
all of the Variable Costs among different portions or user groups of the Center
and other properties owned or managed by Landlord which are either adjacent
to
or which may otherwise comprise a part of the Center, or if certain Variable
Costs are not attributable to all Occupants and/or an Occupant maintains a
certain service and/or an Occupant pays its own Real Estate Taxes at that
Occupant’s own expense and/or the Center contains separate tax parcels, then in
any such event Landlord may, at Landlord’s sole and absolute discretion,
establish equitable, alternative methods of allocating such Variable Costs
(the
“Variable Cost Pool”). The Variable Costs within each such Variable Cost Pool
shall be allocated and charged to the occupants within such Variable Cost Pool
in an equitable manner as determined in Landlord’s good faith and reasonable
business judgment.
5.8.
Marketing
Fund Charge.
From
and after the Rent Commencement Date, Tenant shall pay to Landlord the Marketing
Fund Charge in equal monthly installments, on the first day of each month,
in
advance. Commencing on the first day of January next following the Rent
Commencement Date and on each January 1st
thereafter,
the Marketing Fund Charge shall be equal to one hundred ten percent (110%)
of
the Marketing Fund Charge for the prior Lease Year. The Marketing Fund Charge
shall be used to fund the Marketing Service.
5.9.
Grand
Opening Charge.
For
each Grand Opening Event (including any initial Grand Opening of the Center),
Tenant shall pay to Landlord, within ten (10) days after Landlord bills Tenant,
an amount equal to the Marketing Fund Charge payable for the then-current Lease
Year (“Grand Opening Charge”), which amount shall be in addition to the
Marketing Fund Charge and all other Rent.
1 Personal
Property and Other Taxes.
Tenant
shall pay directly to Landlord or to the appropriate taxing authority, before
delinquency, any and all taxes (including any excise, transaction, sales or
privilege tax imposed upon Landlord on account of, attributed to, or measured
by
Rent), assessments and public charges levied, assessed or imposed by
governmental authorities upon Tenant’s business, upon Tenant’s sales, upon Rent,
upon Tenant’s leasehold interest, and upon all Personal Property and
Improvements, as well as upon Tenant’s right to occupy, and do business at, the
Premises.
2 SECURITY
DEPOSIT
6.1.
Security
Deposit.
Provided Tenant is the tenant entity specified on Page 1 of this Lease, Tenant
shall not be required to deposit a Security Deposit with Landlord. Landlord
reserves the right, as determined in Landlord's sole yet reasonable discretion,
to require a Security Deposit from any Transferee taking possession of the
Premises in accordance with Article 14 and, in such event, concurrently with
Tenant's execution and delivery of an Assignment Instrument and/or Sublease
Instrument to Landlord, Transferee shall deposit a Security Deposit with
Landlord, which sum shall be held by Landlord as security for the faithful
performance by Transferee of all of the terms, covenants and conditions of
this
Lease. The Security Deposit is neither an advance Rent deposit nor a measure
of
Landlord's damages in the event of Transferee's default. The Security Deposit
may be used by Landlord to remedy any default by Tenant, to repair damage caused
by Tenant to any part of the Center, and to undertake on Tenant’s behalf any
Surrender Obligations which Tenant has failed to complete as of the date the
Premises are surrendered to Landlord, as well as to reimburse Landlord for
any
amount which Landlord may expend by reason of Tenant’s default or to compensate
Landlord for any other loss or damage which Landlord may suffer by reason of
Tenant’s default. If any portion of the Security Deposit is so used or applied,
Tenant shall, within ten (10) days after written demand, deposit cash with
Landlord in an amount sufficient to restore the Security Deposit to the full
amount set forth at Section 1.13. Landlord shall not be required to keep the
Security Deposit separate from its general funds, and Tenant shall not be
entitled to interest on the Security Deposit. Tenant may not elect to use any
portion of the Security Deposit as a Rent payment although Landlord may elect
to
do so in the event Tenant is in default hereunder or is insolvent. Tenant shall
not encumber or assign its interest in the Security Deposit. If Tenant fully
and
faithfully performs every provision of this Lease to be performed by it, the
Security Deposit (less any amount which has been applied in the manner permitted
by this Article 6), shall be returned to Tenant within thirty (30) days after
the Refund Date.
7
7.
GROSS SALES
7.1.
Definition
of Gross Sales
7.1.1.
Gross
Sales Defined.
“Gross
Sales” means the aggregate selling price of all goods, wares, merchandise,
tickets, food, beverages and services sold, leased, licensed or delivered from
any part of the Premises by Tenant and Tenant’s Occupants and shall include, but
not be limited to, (a) sales or charges for cash or credit regardless of
collections, (b) sales by vending devices, including coin telephones, (c)
proceeds from audio games and video games,
(d)
commissions and fees paid for the sale of lottery tickets, (e) rent income,
(f)
mail orders received or filled at the Premises, (g) electronic orders received
or filled at the Premises (including, without limitation, orders made by use
of
the Internet, facsimile, telegraph, wire and telephone),
(h)
all
deposits not refunded to purchasers, (i) orders taken at the Premises although
filled elsewhere, (j) fees, commissions and catalogue sales, (k) sales from
solicitations, regardless of where conducted, by personnel operating from,
or
reporting to any person at, the Premises and
(l)
all
service, finance and interest charges on any type of account or note receivable
to the extent the principal amount would constitute Gross Sales.
7.1.2.
Permitted
Exclusions.
The
following (collectively, “Permitted Exclusions”) shall not be part of Gross
Sales: (a) Returns and refunds to customers for goods previously included as
Gross Sales, (b) the amount of any sales tax or other excise tax imposed upon
sales and charges (but only if such sales tax, excise tax or similar tax is
billed to the purchaser as a separate item),
(c)
returns to shippers and manufacturers, (d) exchanges of goods between Tenant’s
stores and warehouses when the same is for a legitimate business purpose and
not
for the purpose of depriving Landlord of any Percentage Rent, (e) sales of
fixtures not constituting Tenant’s stock-in-trade, (f) sales from vending
machines located in non-sales areas and used only by employees of Tenant, (g)
sums and credits received in the settlement of claims for loss of, or damage
to,
merchandise and (h) charges for alterations, gift-wrapping and deliveries if
such services are incidental to the Permitted Use and for which Tenant
reasonably demonstrates it makes no profit.
7.1.3.
Credit
Sales.
Each
sale on an installment basis (such as so-called lay-away sales) or otherwise
involving the extension of credit shall be treated as a sale for the full price
in the period in which occurs the earliest of the following: (a) Tenant first
considers the same a sale for accounting purposes, (b) the first payment
therefor is received or (c) delivery or performance is first commenced.
7.2.
Tenant’s
Records.
All
business upon the Premises shall be operated so that duplicate, dated sales
slips, dated invoices, register receipts or similar evidence of payment serially
numbered, shall be issued with each sale, transaction or other event resulting
in Gross Sales or Permitted Exclusions (“Tenant’s Receipts”). For the purpose of
permitting verification by Landlord of any amounts due as Percentage Rent,
Tenant shall keep and preserve at all times during the period required, at
the
Premises, Tenant’s Receipts, a general ledger, sales receipts and disbursements
journals, sales records and other supporting documentation and full, complete
and accurate non-consolidated books of account (i.e., books and records
reflecting Tenant’s operations solely at the Premises) (collectively “Tenant’s
Records”). Tenant’s Records shall (a) disclose in detail all information
reasonably required to permit Landlord to verify Tenant’s Gross Sales, (b)
conform to and be in accordance with generally accepted accounting principles
consistently applied with respect to all operations of the business conducted
from the Premises, (c) be maintained in the English language and (d) be kept
and
preserved for at least thirty-six (36) months following the end of the Lease
Year for which the same pertain (or such longer period, if and while the same
may need to be consulted in reference to any dispute or audit, until such
dispute or audit has been finally resolved).
1 Failure
of Tenant to Provide Statements.
If
Tenant should fail to timely provide any Monthly Sales Statement or any Annual
Sales Statement in the manner and form required by this Lease, then, without
limitation as to any and all rights and remedies available to Landlord in this
Lease, at law and in equity, Landlord shall also have the right to invoice
Tenant the sum of $250.00 per incident to cover the additional time and expense
involved to obtain each such Monthly Sales Statement or Annual Sales Statement.
2 INDEMNITY
AND INSURANCE
8.1.
Indemnification
8.1.1.
Indemnification
by Tenant.
Tenant
hereby agrees to indemnify, defend and hold Landlord and the Landlord Parties
harmless from and against any and all Claims for property damage, personal
injury or any other matter arising, claimed, charged or incurred against or
by
Landlord or any of the Landlord Parties in connection with or relating to any
event, condition, matter or thing which (a) occurs in, on, under or about the
Premises from any cause except to the extent due to the gross negligence or
willful misconduct of Landlord or any of the Landlord Parties,
(b)
occurs in, on, under or about the remainder of the Center to the extent due
to
the gross negligence or willful misconduct of Tenant or any of the Tenant
Parties or (c) is caused by or relates to any default, breach, violation or
non-performance by Tenant of any provision of this Lease.
8
8.1.2.
Indemnification
by Landlord.
Landlord hereby agrees to indemnify, defend and hold Tenant harmless from and
against any and all Claims for property damage, personal injury or any other
matter arising, claimed, charged or incurred against or by Tenant in connection
with or relating to any event, condition, matter or thing which (a) occurs
in,
on, under or about the Common Area from any cause except to the extent due
to
the gross negligence or willful misconduct of Tenant or any of the Tenant
Parties, (b) occurs in, on, under or about the Premises to the extent due to
the
gross negligence or willful misconduct of Landlord or any of the Landlord
Parties or (c) is caused by or relates to any default, breach, violation or
non-performance by Landlord of any provision of this Lease.
8.1.3.
Release
and Waiver.
If any
part of the Premises or the Center is damaged by fire or other cause for which
a
party is required to carry insurance pursuant to this Lease (“Insuring Party”),
the other party shall not be liable to the Insuring Party (and the Insuring
Party hereby waives all claims on behalf of itself and shall cause its insurance
company to waive all such claims) for any loss, cost or expense arising out
of
or in connection with such damage. Notwithstanding anything to the contrary
contained herein, in no event shall Landlord be liable to Tenant or any of
the
Tenant Parties for any damages arising out of or in connection with (a) any
act
or omission of any Occupant or for losses arising out of or in connection with
theft or burglary or other acts or omissions of third parties or (b) fire,
steam, electricity, gas, water or rain which may leak or flow from or into
any
part of the Premises or the Center, or from the breakage, leakage, obstruction
or other defects of the pipes, sprinklers, wires, appliances, plumbing, HVAC
or
lighting fixtures.
8.2.
Tenant’s
Insurance.
At all
times during the Term, Tenant shall procure and maintain, at its sole cost
and
expense, the following policies of insurance:
8.2.1.
Liability.
Commercial general liability insurance with broad form contractual liability
coverage and with coverage limits of not less than Three Million Dollars
($3,000,000.00) combined single limit, per occurrence, and Five Million Dollars
($5,000,000.00) general aggregate, specifically including liability insurance
covering the consumption of alcoholic beverages by customers of Tenant, if
the
sale of alcoholic beverages is permitted in the Premises. This insurance shall
be on an occurrence basis, not a claims-made basis.
8.2.2.
Workers’
Compensation.
Workers’ compensation insurance in the amount required by the state in which the
Center is located and employers’ liability insurance on an “occurrence” basis
but, in either case, with a limit of not less than One Million Dollars
($1,000,000.00) each accident, One Million Dollars ($1,000,000.00) each employee
by disease and One Million Dollars ($1,000,000.00) policy aggregate by disease,
for the benefit of Tenant’s employees.
8.2.3.
|
Plate
Glass.
Insurance covering the full replacement cost of all plate glass on
the
Premises.
|
8.2.4.
|
Equipment.
Boiler and machinery insurance on all HVAC, electrical, mechanical,
|
plumbing,
telecommunications and other equipment, systems and facilities exclusively
serving the Premises.
8.2.5.
Property.
Property insurance covering any peril generally included in the classification
ISO Causes of Loss - Special Form covering all (a) Personal Property, and
(b)
Improvements in an amount not less than one hundred percent (100%) of their
full
replacement cost. Any policy proceeds shall be used for the repair or
replacement of the property damaged or destroyed, unless this Lease is
terminated under the provisions of Article 23. The insurance required pursuant
to this Section 8.2.5 shall also include business interruption or rental loss
insurance sufficient to cover, for a period of not less than twelve (12) full
calendar months, all Rent and other payment obligations of Tenant under this
Lease which would be borne by or due from Tenant under this Lease if the
Premises and Tenant’s business was fully open and operating.
8.2.6.
Construction
Insurance.
Prior
to commencing the construction or installation of any Improvements, Tenant
shall
provide Landlord with evidence that Tenant carries construction risk insurance
in an amount reasonably approved by Landlord covering the construction and
installation of such Improvements, together with such other insurance as
Landlord may reasonably require. All Improvements shall be insured by Tenant
under the other policies required under this Article 8 immediately upon
completion of such work.
8.2.7.
Automobile
Insurance.
Business automobile liability insurance covering all owned, non-owned and hired
or borrowed vehicles of Tenant or any of the Tenant Parties used in connection
with the operation of its business from the Premises, with limits of not less
than One Million Dollars ($1,000,000.00) per occurrence combined single limit,
insuring for bodily injury, death and property damage.
8.2.8.
Policy
Requirements.
All
policies of insurance provided for in this Section 8.2 shall (a) be issued
by
insurance companies that have a general policyholder’s rating of not less than
“A” and a financial rating of not less than Class VIII as rated in the most
current available “Best’s Insurance Reports”, and that have been admitted or
qualified to do business in the state where the Center is located by the
insurance commission or other highest board, body or official
9
responsible
for overseeing the insurance business in such state, (b) name Landlord,
Landlord’s Manager, all Mortgagees and such other individuals or entities as
Landlord may from time-to-time designate, as “additional insureds”, and (c) not
contain a deductible, nor be subject to a self-insured retention, in an amount
greater than Five Thousand Dollars ($5,000.00). Tenant’s general liability
policy as required in Section 8.2.1 shall contain cross-liability endorsements.
Tenant shall provide to Landlord, at least ten (10) days prior to the Delivery
Date and thereafter thirty (30) days prior to the expiration of any such
policies, binders of all insurance to evidence insurance procured by Tenant
as
required hereunder (together with certified copies of all insurance policies).
All binders and policies of insurance delivered to Landlord shall contain an
agreement by the company issuing said policy to give Landlord twenty (20) days’
advance written notice of any cancellation, lapse, nonrenewal, reduction or
other adverse change respecting such insurance. All commercial general liability
insurance, property damage or other casualty policies shall be written as
primary policies, not contributory with or secondary to coverage that Landlord
may carry. If, at any time during the Term, Tenant fails to obtain and maintain
any insurance which Tenant is required to obtain and maintain under this Lease
or to timely provide Landlord with originals or binders of insurance, Landlord
shall have the right (but not the obligation) to procure such insurance and
Tenant shall pay to Landlord, promptly on demand, the costs and expenses thereof
together with interest at the Agreed Rate from the date Landlord first made
any
expenditures therefor. All insurance policies required to be carried by Tenant
hereunder shall insure Tenant’s performance of the indemnity provisions of this
Lease, but the amount of insurance shall not limit Tenant’s liability or relieve
Tenant of any obligation hereunder.
1 Landlord’s
Insurance.
Landlord shall obtain and maintain throughout the Term property insurance that
shall include the Premises, other premises and the Center (excluding
Improvements and Personal Property from time-to-time located on the Premises
and
the premises of all Occupants) insuring against risks of direct physical loss
or
damage written by insurance companies licensed to do business in the state
of
California (or such other state in which Landlord’s principal business office is
located), together with such other insurance, and in such amounts, covering
such
other risks as Landlord may from time-to-time determine in its reasonable
judgment, including, without limitation (if Landlord so elects), Commercial
General Liability insurance and insurance against earthquake, flood and rental
loss. Any insurance procured by Landlord under this Section 8.3 may be included
in a policy or policies of blanket insurance covering additional items or
locations or insureds, provided that the requirements of this Section 8.3 are
otherwise satisfied.
2 UTILITIES
9.1.
Utilities.
Throughout the Term, Tenant shall be solely responsible for obtaining, and
shall
promptly pay all charges for use and consumption of, all Utilities furnished
to
the Premises. Landlord may (at its election) supply some or all of the Utilities
to the Premises, and, so long as Landlord continues to provide such Utilities
to
the Premises, Tenant agrees to purchase such Utilities from Landlord and pay
Landlord for such Utilities, Tenant’s share thereof (based on Landlord’s
engineer’s calculations of such share or such other reasonable measuring
methodologies as Landlord may utilize from time-to-time). Landlord may also
charge Tenant: (a) An Administrative Charge on any Utilities Tenant receives
from Landlord, and (b) a pro rata share of the costs and expenses of operating,
maintaining, repairing, installing and servicing the Utility Facilities at
the
Center (including any depreciation, reserves and interest costs). Tenant shall
promptly provide Landlord, upon Landlord's written request therefor, such
details as Landlord or its engineer may reasonably require to calculate amounts
which are payable by Tenant pursuant to this Article 9. Landlord may also
require Tenant, at Tenant’s sole cost, to install, maintain and replace meter(s)
or submeter(s) (as applicable) to measure consumption of Utilities at the
Premises. Landlord shall have the right to designate alternate third party
provider(s) to provide any of the foregoing Utilities to the Premises. Landlord
shall notify Tenant from time-to-time of the monthly installments payable by
Tenant pursuant to this Article 9 and Tenant shall pay such monthly installments
on the first day of each month (except for the first installment which shall
be
paid on the Rent Commencement Date).
9.2.
Interruption
of Services.
Landlord shall not be in default and neither Landlord nor the Landlord Parties
shall be liable for any damages directly or indirectly resulting from an
interruption in any of the Utilities, the quality or quantity of the Utilities,
the unavailability of any of the Utilities, or from cooperating with the energy
conservation efforts of governmental agencies or utility suppliers and none
of
the preceding shall (a) constitute an eviction or disturbance of Tenant’s use
and possession of the Premises, (b) constitute a termination of this Lease,
(c)
entitle Tenant to an abatement of any Rent or
(d)
relieve Tenant from performing any of its obligations under this Lease.
10.
USE AND OPERATION
10.1.
Permitted
Use.
Tenant
shall use the Premises (a) only for the Permitted Use and for no other use
or
purpose and (b) solely and specifically under the Trade Name and under no other
trade name and (c) to store or stock only the merchandise which Tenant is
permitted to sell at retail pursuant to this Lease and no other merchandise.
Nothing herein shall be deemed to grant to Tenant an exclusive or preferential
right to the Permitted Use in the Center.
10.2.
Prohibited
and Restricted Uses.
Tenant
shall do none of the following: (a) Permit anything to be done in or about
the
Premises nor bring or keep anything therein which will in any way increase
the
existing rate of, or affect any, fire or other insurance upon the Premises
or
the Center or cause a cancellation of any insurance policy covering the Premises
or the Center or any part thereof or any of
10
its
contents; (b) permit anything to be done in or about the Premises or bring
or
keep anything therein that may cause any deleterious or harmful substance
including, without limitation, mold or fungus, to exist in, on, under or about
the Premises or elsewhere in the Center, (c) obstruct or interfere with the
rights of Occupants or injure or annoy them; (d) use any loudspeakers,
phonographs, televisions or other devices of similar nature in such manner
as to
be heard or viewed outside of the Premises; (e) emit any noise, odors, fumes
or
smoke; (f) use the Premises for any improper, unethical, immoral, unlawful,
pornographic or other similarly objectionable or offensive purpose; (g) conduct
or permit in the Premises any fire, bankruptcy, auction, “closeout”, “going out
of business” or similar sale; (h) use any part of the Center (other than the
inside of the Premises) for the sale, display or storage of any merchandise
or
for the solicitation of customers or for any other business, occupation or
undertaking; (i) install or use upon the Premises or the Center any coin- or
token-operated vending machine or other coin- or token-operated device for
the
sale of any goods, wares, merchandise, food, beverages and/or services
(including, but not limited to, pay-telephones within the sales area of the
Premises, pay-lockers, pay-toilets, scales, amusement devices, slot machines
and
other gambling devices and machines for the sale of beverages, foods, candy,
cigarettes or other commodities); (j) install or use an automated teller machine
or other cash or credit dispensing machines; (k) use any portion of the Premises
as living quarters, sleeping quarters or for lodging purposes; or (l) keep
or
place any Personal Property or other obstruction in any part of the Common
Area.
The Premises shall be kept in a clean condition, and all health and police
regulations shall, in all respects and at all times, be fully complied with
by
Tenant. Tenant shall not commit or allow to be committed any waste upon the
Premises.
10.3.
Days
and Hours of Operation.
Tenant
shall, continuously throughout the Term during Center Hours, operate for
business at the Premises the Permitted Use, keep in stock a full line of
merchandise and maintain an adequate sales force so as to maximize Gross Sales
and keep display windows, exterior signs and exterior advertising adequately
illuminated and in first-class condition. Tenant acknowledges that its failure
to comply with this Section 10.3 will cause Landlord to suffer damages which
will be difficult to ascertain and that the following sum payable by Tenant
under this Section 10.3 represents a fair estimate of such damages. Therefore,
if Tenant fails to comply with the provisions of this Section 10.3, then in
addition to Landlord’s other remedies under this Lease, Landlord shall have the
right to collect from Tenant, in addition to the other Rent, a sum equal to
twice the Fixed Minimum Rent (prorated on a daily basis) for each such full
or
partial day Tenant fails to comply with the provisions of this Section 10.3.
1 Radius.
Neither
Tenant nor any person, partnership, corporation or other entity in which Tenant
has a financial interest or who or which has a financial interest in Tenant
(other than stock of Tenant if such stock is publically traded) shall, at any
time after the Effective Date, directly or indirectly, either individually,
as a
partner, stockholder (other than stock held in a public company) or otherwise,
own, operate or otherwise become financially interested in any business
(including departments and concessions in other stores) similar to or competing
with the business operating in the Premises (“Competing Interest”) within the
Radius. This Section 10.4 shall not apply to any Competing Interest in a
business it is operating within the Radius on the Effective Date so long as
it
continually operates (except for temporary closings for remodeling, a casualty
or condemnation) and continues to operate in the same manner. If Tenant violates
the provisions of this Section 10.4, then Landlord, in its sole discretion
and
without limiting Landlord’s remedies under this Lease, at law or in equity, may
(a) declare such violation to be an incurable default under this Lease and
terminate this Lease and/or (b) include the gross sales made from any such
business(es) within the Radius in the Gross Sales under this Lease for so long
as there continues to be a violation of this Section 10.4. If Landlord elects
to
include the gross sales from such other business in the Gross Sales pursuant
to
(b) preceding, then all gross sales and Tenant’s records from such business
shall be subject to the provisions of Article 7 and Landlord’s audit rights
under Section 27.3.
2 SIGNS
11.1.
Tenant’s
Signs.
Tenant
shall, at its sole cost and expense, obtain all necessary licenses and permits
for, and purchase, install, maintain, operate, repair and replace, as necessary,
all of Tenant’s signs (including the Storefront Sign). All Tenant’s signs
(including the Storefront Sign) shall
(a)
comply with all Governmental Regulations and the Rules and shall have received
the prior written approval of Landlord and, if required, of governmental
authorities and (b) comply with the provisions of this Lease (including the
Tenant Package). The removal of all Tenant’s signs (including the Storefront
Sign) and all work associated with such removal, including without limitation
the cost of restoring the storefront due to such removal prior to the Expiry
Date or date of earlier termination of this Lease, shall be undertaken by,
and
at the sole cost and expense of, Tenant. All Tenant’s signs (including the
Storefront Sign) shall at all times be maintained in working, first-class
condition.
12.
REPAIRS, MAINTENANCE, IMPROVEMENTS AND COMPLIANCE WITH LAW
12.1.
Repairs
and Maintenance
12.1.1.
Landlord’s
Obligations.
Landlord shall maintain in good order, condition and repair the exterior
structural walls, load bearing walls, the outside face of the exterior walls,
foundations, exterior roofs and all Utility Facilities serving the Premises
on a
non-exclusive basis (except to the extent that the applicable utility provider
is responsible for the repair and maintenance of any such Utility Facilities).
Landlord shall be under no obligation to maintain, repair or replace any portion
of the Premises (except as otherwise expressly set forth in this Section
12.1.1), nor shall Landlord be liable for any failure to make any such repairs
or to perform
11
any
maintenance required of Landlord hereunder unless Tenant has notified Landlord,
in writing, of the need of such repairs or maintenance, and such failure shall
then persist for an unreasonable period of time after such written notice.
12.1.2.
Tenant’s
Obligations.
Tenant
shall at all times during the Term, and at its sole cost and expense, maintain,
keep and repair the Premises in good order, condition and repair. Such
obligations of Tenant shall include, without limitation, the maintenance, repair
and replacement of interior surfaces of exterior and demising walls, exterior
doors and entrances, locks and closing devices, all plate glass, frames,
moldings and trim of all doors and windows, all partitions, door surfaces,
floor
covering, fixtures, equipment and appurtenances thereof, lighting, plumbing
fixtures (including any grease traps, grease lines and piping exclusively
serving the Premises), toilet facilities and fixtures, windows, window sashes,
showcases, storefronts, security grilles and similar enclosures, all of Tenant’s
signs (including the Storefront Sign) and any HVAC exclusively serving the
Premises (provided that maintenance work regarding parts of the HVAC or plumbing
systems which protrude outside of the Premises shall be completed by a
contractor selected by Landlord, as a Reimbursed Cost). Tenant shall promptly,
at its sole cost and expense, comply, and cause the Premises to comply, with
all
Governmental Regulations affecting the Premises and Tenant’s activities in the
Center. Notwithstanding anything to the contrary contained in this Lease
(including Section 12.1.1), all alterations, demolitions and improvements
(whether structural or non-structural, interior or exterior) required by any
Governmental Regulations arising from Tenant’s use or occupancy of the Premises,
Tenant’s conduct of business upon the Premises, Tenant’s obligations as an
employer and/or the construction, installation or placement of any Improvements
or Personal Property upon the Premises shall be undertaken by Tenant, at
Tenant’s sole cost and expense, if upon the Premises, and by Landlord as a
Reimbursed Cost, if elsewhere in the Center.
12.2.
Refurbishment.
If the
Term is longer than five (5) years, Landlord may, upon written notice
(“Refurbishment Notice”) to Tenant given at any time following the fourth
(4th)
anniversary of the Rent Commencement Date, require Tenant, at Tenant’s sole cost
and expense, to refurbish the Premises as necessary to maintain the Premises
in
a like-new, first-class condition (“Refurbishment”) (provided, however, in no
event shall Tenant be required to perform more than one Refurbishment in any
five (5) consecutive year period). The extent of such Refurbishment shall be
specified by Landlord in the Refurbishment Notice and may include, without
limitation, new floor coverings, new wall coverings, repainting the Premises
and
installing new trade fixtures. The Refurbishment shall be performed by Tenant
in
accordance with the provisions of this Section 12.2 and shall be completed
within six (6) months following the date Landlord delivers the Refurbishment
Notice to Tenant. Tenant acknowledges that its failure to comply with this
Section 12.2 will cause Landlord to suffer damages which will be difficult
to
ascertain and that the following sum payable by Tenant under this Section 12.2
represents a fair estimate of such damages. Therefore, if Tenant fails to
complete the Refurbishment within such six (6)-month period, then in addition
to
Landlord’s other remedies under this Lease, Landlord shall have the right to
collect from Tenant, in addition to the other Rent, a sum equal to one-fourth
(1/4th)
Fixed
Minimum Rent (prorated on a daily basis) for each full or partial day from
the
expiration of such six (6)-month period until the Refurbishment is complete.
12.3.
Improvements.
Tenant
shall make no Improvements without Landlord’s express, prior written consent in
each instance. All Improvements shall be performed by Tenant (at its sole cost
and expense) in such a manner as to not impede access to the premises of any
other Occupant or of any part of the Common Area, and in a good and xxxxxxx-like
manner, with diligence, using materials of at least the same specifications,
grade and quality as required pursuant to the Tenant Package. All Improvements
shall be (a) performed under the supervision of a licensed architect and/or
licensed structural engineer retained and compensated by Tenant, as shall be
appropriate for such work, (b) in strict conformance with detailed drawings
which have received the prior, written approval of Landlord, and (c) in strict
conformance with Exhibit
C,
the
Tenant Package and with all Governmental Regulations. Upon Landlord’s receipt of
Tenant’s proposed plans and the Plan Review Fee in connection with any
Improvements, Landlord shall review and, in writing to Tenant, either approve,
or disapprove with reasonable detail, said plans. Prior to commencing any
Improvements, Tenant shall deliver to Landlord a copy of the building permit
with respect thereto, if the same is required by any Governmental Regulations
in
connection with any such Improvements.
12.4.
Liens.
Tenant
shall keep the Premises, the Building and the Center free from any liens and
other claims arising out of work performed, materials furnished, or obligations
incurred by or on behalf of Tenant. Tenant shall give Landlord at least ten
(10)
business days’ prior written notice of the expected date of commencement of any
work to be performed by or on behalf of Tenant. Landlord shall have the right
at
all times to keep posted on the Premises any notices permitted or required
by
law, or which Landlord shall deem proper, for the protection of Landlord, the
Premises, the Center and any other party having any interest therein, against
mechanics’ and materialmen’s liens. If, as a result of any work performed or
materials furnished or obligations incurred for the benefit of the Premises,
any
claim of lien is filed against the Premises or any part of the Center or any
similar action affecting title to such property is commenced, the party
receiving notice of such lien or action shall immediately give the other party
written notice thereof. If Tenant fails, within twenty (20) days following
the
imposition of any lien or the filing of a lawsuit seeking foreclosure of such
lien, to cause such lien to be released of record by payment or by recording
of
a proper statutory discharge of xxxx xxxx, Landlord shall have, in addition
to
all other remedies provided herein and at law, the right (but not the
obligation) to cause the same to be released by such means as it shall deem
proper, including payment of the claim giving rise to such lien. All such sums
expended by Landlord and all costs and expenses incurred by Landlord in
connection therewith (including reasonable attorneys’ fees), together with
interest at the Agreed Rate
Arrowhead
Towne Center - As Seen On TV Retail/Mall/Fixed Costs
#217342v2<iManage>:04.27.07.1410 Vers 3.0 : 201924_1 : 06.01.06
from
the
date expenditure is first made by Landlord, shall be payable to Landlord by
Tenant within ten
(10)
days
after Landlord’s written demand to Tenant.
13.
SURRENDER OF PREMISES
13.1.
Surrender.
Prior
to the Expiry Date or date of earlier termination of this Lease, Tenant shall
perform all of the following (collectively, “Surrender Obligations”) at its sole
cost and expense:
(a)
Remove all of its Personal Property, exclusive of Attached Fixtures, from the
Premises and the Center, (b) restore the Premises to the condition in which
the
Premises existed prior to installing such Personal Property to the extent the
Premises were altered or in any manner modified to accommodate the same, and
(c)
repair all damage caused by or in connection with Tenant’s performance of the
Surrender Obligations (including without limitation thereto, repairing the
floor
and patching and painting the walls if damaged beyond ordinary wear and tear,
and leaving the Premises in a clean and rentable condition). Upon the Expiry
Date or date of earlier termination of this Lease, Tenant shall surrender to
Landlord the Premises, broom-clean and in good condition, except for ordinary
wear and tear and destruction to the Premises pursuant to Article 23, to the
extent Tenant is not required to restore the same pursuant to Article 23. If
Tenant’s performance of the Surrender Obligations would damage or otherwise
affect the Building structure, Tenant shall give Landlord prior written notice
thereof and Landlord may elect to perform selected Surrender Obligations as
a
Reimbursed Cost.
13.2.
Improvements
and Personal Property.
Landlord may dispose of any Personal Property remaining on the Premises after
the Expiry Date or date of earlier termination of this Lease in accordance
with
applicable statutes relating to the disposition of abandoned property. If no
such statutes exist, Landlord may retain or dispose of such Personal Property
and title to any such Personal Property which Landlord elects to retain shall
vest in Landlord. Tenant waives all claims against Landlord for any damage
or
loss to Tenant arising out of Landlord’s retention or disposition of any such
Personal Property as provided for in this Article 13 and shall be liable to
Landlord for Landlord’s costs of removing, storing, and disposing of any such
Personal Property which Tenant fails to remove from the Premises prior to the
Expiry Date or date of earlier termination of this Lease, as well as all costs
of restoring the Premises required as a result of removing such Personal
Property. All Improvements (including any Attached Fixtures) shall become the
property of Landlord upon the Expiry Date or date of earlier termination of
this
Lease.
13.3.
Holding
Over.
If
Tenant holds over after the Expiry Date or date of earlier termination of this
Lease without the express written approval by Landlord, (a) such tenancy shall
be at sufferance only and not a renewal of this Lease or an extension of the
Term, (b) monthly installments of Fixed Minimum Rent, Percentage Rent and
Additional Rent shall be payable in an amount equal to two (2) times the Fixed
Minimum Rent, Percentage Rent and Additional Rent in effect as of the last
full
calendar month of the Term (not taking into consideration any Rent abatement
to
which Tenant might have been entitled for such month), and each shall be due
and
payable at the times specified therefor in this Lease and (c) such tenancy
shall
be subject to every other term, covenant and agreement contained herein other
than any provisions for rent concessions, Landlord’s Work, or optional rights of
Tenant requiring Tenant to exercise the same by written notice (such as any
options to extend the Term). Nothing contained in this Section 13.3 shall be
construed as consent by Landlord to any holding over by Tenant (or limit any
of
Landlord’s rights and remedies incident to a holding over under this Lease, at
law or in equity), and nothing in this Section 13.3 shall affect Landlord’s
right to require Tenant to perform all obligations under this Article 13 and
surrender possession of the Premises to Landlord as provided in this Lease
upon
the Expiry Date or date of earlier termination of this Lease or at any time
subsequent thereto as Landlord shall specify.
1 No
Merger on Surrender of Lease.
The
voluntary or other surrender of this Lease by Tenant, or a mutual termination
thereof, shall not work as a merger. Such surrender or termination shall, at
the
option of Landlord, terminate all or any existing subleases or subtenancies,
or
may, at the option of Landlord, operate as an assignment to it of any or all
such subleases or subtenancies. The delivery of keys to the Premises to Landlord
or its agent and/or the taking of physical possession of the Premises by
Landlord shall not constitute a surrender or termination of this Lease absent
Landlord’s written agreement that this Lease has been so surrendered or
terminated.
2 ASSIGNMENT
AND SUBLETTING
14.1.
Prohibited
Transactions.
Tenant
is prohibited from (a) Assigning this Lease or Subletting the Premises to a
governmental agency or instrumentality thereof and/or (b) mortgaging, pledging
or encumbering this Lease or Tenant’s interest in the Premises to any entity
and/or (c) making any Involuntary Assignment.
14.2.
Landlord’s
Consent Required.
Tenant
shall not effect a Transfer, by operation of law or otherwise, without the
prior
written consent of Landlord in each instance, which consent shall not be
unreasonably withheld (subject to the provisions of this Article 14). Any
attempt by Tenant to effect a Transfer without such consent of Landlord shall
be
voidable by Landlord and, at Landlord’s election, shall constitute an incurable
default under this Lease.
14.3.
Tenant’s
Application.
If
Tenant desires to effect a Transfer, Tenant shall submit in writing to Landlord
at least forty-five (45) days prior to the proposed effective date of the
Transfer a notice of intent to Transfer (“Request to Transfer”). Each Request to
Transfer must contain, or be accompanied with, each of the following: (a) The
name of the proposed Transferee and, if not a natural person,
12
details
of the legal and beneficial ownership structure of Transferee, (b) a statement
of the nature of the Transfer (e.g., a sublease, assignment or concession
agreement) and of any related transactions (e.g., details of any sale of the
business, details of a merger and copies of operative documents involved in
the
related transactions), (c) a detailed description of the proposed Transferee’s
business to be conducted upon the Premises, (d) details of the terms and
provisions of the proposed Transfer and the Proposed Transfer Date (which shall
be no later than ninety [90] days after Landlord’s receipt of the Request to
Transfer), (e) a current, audited financial statement for the proposed
Transferee,
(f)
statements of income or profit and loss of the proposed Transferee for a period
of no less than three
(3)
years
prior to the date Landlord receives the Request to Transfer, (g) reasonable,
written history and details of the proposed Transferee’s previous business
experience, (h) if the Transfer is a Subletting, a conformed copy of the final,
proposed Subletting instrument(s), together with a statement by Tenant and
Transferee that such instrument(s) is/are true copies of instrument(s) which
the
parties intend to execute and (i) the Review Fee. If the foregoing information
is not sufficient, in Landlord’s judgment, for Landlord to determine which of
Landlord’s rights to exercise under this Article 14, Landlord shall promptly
request, and Tenant shall promptly furnish to Landlord, other and/or additional
pertinent and reasonable information concerning the proposed Transfer and the
proposed Transferee as Landlord shall require to make such determination.
14.4.
Standards
for Approval and Disapproval.
In
determining whether to grant or withhold its consent to a proposed Transfer,
Landlord may consider any reasonable factor. Without limiting the conditions
that may be construed as a reasonable factor, it is deemed reasonable that
Tenant demonstrate to Landlord’s reasonable satisfaction each of the following:
(a) The proposed Transferee has sufficient financial worth to fully and timely
discharge all of the then remaining obligations of Tenant under this Lease,
(b)
the proposed Transferee is of sound business reputation, (c) the use of the
Premises by the proposed Transferee will be the Permitted Use, (d) the proposed
Transferee is likely to maintain the same levels and increases in Percentage
Rent as Tenant is anticipated to generate during the remaining Term of this
Lease, (e) the proposed Transferee has sufficient retail experience to
successfully undertake its business at the Premises, (f) the proposed Transferee
does not occupy premises in the Center, (g) the proposed Transferee has not
delivered a letter of intent to Landlord or Landlord’s agent to lease space in
the Center and (h) the proposed Transferee is not actively negotiating with
Landlord or Landlord’s agent to lease space in the Center. Furthermore, if
Tenant is then in default of any obligation of Tenant under this Lease, it
shall
be reasonable for Landlord to elect, in its sole discretion, to deny its consent
to such proposed Transfer so long as such default exists. Notwithstanding
anything to the contrary contained in this Lease, if Tenant or any proposed
Transferee claims that Landlord has unreasonably withheld or delayed its consent
under this Article 14 or otherwise has breached or acted unreasonably under
this
Article 14, their sole remedies shall be a declaratory judgment and an
injunction for the relief sought without any monetary damages, and Tenant hereby
waives all other remedies, including, without limitation, any right at law
or in
equity to terminate this Lease, on its own behalf and, to the extent permitted
under all applicable laws, on behalf of the proposed Transferee.
14.5.
Landlord’s
Notification to Tenant
14.5.1.
Notification
to Tenant.
Within
thirty (30) days after Landlord’s receipt of the Request to Transfer and all of
the information required pursuant to Section 14.3, Landlord shall notify Tenant
in writing that Landlord has elected to (a) terminate this Lease pursuant to
Section 14.5.2 (“Notice of Transfer Termination”), or (b) consent to such
proposed Transfer (subject to the provisions hereof), or (c) withhold consent
to
such proposed Transfer.
14.5.2.
Termination.
If
Landlord delivers the Notice of Transfer Termination to Tenant, then (a) this
Lease shall terminate upon the Proposed Transfer Date and (b) upon the Proposed
Transfer Date, provided Tenant has performed all Surrender Obligations, Tenant
shall be released from all further obligations accruing under this Lease from
and after the Proposed Transfer Date. Landlord may lease the Premises, or any
portion thereof, to the prospective Transferee without liability to Tenant.
14.5.3.
Consent.
If
Landlord consents to a proposed Transfer, Landlord may, in its sole discretion
and notwithstanding any contrary provision contained in this Lease, make such
consent contingent upon increasing the Fixed Minimum Rent (and increases
thereto, if any, as specified in this Lease) effective as of the Proposed
Transfer Date by an amount equal to the highest annual Percentage Rent payable
by Tenant during the Term.
14.6.
Required
Subletting Instrument and Assignment Instrument Provisions.
Each
and every Transfer shall be documented by an Assignment instrument or a
Subletting instrument, as the case may be, and a true copy of the same executed
by the parties thereto shall be delivered to Landlord prior to the Proposed
Transfer Date. Each and every Assignment instrument and Subletting instrument
shall contain such terms and conditions as are described in the Request to
Transfer and be expressly subject and subordinate to each and every provision
contained in this Lease. Each Transferee shall expressly assume in writing
for
the benefit of Landlord the obligations of Tenant under this Lease and shall
be
liable jointly and severally with Tenant for the payment of the Rent and the
performance of all the terms, covenants, conditions and agreements herein
contained on Tenant’s part to be performed for the Term. If Landlord approves
the proposed Transfer, Landlord shall prepare and deliver to Tenant, for
execution by Tenant and the proposed Transferee, counterparts of Landlord’s
reasonable and customary assignment instrument, in the case of an Assignment,
or
consent instrument, in the case of a Subletting, and Tenant shall have thirty
(30) days to cause the same to be executed, without modification,
by both Tenant and the proposed Transferee and delivered to Landlord, together
with all required attachments thereto.
13
14.7.
Tenant’s
Duty to Subtenant.
Landlord shall have no obligation whatsoever to perform any duty to or respond
to any request from any Subtenant. Tenant shall have the obligation of
administering the terms of all Subletting instrument(s).
14.8.
No
Release of Tenant.
No
Transfer shall relieve Tenant of any obligation to be performed by Tenant under
this Lease, whether occurring before or after such consent or Transfer,
including Tenant’s obligation to obtain Landlord’s express prior written consent
to any other Transfer (which right of consent shall not negate or waive any
provision contained in this Article 14).
14.9.
Assignment
of Rents and Attornment.
Tenant
immediately and irrevocably assigns to Landlord, as security for Tenant’s
obligations under this Lease, all rent from any Subletting of all or any part
of
the Premises, and Landlord, as assignee for Tenant for purposes hereof or a
receiver for Tenant appointed on Landlord’s application, may collect such rents
and apply the same toward Tenant’s obligations under this Lease; except that,
until the occurrence of an act of default by Tenant, Tenant shall have the
right
and license to collect such rents. In the event of termination, re-entry, or
dispossession of Tenant by Landlord under this Lease, Landlord may, at its
sole
discretion by express written notice to Tenant or the Transferee or both, take
over all of the right, title and interest of Tenant as sublessor under any
Subletting instrument, and such Transferee shall, at Landlord’s sole discretion,
attorn to Landlord, except that Landlord shall not be (a) liable for any
previous act or omission of Tenant under the Subletting instrument, (b) subject
to any offset that theretofore accrued to the Transferee against Tenant, (c)
bound by any previous modification of the Subletting instrument not expressly
consented to in writing by Landlord and (d) bound by any previous prepayment
of
Rent or Security Deposit which has not been expressly delivered by Tenant to
Landlord.
14.10.
Additional
Consideration Upon a Transfer.
In the
event of an Assignment, one-half (1/2) of any consideration paid to Tenant
by
any Transferee for such Assignment shall be paid to Landlord. In the event
of a
Subletting, each month one-half (1/2) of any consideration paid to Tenant by
any
Transferee during such month for any portion of Tenant’s interest in this Lease
shall be paid to Landlord to the extent the full amount of such consideration
(i.e., before being divided between Landlord and Tenant) exceeds the percentage
(equal to the percentage of the Floor Area of the Premises being Sublet) of
Tenant’s Rent obligations hereunder during such month.
14.11.
Review
Fee.
Simultaneously with the delivery to Landlord of the Request to Transfer Tenant
shall pay to Landlord a fee in the amount of One Thousand Dollars ($1,000.00)
(“Review Fee”) for Landlord’s review of each such transaction.
1 Corporate
and Partnership Transfers.
If
Tenant is a privately-held corporation, or is an unincorporated association,
limited liability company or partnership, the cumulative or aggregate transfer,
assignment or hypothecation of twenty-five percent (25%) or more of the total
stock, or the legal or beneficial interest, in such corporation, association,
company or partnership, whether in a single transaction or a series of related
or unrelated transactions, and whether on a direct or indirect basis, shall
be
deemed a Transfer.
2 TRANSFER
OF LANDLORD’S INTEREST
1 Transfer
of Landlord’s Interest.
Landlord shall have the right to sell or transfer its ownership of all or any
part of the Center to one or more third parties. If Landlord sells or transfers
its interest in the Premises (other than a transfer for security purposes),
(a)
Landlord shall be released from all obligations and liabilities accruing
thereafter under this Lease and Landlord’s successor shall be deemed to have
assumed Landlord’s obligations thereafter accruing under this Lease and (b)
Tenant agrees to attorn to the purchaser or assignee.
2 COMMON
AREA
1 Common
Area.
During
the Term, Tenant and the Tenant Parties shall have the non-exclusive right
in
common with Landlord and all others to whom Landlord has or shall give the
same
or similar rights, to use the Common Area for its intended purposes subject
to
(a) the right of Landlord, Occupants and their respective invitees, customers,
agents, employees and independent contractors to use the Common Area, (b) any
Superior Agreements, and (c) each provision of this Lease. Landlord shall,
or
shall cause others to, operate, repair, equip and maintain the Common Area
in a
manner deemed by Landlord in its business judgment to be reasonable and
appropriate. The Common Area shall be subject to the exclusive control and
management of Landlord. Landlord may, from time-to-time, impose parking charges
at the Center.
2 LANDLORD’S
RESERVATION OF RIGHTS
17.1.
Reservation
of Rights.
Landlord reserves the right, at any time, and from time-to-time to:
(a)
expand, reduce, remove, demolish, change, renovate or construct any existing
or
new improvements at the Center, and (b) expand, reduce or otherwise change
the
size, configuration or boundaries of the Center. Landlord shall have complete
and exclusive control of the design, structure, construction, materials, colors,
architectural elements and aesthetics of all improvements and Common Area at
the
Center, as well as all activities undertaken by Landlord and other Occupants
in
connection therewith.
14
This
Lease does not grant any rights to light or air over or about the Center.
Landlord reserves exclusively to itself the use of all of the following: (i)
Roofs and exterior walls, (ii) telephone, electrical, utility, communication
and
janitorial closets, (iii) equipment rooms, building risers or similar areas
that
are used by Landlord for the provision of services, (iv) portions of the
Premises for the repair, maintenance and replacement of machinery, pipes,
conduits, utility lines and the like serving other Occupants and/or the Center
in a manner and in locations which do not unreasonably interfere with Tenant’s
use of the Premises, and (v) the areas beneath, adjacent to and above the
Premises (including the plenum within the Premises).
17.2.
Changes
to the Center.
Landlord shall have the right and privilege at all times of determining the
nature and extent of the Common Area and the Center and of making such changes,
rearrangements, additions and reductions therein from time-to-time as Landlord
deems desirable, including, without limitation, the location, relocation,
enlargement, reduction, addition and/or elimination of driveways, malls,
entrances and exits, automobile parking spaces, employee and customer parking
areas, buildings and other structures, the direction and flow of traffic,
establishment of protected areas, landscaped areas and any and all other
facilities of the Common Area, the right at any time to locate on the Common
Area permanent and/or temporary RMUs, and/or other building(s) and/or other
improvements of any type and the right at any time to enclose or un-enclose
any
portions of the Common Area and/or Mall. Landlord reserves the right to utilize
portions of the Common Area, from time-to-time, for shows, rides,
entertainments, displays, advertising, educational purposes, demonstrations,
civic and charitable functions and other uses which, in Landlord’s judgment, may
attract the public to the Center or create goodwill, community interest or
other
beneficial interest with respect to the Center. Landlord shall have the right
to
convert Common Area to leaseable space and to convert leasable space to Common
Area, from time-to-time. Landlord shall have the right (a) to close, if
necessary, all or any portion of the Common Area to such extent as may be
reasonably necessary to prevent a dedication thereof or the accrual of any
rights of any person or of the public therein, (b) to close temporarily all
or
any portion of the Common Area to discourage non-customer use, (c) to use
portions of the Common Area while engaged in making additional improvements,
repairs or alterations to the Center, (d) to transfer, in whole or in part,
any
of Landlord’s rights and/or obligations under Article 16 to any Occupant or to
any other party as Landlord may from time-to-time determine and (e) to do and
perform such other acts in, to and with respect to, the Common Area as Landlord
shall determine, in its business judgment, to be appropriate for the Center.
Notwithstanding any contrary provision contained in this Lease, services and
facilities may be discontinued, and access to the Premises and the Center
restricted, in whole or in part, during such times as the Center is not open
for
business, and any other times as are necessary for temporary purposes such
as
repairs, alterations, strikes and other reasonable purposes. Landlord has no
obligation to, and has made no representations that it shall, repair, alter,
remodel, improve, renovate, decorate, demolish and/or add improvements to the
Building or the Center, or any part thereof, and no representations respecting
the condition of the Building or the Center have been made by Landlord to
Tenant.
17.3.
Right
to Lease.
Landlord reserves the absolute right to effect such other tenancies in the
Center as Landlord, in the exercise of its sole business judgment, shall
determine to best promote the interests of the Center. Tenant does not rely
on
the fact, nor does Landlord represent, that any specific occupant or type or
number of occupants shall, at any time, occupy any space in the Center. Landlord
shall have the full right to lease space in the Center to any person or entity
and for any purpose Landlord shall deem appropriate, including retail, office,
non-retail, residential, mixed used and commercial purposes.
17.4.
Entry
by Landlord.
Landlord and its representatives (including contractors) shall have the right
at
all reasonable times upon reasonable prior notice to Tenant (and at all times
without notice in the event of an emergency), to enter the Premises (a) for
any
purpose permitted by law, (b) to ascertain if the Premises are in good order,
condition and repair, (c) to post notices of nonresponsibility or other notices
which Landlord may deem necessary for its protection, (d) to show the Premises
to prospective purchasers, mortgagees or ground or underlying lessors (each
of
which may then also enter the Premises), (e) to perform any obligation required
of, or right permitted to, Landlord under this Lease,
(f)
to
take possession of the Premises due to an event of default in the manner
provided for in this Lease or (g) to perform environmental assessments. During
the twelve (12) months prior to the Expiry Date, Landlord may show the Premises
to brokers, prospective tenants and their representatives. Landlord shall use
good faith efforts during any entry upon the Premises pursuant to this Section
17.4 not to unreasonably interfere with Tenant’s conduct of business. No
exercise by Landlord of any rights in this Section 17.4 shall entitle Tenant
to
any damage for any injury or inconvenience occasioned thereby nor to any
abatement of Rent.
17.5.
Relocation.
If, in
connection with Landlord*s
expansion, reduction, removal, renovation or construction of new or existing
improvements or in connection with Landlord’s re-merchandising plans, Landlord
determines that it is necessary or advisable that Tenant vacate the Premises
or
that the Premises be altered, Landlord may, by written notice delivered to
Tenant (“Relocation Notice”), require that Tenant surrender possession of the
Premises, provided and on condition that (a) Landlord and Tenant shall, for
a
period of thirty (30) days following delivery of the Relocation Notice,
negotiate in good faith to enter into a lease for substitute premises at the
Center on substantially the same terms and conditions as those contained in
this
Lease (“Substitute Lease”) to the extent applicable, for the balance of the
remaining Term, or (b) if, despite such good faith negotiations, the parties
are
unable to enter into the Substitute Lease on or before the thirtieth
(30th)
day
following the delivery of the Relocation Notice, Landlord may elect, by written
notice delivered to Tenant, to terminate this Lease. If Landlord terminates
this
Lease, the termination shall be effective on the date specified in Landlord’s
15
written
notice (which shall be at least fifteen [15] days after the sending of such
notice) and upon the date Tenant vacates the Premises and performs all the
Surrender Obligations, Landlord shall pay to Tenant the Unamortized Amount.
The
relocation of the Premises in accordance with (a) herein or the payment of
the
consideration in accordance with (b) herein shall be Tenant*s
sole
recourse and right in the event Tenant is required to surrender possession
of
the Premises as provided in this Section 17.5.
18.
NOTICES
18.1.
Notices.
Any
notice, demand or communication required or permitted to be given by one party
to the other shall be in writing and addressed to Landlord’s Address for Notices
or Tenant’s Address for Notices, as the case may be, or to such other
address(es) and/or to such other parties as one party may from time-to-time
reasonably designate in writing to the other party, and shall be
(a)
personally served, (b) deposited in the United States mail, duly registered
or
certified with postage fully prepaid thereon or (c) delivered by an overnight
courier service that confirms delivery. Either party may, by written notice
similarly given, designate a different address for notice purposes. Notice
shall
be effective upon receipt or refusal to receive, in the event of personal
service; or upon receipt or refusal to receive (but in no event more than three
[3] days after the date first mailed in the manner herein required), in the
event of depositing notice in the United States mails; or upon receipt or
refusal to receive, in the event of delivery by overnight courier service.
19.
DEFAULTS BY TENANT
19.1.
Defaults.
The
occurrence of any one or more of the following events shall constitute a default
by Tenant under this Lease:
19.1.1.
Monetary.
The
failure by Tenant to make any payment of Rent or of any other sum required
to be
made by Tenant when due (however Tenant shall have up to three [3] days after
written notice from Landlord to cure such default).
19.1.2.
Failure
to Conduct Business.
If
Tenant should fail at any time during the Term, to keep the Premises open for
business fully fixtured, staffed or stocked on the days and hours required
by
this Lease.
19.1.3.
Abandonment
and Vacation.
The
vacation or abandonment of the Premises by Tenant. “Vacation” means any absence
by Tenant from the Premises for fourteen (14) or more consecutive days.
19.1.4.
Cross-Default.
If
Tenant (or an Affiliate of Tenant) is in default of any other lease or occupancy
agreement between Landlord (or an Affiliate of Landlord) and Tenant (or an
Affiliate of Tenant), all as the case may be.
19.1.5.
Bankruptcy.
The
making by Tenant of any general assignment for the benefit of creditors, the
filing by or against Tenant of a petition to have Tenant adjudged a bankrupt
or
of a petition for reorganization or arrangement under any law relating to
bankruptcy (unless, in the case of a petition filed against Tenant, the same
is
dismissed within sixty [60] days), or the appointment of a trustee or receiver
to take possession of, or the attachment, execution or other judicial seizure
of, substantially all of Tenant’s assets located at the Premises or of Tenant’s
interest in this Lease, where such seizure is not discharged within thirty
(30)
days.
19.1.6.
Other
Non-Monetary Defaults.
The
failure by Tenant or any of the Tenant Parties to observe or perform any of
the
covenants, conditions or provisions of this Lease to be observed or performed
by
Tenant not previously covered by Section 19.1.1 through Section 19.1.5 above
(however Tenant shall have up to ten [10] days after written notice from
Landlord to cure such default except if the nature of Tenant’s default is such
that it cannot be cured solely by payment of money and more than ten [10] days
are reasonably required for its cure, then Tenant shall be obligated to commence
such cure within the ten [10]-day period and thereafter diligently prosecute
such cure to completion).
19.2.
Sufficiency
of Notices.
Any
notice required or permitted by this Article 19 shall be in lieu of, and not
in
addition to, any notice required under any Governmental Regulations providing
for notice and any cure period. Landlord may (at its discretion) serve a
statutory notice to quit, a statutory notice to pay rent or quit, or a statutory
notice of default, as the case may be, to effect the giving of any notice
required by this Article 19. No notice and opportunity to cure is conferred
upon
Tenant with regard to any default except as expressly set forth in Section
19.1.
19.3.
Involuntary
Assignment.
An
Involuntary Assignment shall constitute a default by Tenant and Landlord shall
have the right to elect to terminate this Lease, in which case this Lease shall
not be treated as an asset of Tenant. All sums payable by Tenant under this
Lease shall be and remain the exclusive property of Landlord and shall not
constitute property of Tenant or of the estate of Tenant within the meaning
of
the Bankruptcy Code. Such sums which are not paid or delivered to Landlord
shall
be held in trust for the benefit of Landlord, and shall be promptly paid or
turned over to Landlord upon demand. Any person or entity to which this Lease
is
assigned pursuant to the provisions of the Bankruptcy Code shall be deemed
without further act or deed to have assumed all of the obligations of Tenant
arising under this Lease on and after the date of such assignment, and all
of
the terms and provisions of this Lease shall be binding upon such assignee.
Any
such assignee shall upon demand
16
execute
and deliver such instruments and documents reasonably requested by Landlord
confirming such assumption.
20.
LANDLORD’S REMEDIES
20.1.
Landlord’s
Remedies.
Upon a
default hereunder, should Tenant fail within the time period, if any, specified
in Article 19 to fully cure such default, then without limiting Landlord in
the
exercise of any other right or remedy at law or in equity which Landlord may
have (all remedies provided herein being non-exclusive and cumulative), Landlord
may do any one or more of the following:
20.1.1.
Continue
Lease.
Landlord may continue this Lease in effect after Tenant’s default and recover
Rent as it becomes due. Accordingly, if Landlord does not elect to terminate
this Lease on account of any default by Tenant, Landlord may, from time-to-time,
without terminating this Lease, enforce all of its rights and remedies under
this Lease, including the right to recover all Rent and other monetary charges
as they become due.
20.1.2.
Terminate
Lease.
Landlord may terminate Tenant’s right to possession by any lawful means, in
which case this Lease shall terminate and Tenant shall immediately surrender
possession of the Premises to Landlord. In such event Landlord shall be entitled
to recover from Tenant all damages incurred by Landlord by reason of Tenant’s
default including (without limitation) the following: (a) The worth at the
time
of award of any unpaid Rent which had been earned at the time of such
termination; plus (b) the worth at the time of award of the amount by which the
unpaid Rent which would have been earned after termination until the time of
award exceeds the amount of such Rent loss that Tenant proves could have been
reasonably avoided; plus (c) the worth at the time of award of the amount by
which the unpaid Rent for the balance of the Term after the time of award
exceeds the amount of such Rent loss that Tenant proves could have been
reasonably avoided; plus (d) any other amount and court costs necessary to
compensate Landlord for all the detriment proximately caused by Tenant’s default
or which in the ordinary course of things would be likely to result therefrom
(including, without limiting the generality of the foregoing, the amount of
any
commissions, finder’s fee, advertising costs, remodeling costs and attorneys’
fees in connection with obtaining a replacement tenant); plus
(e)
at
Landlord’s election, such other amounts in addition to or in lieu of the
foregoing as may be permitted from time-to-time by applicable law. As used
in
subparagraphs (a) and (b) of this Section 20.1.2, the “worth at the time of
award” shall be computed by allowing interest at the Agreed Rate, and, as used
in subparagraph (c) of this Section 20.1.2, the “worth at the time of award” is
to be computed by discounting such amount at the discount rate of the U.S.
Federal Reserve Bank of San Francisco at the time of award, plus one percent
(1%). For the purpose of determining the amount of Tenant’s Share of Variable
Costs which constitute “unpaid Rent which would have been earned after
termination” or which constitute “unpaid Rent for the balance of the term” (as
referenced in subparagraphs [b] and [c] hereof), such amounts shall be deemed
to
increase annually for the balance of the Term by an amount equal to the average
annual percentage increase in Variable Costs during the three (3) calendar
years
preceding the year in which the Lease was terminated, or, if such termination
shall occur prior to the expiration of the third calendar year occurring during
the Term of this Lease, then the amount of Tenant’s Share of Variable Costs
shall be deemed to increase monthly for the balance of the Term by an amount
equal to the average monthly percentage increase in Tenant’s Share of Variable
Costs during all of the calendar months preceding the month in which the Lease
was terminated.
20.1.3.
Collect
Sublease Rents.
Landlord may collect sublease rents (or appoint a receiver to collect such
rents) and otherwise perform Tenant’s obligations at the Premises, it being
agreed, however, that neither the filing of a petition for the appointment
of a
receiver for Tenant nor the appointment itself shall constitute an election
by
Landlord to terminate this Lease.
20.1.4.
Cure
Default.
Landlord may proceed to cure the default at Tenant’s sole cost and expense,
without waiving or releasing Tenant from any obligation hereunder. If at any
time Landlord pays any sum or incurs any expense as a result of or in connection
with curing any default of Tenant (including any administrative fees provided
for herein and reasonable attorneys’ fees), the amount thereof shall be
immediately due as a Reimbursed Cost.
20.1.5.
Disposition
of Property.
Landlord may dispose of any Personal Property remaining on the Premises in
accordance with applicable statutes relating to the disposition of abandoned
property. If no such statute exists, Landlord shall have the right to retain
possession of all of the Personal Property left in the Premises or, at
Landlord’s option, to require Tenant at any time to forthwith remove same, and
if not so removed within three (3) business days, to take title and possession
of the same and to sell or otherwise dispose of the same, without any liability
(a)
to
Tenant for such property or (b) to pay to Tenant the proceeds from the sale
thereof.
20.2.
No
Offsets.
All
covenants and agreements to be performed by Tenant under this Lease shall be
performed by Tenant at Tenant’s sole cost and expense and without any offset to
or abatement of Rent, except as otherwise expressly provided in this Lease.
Tenant hereby waives any right to plead all non-compulsory counterclaims or
offsets in any action or proceeding brought by Landlord against Tenant for
any
default. This waiver shall not be construed, however, as a waiver of any right
of Tenant to assert any non-compulsory counterclaims or offsets in any separate
action brought by Tenant.
17
21.
DEFAULTS BY LANDLORD
21.1.
Defaults
by Landlord.
If
Landlord fails to perform or observe any of the terms, covenants or conditions
contained in this Lease on its part to be performed or observed within thirty
(30) days after written notice of default from Tenant or, when more than thirty
(30) days shall be required because of the nature of the default, if Landlord
shall fail to commence to cure such default after written notice thereof from
Tenant and thereafter diligently pursue such cure to completion, said failure
shall constitute a default by Landlord under this Lease. If any or all of the
Premises or any interest of Landlord in this Lease or the Rent are at any time
subject to any mortgage or deed of trust and if Tenant is given notice of the
name and address of the Mortgagee, then Tenant shall give written notice of
any
default by Landlord to the Mortgagee concurrently when providing Landlord
notice, specifying the default in reasonable detail. If Landlord fails to cure
such default within the applicable cure period, Tenant shall give written notice
of such failure to Mortgagee affording Mortgagee the same opportunity to cure
as
provided Landlord in this Section. If Mortgagee does perform on behalf of
Landlord, such default shall be deemed cured.
1 Limitations
on Recovery Against Landlord.
The
aggregate liability of Landlord and the Landlord Parties to Tenant for any
default by Landlord under this Lease or arising in connection herewith or with
the operation, management, leasing, repair, renovation, alteration of, or any
other matter relating to, the Center or the Premises shall be limited solely
and
exclusively to an amount equal to the interest of Landlord in the Center, and
neither Landlord nor any of the Landlord Parties shall have any personal
liability therefor, and Tenant hereby expressly waives and releases such
personal liability on behalf of itself and all persons claiming by, through
or
under Tenant. The limitations of liability contained in this Article 21 shall
inure to the benefit of Landlord and the Landlord Parties and each of their
respective partners, heirs, successors and assigns. Under no circumstances
shall
any present or future partner of Landlord (if Landlord is a partnership), or
trustee or beneficiary (if Landlord or any partner of Landlord is a trust),
have
any liability for the performance of Landlord’s obligations under this Lease.
Notwithstanding any contrary provision herein, neither Landlord nor the Landlord
Parties shall be liable under any circumstances for injury or damage to, or
interference with, Tenant’s business, including but not limited to, loss of
profits, loss of rents or other revenues, loss of business opportunity, loss
of
goodwill or loss of use, in each case, however occurring.
2 COSTS
OF SUIT
1 Costs
of Suit.
If
either party brings action for relief against the other, declaratory or
otherwise, arising out of this Lease, including any suit by Landlord for the
recovery of Rent or possession of the Premises, the non-prevailing party shall
pay the prevailing party its reasonable costs, fees and expenses incurred in
connection with and in preparation for said action, including its reasonable
attorneys’ fees.
2 DAMAGE
AND DESTRUCTION
23.1.
Insured
Casualty.
Upon
the occurrence of an Insured Casualty to the Premises, Landlord shall promptly
and diligently, subject to reasonable delays for insurance adjustment and
payment, issuance of permits or other matters beyond Landlord’s reasonable
control, and subject to all other terms of this Article 23, restore the damaged
Premises (except for such work with respect to the Premises which is the
responsibility of Tenant pursuant to this Article 23). Tenant, at its sole
cost
and expense, shall be responsible for the prompt and diligent repair and
restoration of all items constituting Improvements and Personal Property (which
repair and restoration work shall be completed no later than sixty [60] days
after the completion of Landlord’s work under this Section 23.1). All repair and
restoration activities by Landlord and Tenant shall be conducted in accordance
with Exhibit
C
and the
Tenant Package.
23.2.
Uninsured
Casualty.
Upon
the occurrence of an Uninsured Casualty to the Premises, Landlord shall have
the
right (in its sole discretion) to elect either to commence repair and
restoration of the Premises (in which event this Lease shall continue in full
force and effect and Landlord and Tenant shall diligently perform their
respective repair and restoration obligations required pursuant to Section
23.1)
or not to perform such repair and restoration, in which event this Lease shall
cease and terminate sixty (60) days after Landlord’s notice of its election to
terminate. Landlord shall give Tenant notice of its election under this Section
23.2 within ninety (90) days following the later of (a) the date of such
Uninsured Casualty, or (b) the date that Landlord’s insurers determine that the
Casualty is an Uninsured Casualty.
23.3.
Rent
Abatement.
Landlord shall not be liable for any inconvenience or annoyance to Tenant or
the
Tenant Parties, or injury to Tenant’s business, resulting in any way from any
Casualty or repair and restoration work. If any Casualty damages the Premises,
or if the Premises are not reasonably accessible (and are not used) due to
any
Casualty to the Common Area, Tenant shall be entitled to a proportionate
abatement of Fixed Minimum Rent during such time and to such extent the Premises
are unfit for occupancy for the Permitted Use and are not so occupied or used
by
Tenant or the Premises are not reasonably accessible (and thus are not used
by
Tenant) due to damage to the Common Area. However, if the Casualty is due to
the
gross negligence or willful misconduct of Tenant or any of the Tenant Parties,
Tenant shall be responsible for any reasonable, applicable insurance deductible
(which shall be payable to Landlord upon demand) and there shall be no Rent
abatement.
18
23.4.
Major
Destruction.
Notwithstanding any of the foregoing provisions of this Article 23, should
there
be a Major Destruction of the Center at any time during the Term, Landlord
shall
have the right to terminate this Lease by written notice to Tenant, which notice
shall be given within one hundred twenty (120) days following the date of such
Major Destruction (in which case such termination shall then take effect on
the
date specified in Landlord’s termination notice).
1 Insurance
Proceeds.
In the
event of termination of this Lease pursuant to this Article 23, Landlord and
Tenant shall each be released from any liability or obligation under this Lease
(except as otherwise provided for in this Lease) arising after the date of
such
termination. In the event of such termination, all proceeds from Tenant’s
insurance (including self-insurance and deductibles) covering the Improvements
(but excluding proceeds for Personal Property) shall be payable to Landlord.
In
no event shall Tenant be entitled to share in Landlord’s insurance proceeds or
to take any action which would result in a reduction of Landlord’s insurance
proceeds.
2 CONDEMNATION
24.1.
Total
Taking.
If
there is a Taking of the entire Premises, this Lease shall terminate as of
the
date of such Taking, and Landlord and Tenant shall have no further liability
or
obligation (except as otherwise provided for in this Lease) arising under this
Lease after such date.
24.2.
Partial
Taking; Right to Terminate.
If more
than twenty-five percent (25%) of the Floor Area of the Premises is taken,
or if
by reason of any Taking, regardless of the amount so taken, the remainder of
the
Premises is rendered unusable for the Permitted Use, Landlord and Tenant shall
each have the right to terminate this Lease as of the date Tenant is required
to
vacate the portion of the Premises which is the subject of such Taking, upon
giving notice of such election within thirty (30) days after the Taking. In
addition, if there is a Taking of fifteen percent (15%) or more of the Floor
Area of the Center and/or fifteen percent (15%) or more of the parking areas
of
the Center, Landlord shall have the right to terminate this Lease upon ninety
(90) days’ written notice to Tenant. In the event of any termination of this
Lease pursuant to this Article 24, Landlord and Tenant shall be released from
any liabilities and obligations under this Lease (except as otherwise provided
for in this Lease) arising after the date of termination. Landlord and Tenant
shall, after learning of any Taking, promptly give notice thereof to each other.
No temporary Taking of the Premises or any part of the Center (meaning a Taking
of less than nine [9] months) shall terminate this Lease.
24.3.
Restoration
and Rent Abatement.
If this
Lease does not terminate pursuant to Sections 24.1 or 24.2 above, then Tenant
shall continue to occupy that portion of the Premises not taken and the parties
shall proceed as follows: (a) Landlord shall, at its sole cost and expense,
restore the Premises remaining to a complete unit of like quality and character
as existed prior to such Taking (except for such work with respect to the
Premises which is the responsibility of Tenant pursuant to this Section 24.3),
(b) Tenant, at its sole cost and expense, shall be responsible for the repair
and restoration of the Improvements and Personal Property and (c) Fixed Minimum
Rent and any Additional Rent that is calculated on the basis of Floor Area
shall
be calculated on the basis of the remaining Floor Area of the Premises.
1 Award.
No
award for any partial or entire Taking shall be apportioned, and Tenant hereby
assigns to Landlord any and all rights of Tenant now or hereafter arising in
or
to the same or any part thereof. Tenant may file a separate claim for an award
at its sole cost and expense for, and nothing contained herein shall be deemed
to give Landlord any interest in, or to require Tenant to assign to Landlord,
any award made to Tenant for compensation for loss of business or for damage
to
or loss of Personal Property; provided, however, that no such claim shall
diminish or otherwise affect the awards otherwise payable to Landlord and each
of Landlord’s Designees.
2 HAZARDOUS
MATERIALS
25.1.
Compliance.
Tenant
covenants and agrees that Tenant shall, at all times during the Term and at
its
sole cost and expense, comply with and assume responsibility and liability
under
all Environmental Laws applicable to occupancy or use of or operations at the
Premises by Tenant and the Tenant Parties. In the event that Tenant proposes
to
undertake any Improvements, Tenant shall comply (at Tenant’s sole cost) with
Landlord’s criteria (as established from time to time) for testing and
remediation of Hazardous Materials.
25.2.
Notification.
Tenant
agrees that should it or any of the Tenant Parties know of (a) any violation
of
Environmental Laws relating to the Premises, or (b) the escape, release or
threatened release of any Hazardous Materials in, on, under or about the
Premises, Tenant shall promptly notify Landlord in writing of such violation,
escape, release or threatened release, and that it will provide all warnings
of
exposure to Hazardous Materials in, on, under or about the Premises in strict
compliance with all applicable Environmental Laws.
25.3.
Hazardous
Materials.
Tenant
shall at no time use, analyze, generate, manufacture, produce, transport, store,
treat, release, dispose of or permit the escape of, or otherwise deposit in,
on,
under or about the Premises or the Center, any Hazardous Materials, or permit
or
allow any of the Tenant Parties to do so.
19
26.
SUBORDINATION AND ESTOPPEL
26.1.
Subordination.
Tenant
covenants and agrees that (a) this Lease is and shall automatically and without
further act or deed by Tenant be subject and subordinate to any mortgages,
deeds
of trust, security deeds or other security instruments, and any ground leases
or
underlying leases presently existing or hereafter placed upon all or any portion
of the Center (each a “Mortgage”) and to any and all advances to be made
thereunder, and to any interest accrued thereon, and to all renewals,
replacements, modifications, consolidations and extensions thereof or
participation thereof, (b) any mortgagee, grantee, master lessor, beneficiary
or
trustee (each a “Mortgagee”) may elect to have this Lease made a prior lien to
its Mortgage, and in the event of such election and upon notification by such
Mortgagee to Tenant to that effect, this Lease shall be deemed prior in lien
to
said Mortgage, whether this Lease is dated prior to or subsequent to the date
of
any such Mortgage and (c) Tenant shall execute and deliver whatever instruments
may reasonably be required by Landlord or any present or prospective Mortgagee
to acknowledge such subordination or priority (as applicable) in recordable
form. If any proceeding is brought for default under any Mortgage to which
this
Lease is subject, or in the event of foreclosure, deed in lieu of foreclosure
or
the exercise of the power of sale under any Mortgage covering the Premises
and
if requested by Landlord’s successor, Tenant shall attorn to the successor and
shall recognize that successor as Landlord under this Lease. Such successor
shall not be (i) liable for any previous act or omission of Landlord under
this
Lease, (ii) subject to any offset that theretofore accrued to Tenant against
Landlord or (iii) bound by any previous prepayment of Rent or Security Deposit
which have not been expressly delivered by Landlord to such successor. If so
requested, Tenant shall enter into a new lease with that successor on the same
terms and conditions as are contained in this Lease (for the unexpired Term
of
this Lease then remaining).
1 Estoppel
Certificate.
Tenant
shall, from time-to-time within ten (10) days after prior written notice from
Landlord, execute, acknowledge and deliver to Landlord a statement in writing
in
such form as may be reasonably required by Landlord (a) certifying that this
Lease is unmodified and in full force and effect (or, if modified, stating
the
nature of such modification and certifying that this Lease, as so modified,
is
in full force and effect) and the date to which the Rent and other charges
are
paid in advance, if any; (b) acknowledging that there are not, to Tenant’s
knowledge, any uncured defaults on the part of Landlord hereunder (or specifying
such defaults if they are claimed); and (c) containing such other matters as
are
set forth in such form. Any such statement may be conclusively relied upon
by
any prospective purchaser or encumbrancer of the Premises. Tenant’s failure to
deliver such statement within such time shall be conclusive upon Tenant that
this Lease is in full force and effect, without modification except as may
be
represented by Landlord, that there are no uncured defaults in Landlord’s
performance, and that not more than one (1) month’s Fixed Minimum Rent has been
paid in advance.
2 MISCELLANEOUS
27.1.
Amendments.
No
provision of this Lease may be amended except by an agreement in writing signed
by the parties hereto or their respective successors-in-interest.
27.2.
Application
of Payments.
Landlord shall have the right to apply payments received from Tenant pursuant
to
this Lease, regardless of Tenant’s designation of such payments, to satisfy any
obligations of Tenant hereunder, in such order and amounts as Landlord, in
its
sole discretion, may elect. Notwithstanding any contrary provision in this
Lease, if Landlord is obligated to credit or refund any amount owed by Landlord
to Tenant and if at such time there is any outstanding Rent due Landlord,
Landlord may elect to apply such credit and/or refund toward such outstanding
Rent.
27.3.
Audits.
Landlord and Tenant shall each have the right to audit the other party’s books
and records respecting Gross Sales and Tenant’s Share of Variable Costs
(respectively). Such audits shall be conducted during business hours by a
non-contingency fee auditor who was not previously employed by the other and
is
not employed by a competitor of the other at such offices as the audited party
shall reasonably specify. A party may not conduct an audit (a) more than once
in
each Lease Year or
(b)
while
such party is in default of the Lease. If an audit should disclose that the
audited party shall have understated Gross Sales or overstated Tenant’s Share of
Variable Costs (as applicable) by more than five percent (5%), then the audited
party shall pay to the other party all reasonable costs and expenses relating
to
such audit (including, without limitation, reasonable travel costs) in addition
to paying any additional amounts due under this Lease or refunding any
overpayment made under this Lease as a result of such understatement or
overstatement, as applicable. The results of any such audit shall be kept
confidential and not disclosed to any third parties (except to the extent
required by law). Neither party shall have the right (whether at law, at equity
or under this Lease) to audit (1) Gross Sales or Tenant’s Share of Variable
Costs (as applicable) except on the express terms and conditions provided in
this Section 27.3 or (2) the amount payable by Tenant as Fixed Costs.
27.4.
Authority
of Signatories.
Each
person executing this Lease on behalf of Tenant represents and warrants that
he
or she is duly authorized to execute and deliver this Lease on behalf of Tenant,
and that Tenant is qualified to do business in the state where the Center is
located, and shall deliver appropriate certification to that effect if
requested.
27.5.
Binding
Effect.
Except
as otherwise expressly provided in this Lease, all of the provisions of this
Lease shall be binding upon and inure to the benefit of the parties hereto
and
their respective heirs, legal representatives, successors and assigns.
20
27.6. |
Brokers.
Landlord and Tenant shall each indemnify, defend and hold the other
harmless from and against, all damages (including reasonable attorneys’
fees and costs) resulting from any claims that may be asserted against
Landlord or Tenant by any broker, finder, or other person with whom
the
indemnifying party has or purportedly has dealt.
|
27.7.
Captions.
The
names of Articles and Sections are for convenience only and shall not be used
to
interpret or construe the meaning of any provision in this Lease. All references
to Articles, Sections and Exhibits are references to Articles and Sections
contained in this Lease and Exhibits attached to this Lease unless otherwise
expressly provided.
27.8.
Choice
of Law.
This
Lease shall be governed by the laws of the state where the Center is located.
27.9.
Confidentiality.
Tenant
shall keep the content of this Lease and all related documents strictly
confidential and shall not disclose such confidential information to any person
or entity other than Tenant’s financial, legal and space planning consultants.
27.10.
Counterparts.
This
Lease may be executed in counterparts with the same effect as if both parties
hereto had executed the same document. All counterparts shall be construed
together and shall constitute a single Lease.
27.11.
Execution
by Landlord.
The
submission of this document to Tenant does not constitute an offer to lease,
or
a reservation of, or an option for, the Premises. This document becomes
effective and binding only upon Landlord’s delivery to Tenant of a counterpart
executed by both Landlord and Tenant. Until this Lease is executed by both
Landlord and Tenant and delivered by Landlord to Tenant, Landlord and its agents
may continue to negotiate with third parties for the leasing of all or portions
of the Premises. No act or omission of any employee or agent of Landlord or
of
Landlord’s broker shall alter, change or modify any of the provisions hereof.
27.12.
Exhibits.
All
exhibits affixed to this Lease are made a part of, and are incorporated into,
this Lease. In particular, the Center Rider, attached as Exhibit
E,
reflects certain provisions particular to the Center and the state in which
the
Premises are located. If there are any inconsistencies between this Lease and
the provisions of Exhibit
E,
the
provisions of Exhibit
E
shall
prevail.
27.13.
Force
Majeure.
Any
prevention, delay or stoppage due to strikes, lockouts, labor disputes, acts
of
God, acts of war or terrorism, inability to obtain services, labor, or materials
or reasonable substitutes therefor, governmental actions, civil commotions,
fire
or other Casualty, in each case if due to a cause beyond the reasonable control
of the party obligated to perform, and other causes beyond the reasonable
control of the party obligated to perform, except with respect to the
obligations imposed with regard to Rent payable by Tenant pursuant to this
Lease
and Tenant’s obligations under Section 12.1.2 (collectively, “Force Majeure”)
shall, notwithstanding anything to the contrary contained in this Lease, excuse
the performance of such party for a period equal to any such prevention, delay
or stoppage and, therefore, if this Lease specifies a time period for
performance of an obligation of either party, that time period shall be extended
by the period of any delay in such party’s performance caused by a Force
Majeure. For purposes of this Section 27.13, a cause shall not be deemed beyond
a party’s control if it is within the control of such party’s agents, employees
or contractors.
27.14.
Independent
Covenants.
This
Lease shall be construed as though the covenants herein between Landlord and
Tenant are independent and not dependent and Tenant hereby expressly waives
the
benefit of any statute to the contrary.
27.15.
Labor
Contracts.
Neither
Tenant nor any of the Tenant Parties shall take any action which violates
Landlord’s labor contracts affecting the Center or which creates any work
stoppage, picketing, labor disruption or dispute, or interferes with the
business of Landlord or any Occupant in the Center or with the rights and
privileges of any customer or other person(s) lawfully in the Center, or causes
any impairment or reduction of the goodwill of the Center. If there shall be
any
work stoppage, picketing, labor disruption or dispute as the result of the
actions of Tenant or any of the Tenant Parties, Tenant shall immediately
undertake such action as may be necessary to eliminate such dispute or potential
dispute, including, but not limited to, (a) removing all disputants from the
job
site until such time as the labor dispute no longer exists, (b) seeking a
judgment for a breach of contract between Tenant and Tenant’s contractor and (c)
filing appropriate unfair labor practice charges in the event of a union
jurisdictional dispute.
27.16.
Landlord
and Tenant.
The
words “Landlord” and “Tenant” include the plural as well as the singular. Words
used in the neuter gender include the masculine and feminine and words in the
masculine or feminine gender include the neuter. If there is more than one
person or entity constituting Landlord or Tenant, the obligations imposed
hereunder upon Landlord or Tenant are joint and several. If Tenant consists
of a
husband and wife, the obligations of Tenant hereunder extend individually to
the
sole and separate property of each of them as well as to their community
property. The obligations contained in this Lease to be performed by Landlord
shall be binding on Landlord’s successors and assigns only during their
respective periods of ownership of the Premises.
21
27.17.
Merger.
This
Lease contains all of the agreements of the parties hereto with respect to
any
matter covered or mentioned in this Lease, and no prior agreement, negotiations,
brochures, arrangements, or understanding pertaining to any such matter shall
be
effective for any purpose unless expressed herein.
27.18.
Modification
of Lease.
Should
any current or prospective Mortgagee require a modification of this Lease,
which
modification will not cause an increased cost or expense to Tenant or in any
other way materially and adversely change the rights and obligations of Tenant
hereunder, then, and in such event, Tenant agrees that this Lease may be so
modified and agrees to execute whatever documents are reasonably required
therefor and to deliver the same to Landlord within ten (10) days following
a
request therefor. At the request of Landlord or any Mortgagee, Tenant agrees
to
execute a short form of Lease and deliver the same to Landlord within ten (10)
days following the request therefor.
27.19.
Name
of Center.
Landlord expressly reserves the right at any time, after no less than sixty
(60)
days’ notice to Tenant, to change the name of the Center without any liability
to Tenant. Tenant shall use the Center’s name in referring to the location of
the Premises in all newspaper, radio, television and other advertising with
respect to Tenant’s business at the Premises.
27.20.
No
Consent or Approval.
Landlord’s or Tenant’s consent to or approval of any act by the other requiring
its consent or approval shall not constitute a consent or approval of any
subsequent act by the other.
27.21.
No
Violation.
Tenant
hereby warrants and represents that neither its execution of nor performance
under this Lease shall cause Tenant to be in violation of any agreement,
instrument, contract, law, rule or regulation by which Tenant is bound.
27.22.
No
Warranty.
In
executing and delivering this Lease, Tenant has not relied on any
representations, including, but not limited to, any representation as to the
amount of any item comprising Costs or the amount of the Costs in the aggregate
or that Landlord is furnishing the same services to other tenants, at all,
on
the same level or on the same basis as to Tenant, or any warranty or any
statement which is not set forth herein or in one or more of the exhibits
attached hereto.
27.23.
Nondiscrimination.
Tenant
covenants for itself, its heirs, executors, administrators, successors, and
assigns and all persons claiming under or through it or them, that there shall
be no discrimination against or segregation of any person or group of persons
on
account of race, color, religion, creed, sex, marital status, sexual
orientation, national origin, ancestry, age, physical handicap or medical
condition, in the leasing, subleasing, transferring, use, occupancy, tenure
or
enjoyment of the Premises herein leased, and Tenant and any person claiming
under or through Tenant shall not establish or permit any such practice or
practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, subtenants, licensees, vendees
or
customers in the Premises.
27.24.
Nonrecordability
of Lease.
Tenant
shall not record this Lease or a memorandum hereof without Landlord’s express
prior written consent, which consent may be withheld in Landlord’s sole
discretion.
27.25.
OFAC
Certification
27.25.1.
Representation
and Warranty.
Tenant
represents and warrants that:
27.25.1.1.
It is not, and shall not become, a person or entity with whom Landlord is
restricted from doing business under regulations of the Office of Foreign Asset
Control (“OFAC”) of the Department of the Treasury (including, but not limited
to, those named on OFAC’s Specially Designated and Blocked Persons list) or
under any statute, executive order (including, without limitation, the September
24, 2001 Executive Order Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism, as amended
[“Executive Order 13224”]), or other governmental action and is not, and shall
not, engage in any dealings or transactions or otherwise be associated with
such
persons or entities; and
27.25.1.2.
It is not acting, directly or indirectly, for or on behalf of any person, group,
entity or nation with whom Landlord is restricted from doing business under
the
regulations of OFAC (including, but not limited to, Executive Order 13224)
or
other governmental action and is not and shall not engage in any dealings or
transactions, employ or otherwise be associated, with such person, group, entity
or nation.
27.25.2.
Default.
Any
breach of the representation and/or warranty contained in this Section 27.25
shall constitute a non-curable default and is grounds for immediate termination
of this Lease by Landlord. Any such exercise by Landlord of its remedies under
this Section 27.25 shall not constitute a waiver by Landlord to recover (a)
any
Rent due under this Lease and (b) any damages arising from such breach by
Tenant.
27.26.
Quiet
Enjoyment.
So long
as Tenant timely pays all Rent, timely performs its covenants and obligations
under this Lease and recognizes any successor to Landlord in accordance with
the
terms of this Lease, Tenant shall lawfully and quietly have, hold and enjoy
the
Premises during the Term without
hindrance or molestation by Landlord or anyone claiming by, through or under
Landlord, subject, however, to all Superior Agreements.
22
27.27.
REIT
Qualifications.
Landlord and Tenant agree that all Rent paid to Landlord under this Lease shall
qualify as “rents from real property” as defined in Internal Revenue Code
Section 856(d) and as further defined in Treasury Regulation Section 1.856-4,
as
each is amended from time-to-time. Should the requirements of the said Internal
Revenue Code Section or Treasury Regulation Section be amended so that any
rent
no longer qualifies as “rents from real property” for the purposes of the
Internal Revenue Code or the Treasury Regulation, the Rent payable to Landlord
shall be adjusted so that such Rent will qualify as “rents from real property”
under the Internal Revenue Code and Treasury Regulation; provided that such
adjustments required pursuant to the provisions of this Section 27.27 shall
not
increase the monetary obligations of Tenant. If any adjustment of Rent under
this Section 27.27, or if Landlord in good faith determines that its status
as a
real estate investment trust under the provisions of the Internal Revenue Code
or the Treasury Regulation will be jeopardized because of any provision of
this
Lease, Tenant shall, without charge therefor and within ten (10) days after
Landlord’s written request therefor, execute and deliver to Landlord such
amendments to this Lease as may be reasonably required by Landlord to avoid
such
jeopardy; provided such amendments do not increase the monetary obligations
of
Tenant or in any other manner materially increase Tenant’s obligations or
materially decrease Tenant’s rights under this Lease.
27.28.
Relationship
of Parties.
Nothing
contained in this Lease shall be deemed or construed by the parties hereto
or by
any third party to create the relationship of principal and agent, partnership,
joint venturer or any association between Landlord and Tenant.
27.29.
Rules.
Landlord shall have the right at any time to establish, modify, amend and
enforce reasonable and non-discriminatory Rules. Tenant shall (and shall cause
all of the Tenant Parties to) comply with all Rules.
27.30.
Security.
Landlord may from time-to-time elect to obtain or cease to provide security
services and/or devices for the protection of the Common Area. To the extent
that such security services and devices are provided, they are not intended
to
provide protection for the Premises or the persons thereon or the contents
thereof and, therefore, Tenant shall obtain any and all security services and/or
devices as Tenant shall reasonably require for the protection of the Premises,
the Tenant Parties, and Improvements and Personal Property. No firearms or
other
devices that could cause grievous bodily harm shall be used, possessed or
carried by any of Tenant’s security services, or any of Tenant or the Tenant
Parties, unless Landlord shall have agreed to the same in writing (which consent
Landlord may grant or withhold in its sole discretion) and Tenant shall have
provided Landlord with such instruments as Landlord shall require to protect
Landlord and the Landlord Parties from any and all liability in connection
with
the use of such firearms or devices.
27.31.
Severability.
If any
provision of this Lease shall, to any extent, be determined by a court of
competent jurisdiction to be invalid or unenforceable, the remainder of this
Lease shall not be affected thereby, and every other term and provision of
this
Lease shall be valid and enforceable to the fullest extent permitted by law.
27.32.
Submittal
of Financial Statement.
At any
time and from time-to-time during the Term, but not more often than once in
any
calendar year, within fifteen (15) days after request therefor by Landlord,
Tenant shall supply to Landlord and/or any of Landlord’s Designees a current
financial statement, profit and loss statements for the business at the
Premises, and/or such other reasonable financial information as may be required
by any such party. Such information shall be confidential and Landlord shall
not
divulge such information, except to any actual or prospective purchaser of
Landlord’s interest in the Premises or to any actual or prospective lender or as
may otherwise be required for Landlord to undertake its obligations and rights
under this Lease.
27.33.
Superior
Agreements.
This
Lease and Tenant’s rights hereunder are subject and subordinate in all respects
to all Superior Agreements.
27.34.
Survival.
Every
obligation to pay Rent, every indemnification of one party by the other and
every provision relating to Hazardous Materials shall survive the expiration
or
earlier termination of this Lease, unless and to the extent otherwise expressly
provided in this Lease.
27.35.
Time.
Time is
of the essence of this Lease and each and every provision hereof, except as
may
be expressly provided otherwise.
27.36.
Waivers
27.36.1.
Waiver
of Default.
No
delay or omission in the exercise of any right or remedy of Landlord or Tenant
for any default by the other shall impair such right or remedy or be construed
as a waiver. Any waiver by Landlord of any default must be in writing and shall
not be a waiver of any other default concerning the same or any other provision
of this Lease.
27.36.2.
Waiver
of Redemption by Tenant.
Tenant
hereby waives for Tenant and for all those claiming under Tenant all right
now
or hereafter existing to redeem by order or judgment of any court or by any
legal process or writ, Tenant’s right of occupancy of the Premises after any
termination of this Lease.
23
27.36.3.
Waiver
of Right to Repair.
Except
as otherwise expressly provided herein, there shall be no abatement of Rent
and
no liability of Landlord by reason of any injury to or interference with
Tenant’s business arising from the making of any repairs, alterations or
improvements in or to any portion of the Premises or the Center or in or to
the
fixtures, appurtenances and equipment therein. Tenant hereby waives the right
to
make repairs at Landlord’s expense under the provisions of any laws permitting
repairs by a tenant at the expense of a landlord.
27.36.4.
Waivers
Respecting Casualty and Taking.
The
provisions of Articles 23 and 24 constitute an express agreement between
Landlord and Tenant with respect to any Casualty and Taking, respectively.
Therefore, any statute or regulation of the state in which the Premises are
located with respect to any rights or obligations concerning damage, destruction
or condemnation and any other Article of this Lease, shall have no application
to this Lease as to any Casualty or Taking, respectively, as to which Articles
23 and 24 shall govern and prevail.
27.36.5.
Waiver
of Trial by Jury and Venue Selection.
LANDLORD AND TENANT EACH HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR
COUNTERCLAIM BROUGHT BY EITHER PARTY AGAINST THE OTHER ON ANY MATTER WHATSOEVER
ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE OR TENANT’S USE OR
OCCUPANCY OF THE PREMISES, INCLUDING ANY CLAIM OF INJURY OR DAMAGE, AND ANY
EMERGENCY AND OTHER STATUTORY REMEDY WITH RESPECT THERETO. LANDLORD AND TENANT
ALSO AGREE THAT THE VENUE OF ANY SUCH ACTION, PROCEEDING OR COUNTERCLAIM SHALL
BE IN THE CITY, COUNTY AND STATE IN WHICH THE CENTER IS LOCATED OR AT SUCH
OTHER
CITY AND COUNTY AS MAY BE DETERMINED BY LANDLORD IN ITS SOLE AND ABSOLUTE
DISCRETION.
IN
WITNESS WHEREOF,
Landlord and Tenant have executed this Lease as of the day and year first
above
written.
|
|
LANDLORD:
|
NEW
RIVER ASSOCIATES, an
Arizona general partnership
|
By:
Westcor Realty Limited Partnership, a Delaware limited partnership
its
general partner
|
|
By:
Macerich WRLP Corp., a Delaware corporation its general partner
|
|
By:
Name: Title:
|
TENANT: XXXXXXXXX
AS SEEN ON TV FRANCHISING COMPANY, a
Nevada
corporation
By: | |||
President
|
|||
By: | |||
Vice
President
|
LANDLORD'S
BROKER:
WESTCOR
PARTNERS, L.L.C., an Arizona limited liability company
By:
Xxxxxxx X. Xxxxxxxxx Its: Designated Broker
24
EXHIBIT
A
DEPICTION
OF CENTER
![](https://www.sec.gov/Archives/edgar/data/1337340/000101376207001269/map3.jpg)
25
EXHIBIT
A
EXHIBIT
B
DEPICTION
OF PREMISES
![](https://www.sec.gov/Archives/edgar/data/1337340/000101376207001269/map4.jpg)
26
EXHIBIT
C
PROVISIONS
FOR THE DESIGN
AND
CONSTRUCTION OF THE PREMISES
(AS
IS WITH REMODEL)
1.
GENERAL PROVISIONS
1.1.
Purpose.
This
Exhibit
C
sets
forth certain provisions with respect to Landlord’s Work and Tenant’s Work.
1.2.
Definitions.
Capitalized terms used in this Exhibit
C
without
definition shall have the meaning ascribed to such terms in the Tenant Package.
1 References.
Unless
otherwise expressly provided in this Exhibit
C,
references to Articles, Sections and captions are references to Articles,
Sections and captions contained in this Exhibit
C.
2 TENANT
PACKAGE
2.1.
Tenant
Package.
Tenant
acknowledges it has received from Landlord a Tenant Package which shall govern
all of Tenant’s Work. Tenant shall, and Tenant shall cause, Tenant’s Architect,
Tenant’s engineer and Tenant’s Contractor and subcontractors to, in all respects
comply with, and Tenant’s Work shall in all respects be subject to, the Tenant
Package. “Tenant Package” means the package(s) containing, among other
materials, the following: (a) Tenant Design and Construction Criteria, (b)
Sign
Criteria and Plan Submittal Guidelines, (c) Contractors’ Rules and Regulations
and
(d)
Technical Manual. The Tenant Package is hereby incorporated herein and made
a
part of this Exhibit
C
by this
reference.
3.
DESCRIPTION
OF LANDLORD’S WORK
3.1.
Landlord’s
Work Defined.“Landlord’s
Work” means the work, if any, which Landlord is expressly obligated to undertake
pursuant to this Article 3. Landlord shall have no obligation to improve,
remodel, alter or otherwise modify or prepare the Premises or the Center in
connection with Tenant’s occupancy.
3.2.
Center.
Landlord or its predecessor-in-interest has constructed the Center, and the
Building and other improvements upon the Center (exclusive of improvements
constructed by or on behalf of each present and prior Occupant). Tenant has
inspected the Center, the Building, the Utilities, the types, quantities and
qualities of the Utilities, and the other systems and Tenant has found the
same
to be suitable, sufficient and in acceptable condition for the purpose of Tenant
conducting the Permitted Use upon the Premises. Landlord shall have no
obligation to undertake any work or furnish any additional materials upon any
part of the Center or to provide any additional Utilities or other systems
for
the benefit of the Premises.
1 Tenant
Coordinator.
Landlord shall designate a person, or persons, as Tenant Coordinator (“Tenant
Coordinator”) who alone shall have authority on behalf of Landlord to oversee
and manage the review and approval of Preliminary Documents, Construction
Documents, As-Built Documents, Plan Revisions and other matters specified in
this Exhibit
C
and the
Tenant Package. No matter shall be deemed approved by Landlord under this
Exhibit
C
or the
Tenant Package unless approved in writing by the Tenant Coordinator. Landlord
may, from time-to-time and upon written notice to Tenant’s Representative, name
another person or persons as Tenant Coordinator.
2 DESCRIPTION
OF TENANT’S WORK
4.1.
Condition
of Premises.
Upon
the Delivery Date, Tenant shall accept delivery of the Premises in an “As Is”
condition and “With All Faults” and Landlord shall have no obligation to
improve, remodel, alter or otherwise modify or prepare the Premises for Tenant’s
occupancy except to the extent otherwise expressly stated in Article 3 as
“Landlord’s Work”, if any. Tenant hereby represents each of the following: (a)
Tenant or its authorized representative has inspected the Premises and has
made
all inquiries, tests and studies that it deems necessary in connection with
its
leasing of the Premises,
(b)
Tenant is relying solely on Tenant’s own inspection, inquiries, tests and
studies conducted in connection with, and Tenant’s own judgment with respect to,
the condition of the Premises and Tenant’s leasing thereof and (c) Tenant is
leasing the Premises without any representations or warranties, express, implied
or statutory by Landlord, or Landlord’s agents, brokers, finders, consultants,
counsel, employees, officers, directors, shareholders, partners, trustees or
beneficiaries.
4.2.
Tenant’s
Work Defined.
“Tenant’s Work” means the purchase, installation, construction and performance
of the improvements and duties specified in the Approved Plans and as described
in the Tenant Package for a full and complete remodel of the Premises, and
the
purchase, installation and construction of all Tenant’s furniture, equipment and
Personal Property, all at Tenant’s sole cost and expense (except to the extent
otherwise expressly provided in the Tenant Package) and in compliance with
applicable Governmental Regulations. All Tenant’s Work shall be performed by a
licensed, bondable contractor retained by Tenant and approved in advance, in
writing, by Landlord (“Tenant’s Contractor”). Tenant’s Contractor shall
construct Tenant’s Work in a good and workmanlike manner and complete Tenant’s
Work in accordance with the Approved Plans, the Lease and the Tenant Package,
and in compliance with all Governmental Regulations.
27
4.3.
Tenant’s
Architect.
Tenant
shall engage the services of a licensed architect (“Tenant’s Architect”) to
prepare the Preliminary Documents, Construction Documents and As-Built
Documents.
4.4.
No
Mezzanines.
No
mezzanines shall be permitted upon the Premises. The approval of the Preliminary
Documents or Construction Documents containing any depictions of mezzanines
shall not constitute either Landlord’s approval of any mezzanine upon the
Premises or a waiver of the prohibition against mezzanines set forth in this
Section 4.4. As used herein, the term “mezzanine” shall apply to all mezzanines
regardless of purpose and shall include, without limitation, mezzanines used
for
storage.
4.5.
On-Site
Corrections.
Tenant
Coordinator reserves the right to make any on-site corrections to any of the
Approved Plans.
4.6.
Scope
of Approval.
Landlord’s approval of the Preliminary Documents, the Construction Documents and
the Approved Plans shall not constitute any representation or warranty by
Landlord that the same are complete or sufficient for (a) purposes of Tenant’s
design, (b) purposes of constructing the Premises or any part of the Premises
or
(c) complying with any Governmental Regulations. Landlord shall not be liable
to
Tenant if the Preliminary Documents, the Construction Documents or the Approved
Plans fail to satisfy any of the provisions specified in (a), (b) and/or (c)
preceding and Tenant shall not be relieved of any of its obligations under
this
Exhibit
C,
the
Tenant Package, the Lease or Governmental Regulations on account of any such
approval by Landlord.
4.7.
Plan
Review Fee. Concurrently
with submitting the Preliminary Documents to Landlord, Tenant shall pay to
Landlord the Plan Review Fee for Tenant Coordinator’s and/or other consultants’
review of the Preliminary Documents. The time frame in which Landlord is
obligated to approve or disapprove the Preliminary Documents shall not commence
until Tenant has paid in full the Plan Review Fee.
4.8.
Plan
Revisions.
If
Tenant requires any changes, additions, deletions or other modifications to
the
Approved Plans, Tenant shall submit revised Construction Documents clearly
identifying all changes, additions, deletions and other modifications (“Plan
Revisions”) to Tenant Coordinator for approval on behalf of Landlord. Tenant
Coordinator shall promptly review the Plan Revisions and approve, conditionally
approve or disapprove the Plan Revisions. Plan Revisions shall be at the sole
cost and expense of Tenant.
4.9.
Landlord’s
Right to Access.
Throughout the entire course of Landlord’s Work and Tenant’s Work, Landlord,
Landlord’s authorized representatives (including Tenant Coordinator) and
Landlord’s contractors shall have access to the Premises and shall have the
right to inspect the progress of Tenant’s Work, Tenant’s and Tenant’s
Contractor’s compliance with the provisions of the Lease, this Exhibit
C and
the
Tenant Package, and to install such portions of Landlord’s Work that first
requires all or some portion of Tenant’s Work to be completed. If Landlord or
any of Landlord’s representatives or contractors shall enter the Premises during
the course of Tenant’s Work, Landlord shall use commercially reasonable efforts
to avoid interfering with the progress of Tenant’s Work upon the Premises.
1 Commencement
of Tenant’s Work.
Promptly following (a) the Delivery Date, (b) Landlord’s approval of the
Approved Plans, (c) Tenant’s receipt of all permits and licenses required by
governmental authorities and (d) the complete satisfaction of all requirements
under the Lease, this Exhibit
C and
the
Tenant Package which Tenant and Tenant’s Contractor are obligated to perform
prior to commencing construction of Tenant’s Work, Tenant shall cause Tenant’s
Contractor to commence Tenant’s Work in accordance with the Approved Plans, the
Lease, this Exhibit
C
and the
Tenant Package and to diligently pursue the same to completion and to initially
open the Premises for business on or before the Required Opening Date.
2 CLOSE-OUT
PACKAGE.
5.1.
Close-Out
Package. Tenant
shall perform and provide Landlord with each of the following within the time
frame specified therefor all at Tenant’s sole cost and expense (collectively,
“Close-Out Package”):
5.1.1.
Compliance
and Close Out Documentation.
All
compliance and close out documentation as detailed in Section U of the
Contractors’ Rules and Regulations in connection with the performance of
Tenant’s Work.
5.1.2.
AIA
Document Requirements
5.1.2.1.
For Tenant’s Work with an aggregate cost to Tenant in excess of $1,000,000.00,
Tenant shall obtain and deliver to Landlord, within thirty (30) days after
the
substantial completion of Tenant’s Work, the following documents: (a) AIA
Document G702, completed, executed and certified by Tenant’s Architect that the
Premises were constructed in accordance with the Approved Plans and (b) AIA
Document G703, completed, executed and certified by Tenant’s Contractor.
Arrowhead
Towne Center - As Seen On TV Retail/Mall/Fixed Costs
#217342v2<iManage>:04.27.07.1410 Vers 3.0 : 201924_1 : 06.01.06
5.1.2.2.
For Tenant’s Work with an aggregate cost to Tenant from $100,000.00 to
$1,000,000.00, inclusive, Tenant shall obtain and deliver to Landlord, within
thirty (30) days after the substantial completion of Tenant’s Work, the
following documents, completed, executed and certified by Tenant’s Contractor:
(a) AIA Document G702 and (b) AIA Document G703.
5.1.2.3.
For Tenant’s Work with an aggregate cost to Tenant of less than $100,000.00,
Tenant shall obtain and deliver to Landlord, within thirty (30) days after
the
substantial completion of Tenant’s Work, a copy of the contract between Tenant
and Tenant’s Contractor showing Tenant’s Contractor’s aggregate final billing.
5.1.3.
Affidavit
of Improvements Cost.
Tenant
shall deliver to Landlord, within thirty
(30)
days
after the substantial completion of Tenant’s Work (a) an affidavit, certified as
true and correct by an Authorized Officer of Tenant, setting forth in reasonable
detail the amounts paid by Tenant for the leasehold improvements made by Tenant
(less any amounts paid by Landlord toward such leasehold improvements and
specifically excluding all costs for Personal Property), and (b) all paid
invoices for Tenant’s Work.
28
EXHIBIT
D
CERTAIN
DEFINED TERMS
1.
INTENT
1.1.
Intent.
The
purpose of this Exhibit
D is
to set
forth certain defined terms which are used in the Lease. Terms which are not
defined in this Exhibit
D
are
defined in the Lease or the Exhibits attached to the Lease.
1 References.
All
references to Articles, Sections and captions contained in this Exhibit
D are
Articles, Sections and captions contained in the Lease unless otherwise
provided.
2 CERTAIN
DEFINED TERMS
2.1.
Additional
Rent
means
all amounts payable by Tenant under this Lease, other than Fixed Minimum Rent
and Percentage Rent.
2.2.
Address
for Payment of Rent
means
the address specified at Section 1.19.
2.3.
Administrative
Charge
means
fifteen percent (15%) of the subject sum. The Administrative Charge is intended
to reimburse Landlord for additional administrative costs incurred by Landlord
for providing work, materials or services.
2.4.
Affiliate
means
any entity that Controls, is Controlled by or is under common Control with
another specified entity.
2.5.
Agreed
Rate
means
the prime commercial rate of interest charged from time-to-time by Xxxxx Fargo
Bank, National Association (or, if the same does not exist, such other
comparable bank selected by Landlord), plus two percent (2%) per annum, but
not
to exceed the maximum rate of interest allowable under law.
2.6.
Annual
Base Sales
means
the annual figure specified at Section 1.10, as the same may be adjusted from
time-to-time pursuant to this Lease.
2.7.
Annual
Fixed Minimum Rent
means
the annual rent sum specified at Section 1.8, as the same may be adjusted from
time-to-time pursuant to this Lease.
2.8.
Annual
Sales Statement
means a
written statement in the form attached as Exhibit
G
to the
Lease certified to be true and correct by an Authorized Officer of Tenant.
2.9.
Approved
Plans
means
the final set of plans for Landlord’s Work and/or Tenant’s Work (as the case may
be) which have received the final written approval of both Landlord and Tenant
to the extent required by any applicable provisions of this Lease and the Tenant
Package.
2.10.
Assignment,
Assign
and
Assigning
mean any
assignment of Tenant’s interest in the Lease and Assignment
Instrument
means
the instrument by which an Assignment is made.
2.11.
Attached
Fixtures
means
such trade fixtures, equipment and other Personal Property which is attached
or
affixed to the Premises (including, without limitation, carpeting, flooring,
lighting, light fixtures, electrical systems, communications wiring and cabling,
built-in shelving, built-in furniture and the cash wrap).
2.12.
Authorized
Officer
means
(a) each natural person who executed the Lease (or the most recent amendment
of
the Lease), if Tenant is one or more natural persons, (b) an authorized officer,
if Tenant is a corporation, (c) an authorized or managing partner, if Tenant
is
a partnership or a limited liability partnership or (d) an authorized member,
if
Tenant is a limited liability company.
2.13.
Bankruptcy
Code
means
the Bankruptcy Code 11 U.S.C. 101 et
seq.,
as
amended from time-to-time.
2.14.
Building
means
the building, if any, of which the Premises are a part.
2.15.
Casualty
means
fire or any other casualty.
2.16.
Center
means
that certain commercial project, the name and approximate location of which
is
specified at Section 1.1.
2.17.
Center
Hours
is
defined at Section 1.15.
2.18.
Claims
means,
collectively, claims, charges, liabilities, obligations, penalties, causes
of
action, liens, damages, costs and expenses, including reasonable attorneys’ and
other expert and third party fees and costs.
2.19.
Close-Out
Package
is
defined at Exhibit
C.
29
2.20.
Common
Area
means
all improvements, facilities, equipment, signs, land and areas (as each may
be
enlarged, reduced, dedicated to retail use, replaced, increased, removed,
demolished or otherwise altered in any way by Landlord) within the exterior
boundaries of the Center which are now or hereafter made available for general
use, convenience or benefit of more than one (1) Occupant, which may include,
but shall not be limited to, parking areas, access and perimeter roads,
driveways, loading docks, pedestrian malls and courts (whether enclosed or
unenclosed), corridors, stairs, ramps, elevators, escalators, first-aid
stations, security stations, drinking fountains, toilets, public washrooms,
community halls, auditoriums, and other public facilities, parcel pick-up
stations and landscaped areas. Common Area shall include any other land which
Landlord, by means of purchase, lease or otherwise, acquires, and which land
is
not presently part of the Center, to the extent Landlord designates all or
any
portion of such land available as Common Area.
2.21.
Competing
Interest
is
defined at Section 10.4.
2.22.
Control,
Controlled
and
Controls
mean the
ownership, directly or indirectly, of at least fifty-one percent (51%) of the
voting securities of, or possession of the right to vote, in the ordinary
direction of its affairs, of at least fifty-one percent (51%) of the voting
interest in, any person or entity.
2.23.
Costs
means
both Fixed Costs and Variable Costs (or Tenant’s Share of Variable Costs, as the
context of the sentence, paragraph or Section may require).
2.24.
Cumulative
Basis
means
that the stated cap shall be applied on a cumulative and compounding basis.
For
example, if the stated cap is three percent (3%), the maximum capped amount
for
the first year to which the cap applies shall be one hundred three percent
(103%) of the amount for the immediately preceding period (annualized if such
amount is not for a full year), which shall constitute the “Cap Amount” for such
year; for the second year, the “Cap Amount” shall be equal to one hundred six
and 9/100ths
percent
(106.09%); and for each year after such second year, the Cap Amount shall be
an
amount equal to one hundred three percent (103%) of the Cap Amount applicable
to
the immediately preceding year.
2.25.
Delivery
Date
means
January 1, 2007.
2.26.
Effective
Date
is
defined in the preamble to this Lease.
2.27.
Intentionally
Omitted (Form)
2.28.
Environmental
Laws
means
any and all federal, state and local laws, regulations, ordinances, codes and
policies, and any and all judicial or administrative interpretations thereof
by
governmental authorities, as now in effect or hereinafter amended or enacted,
relating to:
2.28.1.
Pollution or protection of the environment, natural resources or health and
safety; including, without limitation, those regulating, relating to, or
imposing liability for emissions, discharges, releases or threatened releases
of
Hazardous Materials into the environment, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
release, transport or handling of Hazardous Materials; and
2.28.2.
The use of chemical, electrical, radiological or nuclear processes, radiation,
sophisticated electrical and/or mechanical equipment, sonar and sound equipment,
lasers, and laboratory analysis and materials.
2.29.
Excluded
Floor Area
means
the total Floor Area of all of the following: Major Occupant Stores, the
premises of all Occupants occupying between 15,000 and 40,000 square feet of
Floor Area, all premises having an exterior entrance (but only if the Center
contains an enclosed mall), movie theatre premises, premises occupied by
Occupants under pad leases, premises used for educational purposes, premises
used for office purposes, premises used for restaurants, mezzanines, storage
areas, premises occupied by Temporary Tenants, Landlord’s management office(s),
merchants’ association offices, Marketing Service offices, maintenance buildings
and offices, equipment rooms utilized by Landlord for the maintenance of the
Common Area, and such facilities and areas the primary purpose of which is
to
afford services, convenience or recreation to customers and invitees of the
Center or for municipal and community purposes, which include, without
limitation, post offices, security and/or police offices, child care facilities,
and rooms used for community or public meetings.
2.30.
Executive
Order 13224
is
defined at Section 27.25.1.1.
2.31.
Expiry
Date
means
the date specified at Section 1.7.
2.32.
First
Fixed Costs Adjustment Date
is
defined at Section 1.25.
2.33.
Fixed
Costs
means
the annual figure specified at Section 1.25, as the same may be adjusted from
time-to-time pursuant to this Lease.
2.34.
Fixed
Costs Adjustment Date
is
defined at Section 5.7.1.
30
2.35.
Fixed
Minimum Rent
means
Annual Fixed Minimum Rent and/or Monthly Fixed Minimum Rent (as the case may
be).
2.36.
Floor
Area
means
(a) with respect to areas in the Center that are available from time-to-time
for
the exclusive use and occupancy by an Occupant, Landlord’s calculation of the
number of square feet of floor area of all floors in such subject space measured
from the exterior faces of all exterior walls (and from the extensions thereof
in the case of openings) and from the center line of interior demising walls
inclusive of the floor area of mezzanines and basements (unless otherwise
excluded) and (b) with respect to RMUs, Landlord’s calculation of the floor area
of the footprint of each of the RMUs. Landlord and Tenant stipulate to all
Floor
Area calculations made from time-to-time by Landlord.
2.37.
Floor
Area of the Premises
means
the number of square feet of Floor Area specified at Section 1.3.
2.38.
Force
Majeure
is
defined at Section 27.13.
2.39.
Governmental
Regulations means
all
laws, statutes, ordinances, rules, regulations, zoning codes, building codes,
standards and requirements now or hereafter in force of all governmental and
quasi-governmental authorities, and of all board of fire insurance underwriters,
having jurisdiction of the Premises or the Center.
2.40.
Grand
Opening Charge
is
defined at Section 5.9.
2.41.
Grand
Opening Event means
each time after the Effective Date (a) a new Major Occupant initially opens
its
premises in the Center to the public or (b) the amount of leasable Floor Area
in
the Center increases by 20,000 or more square feet.
2.42.
Gross
Sales
is
defined at Section 7.1.1.
2.43.
Guarantor(s)
means
those person(s) and/or entities whose name(s) appear at Section 1.22.
2.44.
Hazardous
Materials
means
any and all substances, chemicals, wastes, sewage or other materials that are
now or hereafter regulated, controlled or prohibited by any Environmental Laws,
including, without limitation, any (a) substance defined as a “hazardous
substance”, “extremely hazardous substance”, “hazardous material”, “hazardous
chemical”, “hazardous waste”, “toxic substance” or “air pollutant” by the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Section 9601, et
seq.;
the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et
seq.;
the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et
seq.;
the
Federal Water Pollution Control Act, 33 U.S.C. Section 1251, et
seq.;
the
Clean Air Act, 42 U.S.C. Section 7401, et
seq.;
the
Emergency Planning and Community Right-to-Know Act, 42 U.S.C. Section 11001,
et
seq.;
the
Toxic Substances Control Act, 15 U.S.C. Section 2601 et
seq.;
the
Occupational Safety and Health Act, 29 U.S.C. Section 651 et
seq.;
or the
Occupational Safety and Health Standards, 25 C.F.R. 1910-1000 et
seq.,
or
regulations promulgated thereunder, all as amended to date and as amended
hereafter; (b) hazardous substance, hazardous waste, toxic substance, toxic
waste or hazardous material, waste, chemical or compound described in any other
Environmental Laws; and
(c)
asbestos, polychlorinated biphenyls, urea formaldehyde insulation, flammable
or
explosive or radioactive materials, gasoline, oil, motor oil, waste oil,
petroleum (including, without limitation, crude oil or any component thereof),
petroleum-based products, paints, solvents, lead, cyanide, DDT, printing inks,
acids, pesticides, ammonium compounds, and other regulated chemical products.
2.45.
|
HVAC
means heating, ventilating and air conditioning system(s).
|
||||||||||
2.46.
|
Intentionally
Omitted (Form)
|
||||||||||
2.47.
|
Improvementsmeans
all
existing
and
future
fixtures,
installations,
alterations,
replacements,
additions, changes and improvements to the Premises.
|
2.48.
Index
means
the
United States Department of Labor, Bureau of Labor Statistics Consumer Price
Index for All Urban Consumers, U.S. City Average, Subgroup “All Items”
(1982-84=100). If the foregoing Index is not available, then the successor
or
substitute index published by the Bureau of Labor Statistics shall be used
by
Landlord as the Index. If the Bureau of Labor Statistics does not publish such
successor or substitute Index, a reliable governmental or other non-partisan
publication evaluating substantially the same consumer information shall be
used
by Landlord for the Index. If Landlord uses any substitute or successor index
or
other publication, the same shall be converted to a basis of 100 if the basis
used for such other index or publication is less than 100.
2.49.
Insured
Casualty
means
damage or destruction the repair of which is fully covered by insurance proceeds
made available to Landlord for repair and restoration pursuant to any insurance
policy required to be carried by Landlord under the terms of this Lease.
2.50.
Insuring
Party
is
defined in Section 8.1.3.
2.51.
Involuntary
Assignment
means
any transfer of interest of Tenant in the Lease by operation of law (including,
without limitation, the transfer of this Lease by testacy or intestacy, or
in
any
31
bankruptcy
or insolvency proceeding) and each of the following acts shall be considered
an
Involuntary Assignment: (a) If Tenant is or becomes bankrupt or insolvent,
makes
an assignment for the benefit of creditors, or institutes a proceeding under
any
bankruptcy law in which Tenant is the bankrupt; or, if Tenant is a partnership
or consists of more than one (1) person or entity, if any partner of the
partnership or other such person or entity is or becomes bankrupt or insolvent,
or makes an assignment for the benefit of creditors; (b) if a writ of attachment
or execution is levied on this Lease; (c) if, in any proceeding or action to
which Tenant is a party, a receiver is appointed with authority to take
possession of the Premises; or (d) there is any assumption, assignment, sublease
or other transfer under or pursuant to the Bankruptcy Code.
2.52.
Intentionally
Omitted (Form)
2.53.
Landlord
is
defined in the preamble to this Lease.
2.54.
Landlord
Parties
means,
collectively, the Manager, Landlord’s Designees and the respective past, present
and future partners, officers, directors, shareholders, beneficiaries, trustees,
employees, agents and independent contractors of both Landlord and Manager.
2.55.
Landlord’s
Address for Notices
means
the address specified at Section 1.17.
2.56.
Landlord’s
Broker(s)
means
the broker(s), if any, specified at Section 1.20.
2.57.
Landlord’s
Designees
means,
collectively, the Manager, the Mortgagee, any lessors under any ground or
underlying leases xxxxxxx the Premises and such person(s) designated by Landlord
as having an insurable interest in the Premises.
2.58.
Landlord’s
Statement Address means
the
address for Landlord set forth at Section 1.24.
2.59.
Landlord’s
Work
is
defined at Exhibit
C.
2.60.
Lease
is
defined in the preamble to this Lease.
2.61.
Lease
Year
means,
as to the first Lease Year, the period from the Rent Commencement Date through
the immediately following December 31, and as to each subsequent Lease Year,
the
period of January 1 of a given year through the immediately following December
31 of the same year; however, the last Lease Year shall end upon the Expiry
Date.
2.62.
Major
Destruction means
any
destruction (whether or not an Insured Casualty) (a) to the extent of more
than
twenty five percent (25%) of the full replacement cost of any of the Premises,
the Building, the parking structures located at the Center or the Center, as
the
case may be, as of the date of destruction, (b) that will take in excess of
one
(1) year to complete repair and restoration, or (c) that occurs at any time
during the last twenty four (24) months of the Term.
2.63.
Major
Occupant means
each Occupant (if any) occupying premises containing at least 40,000 square
feet
of contiguous Floor Area, and shall include such Occupants who have (if any)
contiguous stores with different trade names but with direct access between
or
among such stores.
2.64.
Major
Occupant Stores
means
(a) each of the premises (if any) identified on Exhibit
A
as a
“Major Occupant Store” and (b) the premises occupied, or designated for
occupancy, by Major Occupants.
2.65.
Mall
means
(a)
that portion of the Common Area which is contained in the enclosed mall, if
the
Center contains an enclosed mall, or (b) the Common Area of the Center, if
the
Center does not contain an enclosed mall.
2.66.
Manager
means
such entity with whom Landlord then has an agreement to manage the Center.
2.67.
Marketing
Fund Charge
means
the annual figure specified at Section 1.14, as the same may be adjusted from
time-to-time pursuant to the Lease.
2.68.
Marketing
Service means
the
promotion and media service directed by Landlord, the purpose of which shall
be
to promote the Center in a manner deemed appropriate in Landlord’s reasonable
judgment and may include, without limitation, marketing sales promotions,
specified events, community relations, and advertising and promotions through
television, radio, print, electronic and other media.
2.69.
mezzanine
is
defined at Exhibit
C.
2.70.
Monthly
Base Sales
means
the monthly figure specified at Section 1.10, as the same may be adjusted from
time-to-time pursuant to this Lease.
2.71.
Monthly
Fixed Minimum Rent
means
the monthly rent sum specified at Section 1.8, as the same may be adjusted
from
time-to-time pursuant to this Lease.
32
2.72.
Monthly
Sales Statement means
a
written statement in the form attached as Exhibit
G
to the
Lease certified to be true and correct by an Authorized Officer of Tenant.
2.73.
Mortgage
and
Mortgagee
are each
defined in Section 26.1.
2.74.
Notice
of Transfer Termination
is
defined at Section 14.5.1.
2.75.
Occupant
means
any entity, inclusive of Tenant and exclusive of Landlord (except to the extent
Landlord operates any retail business open to the public in the Center),
entitled by any form of instrument to occupy Floor Area in the Center.
2.76.
OFAC
is
defined at Section 27.25.1.1.
2.77.
Percentage
Rent
means
the amount, if any, equal to the product obtained by multiplying the Percentage
Rent Rate by the amount of Gross Sales for each Lease Year during the Term
that
is in excess of the Annual Base Sales for each such Lease Year.
2.78.
Percentage
Rent Rate
means
the rate specified at Section 1.9.
2.79.
Permitted
Exclusions
is
defined at Section 7.1.2.
2.80.
Permitted
Use
means
the use specified at Section 1.11.
2.81.
Personal
Property means
all
of the following which do not otherwise constitute Attached Fixtures: Tenant’s
trade fixtures, equipment, appliances, furniture, displays, Storefront Sign,
other signs, inventory, merchandise and other personal property.
2.82.
Plan
Review Fee
means
the sum of $2,500.00; however, (a) if the scope of the plans depicts nothing
more than painting, carpeting, installing or remodeling the storefront and
Storefront Sign, such sum shall be in the amount of $1,250.00, and (b) if the
scope of the plans depicts nothing more than the Storefront Sign, such sum
shall
be in the amount of $500.00. The Plan Review Fee shall be subject to annual
increase (but never a decrease) on each anniversary of the Effective Date as
follows: The Index published four (4) months prior to the Effective Date
(“Base
Year”
for
purposes of this Section only) shall be compared to the Index published four
(4)
months prior to each anniversary of the Effective Date anniversary
(“Comparison
Year”
for
purposes of this Section only), and the Plan Review Fee shall be increased
by
the percentage increase, if any, in the Index published for the Comparison
Year
over the Index published for the Base Year.
2.83.
Plan
Revisions
is
defined at Exhibit
C.
2.84.
Premises
means
that certain space identified at Section 1.2.
2.85.
Proposed
Transfer Date
means
the effective date of such Transfer, as specified by Tenant in writing to
Landlord.
2.86.
Radius
is
defined at Section 1.16.
2.87.
Real
Estate Taxes means,
without limitation, all taxes (except for franchise, gift, estate, inheritance
or net income taxes [unless and then only to the extent that net income taxes
are a substitute for real estate taxes]), assessments and reassessments (whether
resulting from any new construction, renovation or replacement of existing
improvements or a transfer of all or any portion of the Center or otherwise),
whether special or general, bonds, permit fees, license fees, license taxes,
levies and penalties imposed, assessed or levied against the Center or any
portion thereof by any authority having the direct or indirect power to impose,
assess or levy the same, including, without limitation, any city, county, state
or federal government or agency thereof, or any school, agricultural, lighting,
drainage, fire, street, sanitary, community facilities or other improvement
district thereof; all taxes, fees and/or charges on the operation and use of
the
Center or Common Area imposed by any federal, state or local governmental
entity; all impositions (whether or not such impositions constitute tax receipts
to governmental agencies) in substitution, partially or totally, of any
impositions now or previously included within the definition of real estate
taxes, including, without limitation, those imposed or required by governmental
agencies to increase tax increments to governmental agencies and for such
services as fire protection, street, sidewalk and road maintenance, refuse
removal and/or for other governmental services formerly provided without charge
to property owners or occupants (it being the intention of Landlord and Tenant
that all such new and/or increased impositions and all similar impositions
be
included within the definition of Real Estate Taxes for purposes of this Lease);
interest on the foregoing to the extent any of the same are paid in
installments; and the costs of professionals and counsel to analyze tax bills
and prosecute any challenges, protests, refunds and appeals.
2.88.
Refund
Date
means
the date which is the later of (a) the Expiry Date or date of earlier
termination of this Lease, or (b) the date Tenant has fully performed all of
its
Surrender Obligations under Section 13.1.
2.89.
Refurbishment
is
defined at Section 12.2.
2.90.
Refurbishment
Notice
is
defined at Section 12.2.
33
2.91.
Reimbursed
Cost(s)
means
Landlord’s cost for performing specific work or services, or providing materials
on behalf of Tenant, together with interest at the Agreed Rate, calculated
from
the date Landlord performs such work or services, or provides such materials,
until the date that any such cost(s) are paid by Tenant. Tenant shall pay any
Reimbursed Costs within ten (10) days after Landlord’s written demand therefor.
2.92.
Relocation
Notice
is
defined at Section 17.5.
2.93.
Rent
means
Fixed Minimum Rent, Percentage Rent and Additional Rent.
2.94.
Rent
Commencement Date
means
the date specified at Section 1.6.
2.95.
Rent
Inquiry Address means
the
addresses for Landlord and Tenant, respectively, set forth at Section 1.23.
2.96.
Request
to Transfer
is
defined at Section 14.3.
2.97.
Required
Opening Date
means
the date specified at Section 1.5.
2.98.
Review
Fee
is
defined at Section 14.11.
2.99.
RMUs
means
sales areas, display areas, carts, kiosks and other retail merchandising units
of Occupants located from time-to-time in the Common Area.
2.100.
Rules
means
such rules and regulations established from time-to-time by Landlord with
respect to the Center.
2.101.
Security
Deposit
means
the sum specified at Section 1.13.
2.102.
Storefront
Sign
means
the sign for the Premises facing onto the Mall which shall contain no name
other
than the Trade Name.
2.103.
Subletting
and
Sublet
mean a
subletting of all or any portion of the Premises or any concession, franchise
or
license with respect to the Premises.
2.104.
Substitute
Lease
is
defined at Section 17.5.
2.105.
Superior
Agreements
means
all mortgages, deeds of trust, ground leases, reciprocal easement agreements,
declarations, covenants, conditions, restrictions, easements, rights-of-way
and
other matters of record (whether placed of record on, prior to, or after the
Effective Date) affecting all or any portion of the Center, as the same may
be
modified, amended and supplemented from time-to-time.
2.106.
Surrender
Obligations
is
defined at Section 13.1.
2.107.
Taking
means
any taking or appropriation for public or quasi-public use by the right of
eminent domain or otherwise by a taking in the nature of inverse condemnation,
with or without litigation, or a transfer by agreement in lieu thereof.
2.108.
Temporary
Tenants
means
all Occupants under leases, licenses or other agreements each with an original
stated term of twelve (12) months or less.
2.109.
Tenant
is
defined in the preamble to this Lease.
2.110.
Tenant
Coordinator
is
defined at Exhibit
C.
2.111.
Tenant
Package
is
defined at Exhibit
C.
2.112.
Tenant
Parties
means,
collectively, Tenant’s Occupants and the respective past and present officers,
directors, shareholders, invitees, customers, agents, employees and independent
contractors of both Tenant and Tenant’s Occupants.
2.113.
Tenant’s
Address for Notices
means
the address specified at Section 1.18.
2.114.
Tenant’s
Architect
is
defined at Exhibit
C.
2.115.
Tenant’s
Broker(s)
means
the broker(s), if any, specified at Section 1.21.
2.116.
Tenant’s
Contractor
is
defined at Exhibit
C.
2.117.
Tenant’s
Occupants
means
all concessionaires, licensees, subtenants, assignees and others holding any
rights to, or interest in, any part of the Premises under Tenant.
2.118.
Tenant’s
Receipts
is
defined at Section 7.2.
34
2.119.
Tenant’s
Records
is
defined at Section 7.2.
2.120.
Tenant’s
Representative
is
defined at Exhibit
C.
2.121.
Tenant’s
Share
means a
fraction, the numerator of which is the Floor Area of the Premises and the
denominator of which is the Floor Area of the Center (inclusive of the Premises,
but exclusive of the Excluded Floor Area), which is from time-to-time occupied
and open for business.
2.122.
Tenant’s
Work
is
defined at Exhibit
C.
2.123.
Term
means
the period of time specified at Section 1.4.
2.124.
Trade
Name
means
the name(s) specified at Section 1.12.
2.125.
Transfer
and
Transferring
mean
either an Assignment or a Subletting or both, as the case may be.
2.126.
Transferee
means
all of the following: Concessionaire(s), franchisee(s), licensee(s), assignee(s)
and subtenant(s), as the case may be.
2.127.
Unamortized
Amount
shall
mean an amount equal to the remaining unamortized net cost paid by Tenant for
Improvements (less all amounts either [a] paid by Landlord toward such
Improvements, or [b] spent by Tenant on Personal Property) amortized on a
straight line basis over the initial term of the Lease.
2.128.
Uninsured
Casualty
means
damage or destruction resulting from any flood, earthquake, act of war, act
of
terrorism, nuclear reaction, nuclear radiation or radioactive contamination,
or
any other casualty of any kind or nature whatsoever which is not an Insured
Casualty.
2.129.
Utilities
means
all water, gas, sewer, heat, electricity, steam, chilled water, conditioned
water, hot water, sprinklers, fire-safety systems, lighting, power, HVAC,
telephone service and other telecommunications services, sewer service, refuse
removal service and all other utilities and related services.
2.130.
Utility
Facilities means
any
and all systems, machinery, facilities, installations, supply lines,
transformers, pipes, conduits, ducts, penetrations, components, appurtenances
and equipment, located on or at the Center, for the generation or supply of
any
Utilities (including, without limitation, any central plants and individual
HVAC
units owned or maintained by Landlord).
2.131.
Vacation
is
defined at Section 19.1.3.
2.132.
Variable
Costs
means
Real Estate Taxes together with an Administrative Charge calculated on Real
Estate Taxes.
35
EXHIBIT
E
CENTER
RIDER
(Arrowhead
Towne Center)
1.
GENERAL PROVISIONS
1.1.
Purpose.
This
Exhibit
E
sets
forth certain provisions particular to the Center and the state in which the
Premises are located.
1.2.
Prevailing
Provisions.
If
there are any inconsistencies between the Lease and the provisions of this
Exhibit
E,
the
provisions of this Exhibit
E
shall
prevail.
1 Definitions.
Unless
otherwise expressly defined in this Exhibit
E,
all
capitalized words shall have the meanings specified in the Lease.
2 AMENDMENT
AND SUPPLEMENTS
The
following Articles and Sections of the Lease are amended and supplemented as
follows:
2.1.
Article
5 (Rent) is
amended by adding to the Section captioned “Marketing Fund Charge”, the
following:
If
Landlord, at its sole option, produces or causes to be produced a direct mail,
broadcast, print or other advertising device featuring tenants of the Center,
then, if requested by Landlord from time-to-time for any given Lease Year,
Tenant shall participate in such advertising at least twice during such Lease
Year (or as often as the same is produced, if less than twice during such Lease
Year). In no event, however, shall the foregoing provisions be construed to
obligate Landlord for any given Lease Year to produce or cause to be produced
any such advertising. Tenant shall pay to Landlord, in addition to all other
Rent, the cost of each such advertisement within thirty (30) days following
receipt of an invoice therefor, which cost shall be reasonably determined by
Landlord from time-to-time based upon Landlord’s reasonably anticipated costs
and expenses incurred in connection therewith. If Landlord implements a program
and/or system of gift certificates or similar program and/or system, Tenant
shall (a) participate therein, (b) utilize any equipment and/or software
necessary to implement the same, (c) be responsible for any costs associated
therewith and (d) execute any necessary documentation to effectuate the program.
2.2.
Section
20.1.1 (Continue Lease)
is
deleted in its entirety and the following substituted in lieu thereof:
20.1.1
Terminate
Possession Without Terminating the Lease.
Landlord may recover possession of the Premises after Tenant’s default, without
terminating the Lease, and recover any and all Rents due under the Lease
throughout the remaining Term, subject only to Landlord’s duty to mitigate
damages. In such event, Landlord may, in its sole and absolute discretion,
recover any and all amounts due under the Lease, from time-to-time, until the
expiration of the Term. Nevertheless, Landlord expressly reserves the right
to
terminate the Lease at any time.
2.3.
Section
20.1.2 (Terminate Lease)
is
amended by deleting the caption “Terminate Lease” and substituting in lieu
thereof the caption “Terminate Possession and the Lease”.
2.4.
Article
27 (Miscellaneous)
is
amended be adding the following new Sections to the end thereof:
No
Dual Agency of Landlord’s Broker.
Landlord hereby discloses to Tenant that Westcor Partners, L.L.C., an Arizona
limited liability company, and Macerich Westcor Management LLC, a Delaware
limited liability company, are both licensed real estate brokers in the State
of
Arizona, one or both of which have acted as Landlord’s sole agents in connection
with the leasing of the Premises to Tenant pursuant to the terms and provisions
of the Lease, and Landlord hereby expressly agrees to pay all brokerage
commissions payable, if any, to such licensee(s). In that regard, or in the
event Landlord is alternatively, or in addition thereto, represented by any
other person, corporation, partnership or other entity holding a real estate
license, Tenant hereby expressly acknowledges and agrees that (a) such
licensee(s) shall, for all purposes hereunder or at law or in equity, be acting
as agent(s) of Landlord only and (b) no dual agency shall be deemed to exist
or
to have been created by any such licensee’s actions, statements, warranties or
representations (whether verbal or written) or by omission thereof, so that
under no circumstances shall any such licensee(s) ever be deemed in any way
to
be the agent of Tenant in connection with the leasing of the Premises to Tenant
pursuant to the terms and provisions of the Lease. Tenant hereby expressly
waives any and all claims that such dual agency exists and further acknowledges
and agrees that there shall be
36
absolutely
no liability on the part of Landlord or any such agent(s) or licensee(s) of
Landlord arising as a result of any such claim, notwithstanding any action,
statement, warranty or representation of any kind (whether written or oral)
to
the contrary made to Tenant by such agent(s) or licencee(s). For purposes of
this Section, the terms “licensee(s)” and “agents(s)” shall be deemed to also
include subagents and employees of such licensee(s), agent(s) or subagent(s).
2.5.
Exhibit
D (Excluded Floor Area).
The
defined term “Excluded Floor Area” is modified by the addition of the following
language to the end thereof:
Notwithstanding
anything to the contrary contained herein, Excluded Floor Area shall also mean
the Floor Area of all restaurants.
37
EXHIBIT
F
Exhibit
F has been Intentionally Omitted
38
EXHIBIT
F
- PAGE 1
EXHIBIT
G MONTHLY AND ANNUAL SALES STATEMENT FORM
Center:
Store
Name/Number:
|
||
CERTIFIED
GROSS SALES
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CERTIFIED
PERMITTED EXCLUSIONS
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January
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February
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March
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April
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May
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June
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July
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August
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September
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October
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November
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December
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Details
have been attached explaining Permitted Exclusions as required by the applicable
provisions of the Lease.
I
certify
that the sales indicated above are true and correct.
Name: | |||
Title: | |||
Authorized
Signatory
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39
GUARANTEE
OF LEASE
THIS
GUARANTEE OF LEASE
(“Guarantee”) is made as of this day ofby Tradeshow Marketing Co Ltd., a Nevada
corporation (collectively, “Guarantors” and individually, each a “Guarantor”),
whose addresses are set forth in Section 9 hereof, in favor of New River
Associates (“Landlord”), having an office at 000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000,
Xxxxx Xxxxxx, Xxxxxxxxxx 00000.
WHEREAS,
Landlord and XXXXXXXXX As Seen On TV Franchising Company, a Nevada corporation
(“Tenant”) desire to enter into that certain Lease Agreement made as of even
date herewith (“Lease”), concerning the premises commonly referred to as space
number 2136 (“Premises”) in the commercial project located at Arrowhead Towne
Center (“Center”) in the City of Glendale, County of Maricopa, State of Arizona;
WHEREAS,
Guarantors have a financial interest in Tenant; and
WHEREAS,
Landlord would not execute the Lease if Guarantors did not execute and deliver
to Landlord this Guarantee.
NOW,
THEREFORE,
for and
in consideration of the execution of the foregoing Lease by Landlord and as
a
material inducement to Landlord to execute the Lease, Guarantors hereby jointly,
severally, and absolutely, presently, continually, unconditionally and
irrevocably guarantee the prompt payment by Tenant of all rentals and all other
sums payable by Tenant under the Lease and the faithful and prompt performance
by Tenant of each and every one of the terms, conditions and covenants of the
Lease to be kept and performed by Tenant, and further agree as follows:
1 It
is
specifically agreed and understood that the terms, covenants and conditions
of
the Lease may be altered, affected, modified, amended, compromised, released
or
otherwise changed by agreement between Landlord and Tenant, or by course of
conduct and each Guarantor does guarantee and promise to perform all of the
obligations of Tenant under the Lease as so altered, affected, modified,
amended, compromised, released or changed and the Lease may be assigned by
or
with the consent of Landlord or any assignee of Landlord without consent or
notice to Guarantors and that this Guarantee shall thereupon and thereafter
guarantee the performance of the Lease as so changed, modified, amended,
compromised, released, altered or assigned.
2 This
Guarantee shall not be released, modified or affected by failure or delay on
the
part of Landlord to enforce any of the rights or remedies of Landlord under
the
Lease, whether pursuant to the terms thereof or at law or in equity, or by
any
release of any person liable under the terms of the Lease (including, without
limitation, Tenant) or any other Guarantor, including without limitation, any
other Guarantor named herein, from any liability with respect to Guarantors’
obligations hereunder.
3 Each
Guarantor’s liability under this Guarantee shall continue until all rents due
under the Lease have been paid in full in cash and until all other obligations
to Landlord have been satisfied, and shall not be reduced by virtue of any
payment by Tenant of any amount due under the Lease. If all or any portion
of
Tenant’s obligations under the Lease is paid or performed by Tenant, the
obligations of Guarantor hereunder shall continue and remain in full force
and
effect in the event that all or any part of such payment(s) or performance(s)
is
avoided or recovered directly or indirectly from Landlord as a preference,
fraudulent transfer or otherwise.
4 Each
Guarantor warrants and represents to Landlord that such Guarantor now has and
will continue to have full and complete access to any and all information
concerning the Lease, the value of the assets owned or to be acquired by Tenant,
Tenant’s financial status and its ability to pay and perform the obligations
owed to Landlord under the Lease. Each Guarantor further warrants and represents
that such Guarantor has reviewed and approved copies of the Lease and is fully
informed of the remedies Landlord may pursue, with or without notice to Tenant,
in the event of default under the Lease. So long as any of Guarantors’
obligations hereunder remains unsatisfied or owing to Landlord, each Guarantor
shall keep fully informed as to all aspects of Tenant’s financial condition and
the performance of said obligations.
5 Each
Guarantor hereby covenants and agrees with Landlord that if a default shall
at
any time occur in the payment of any sums due under the Lease by Tenant or
in
the performance of any other obligation of Tenant under the Lease, such
Guarantor shall and will forthwith upon demand pay such sums, and any arrears
thereof, to Landlord in legal currency of the United States of America for
payment of public and private debts, and take all other actions necessary to
cure such default and perform such obligations of Tenant.
6 The
liability of Guarantors under this Guarantee is a guarantee of payment and
performance and not of collectibility, and is not conditioned or contingent
upon
the genuineness, validity, regularity or enforceability of the Lease or the
pursuit by Landlord of any remedies which it now has or may hereafter have
with
respect thereto, at law, in equity or otherwise.
7 To
the
extent permitted by law, each Guarantor hereby waives and agrees not to assert
or take advantage of: (a) All notices to Guarantor (or any of them), to Tenant,
or to any other person, including, but not limited to, notices of the acceptance
of this Guarantee or the creation, renewal,
40
extension,
assignment, modification or accrual of any of the obligations owed to Landlord
under the Lease and, except to the extent set forth in Section 9 hereof,
enforcement of any right or remedy with respect thereto, and notice of any
other
matters relating thereto; (b) notice of acceptance of this Guarantee; (c) demand
of payment, presentation and protest; (d) demand for performance, (e) any right
to require Landlord to apply to any default any security deposit or other
security it may hold under the Lease; (f) any right or defense that may arise
by
reason of the incapability, lack or authority, death or disability of Tenant
or
any other person; (g) any statute of limitations affecting the enforcement
of
this Guarantee; (h) all principles or provisions of law which conflict with
the
terms of this Guarantee and
(i)
any
right to enter upon or take possession of the Premises or to cure any default
on
behalf of Tenant. Moreover, each Guarantor agrees that such Guarantor’s
obligations shall not be affected by any circumstances which constitute a legal
or equitable discharge of a guarantor or surety.
8.
Each
Guarantor agrees that Landlord may enforce this Guarantee without the necessity
of proceeding against Tenant or any other guarantor, including, without
limitation, any other Guarantor named herein. Each Guarantor hereby waives
the
right to require Landlord to proceed against Tenant, to proceed against any
other guarantor, including, without limitation, any other Guarantor named
herein, to exercise any right or remedy under the Lease or to pursue any other
remedy or to enforce any other right.
9.
Each
Guarantor agrees:
9.1.
That
nothing contained herein shall prevent Landlord from suing on the Lease or
from
exercising any rights available to it thereunder and that the exercise of any
of
the aforesaid rights shall not constitute a legal or equitable discharge of
Guarantor.
9.2.
That
such Guarantor shall have no right of subrogation against Tenant or any right
of
contribution against any other Guarantor hereunder unless and until all amounts
due under the Lease have been paid in full and all other obligations under
the
Lease have been satisfied. Each Guarantor further agrees that, to the extent
the
waiver of such Guarantor’s rights of subrogation and contribution as set forth
herein is found by a court of competent jurisdiction to be void or voidable
for
any reason, any rights of subrogation such Guarantor may have against Tenant
shall be junior and subordinate to any rights Landlord may have against Tenant,
and any rights of contribution such Guarantor may have against any other
Guarantor shall be junior and subordinate to any rights Landlord may have
against such other Guarantor.
9.3.
To
the extent any dispute exists at any time between or among any of the Guarantors
as to any Guarantor’s right to contribution or otherwise, to indemnify, defend
and hold Landlord harmless from and against any loss, damage, claim, demand,
cost or any other liability (including, without limitation, reasonable
attorneys’ fees and costs) Landlord may suffer as a result of such dispute.
9.4.
The
obligations of each Guarantor under this Guarantee shall not be altered, limited
or affected by any case, voluntary or involuntary, involving the bankruptcy,
insolvency, receivership, reorganization, liquidation or arrangement of Tenant
or any defense which Tenant may have by reason of order, decree or decision
of
any court or administrative body resulting from any such case. Landlord shall
have the sole right to accept or reject any plan on behalf of each Guarantor
proposed in such case and to take any other action which such Guarantor would
be
entitled to take, including, without limitation, the decision to file or not
file a claim. Each Guarantor acknowledges and agrees that any payment which
accrues with respect to Tenant’s obligations under the Lease (including, without
limitation, the payment of rent) after the commencement of any such proceeding
(or, if any such payment ceases to accrue by operation of law by reason of
the
commencement of such proceeding, such payment as would have accrued if said
proceedings had not been commenced) shall be included in Guarantors’ obligations
hereunder because it is the intention of the parties that said obligations
should be determined without regard to any rule or law or order which may
relieve Tenant of any of its obligations under the Lease. Each Guarantor hereby
permits any trustee in bankruptcy, receiver, debtor-in-possession, assignee
for
the benefit of creditors or similar person to pay Landlord, or allow the claim
of Landlord in respect of, any such payment accruing after the date on which
such proceeding is commenced. Each Guarantor hereby assigns to Landlord such
Guarantor’s right to receive any payments from any trustee in bankruptcy,
receiver, debtor-in-possession, assignee for the benefit of creditors or similar
person by way of dividend, adequate protection payment or otherwise.
9.5.
Any
notice, statement, demand, consent, approval or other communication required
or
permitted to be given, rendered or made by either party to the other, pursuant
to this Guarantee or pursuant to any applicable law or requirement of public
authority, shall be in writing (whether or not so stated elsewhere in this
Guarantee) and shall be deemed to have been properly given, rendered or made
only if hand-delivered or sent by first-class mail, postage pre-paid, addressed
to the other party at its respective address set forth below, and shall be
deemed to have been given, rendered or made on the day it is hand-delivered
or
one day after it is mailed, unless it is mailed outside of the county in which
the Center is located, in which case it shall be deemed to have been given,
rendered or made on the third business day after the day it is mailed. By giving
notice as provided above, either party may designate a different address for
notices, statements, demands, consents, approvals or other communications
intended for it.
41
To Guarantors: | 0000 Xxxx 00xx Xxxxxx, Xxx 000 | ||
Xxxxxxxxx, Xxxxxxx Xxxxxxxx X0X 0X0 | |||
To Landlord: |
New River Associates
j
Macerich Company
|
||
X.X. Xxx 0000 000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000 Xxxxx Xxxxxx, Xxxxxxxxxx 00000 Attention: Legal Department |
10.
Each
Guarantor represents and warrants to Landlord as follows:
10.1.
No
consent of any other person, including, without limitation, any creditors of
such Guarantor, and no license, permit, approval or authorization of, exemption
by, notice or report to, or registration, filing or declaration with, any
governmental authority is required by such Guarantor in connection with this
Guarantee or the execution, delivery, performance, validity or enforceability
of
this Guarantee and all obligations required hereunder. This Guarantee has been
duly executed and delivered by such Guarantor, and constitutes the legally
valid
and binding obligation of such Guarantor enforceable against such Guarantor
in
accordance with its terms.
10.2.
The
execution, delivery and performance of this Guarantee will not violate any
provision of any existing law or regulation binding on such Guarantor, or any
order, judgment, award or decree of any court, arbitrator or governmental
authority binding on such Guarantor, or of any mortgage, indenture, lease,
contract or other agreement, instrument or undertaking to which such Guarantor
is a party or by which such Guarantor or any of such Guarantor’s assets may be
bound, and will not result in, or require, the creation or imposition of any
lien on any of such Guarantor’s property, assets or revenues pursuant to the
provisions of any such mortgage, indenture, lease, contract or other agreement,
instrument or undertaking.
1 The
obligations of Tenant under the Lease to execute and deliver estoppel
statements, as therein provided, shall be deemed to also require the Guarantors
hereunder to do and provide the same relative to Guarantors.
2 This
Guarantee shall be binding upon each Guarantor, such Guarantor’s heirs,
representatives, administrators, executors, successors and assigns and shall
inure to the benefit of and shall be enforceable by Landlord, its successors,
endorsees and assigns. Any married person executing this Guarantee agrees that
recourse may be had against community assets and against his or her separate
property for the satisfaction of all obligations herein guaranteed. As used
herein, the singular shall include the plural, and the masculine shall include
the feminine and neuter and vice versa, if the context so requires.
3 The
term
“Landlord” whenever used herein refers to and means the Landlord specifically
named in the Lease and also any assignee of the said Landlord, whether by
outright assignment or by assignment for security, and also any successor to
the
interest of the said Landlord or of any assignee in the Lease or any part
thereof, whether by assignment or otherwise. So long as the Landlord’s interest
in or to Premises (as that term is used in the Lease) or the rents, issues
and
profits therefrom, or in, to or under the Lease, are subject to any mortgage
or
deed of trust or assignment for security, no acquisition by Guarantors of the
Landlord’s interest in the Premises or under the Lease shall affect the
continuing obligations of Guarantors under this Guarantee, which obligations
shall continue in full force and effect for the benefit of the mortgagee,
beneficiary, trustee or assignee under such mortgage, deed of trust or
assignment, of any purchaser at sale by judicial foreclosure or under private
power of sale, and of the successors and assigns of any such mortgagee,
beneficiary, trustee, assignee or purchaser.
4 The
term
“Tenant” whenever used herein refers to and means the Tenant in the Lease
specifically named and also any assignee of the said Lease or sublessee of
the
Premises and also any successor to the interests of said Tenant, assignee or
sublessee of such Lease or Premises or any part thereof, whether by assignment,
sublease or otherwise.
5 In
the
event of any dispute or litigation regarding the enforcement or validity of
this
Guarantee, Guarantors shall be obligated to pay all charges, costs and expenses
(including, without limitation, reasonable attorneys’ fees) incurred by
Landlord, whether or not any action or proceeding is commenced regarding such
dispute and whether or not such litigation is prosecuted to judgment.
6 This
Guarantee shall be governed by and construed in accordance with the laws of
the
state in which the Center is located, and in a case involving diversity of
citizenship, shall be litigated in and subject to the jurisdiction of the courts
of the state in which the Center is located.
7 Every
provision of this Guarantee is intended to be severable. In the event any term
or provision hereof is declared to be illegal or invalid for any reason
whatsoever by a court of competent jurisdiction, such illegality or invalidity
shall not affect the balance of the terms and provisions hereof, which terms
and
provisions shall remain binding and enforceable.
8 This
Guarantee may be executed in any number of counterparts each of which shall
be
deemed an original and all of which shall constitute one and the same Guarantee
with the same effect as if all parties had signed the same signature page.
Any
signature page of this Guarantee may be attached
from any counterpart of this Guarantee and re-attached to any other counterpart
of this Guarantee identical in form hereto but having attached to it one or
more
additional signature pages.
42
1 No
failure or delay on the part of Landlord to exercise any power, right or
privilege under this Guarantee shall impair any such power, right or privilege,
or be construed to be a waiver of any default or an acquiescence therein, nor
shall any single or partial exercise of such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege.
2 This
Guarantee shall constitute the entire agreement between each Guarantor and
the
Landlord with respect to the subject matter hereof. No provision of this
Guarantee or right of Landlord hereunder may be waived nor may any Guarantor
be
released from any obligation hereunder except by a writing duly executed by
an
authorized officer, director or trustee of Landlord.
3 The
liability of each Guarantor and all rights, powers and remedies of Landlord
hereunder and under any other agreement now or at any time hereafter in force
between Landlord and such Guarantor relating to the Lease shall be cumulative
and not alternative and such rights, powers and remedies shall be in addition
to
all rights, powers and remedies given to Landlord by law.
4 LANDLORD
AND EACH GUARANTOR EACH HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR
COUNTERCLAIM BROUGHT BY EITHER AGAINST THE OTHER ON ANY MATTER WHATSOEVER
ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS GUARANTEE, INCLUDING ANY
EMERGENCY AND OTHER STATUTORY REMEDY WITH RESPECT THERETO. LANDLORD AND EACH
GUARANTOR ALSO AGREES THAT THE VENUE OF ANY SUCH ACTION, PROCEEDING OR
COUNTERCLAIM SHALL BE IN THE CITY, COUNTY AND STATE IN WHICH THE CENTER IS
LOCATED.
IN
WITNESS WHEREOF,
Guarantors have executed this Guarantee as of the day and year first above
written.
Tradeshow Marketing Co Ltd.,
a
Nevada corporation
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By: Name: | |||
Its: President | |||
By: Name: | |||
Its: Vice President |
STATE OF NEVADA | ) | |
)
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SS.
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|
COUNTY
OF
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)
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On
before
me, , a Notary Public in and or for said State, personally appeared
__________________ and _________________ personally known to me (or proved
to me
on the basis of satisfactory evidence) to be the persons whose names are
subscribed to the within instrument and acknowledged to me that they executed
the same in their authorized capacities, and that by their signatures on the
instrument the persons, or the entity upon behalf of which the persons acted,
executed the instrument.
WITNESS
my hand
and official seal.
Notary
Public
SEAL
43