Exhibit 10.7
LEASE AGREEMENT
(RETAIL STORE)
BY AND BETWEEN
PREMIER ENTERTAINMENT BILOXI LLC,
A DELAWARE LIMITED LIABILITY COMPANY,
AS LANDLORD,
AND
HARD ROCK CAFE INTERNATIONAL (STP), INC.,
A NEW YORK CORPORATION,
AS TENANT
FOR PREMISES LOCATED AT
BILOXI, MISSISSIPPI
TABLE OF CONTENTS
ARTICLE PAGE
ARTICLE 1 DEFINITIONS ....................................................................................1
ARTICLE 2 DEMISE; TERM; COMMENCEMENT .....................................................................5
ARTICLE 3 ACCESS AND POSSESSION OF PREMISES ..............................................................6
ARTICLE 4 RENT ...........................................................................................7
ARTICLE 5 TAXES .........................................................................................10
ARTICLE 6 COMMON AREAS; CONTROL OF ACCESS TO THE PREMISES AND SUPPORTING INFRASTRUCTURE .................11
ARTICLE 7 UTILITIES .....................................................................................12
ARTICLE 8 USE ...........................................................................................13
ARTICLE 9 COMPLIANCE WITH LAWS ..........................................................................15
ARTICLE 10 LANDLORD'S DEVELOPMENT OBLIGATIONS ............................................................16
ARTICLE 11 THE WORK ......................................................................................20
ARTICLE 12 RESERVED ......................................................................................22
ARTICLE 13 SIGNAGE AND/OR ARTWORK ........................................................................22
ARTICLE 14 FIXTURES AND EQUIPMENT; TENANT'S PROPERTY .....................................................23
ARTICLE 15 MAINTENANCE AND REPAIRS .......................................................................24
ARTICLE 16 TENANT'S ALTERATIONS ..........................................................................25
ARTICLE 17 DAMAGE AND RESTORATION ........................................................................25
ARTICLE 18 CONDEMNATION ..................................................................................28
ARTICLE 19 ACCESS AND PARKING ............................................................................30
ARTICLE 20 RESERVED ......................................................................................31
ARTICLE 21 LANDLORD'S ACCESS TO DEMISED PREMISES .........................................................31
ARTICLE 22 QUIET ENJOYMENT ...............................................................................32
ARTICLE 23 DEFAULT AND TERMINATION .......................................................................32
ARTICLE 24 INDEMNIFICATION ...............................................................................40
ARTICLE 25 ASSIGNMENT AND SUBLETTING .....................................................................41
ARTICLE 26 COMMISSIONS ...................................................................................44
ARTICLE 27 NOTICES .......................................................................................44
ARTICLE 28 INSURANCE .....................................................................................45
ARTICLE 29 MORTGAGE NON-DISTURBANCE AND SUBORDINATION ....................................................48
ARTICLE 30 LANDLORD'S COVENANTS ..........................................................................48
ARTICLE 31 ENVIRONMENTAL REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION; ASSESSMENTS; REMEDIATION .......50
i
ARTICLE 32 RESERVED ......................................................................................53
ARTICLE 33 TENANT'S RIGHT TO RENT ABATEMENT AND SPECIAL RIGHTS TO TERMINATE ..............................53
ARTICLE 34 INTENTIONALLY DELETED .........................................................................56
ARTICLE 35 MISCELLANEOUS .................................................................................56
ARTICLE 36 COTERMINATION WITH LICENSE AGREEMENT ..........................................................60
ARTICLE 37 GAMING REGULATION REQUIREMENTS ................................................................61
EXHIBITS:
Exhibit A - Project Legal Description
Exhibit B - Premises
Exhibit C - Hard Rock Retail Store Shell Improvements by Landlord
Exhibit D - Prohibited Uses
Exhibit E - Reserved
Exhibit F - Reserved
Exhibit G - Signage Plan
Exhibit H - Reserved
Exhibit I - Reserved
Exhibit J - Required Insurance
Exhibit K - Form of Subordination, Non-Disturbance and Attornment Agreement
Exhibit L - Form of Memorandum of Lease
ii
LEASE AGREEMENT
(RETAIL STORE)
THIS
LEASE AGREEMENT (the "Lease") made and entered into as of December
30, 2003 ("Date of Execution"), between PREMIER ENTERTAINMENT BILOXI LLC, a
Delaware limited liability company, whose address is 00000 Xxxxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxxxxx 00000 ("Landlord") and HARD ROCK CAFE INTERNATIONAL
(STP), INC., a New York corporation, whose address is 0000 Xxx Xxxx Xxxx,
Xxxxxxx, Xxxxxxx 00000 ("Tenant").
W I T N E S S E T H:
WHEREAS, Landlord has constructed, intends to construct or intends to have
others construct on Landlord's behalf on certain property owned by Landlord in
Biloxi, Mississippi (the "Property") (i) the Premises and Common Areas, (ii) a
Hotel (defined below), and (iii) related entertainment and retail facilities,
all of which will be located in the property described on EXHIBIT "A" (the
Common Area, Premises and the Hotel shall sometimes hereinafter be referred to
as the "Project"); and
WHEREAS, Tenant desires to lease from Landlord and Landlord is willing to
lease to Tenant, a portion of the Project in a prominent location on the main
floor lobby of the Hotel and in close proximity to the Hard Rock Cafe restaurant
being operated by Tenant in the Project, as more particularly depicted on
EXHIBIT "B" attached hereto and by this reference made a part hereof (the
"Premises").
NOW, THEREFORE, in consideration of the rents and agreements set forth
herein, and intending to be legally bound hereby, Landlord and Tenant agree as
follows:
ARTICLE 1 DEFINITIONS
1.1 The following terms shall have the following meanings wherever used
in this Lease:
"ABATEMENT OF RENT" shall mean a relinquishment and release of any duty
upon the Tenant to pay any Rent (as hereinafter defined).
"CAFE" means the Hard Rock Cafe restaurant located in the Hotel and leased
by Landlord to Tenant in accordance with the Cafe Lease.
"CAFE LEASE" means that certain
Lease Agreement by and between Landlord and
Tenant, dated as of even date herewith, for the operation by Tenant of the Cafe.
"COMMON AREAS" means those areas which are within the Hotel, for the
non-exclusive general common use or benefit of tenants (including the
Tenant), Landlord and other occupants, their officers, agents, servants,
employees, patrons, guests and invitees, which includes all parking areas,
access roads and facilities furnished, made available or maintained by
Landlord in or near the Hotel, including the Parking Garage (as hereinafter
1
defined), employee parking areas, other parking facilities for public
parking, truck ways, driveways, loading docks and areas, delivery areas,
package pickup stations and areas available for common use and benefit as
described above under easements, skyways, plazas, accessways, delivery
passages, sidewalks, malls, roofs, and irrigation systems thereon, courts,
ramps, landscaped and planted areas, retaining walls, stairways,
escalators, elevators, lighting facilities, loading docks, comfort stations
or rest rooms, and other similar areas, facilities or improvements designed
for common use with respect to the Hotel.
"COMMENCEMENT DATE" shall have the meaning set forth in Section 2.3 hereof.
"CONDEMNATION" (or to "CONDEMN") means any and every taking (temporary or
permanent) for any public or quasi-public purpose, by any Governmental
Entity by exercise of condemnation or eminent domain (or any transfer or
conveyance by agreement in lieu thereof).
"DIRECT SUPPLIED UTILITIES" shall mean local and long distance telephone
service, internet service, cable television service and all other Utilities
not otherwise defined as Landlord Supplied Utilities.
"EFFECTIVE DATE" means the date when the last one of the Landlord or Tenant
has signed this Lease.
"EXPIRATION DATE" means the last day of the Term.
"FORCE MAJEURE" shall mean a flood, storm, hurricane, excessive rain (above
that which is normal for the subject period for the geographic region
within which the Premises is located) or similar Act of God or damage or
delay not within the control of the party claiming the Force Majeure delay,
including, but not limited to, acts of war, terrorism, riots, strikes,
fires or floods. For purposes of this definition, payment obligations shall
not be excused by Force Majeure.
"GOVERNMENTAL ENTITY" means the United States, the State of Mississippi and
any and every political subdivision of government of any kind whatsoever,
now existing or hereafter created, including all administrative agencies,
tribal entities or authorities, departments, bureaus, boards, commissions,
courts, or other instrumentalities thereof, now or hereafter having
jurisdiction over the Property.
"HOTEL" shall mean the Hard Rock Resort Hotel & Casino which is to be
constructed within the Project in accordance with the terms and conditions
of the License Agreement.
"LANDLORD DELAY" shall mean any one or more of the following: (i)
Landlord's failure to timely provide Tenant with any information reasonably
required by Tenant to complete or prepare to complete the Work, (ii)
Landlord's failure to approve of any item requiring Landlord's approval in
the time frames required or provided for in this Lease, (iii) required
changes, deletions or additions to the Work requested by or resulting from
acts or omissions of Landlord or its agents, contractors or affiliates, or
(iv) the material interference by Landlord's agents, employees and
independent contractors with the
2
Work. A claim for Landlord Delay shall only be considered valid and
effective if made in writing as and when the claimed delay occurs, and
delivered by written notice to Landlord.
"LANDLORD SUPPLIED UTILITIES" shall mean the following Utilities: electric;
heating, ventilation and air conditioning ("HVAC"), HVAC maintenance and
repair; and trash removal.
"LAW" OR "LAWS" means each and every law, regulation, rule, order,
ordinance, statute, decree, official interpretation, or other requirement
of any kind whatsoever, present or future, issued by any Governmental
Entity applicable to or affecting the Premises, including, without
limitation all federal, state and local laws, including statutes,
regulations, ordinances, codes, rules and other governmental restrictions
and requirements relating to the environment, pollutants or hazardous
substances including, but not limited to, the Federal Solid Waste Disposal
Act, the Federal Clean Air Act, the Federal Clean Water Act, the Federal
Resource Conservation and Recovery Act of 1976, the Federal Comprehensive
Environmental Response, Compensation and Liability Act of 1980, the Federal
Superfund Amendments and Reauthorization Act of 1986, and all applicable
Mississippi laws, rules and regulations.
"LEASE" means this
Lease Agreement between Landlord and Tenant.
"LICENSE AGREEMENT" means that certain License Agreement between Landlord
and Hard Rock Hotel Licensing, Inc. ("Licensor"), dated as of May 15, 2003.
"MATERIALLY ADVERSELY AFFECTED" or "MATERIAL ADVERSE EFFECT" shall mean a
reduction in Tenant's Gross Sales (as defined in Article 4) by fifteen
percent (15%) or more for a calendar month below the Gross Sales for the
same calendar month in the Rental Year immediately preceding the adverse
event.
"OFF-SITE WORK" shall mean (i) any requirement of any Governmental Entity
as a condition to the construction, completion, operation or full use and
enjoyment of the Premises or the main lines for Utilities to the Premises
by Tenant or of any of Tenant's, invitees, employees or patrons, which is
not to be constructed, contributed or required within or upon the Premises,
and (ii) the improvements outside of the Premises to be performed by
Landlord as set forth in EXHIBIT "C".
"PERCENTAGE RENT" means the amount determined in accordance with Sections
4.1 (a) and (b) hereof.
"PREMISES" shall have the meaning set forth in the second recital above.
"RELATED AGREEMENTS" means (i) the License Agreement, (ii) the Cafe Lease,
(iii) that certain Memorabilia Lease by and between Landlord and Tenant, to
be executed after the effective date hereof, for the lease by Tenant to
Landlord of "rock and roll" memorabilia for display in the Hotel, and (iv)
such other agreements required under the License Agreement to be executed
by the parties and/or their affiliates.
3
"RENT" means all components of Percentage Rent and any other amount due
from Tenant to Landlord hereunder.
"RENTAL YEAR" means (a) the period commencing on the Commencement Date and
terminating at 11:59 p.m. on the day immediately preceding the first
anniversary of the first day of the first full calendar month during the
term, and (b) each successive period of twelve (12) calendar months
thereafter during the Term. Any portion of the Term of the Lease which is
less than a Rental Year shall be deemed a Partial Rental Year, except that
if the Commencement Date occurs on a date other than the first day of a
calendar month, then the period commencing on the Commencement Date and
ending on the last day of the calendar month in which the Commencement Date
occurs shall be included in the first Rental Year.
"SHELL OF THE PREMISES" shall have the definition attributed to it in
EXHIBIT "C".
"SITE WORK" shall mean all of the obligations required to be performed by
or on behalf of Landlord in order to furnish and construct or cause to be
furnished and constructed, the Shell of the Premises in accordance with the
terms and conditions of this Lease.
"STATE" means the State of Mississippi.
"TENANT DELAY" shall mean any one or more of the following: (i) Tenant's
failure to timely provide Landlord with any information reasonably required
by Landlord to complete or prepare to complete the Landlord's Development
Obligations, (ii) Landlord's failure to approve of any item requiring
Tenant's approval in the time frames required or provided in this Lease,
(iii) required changes, deletions or additions to Landlord's work requested
by or resulting from acts or omissions of Tenant or its agents, contractors
or affiliates, or (iv) the material interference by Tenant's agents,
employees and independent contractors with Landlord's Development
Obligations. A claim for Tenant Delay shall only be considered valid and
effective if made in writing and as and when the claimed delay occurs, and
delivered by written notice to Landlord.
"TENANT'S IMPROVEMENTS" means the installation by Tenant of any and all
equipment, furniture or fixtures in the Premises in substantial conformity
with the Tenant's Plans.
"TENANT'S PLANS" means all of the plans and specifications for construction
of the Premises by Tenant, including, but not limited to, construction of
the Tenant's Improvements as prepared and finalized by Tenant consistent
with Tenant's Conceptual Drawings (as hereinafter defined), along with all
detailed drawings and specifications thereof, and all additions,
alterations or modifications as approved by Landlord as hereinafter
provided, all in accordance with Article 11 hereof.
"TENANT'S REQUIREMENTS" shall mean the specifications of utility capacities
and other requirements as to the Premises as listed on EXHIBIT "C" attached
hereto and incorporated herein.
"TERM" shall mean the Initial Term (as defined in Section 2.2), as extended
(if at all) at the option of Tenant for not more than two (2) separate,
consecutive extension periods of
4
ten (10) years each, in accordance with and subject to the conditions set
forth in Section 2.5.
"UTILITIES" means any and all utility services and installations pursuant
to EXHIBIT "C" (including empty conduit for telephone, cable, and
electrical feeders to the Premises pursuant to the requirements of EXHIBIT
"C"), and all piping, wiring, conduit, and/or other fixtures of every kind
related thereto or used in connection therewith which are reasonably
necessary to comply with the construction, capacity and availability listed
on EXHIBIT "C" attached hereto and incorporated herein. All Utilities shall
be so installed to allow connection thereto for the Premises at points to
be reasonably designated by Tenant in EXHIBIT "C", in reasonably close
proximity to the Premises.
"WORK" means everything required to be furnished and done or arranged to be
furnished and done in connection with the construction of the Premises by
Tenant, as set forth in Article 11 hereof, and any signage and
architectural features referenced in Article 13 in accordance with Tenant's
Plans. Work shall include installation of all Tenant's Improvements. Work
shall include all exterior and interior signage; canopies and awnings, if
any; and interior partitions and all Tenant's Improvements. A reference to
the Work shall mean any part and all of the Work unless the context
specifically requires otherwise. The Work shall not include Landlord's
Development Obligations as set forth in Article 10 hereof, which shall be
performed at Landlord's sole expense.
1.2 Certain other terms as are defined elsewhere in this Lease.
ARTICLE 2 DEMISE; TERM; COMMENCEMENT
2.1 Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord for the Term (as hereinafter defined), the Premises together with all
rights and appurtenances thereunto as provided in this Lease. Tenant shall, upon
request by Landlord, confirm the Commencement Date in writing. Notwithstanding
the foregoing, Landlord and Tenant acknowledge and agree that certain terms of
this Lease are effective as of the Effective Date as stated in this Lease.
2.2 This Lease shall be for a period of twenty (20) years from the
Commencement Date as provided in Section 2.3 hereof, unless earlier terminated
or extended as provided herein (the "Initial Term").
2.3 The Term shall commence ("Commencement Date") upon the date which is
the earlier of (a) the date on which Tenant opens to the general public for
business in the Premises or (b) one hundred eighty (180) days from the
Possession Date. Landlord acknowledges and agrees that Tenant shall not be
considered open for business in the Premises during the time Tenant is not
opened to the general public, but has opened the Premises for purposes of
training Tenant's employees, which training shall not exceed twenty (20) days.
For purposes of this Lease, the term "Possession Date" shall mean the later to
occur of (i) the date upon which Landlord delivers the Premises to Tenant with
the Site Work and Off-Site Work substantially completed and the Deficiency List
(as defined in Section 10.5 hereof) items completed to the reasonable
satisfaction of Tenant (except to the extent any such Deficiency List items have
not been completed because under good construction scheduling practices such
work should be done after still incomplete
5
finishing or other work (or Work, as the case may be) to be done by or on behalf
of Tenant is completed), and (ii) the date specified in Landlord's Delivery
Notice (as hereinafter defined). As used in this Lease, "substantially
completed" shall mean that the Shell of the Premises has been sufficiently
constructed in accordance with the Landlord's Plans, such that Tenant may, in
Tenant's reasonable determination, reasonably commence construction of the Work,
regardless of whether Tenant has obtained the permits, licenses and approvals it
requires to construct the Work or for the operation of Tenant's business. The
Site Work and Off-Site Work shall be deemed substantially completed
notwithstanding the fact that Punchlist Items (as hereinafter defined) or other
minor or insubstantial details of the work, mechanical adjustment or decoration
remain to be performed or portions of the Site Work or Off-Site have not been
completed because under good construction scheduling practices such work should
be done after still incomplete finishing or other work (or Work, as the case may
be) to be done by or on behalf of Tenant is completed. When the Possession Date
has occurred pursuant to this Section, Tenant shall execute a tenant acceptance
letter stating the date upon which the Possession Date has occurred, which
letter shall be countersigned and acknowledged by Landlord.
2.4 Tenant shall, at Tenant's expense, at the expiration of the Term or
any earlier termination of this Lease, (i) promptly surrender to Landlord
possession of the Premises in the same condition as existed on the Commencement
Date, casualty, condemnation, ordinary wear and tear and the rights of Tenant to
remove certain Tenant's Property within the time period permitted in Article 14
hereof excepted and in "broom clean" condition and (ii) remove therefrom
Tenant's icons, decorations, signs, goods, and effects and any machinery and
equipment which are used in conducting the Tenant's trade or business. Landlord
shall have the rights set forth in Section 14.2 hereof in the event Tenant fails
to remove all or any portion of Tenant's Property within the time period set
forth therein.
2.5 If Tenant shall not be in default under the terms and conditions of
this Lease at the time of delivering notice of its election to exercise an
extension option and on the commencement date of such extension term, beyond
applicable notice and cure periods under the terms of this Lease, then Tenant
may extend the Term of this Lease for up to two (2) separate, consecutive,
additional periods of ten (10) years each, on the terms and conditions as apply
to the Initial Term as set forth herein by notifying the Landlord in writing not
less than twelve (12) months prior to the then current Expiration Date. Failure
of Tenant to timely exercise any extension option herein shall be deemed an
election by Tenant not to exercise such extension option and this Lease shall
automatically terminate on the then scheduled Expiration Date.
ARTICLE 3 ACCESS AND POSSESSION OF PREMISES
Effective as of the date hereof, Landlord hereby authorizes Tenant to
personally or through its agents, employees and independent contractors, enter
upon Landlord's Property, as reasonably necessary for the purposes of, at its
own expense, inspecting the same, and conducting such other investigations which
Tenant deems appropriate for performance of the Work or construction of Tenant's
Improvements or any other matters contemplated by this Lease. Tenant shall
provide Landlord written notice at least twenty-four (24) hours prior to
entering upon Landlord's Property for purposes of performing the inspections
permitted in this Article 3. Tenant agrees that it shall not perform invasive
procedures in order to make such investigations. Tenant shall, at its sole cost
and expense, repair or restore any damage or injury
6
to the Landlord's Property or the Premises caused by Tenant's inspection
activities thereon. Tenant shall not unreasonably interfere with the performance
by Landlord of the Site Work, Off-Site Work, installation of the Utilities or
any other construction activities performed by or on behalf of Landlord on
Landlord's Property. Tenant's rights pursuant to this Article 3 shall be
specifically subject to the indemnification provisions set forth in Article 24
and the insurance provisions set forth in Article 28 of this Lease.
ARTICLE 4 RENT
4.1 PERCENTAGE RENT.
(a) For any calendar month (or portion thereof) Tenant shall pay
to Landlord, as the sole and exclusive base rental due to Landlord
under this Lease, in the manner hereafter provided, the amount
obtained by multiplying the Percentage Rate, as hereinafter defined,
by Gross Sales for the applicable calendar month (as defined below).
(b) The term "Gross Sales" means the total gross amount of all
sales, income, receipts, revenues, monies or other things of value
received by Tenant, sublessee, licensee, concessionaires or other
entity, for all merchandise (as defined in Section 8.1 hereof) sold or
delivered in, at, on or from the Premises and sales of merchandise
ordinarily sold in, at or from the Premises which are sold elsewhere
on the Property (subject, however, to the restriction contained in
Section 8.8 hereof). Gross Sales shall include only (i) sales of
merchandise for cash (including redemption of gift certificates,
provided it is Tenant's general corporate policy for its stores to
include the redemption of gift certificates in gross sales, and not
the sale of the gift certificate) or credit, and (ii) sales that
Tenant in the ordinary and normal course of business would credit or
attribute for the sale of merchandise to its business at the Premises.
Gross Sales also shall include sales of all merchandise pursuant to
mail, internet, catalogue, telegraph, telephone or other technology
that originate from, or are accepted, received or filled at or from
the Premises, but delivery or performance takes place outside of the
Project in the ordinary course of Tenant's business. Gross Sales shall
not include: (1) returns and refunds by Tenant upon transactions
included within Gross Sales, not exceeding the original selling price
included in Gross Sales; (2) sales by any mechanical or vending device
owned by an unrelated third party; (3) sales of non-location specific
merchandise pursuant to mail, internet, catalogue, telegraph,
telephone or other technology that originate from, or are accepted,
received or filled at or from the Premises, but delivery or
performance takes place outside of the Project in the ordinary course
of Tenant's business; (4) sales of gift certificates (except upon
redemption as set forth above, provided it is Tenant's general
corporate policy for its stores to include the redemption of gift
certificates in gross sales and not the sale of the gift certificate);
(5) discounts or charges of credit card issuers on sales made by
credit card; (6) intercompany sales or transfers of merchandise
between stores of Tenant (or its affiliates) in the ordinary course of
Tenant's business; (7) the amount of any city, county, state, or
federal sales tax which is both added to the sales price and paid to
the taxing authority by Tenant (but not by any vendor of Tenant),
including, but not limited to, any sales or gross receipts tax
regardless of whether
7
included within the sales price or added to the sales price of an
item; (8) the net amount of discounts to customers or employees
pursuant to Tenant's customary and reasonable policies consistent with
the ordinary course of Tenant's business; (9) sales of furniture,
fixtures, equipment or memorabilia outside of the normal course of
Tenant's business, or other similar sales or transfers commonly
considered capital in nature; (10) interest and dividend income; (11)
proceeds of insurance, condemnation or indemnity for a loss or taking;
or (12) sales for credit at the Premises which are charged off as "bad
debt" in the ordinary course of business.
(c) The "Percentage Rate" shall be five percent (5%) during the
first three (3) Rental Years and seven percent (7%) for the remainder
of the Term hereof.
4.2 Percentage Rent shall be paid monthly, in arrears, within fifteen
(15) days after expiration of each calendar month during the Term. The payment
of Percentage Rent shall begin with the first calendar month of the Term and
shall continue through the end of the Term (and any extension of the Term
exercised by Tenant).
Within the above-referenced due date, Tenant shall make payment of
Percentage Rent as required by Section 4.2, above. Tenant shall retain and make
available to Landlord, or to the designated representatives of Landlord, upon
reasonable advance Notice to Tenant, and in a manner not unreasonably disruptive
to Tenant, all books and records, including, without limitation, all contracts,
documents, invoices, construction records, financial statements and reports, tax
returns, accounting or accountants' work papers, insurance reports,
computer-retained information, and other items of financial and business
information of or relating to the Premises and all operations and activities
thereon, as Landlord shall reasonably request (collectively, "Books and
Records"). Landlord shall have the right to copy such Books and Records,
provided Landlord first executes a confidentiality agreement mutually acceptable
to the parties. Tenant shall keep all such Books and Records in all material
respects in accordance with the determination of the accountants, on an accrual
basis, and in accordance with GAAP, consistently applied. For a period of two
(2) years after the end of each Rental Year, but in no event more frequently
than twice per Rental Year, Landlord shall have the right to request an audit of
the Books and Records of Tenant pertaining to Gross Sales ("Landlord's Audit").
Upon receiving a request within such period, Tenant shall make the applicable
Books and Records available, at Tenant's United States corporate headquarters,
within twenty (20) days after such request, during ordinary business hours to
Landlord or the certified public accounting firm designated by Landlord
(Landlord's Auditors). If no request is received within said two (2) years,
Landlord shall be deemed to have waived its right to audit Gross Sales for such
period; provided, however, that such waiver shall not apply in the event of a
material fraud or intentional misstatement by Tenant with respect to the
calculation of Gross Sales or Percentage Rent. In the event, Landlord's Audit
alleges errors indicating underpayment by Tenant of Percentage Rent, then
Landlord shall, within ninety (90) days from commencement of Landlord's Audit,
notify Tenant of such errors supplying Tenant with a copy of Landlord's Audit
and commercially reasonable supporting documentation to allow Tenant to review
the alleged errors. Tenant or Tenant's designated certified public accountants
(Tenant's Auditors) shall have a period of forty-five (45) days after receipt of
a copy of Landlord's Audit to provide to Landlord and Landlord's Auditors any
information which relates to the accuracy of the alleged errors and to attempt
to resolve any issues pertaining thereto. In the event Landlord and Tenant,
along with their
8
respective designated certified public accountants are unable to resolve their
differences regarding the alleged errors despite negotiations in good faith
within said forty-five (45) day period, Tenant shall, within fifteen (15) days
thereafter, either pay the amount required to comply with Landlord's Audit (less
any adjustments agreed to by Landlord) or submit the matter with all pertinent
information in its possession to an independent (so-called "big four") certified
public accounting firm as agreed to by Landlord's Auditors and Tenant's Auditors
within the aforesaid fifteen (15) day period, or if they cannot agree on the
certified public accounting firm within such fifteen (15) day period, Tenant, on
behalf of Landlord and Tenant, shall submit the matter with all pertinent
information in its possession to the independent certified public accounting
firm with the largest office (as determined by the number of CPAs within the
office) within the Gulfport, Mississippi ("Final Auditor") metropolitan area.
Each party shall within ten (10) days of designation of the Final Auditor submit
copies of all information pertinent to the issues in controversy but only to the
extent copies thereof were supplied to the other party prior to the date
thereof. The Final Auditor may request additional information and the parties
shall require that any such request be made within five (5) days of the initial
designation. The Final Auditor shall be required to reach its determination
within twenty (20) days after its initial designation. The determination by the
Final Auditor shall be the final and binding decision and each party agrees to
be bound thereby. The cost and expense of the Final Auditor shall be borne by
the parties in proportion to the financial effect of the final decision. For
example, if the Final Auditor determines that the conclusion from Landlord's or
Tenant's auditor (i) was incorrect in total on the issues in controversy, the
party which was incorrect, Landlord or Tenant, respectively, shall pay 100% of
the cost of the Final Auditor; (ii) was incorrect on five (5) issues in
controversy and total of ten (10) issues are in controversy, the party which was
incorrect shall pay its share of the cost of the Final Auditor determined as
follows: total cost of the Final Auditor multiplied 5/10; or (iii) that neither
party was correct in total on the issues in controversy, the parties shall
evenly split the total cost of the Final Auditor. Tenant shall pay any sums due
to Landlord pursuant to the determination of the Final Auditor within ten (10)
days after receipt of the determination of such Final Auditor. Notwithstanding
the forgoing allocation of the cost and expense of the Final Auditor, in the
event the errors agreed to by Tenant or determined to exist by the Final Auditor
exceed five percent (5%) of the sums paid by Tenant to Landlord as Percentage
Rent for the Rental Year, then in addition to the additional Percentage Rent,
Tenant shall pay Landlord for the reasonable cost of Landlord's Audit plus
interest on the additional amount at the rate of one and one-half percent (1
1/2%) per month ("Interest") for each month after the date Landlord alleged (in
writing) an error with respect to Tenant's calculation of Percentage Rent. The
parties acknowledge that a reasonable, good-faith error in the calculation of
Gross Sales or Percentage Rent shall not be deemed a default hereunder.
4.3 Tenant shall pay all Rent at the address for Notices or at such
other place in the United States as Landlord may designate by notice to Tenant.
All Rent shall be paid in United States dollars by Tenant's check drawn to
Landlord's order.
4.4 If the Commencement Date of this Lease falls on a day other than the
first day of a calendar month, then the term "calendar month" shall, with
respect only to the first calendar month of the Term mean the period commencing
on the Commencement Date and ending on the last day of the first full calendar
month following the Commencement Date. If the Expiration Date of this Lease
falls on a day other than the last day of a calendar month, then the term
"calendar month" shall, with respect only to the last calendar month during the
Term, mean the
9
period commencing on the first day of such last calendar month and ending on the
last day of the then current Term.
4.5 Tenant shall, in conjunction with each payment of Percentage Rent,
provide Landlord monthly statements in reasonable detail and reasonably
sufficient to support the calculation of Tenant's Gross Sales and Percentage
Rent being paid in conjunction therewith, verified and certified by its chief
financial officer to be true and correct. In addition, within sixty (60) days
after the end of each calendar year during the Term of this Lease, Tenant shall
deliver to Landlord a written statement, signed and certified by Tenant's chief
financial officer to be true and correct, setting forth the amount of Tenant's
Gross Sales made during each month of the immediately preceding calendar year,
together with a copy of Tenant's monthly sales tax report submitted to the State
of Mississippi, Department of Revenue.
4.6 All financial statements and reports provided for in this Section to
be submitted to Landlord shall contain a written and signed certification from
the chief executive officer or the chief financial officer of Tenant, that, to
the best knowledge and belief of such officer, the information contained in all
such statements and reports is true, correct, and complete.
ARTICLE 5 TAXES
5.1 Landlord, and not Tenant, shall pay all ad valorem or real property
taxes ("Ad Valorem Taxes") levied or assessed by any Governmental Entity against
the Premises or the Project, and Tenant shall not be obligated to reimburse
Landlord for any portion of such Ad Valorem Taxes. Tenant shall be responsible
for any personal property taxes or business taxes levied against Tenant's
Property located in the Premises or on business conducted by Tenant therein
("Personal Property Taxes").
5.2 Tenant shall, during the Term of this Lease, pay and discharge
punctually, as and when the same shall become due and payable, all Personal
Property Taxes accruing from and after the Possession Date and which shall or
may during the term of this Lease be charged, levied, laid, assessed, imposed,
become due and payable, or liens upon or for or with respect to the Premises or
any part thereof. Landlord acknowledges and agrees that any standby fees,
Personal Property Taxes, or assessments by any taxing authority attributable to
any period prior to the Possession Date which may become due shall be paid in
full by Landlord. Landlord shall further be responsible for the payment of all
impact fees (or their equivalent) imposed by any Governmental Entity with
respect to the development of the Premises.
5.3 Tenant shall be deemed to have complied with the covenants of this
Section if payment of such Personal Property Taxes shall have been made within
any period allowed either by law or by the Governmental Entity imposing the same
during which payment is permitted without penalty or interest, and Tenant shall
produce and exhibit to Landlord satisfactory evidence of such payment, if
Landlord shall demand the same in writing.
5.4 Tenant or its designees shall have the right to contest or review
all such Personal Property Taxes by legal proceedings, or in such other manner
as it may deem suitable (which, if instituted, Tenant or its designees shall
conduct promptly at its own cost and expense and free of any cost, liability or
expense to Landlord, and, if necessary, in the name of and with the
10
cooperation of Landlord and Landlord shall execute all documents necessary to
accomplish the foregoing at no cost, expense or liability to Landlord).
Notwithstanding the foregoing, Tenant shall promptly pay all such Taxes if at
any time the Premises or any part thereof shall then be immediately subject to
forfeiture, or if Landlord shall be subject to any criminal liability arising
out of the non-payment thereof.
5.5 Landlord or its designees shall have the right to contest or review
all such Ad Valorem Taxes by legal proceedings, or in such other manner as it
may deem suitable (which, if instituted, Landlord or its designees shall conduct
promptly at its own cost and expense and free of any cost, liability or expense
to Tenant, and, if necessary, in the name of and with the cooperation of Tenant
and Tenant shall execute all documents necessary to accomplish the foregoing at
no cost, expense or liability to Tenant). Notwithstanding the foregoing,
Landlord shall promptly pay all such Taxes if at any time the Premises or any
part thereof shall then be immediately subject to forfeiture, or if Tenant shall
be subject to any criminal liability arising out of the non-payment thereof.
ARTICLE 6 COMMON AREAS; CONTROL OF ACCESS TO THE PREMISES AND SUPPORTING
INFRASTRUCTURE
6.1 COMMON AREAS. In accordance with the terms of this Lease, Landlord
grants to Tenant and its agents, servants, employees, guests, invitees and
patrons a non-exclusive license during the Term of this Lease to use the Common
Areas in common with others for their intended purposes (e.g. access, ingress
and egress), subject to the reasonable control and management thereof by
Landlord. Subject to the other terms of this Lease, Tenant's rights to use the
Common Areas shall remain in full force and effect during the Term of this Lease
and shall only be terminated upon the expiration or earlier termination of this
Lease. Landlord shall, at Landlord's sole cost and expense, operate and maintain
or shall cause to be operated and maintained the Hotel in accordance with the
terms and conditions of the License Agreement, specifically including, but not
limited to, the requirements set forth in Section 5 thereof. Landlord has the
right at any time, and from time to time, to (i) establish, modify and enforce
reasonable rules and regulations with respect to the Common Areas; (ii) enter
into, modify and terminate easements and other agreements pertaining to the use
and maintenance of the Common Areas; (iii) close temporarily any or all portions
of the Common Areas; (iv) discourage non-customer use; and (v) do and perform
such other acts in and to said Common Areas, as, in the exercise of good
business judgment, Landlord shall determine to be advisable; PROVIDED, HOWEVER,
no such rule, regulation or action of Landlord shall materially and adversely
interfere with Tenant's, its agents, servants, employees, guests, invitees and
patrons access to the Premises, including the license to utilize the Common
Areas, or Tenant's ongoing business operations at the Premises. Landlord shall
not allow buildings, structures, landscaping, kiosks, stands or other vending or
obstructions in the portion of the Common Area located within ten (10) feet of
certain exterior portions of the Premises (including, but not limited to the
main entrance to the Premise) as mutually agreed upon by Landlord and Tenant
(the "View Easement Area").
6.2 Landlord shall be responsible for all costs of operation and
maintenance of the Common Areas, except for damages to any of the Common Areas
caused by intentional misconduct or gross negligence of Tenant or its agents,
employees, approved sub-tenants,
11
contractors or affiliates and then, only to the extent the same is not covered
by Landlord's Required Insurance (as hereinafter defined).
6.3 Landlord shall have the right at any time and from time to time to
make or permit additions to, subtractions from, rearrangements of, alterations
of, modification of or supplements to the Common Areas; PROVIDED, HOWEVER, that,
except as required by Law or as required in order for Landlord to fulfill its
obligations under this Lease, the exercise by Landlord of any of its rights
granted hereunder shall in no way materially reduce, or impair the quality
and/or quantity of the Common Areas and shall in no way materially and adversely
interfere with Tenant's business and/or use of the Premises, access to the
Premises, Tenant's signage and/or artwork, and/or any license or other rights
granted to Tenant hereunder.
6.4 Landlord covenants and agrees that the Common Areas shall be open to
the public, adequately illuminated, monitored by appropriate security systems
and/or personnel (consistent with the security program utilized for the Common
Areas serving the Hotel) and, with respect to any indoor Common Areas, air
condition or heated (whichever is appropriate) during all hours in which the
Premises are open for business.
ARTICLE 7 UTILITIES
Landlord represents and warrants that all Utilities are currently or will
be (as of the Commencement Date) provided and available to the Premises in the
amounts shown and in accordance with EXHIBIT "C". Landlord shall, at Landlord's
sole cost and expense, provide lines for all Utilities (including, but not
limited to, electricity, light, heat, telephone, power and communications
services) to the Premises.
Tenant shall pay directly to the provider thereof for the cost of all
Direct Supplied Utilities used in or in connection with the Premises.
Landlord shall, at Landlord's sole cost and expense, provide Landlord
Supplied Utilities to the Premises. Such Landlord Supplied Utilities shall be
available to the Premises twenty-four (24) hours per day, seven (7) days per
week in a manner sufficient to maintaining service consistent with the standards
set forth in EXHIBIT "C" of this Lease.
Landlord shall incur no liability to Tenant in damages or otherwise in the
event that any Utility services shall be or become unavailable from any source
of supply, except due to the negligence or intentionally wrongful acts or
omissions of Landlord. Notwithstanding anything in this Lease to the contrary,
in the event that restoration of any interruption of utilities services is not
the sole responsibility of the public utility service company or the Tenant,
Landlord, at Landlord's cost and expense, shall use commercially reasonable
efforts to restore such service after interruption (subject to delays caused by
Force Majeure, Tenant Delay or defaults on the part of Tenant), but Landlord
shall not be responsible to Tenant for any interruption, unless caused by the
gross negligence or intentionally wrongful acts or omissions of Landlord. If
such interruption is caused by the negligence or intentionally wrongful act or
omission of Landlord, and as a result thereof, Tenant is precluded from being
open for business within the Premises for a period of one (1) day or more (which
period shall be subject to delays caused by Force Majeure, Tenant Delay or
defaults on the part of Tenant), then, to the extent (but only to the
12
extent) Tenant's rental obligation is not actually reimbursed to Tenant by
business loss insurance obtained by Tenant, if any, the parties acknowledge that
no Gross Sales will be generated from the Premises during the period Tenant is
precluded from being open for business, and Tenant shall not be obligated to pay
Percentage Rent from the date Tenant is precluded from being open for business
until the earlier of the date on which such Utility service is restored or the
date Tenant reopens for business to the general pubic in the Premises. In
addition, if Tenant is precluded from being open for business within the
Premises (i) for a period of three (3) days or more (which period shall be
subject to delays caused by Force Majeure, Tenant Delay or defaults on the part
of Tenant) as a result of an interruption in Utility service caused by the
negligence or intentionally wrongful act or omission of Landlord, Tenant shall
be entitled to pursue any other remedies available to Tenant, at law or in
equity, and (ii) for a period of twenty (20) days or more (which period shall be
subject to delays caused by Force Majeure, Tenant Delay or defaults on the part
of Tenant) as a result of an interruption in Utility service caused by the
negligence or intentionally wrongful act or omission of Landlord, this Lease may
be terminated by Tenant by giving written notice to Landlord anytime after such
twenty (20) day period, but before Landlord shall have restored or caused the
restoration of such utility services.
In connection with the construction of the Project, Landlord shall also
procure, or cause to be procured, without cost to Tenant, any and all necessary
master permits, master licenses, or other master authorizations (including
master meters and master tap fees) required for the lawful and proper
installation and maintenance of the master utilities servicing the main utility
lines to the Project. Landlord shall pay, as and when due, any and all tap fees,
impact fees or similar permitting or authorization costs associated with all
connections of the Project to the Utilities. Tenant shall pay all hook-up
charges to connect the Premises to such Utilities.
Tenant shall store all trash and garbage within the areas indicated on the
Tenant's Plans approved by Landlord for such purposes or within the Premises in
good quality containers so located as not to be visible to Tenant's customers
and other invitees of the Project and so as not to create or permit any health,
safety or fire hazard. Tenant shall not allow refuse, garbage or trash to
accumulate outside the Premises and shall dispose of all trash collected at the
Premises in appropriate garbage receptacles. Landlord shall, at Landlord's sole
cost and expense, provide for regular (i.e., no less often than every other day)
and efficient off-site disposal of trash generated on the Premises.
ARTICLE 8 USE
8.1 Tenant shall, throughout the Term of this Lease (and any extension
thereof exercised by Tenant in accordance with the terms and conditions of
Section 2.5 hereof), operate the Premises as a retail store for the sale of (i)
"Hard Rock" ("Trade Name") branded merchandise including, but not limited to,
wearing apparel, reading materials, trading pins, souvenirs and gift items; (ii)
Sundry Items (as defined in Section 30.4 hereof), accessories, gift items and
souvenirs; (iii) snacks, beverages (provided, however, that the sale of any
alcoholic beverages shall be limited to bottled/canned beer and wine), wrapped
candies and cookies; and (iv) books, magazines and newspapers, and (v) recorded
music, compact discs and videotapes. Tenant may, at Tenant's sole discretion,
discontinue and thereafter, recommence, the sale of any or all of the foregoing
items other than branded merchandise, provided, however, that an election by
Tenant to discontinue the sale of any one or more Exclusive Sundry Items (as
defined in
13
Section 30.4 hereof) shall give Landlord the right to sell such item or items,
subject to the terms and conditions set forth in Section 30.4, including prior
written notice to Tenant. Tenant shall be open for business in the Premises (a)
for the sale of Sundry Items, twenty-four (24) hours per day, seven days per
week, three hundred sixty-five (365) days per year (including holidays), and (b)
for the sale of all other goods and merchandise permitted to be sold by Tenant
in accordance with this Lease, other than Sundry Items, between the hours of
10:00 a.m. and 11:00 p.m. on Sunday through Wednesday each week, and between the
hours of 10:00 a.m. and 12:00 a.m. (midnight) on Thursday through Saturday each
week, three hundred sixty-five (365) days per year (including holidays), each of
the foregoing being subject to Tenant's right to close for business in all or a
portion of the Premises at such earlier time as Tenant deems advisable in its
reasonable business judgment, after obtaining the consent of Landlord, which
consent shall not be unreasonably withheld, conditioned or delayed.
8.2 Tenant shall not use or permit any portion of the Premises to be
used for any use or purpose other than those specifically granted in Section 8.1
of this Lease without the prior written consent of Landlord, which consent may
be withheld in Landlord's sole discretion.
8.3 Notwithstanding anything herein to the contrary Tenant agrees not to
conduct any business within the Premises which is listed on EXHIBIT "D".
8.4 Tenant shall make a diligent, good faith, reasonable effort to
complete all components of the Work and be open for business to the public by
not later than the date which is one hundred eighty (180) days after the
Possession Date, subject to Force Majeure, condemnation, casualty and Landlord
Delays. In the event Tenant shall fail to complete all components of the Work
and be open for business to the public by not later than the date which is two
hundred ten (210) days after the Possession Date, subject to Force Majeure,
condemnation, casualty and Landlord Delays ("Required Opening Date"), such
failure shall constitute a default by Tenant under this Lease, without the
necessity of notice of such default or the application of any cure periods.
8.5 Tenant shall have the co-tenancy rights as set forth in Section
33.1(d) and (f).
8.6 Tenant covenants and agrees, at all times during the Term and such
other times as Tenant occupies the Premises or any part thereof, to comply, at
its own cost and expense, with the written, reasonable rules and regulations
propounded by Landlord from time to time, and such changes and additions thereto
made by Landlord, provided such rules and regulations (i) shall be uniformly and
non-discriminatorily applicable to all other tenants in the Project and to
Landlord in its operation of other businesses in the Project, and (ii) do not
materially and adversely affect the use by Tenant of the Premises and the
operation of Tenant's business therein.
8.7 Tenant covenants and agrees that it will not use or cause to be used
any part of the Premises for any unlawful conduct or purpose.
8.8 Tenant covenants and agrees that the "Hard Rock Cafe" branded
merchandise sold in, at or from the Cafe shall not be sold in, at or from the
Premises and that the "Hard Rock
14
Hotel" and "Hard Rock Casino" branded merchandise sold in, at or from the
Premises shall not be sold in, at or from the Cafe.
ARTICLE 9 COMPLIANCE WITH LAWS
9.1 Tenant, at Tenant's sole cost and expense, shall promptly comply
with all Laws of Governmental Entities which shall (i) impose any violation,
order or duty upon Landlord or Tenant as a result of Tenant's or Tenant's
agents, employees, contractors, servants, guests, invitees, patrons or customers
actual use of the Premises or its operation and maintenance of the Premises
(other than the Shell of the Premises), or (ii) affect the Premises (other than
the Shell of the Premises), or any portion thereof, provided Tenant is
responsible for such item pursuant to the other portions of this Lease,
including, but not limited to Article 15; or (iii) be necessitated by any
improvement, alteration or addition to the Premises performed by or at the
direction of Tenant; or (iv) required of Tenant in its capacity as an employer.
9.2 Except as provided in Section 9.1, Landlord, at Landlord's sole cost
and expense, shall promptly comply with all Laws of Governmental Entities which
shall impose any violation, order or duty upon Landlord with regard to the Shell
of the Premises, Hotel and the Common Areas.
9.3 Tenant shall have the right to contest by appropriate proceedings
diligently conducted in good faith in the name of Tenant, the validity or
application of any Law applicable to or affecting the Premises or affecting
Tenant's use, operation or maintenance thereof, provided Tenant indemnifies,
defends and holds Landlord harmless from any claims, lawsuits, proceedings,
damages, loss, or expense, including reasonable attorney's fees, arising out of
Tenant's contest of the same. If compliance with any Law may legally be delayed
pending the prosecution of any such proceeding, Tenant may delay compliance
until the final determination of the proceeding, provided Tenant indemnifies,
defends and holds Landlord harmless from any claims, lawsuits, proceedings,
damages, loss, or expense arising out of Tenant's failure to comply with the
foregoing. Notwithstanding the foregoing, if such contest shall materially and
adversely affect Landlord's business operations at the Project, Tenant shall
comply with such Law to the extent minimally necessary during the pending
prosecution of such proceedings, to avoid such affect on Landlord's business
operations at the Project.
9.4 Landlord shall have the right to contest by appropriate proceedings
diligently conducted in good faith in the name of Landlord, the validity or
application of any Law applicable to or affecting the Shell of the Premises,
Hotel and the Common Areas or affecting Landlord's use, operation or maintenance
thereof, provided Landlord indemnifies, defends and holds Tenant harmless from
any claims, lawsuits, proceedings, damages, loss, or expense, including
reasonable attorney's fees, arising out of Landlord's contest of the same. If
compliance with any Law may legally be delayed pending the prosecution of any
such proceeding, Landlord may delay compliance until the final determination of
the proceeding, provided Landlord indemnifies, defends and holds Tenant harmless
from any claims, lawsuits, proceedings, damages, loss, or expense arising out of
Landlord's failure to comply with the foregoing. Notwithstanding the foregoing,
if such contest shall materially and adversely affect Tenant's business
operations at the Premises, Landlord shall comply with such Law to the extent
15
minimally necessary during the pending prosecution of such proceedings, to avoid
such affect on Tenant's business operations at the Premises.
9.5 Subject to the terms of Section 9.6, if, at any time during the last
two Rental Years within the Term, Tenant shall make an expenditure or aggregate
expenditures in excess of Fifty Thousand and 00/100 Dollars ($50,000) (subject
to increases or decreases resulting from application of the Index set forth
herein below) as a result of any applicable Law which is enacted or first
becomes effective in connection with the Premises during the last two Rental
Years, and not required by Laws previously in effect, and after making such
expenditure, Tenant shall elect not to exercise any then remaining right to
extend the Term (unless Tenant was prohibited from exercising such right because
of a material uncured default by Tenant under this Lease), Landlord shall
reimburse Tenant for the amount of Tenant's expenditure in excess of Fifty
Thousand and 00/100 Dollars ($50,000) (subject to increases or decreases
resulting from application of the Index set forth herein below). The above
mentioned Fifty Thousand and Dollars ($50,000) shall be adjusted annually
starting in the second Rental Year to a sum equal to Fifty Thousand Dollars
($50,000) times a fractional number, the numerator of which is the National
Customer Price Index for all Urban Consumers U.S. City Average (All Items; 1982
84 - 100) (the "Index")) reported for the month immediately preceding the Rental
Year in question and the denominator of which is the Index as published for the
calendar month containing the last day of the second Rental Year. If the Index
shall be discontinued for any reason, Landlord shall designate from indexes
supplied by the Bureau an alternative index comparable to the Index, together
with information which will make possible the conversion to the alterative
index. If for any reason the Bureau does not furnish such an index and such
information, the parties shall thereafter accept and use such other index of
comparable statistics on the costs of living in Gulfport, Mississippi, as shall
be computed and published by an agency of the U.S. Government or by a
responsible financial periodical of recognized authority then to be selected by
Landlord (subject to the prior reasonable written approval of Tenant).
9.6 If Tenant shall not have any remaining rights to extend the Term of
this Lease, and any applicable Law is enacted or first becomes effective during
the last two Rental Years within the Term, which would and does require Tenant
to make an expenditure or aggregate expenditures not required by Laws previously
in effect, in connection with the Premises, during any such period in excess of
Fifty Thousand and 00/100 Dollars ($50,000) (subject to increases or decreases
resulting from application of the Index set forth in Section 9.5 above), Tenant
may, at its option, terminate this Lease upon thirty (30) days written notice to
Landlord unless Landlord agrees to pay and does pay the amount of such
expenditure in excess of Tenant's aggregate expenditure obligation as provided
for herein. In the event Landlord does not elect to pay such excess expenditure,
this Lease shall terminate on the date which is thirty (30) days after the date
of such Notice, in which event, the parties hereto shall thereafter be relieved
of all rights and obligations hereunder which would otherwise accrue hereunder
following such date except as otherwise provided herein.
ARTICLE 10 LANDLORD'S DEVELOPMENT OBLIGATIONS
10.1 In accordance with, and to the extent provided by Section 5 of the
License Agreement, Landlord shall provide Tenant with a rendering that depicts,
in reasonable detail, the proposed exterior facade of the Hotel and the interior
design of the Hotel ("Landlord's
16
Conceptual Drawings"). Within twenty-five (25) days after receipt by Tenant of
the initial draft of Landlord's Conceptual Drawings, Tenant shall provide
Landlord written notice of acceptance or objections and questions with respect
to Landlord's Conceptual Drawings, and shall specifically note each objection in
writing. Tenant shall not unreasonably object to or question Landlord's
Conceptual Drawings. If Tenant fails to approve, identify objections or seek
clarifications to Landlord's Conceptual Drawings within such twenty-five (25)
day period, Tenant shall be deemed to have approved such initial Landlord's
Conceptual Drawings. In the event of any reasonable objections by Tenant,
Landlord shall resubmit the Landlord's Conceptual Drawing following consultation
with Tenant, whereupon Tenant shall, within twenty (20) days after receipt by
Tenant of the revised Landlord's Conceptual Drawings or any modification
thereafter, provide Landlord written notice of acceptance or further objections
to such revised Landlord's Conceptual Drawings. Tenant shall not unreasonably
object to such revised Landlord's Conceptual Drawings. If Tenant fails to
approve or object to any revisions to Landlord's Conceptual Drawings within such
twenty (20) day period, Tenant shall be deemed to have approved such revised
Landlord's Conceptual Drawings.
10.2 Landlord shall cause to be prepared and delivered to Tenant plans
and specifications for construction of the Site Work and Off-Site Work,
provided, however, such plans and specifications may be completed in phases,
each of which comprise a portion of the plans and specifications for the Site
Work and Off-Site Work (the "Landlord's Plans"). Tenant herby grants its
approval and waives any right to object to Landlord's Plans to the extent they
materially conform with Landlord's Conceptual Drawings for the Site Work and
Off-Site Work and EXHIBIT "C" attached hereto. Tenant agrees to review
Landlord's Plans within twenty (20) days after receipt thereof and notify
Landlord of the manner, if any, in which said plans fail to materially conform
to Landlord's Conceptual Drawings in a manner which is unacceptable to Tenant
(which acceptance shall not be unreasonably withheld). If Tenant shall not
inform Landlord of its desired revisions or corrections within twenty (20) days,
then the plans submitted shall be deemed approved and accepted by Tenant.
Landlord shall cause said plans to be revised in such manner as to comply with
Tenant's reasonable requirements within sixty (60) days after receipt of
Tenant's notice to Landlord and Landlord shall submit revised Landlord's Plans
for Tenant's approval, which will not be unreasonably withheld. Tenant shall
approve or object to the revised Landlord's Plans in accordance with the manner
set forth above. If, upon any resubmittal of Landlord's Plans to Tenant, Tenant
shall not inform Landlord of its desired revisions or corrections within twenty
(20) days, then the plans submitted shall be deemed approved and accepted by
Tenant. When Tenant has approved Landlord's Plans or revised plans, as the case
may be, Tenant shall initial and return one (1) set of approved Landlord's Plans
to Landlord showing the date of Tenant's approval. Notwithstanding anything to
the contrary contained herein, Tenant's approval of any plans and specifications
and/or Landlord's Plans is not intended and shall not be deemed to constitute a
representation, warranty or assurance of any kind that such plans and
specifications and the work shown thereon comply with applicable Laws, or that
the same are structurally sound. Landlord shall be solely responsible for
causing such compliance and for the quality and structural integrity of any
work, and Landlord acknowledges that it is not relying on Tenant or any of its
agents or contractors for the same.
10.3 Landlord, at its sole cost and expense, shall cause all of the Site
Work and Off-Site Work to be performed in accordance with Landlord's Plans and
in a manner which is consistent with good engineering and architectural practice
and all applicable Laws. Landlord
17
shall, in all cases, have delivered the substantially completed Shell of the
Premises by the date which is one hundred eighty (180) days prior to the Hotel
Opening Date, subject to delays caused by Force Majeure, Tenant Delay or
defaults on the part of Tenant. In no event, however, shall Landlord deliver,
nor shall Tenant be required to accept delivery of, the substantially completed
Shell of the Premises earlier than the date that is thirty (30) days after
Landlord provides Tenant written notice of its intent to deliver the
substantially completed Shell of the Premises (the "Landlord's Delivery
Notice"), which Landlord's Delivery Notice shall specify the intended date of
delivery.
10.4 Landlord, at its sole cost and expense, shall cause to be
constructed the Common Areas, Hotel and related improvements on the Property
consistent with good engineering and architectural practice and as required by
the License Agreement. Landlord shall in all cases have substantially completed
the Common Areas and Hotel (substantially complete meaning for this purpose that
the Common Areas and Hotel that a certificate of occupancy, whether, temporary
or permanent ("Certificate of Occupancy") shall have been issued for the Hotel
(including the Common Areas) so that the Common Areas and Hotel are open for
business on or before the date as set forth in the License Agreement (the "Hotel
Opening Date"). For purposes hereof, the term "open for business" shall mean,
with respect to the Hotel, that seventy-five percent (75%) of the rooms intended
to be constructed in the Hotel, but in no event less than one hundred fifty
(150) rooms, are actually open to the public for business and with respect to
the Common Areas that a Certificate of Occupancy (or its equivalent) shall have
been issued for the Common Areas and the same is open to the public for its
intended purpose. Landlord covenants and agrees not to materially deviate from
the drawings or plans for the Common Areas and Hotel as presented to, and
approved by, the Licensor pursuant to the License Agreement, without the consent
of Licensor, which consent shall not be unreasonably withheld, conditioned or
delayed, or such other standard, if any, as may be provided in the License
Agreement.
10.5 Landlord shall not be responsible for delays in the required
deadlines called for in this Lease to the extent they result from a Force
Majeure or a Tenant Delay. In the event of such an excused delay, Landlord's
sole remedy shall be a day for day extension of the prescribed deadline.
Landlord's obligations set forth in Sections 10.1, 10.2, 10.3, 10.4 and this
10.5 shall be collectively referred to as "Landlord's Development Obligations".
Further, the parties acknowledge that the Work in large part shall be performed
contemporaneously with the Landlord's Development Obligations and each party
agrees to require its agents, employees and independent contractors to
reasonably cooperate with the other party's employees, agents and independent
contractors so that the Landlord's Development Obligations and the Work can
proceed without undue delay or material interference. To this end, Tenant and
Landlord will routinely and promptly make their respective construction
schedules available to each other upon request of the other party. To the extent
any delay occurs in the performance and completion of the Landlord's Development
Obligations on account of a Tenant Delay, as Landlord's sole remedy, the
required deadlines called for in this Lease shall be extended on a day-for-day
basis.
10.6 Tenant's occupancy of the Premises shall constitute acceptance
thereof and any Site Work performed by Landlord, including, but not limited to
the condition of the Shell of the Premises, except for (i) punchlist items, the
existence or completion of which will not interfere with the performance of the
Work by Tenant, the opening of Tenant's business or the Commencement Date (the
"Punchlist"); and (ii) any latent defects, which are hereinafter
18
discussed. Within fifteen (15) days after Landlord provides the Landlord's
Delivery Notice, Landlord and Tenant, or their representatives, shall inspect
the Premises. If, as a result of Tenant's inspection of the Premises, Tenant
determines, in its reasonable judgment, that the Premises are subject to a
Punchlist, Tenant and Landlord shall jointly develop a Punchlist within ten (10)
days after such inspection. In addition, if, as a result of Tenant's inspection
of the Premises, Tenant determines, in its reasonable judgment, that the
condition of the Site Work and the Off-Site Work is not substantially completed
(as defined in Section 2.3 hereof), Tenant shall deliver a list of specific
deficiencies and deviations that constitute a failure to achieve substantial
completion ("Deficiency List") to Landlord within ten (10) days after such
inspection. Notwithstanding the foregoing, Tenant shall not have the right to
object to any portions of the Site Work or Off-Site Work that have not been
completed because, under good construction scheduling practices, such work
should be done after still incomplete finishing or other work (or Work, as the
case may be) to be done by or on behalf of Tenant is completed (referred to
herein as "Subsequent Construction Items"), and any such Subsequent Construction
Items shall not delay the Possession Date. If no Deficiency List is delivered to
Landlord within such ten (10) day period, Tenant shall be deemed to have
accepted the Premises in its condition at the time of Tenant's inspection of the
Premises and as being in the condition in which Landlord is required to deliver
the Premises in accordance with this Lease, except with respect to latent
defects, and the date of Landlord's notice to Tenant stating the Possession Date
shall be conclusive as to the determination of the Possession Date. If a
Punchlist or Deficiency List is delivered, Landlord shall, with reasonable
diligence, commence to correct or cure any items disclosed therein, which shall
be completed within thirty (30) days or such longer time as may be reasonably
required due to the nature of the item(s) in question. In the event that Tenant
had delivered a Deficiency List to Landlord, after completion of the items on
the Deficiency List, Landlord shall again give notice of the Possession Date to
Tenant, which Possession Date shall in all cases, meet the Delivery Date
requirement set forth in Section 10.1, unless Tenant shall have elected to
proceed with the prosecution of Tenant's Work before completion of the items on
the Deficiency List. In the event Tenant elects to proceed with the prosecution
of Tenant's Work before completion of all items on the Deficiency List, Landlord
shall not be obligated to again give notice of the Possession Date, and Landlord
shall use diligent efforts to correct or cure the items on the Deficiency List,
and in so doing, shall cause its employees, agents and independent contractors
to reasonably cooperate with Tenant's employees, agents and independent
contractors so that Tenant's Work can proceed without material interference.
Tenant and Landlord shall again follow the procedure set forth in this paragraph
for inspection and delivery of Punchlist until such time as the Deficiency List
is completed. Landlord shall have the right to enter the Premises at any
reasonable time to correct or cure the Punchlist or Deficiency List, and in so
doing, Landlord shall cause its employees, agents and independent contractors to
reasonably cooperate with Tenant's employees, agents and independent contractors
so that Tenant's Work can proceed without material interference. The date of
completion of the Deficiency List shall be deemed to be the Possession Date
(unless Tenant has elected to proceed with Tenant's Work before completion of
the Deficiency List as aforesaid), provided, however, that Subsequent
Construction Items shall not be deemed to delay the Possession Date. Landlord
shall complete or cause the completion of all Subsequent Construction Items in
accordance with a construction schedule mutually acceptable to Tenant and
Landlord.
10.7 In no event will Tenant be deemed to have approved of any latent
defects in the work performed by Landlord. Tenant shall have one (1) year
following the Possession Date to
19
notify Landlord of any latent defects in such work, and Landlord shall promptly
correct or cause the correction of the same. After the expiration of such one
(1) year period, Tenant shall be deemed to have waived all claims against
Landlord on account of the condition of the Premises and the Site Work and
Off-Site Work performed by or on behalf of Landlord, except to the extent Tenant
has notified Landlord in writing of any such claims before the expiration of
such one (1) year period and except to the extent any components of the work
performed by Landlord are covered by valid and effective warranties which extend
beyond such one (1) year period (in which event, Tenant shall have the benefit
of such longer warranty period). If any defective component of the work
requiring repair under this Article is under warranty or guaranty, the parties
hereto agree to make available the benefit of the warranty or guaranty to the
other party so that no such warranty or guaranty shall be violated.
10.8 For purposes of this Article 10, Tenant shall have the remedies
stated in Section 33.1(d) as Tenant's sole remedy for failure of the Hotel
and/or Common Areas to be "open for business" as defined in Section 10.4.
ARTICLE 11 THE WORK
11.1 Within thirty (30) days after Tenant's receipt of Landlord's
Conceptual Drawings for the Site Work, Hotel and Common Areas, Tenant shall
provide Landlord with a rendering that depicts, in reasonable detail, the
proposed exterior facade of the Premises and the interior design of the Premises
(the "Tenant's Conceptual Drawings"). Within twenty-five (25) days after receipt
by Landlord of the initial draft of Tenant's Conceptual Drawings, Landlord shall
provide Tenant written notice of acceptance or objections and questions with
respect to Tenant's Conceptual Drawings, and shall specifically note each
objection in writing. If Landlord fails to approve, identify objections or seek
clarifications to Tenant's Conceptual Drawings within such twenty-five (25) day
period, Landlord shall be deemed to have approved such initial Tenant's
Conceptual Drawings. In the event of any objections by Landlord, Tenant shall
resubmit the Tenant's Conceptual Drawing within twenty (20) days following
consultation with Landlord, whereupon Landlord shall, within thirty (30) days
after receipt by Landlord of the revised Tenant's Conceptual Drawings or any
modification thereafter, provide Tenant written notice of acceptance or further
objections to such revised Tenant's Conceptual Drawings. If Landlord fails to
approve or object to any revisions to Tenant's Conceptual Drawings within such
thirty (30) day period, Landlord shall be deemed to have approved such revised
Tenant's Conceptual Drawings.
11.2 Within ninety (90) days after Tenant receives the final draft of
Landlord's Plans, Tenant shall cause to be prepared and delivered to Landlord,
Tenant's Plans. Landlord agrees to review Tenant's Plans within thirty (30) days
after receipt thereof and notify Tenant of the manner, if any, in which said
plans fail to materially conform to Tenant's Conceptual Drawings in a manner
which is unacceptable to Landlord (which acceptance shall not be unreasonably
withheld). Tenant shall cause said plans to be revised in such manner as to
comply with Landlord's requirements within twenty (20) days after Landlord's
notice to Tenant, and Tenant shall submit revised Tenant's Plans for Landlord's
approval. If Landlord shall not inform Tenant of its desired revisions or
corrections within thirty (30) days, then the plans submitted shall be deemed
approved and accepted by Landlord. When Landlord has approved Tenant's Plans or
revised plans, as the case may be, Landlord shall initial and return one (1) set
of approved
20
Tenant's Plans to Tenant showing the date of Landlord's approval. If, upon any
resubmittal of Tenant's Plans to Landlord, Landlord shall not inform Tenant of
its desired revisions or corrections within thirty (30) days, then the plans
submitted shall be deemed approved and accepted by Landlord. Notwithstanding
anything to the contrary contained herein, Landlord's approval of Tenant's
Conceptual Drawings, Tenant's Plans or any other plans and specifications
submitted by Tenant to Landlord is not intended and shall not be deemed to
constitute a representation, warranty or assurance of any kind that such plans
and specifications and the Work shown thereon comply with applicable Laws or
that the same are structurally sound, and Tenant shall be solely responsible for
causing such compliance and for the quality and structural integrity of any
Work, and Tenant acknowledges that it is not relying on Landlord or any of its
agents or contractors for the same.
11.3 Upon the Possession Date, Tenant shall commence the Work and shall
diligently pursue all components of such Work to completion on or before the
date set forth in Section 8.4 hereof. The Work and any other work performed by
Tenant during the Term shall be performed in a first-class workmanlike manner
with first-class materials, by duly qualified or licensed persons, in accordance
with Tenant's Plans and in accordance with all applicable Laws.
11.4 Tenant shall make a good faith, reasonable effort to complete the
Work and be open for business within one hundred eighty (180) days after the
Possession Date. In the event Tenant shall fail to complete all components of
the Work and be open for business to the public by not later than the date which
is two hundred ten (210) days after the Possession Date, subject to Force
Majeure, condemnation, casualty and Landlord Delays ("Required Opening Date"),
such failure shall constitute a default by Tenant under this Lease, without the
necessity of notice of such default or the application of any cure periods.
Notwithstanding the foregoing, in the event Landlord shall have delivered the
substantially completed Shell of the Premises earlier than one hundred eighty
(180) days prior to the Hotel Opening Date, such early delivery shall not
require Tenant to complete the Work and be open for business prior to the Hotel
Opening Date.
11.5 With respect to the Work and Tenant's use (except for zoning
permitting a retail store and approvals of any other tenant for such retail
store use):
(a) Tenant shall, at its own cost and expense, procure or cause
to be procured all permits, approvals, consents, licenses and filings
of any kind required by applicable Laws or any Governmental Entity
having approval authority thereover, including, without limitation,
approvals of all signage for which Tenant is responsible under the
terms of this Lease to obtain; and
(b) Landlord shall provide to Tenant its reasonable cooperation
in allowing Tenant to complete Tenant's Improvements authorized herein
and in all matters in connection therewith; provided the Tenant shall
pay all reasonable cost or expenses of Landlord associated therewith,
if any.
11.6 Tenant agrees to pay when due the entire cost of any work at the
Premises, including the Work, and materials furnished to Tenant undertaken by
Tenant, its agents, employees or contractors, including payment for the
equipment, facilities, signs and fixtures therein or shall discharge, within
thirty (30) days of Tenant's notice of the lien, at Tenant's sole
21
cost and expense (whether by payment, bonding, or otherwise), any such lien so
that the Premises shall at all times be free of liens for labor and materials
with respect to any work at the Premises, including the Work, and materials
furnished to Tenant undertaken by Tenant, its agents, employees or contractors.
If Tenant shall fail to cause such lien to be so discharged within thirty (30)
days after notice of the filing thereof, then, in addition to any other right or
remedy of Landlord, Landlord may, but shall not be obligated to, discharge the
same, by paying the amount claimed to be due without inquiring as to the
validity of any such lien, and the amount so paid by Landlord, plus Interest
accruing from the date of such payment by Landlord until reimbursed by Tenant,
together with reasonable attorneys' fees incurred by Landlord in connection
therewith, shall be due and payable by Tenant to Landlord upon demand as Rent.
ARTICLE 12 RESERVED
ARTICLE 13 SIGNAGE AND/OR ARTWORK
13.1 Tenant shall remove all of its signage and artwork at its sole
expense prior to the earlier of the Expiration Date or earlier termination of
this Lease in accordance with the terms hereof. In the event Tenant has not
removed (i) Tenant's Memorabilia (as defined in Section 14.1 hereof) within the
time periods set forth in Section 14.2 hereof, and (ii) Tenant's signage and
artwork within ten (10) days after the Expiration Date or earlier termination of
this Lease, Landlord shall have the right to remove and dispose of the remaining
portions of same and may retain the proceeds from the sale or other disposition
thereof.
13.2 Tenant's signage and/or architectural features shall comply with all
Laws. Landlord shall use commercially reasonable efforts to obtain all
Governmental Entity approvals necessary to permit the construction and
installation of the signage permitted in this Article 13, and the Tenant's
Plans, specifically excepting, however, any and all building permits needed by
Tenant to install Tenant's signage and/or architectural features. Tenant shall
use its best efforts to work, assist and cooperate with Landlord in all respects
with the application and review process necessary for the approval of such
signage, as required by any Governmental Entity.
13.3 Except as required by Laws or by any Governmental Entity or as shown
on Landlord's Plans, Landlord shall not erect, install, locate or construct, or
permit the erection, installation, location or construction of, any structure,
signage and/or other item or improvement or landscape (i) within the View
Easement Area, or (ii) that would materially and adversely impact the visibility
of Tenant's signage and/or architectural features, in each case as determined by
Tenant in its commercially reasonable discretion, other than as shown in
Landlord's Plans. Upon Tenant's request, Landlord shall promptly remove any
signage, artwork or other obstruction which Tenant has determined violates the
provisions of this Section 13.3. All Tenant's signage and/or architectural
features provided pursuant to this Section 13.3 shall be maintained in good
condition and repair by Tenant, at its sole expense.
13.4 Landlord shall allow Tenant, at Tenant's sole expense, to install
such signage and/or artwork of a size and character on the exterior face of the
Premises, within the Common Areas and the parking areas, all as set forth in
EXHIBIT "G" or as otherwise approved by Landlord on the Tenant's Plans. Tenant
shall also be entitled to be included in Landlord's directional or multiparty
signage located in the Common Areas, Hotel and/or Parking Garage, in
22
an manner reasonably determined by Landlord. Except as required by Law or any
Governmental Entity or as shown on Landlord's Plans, Landlord shall not erect,
install, locate or construct any structure, signage and/or other item or
improvement or landscape that would materially and adversely impact the
visibility of Tenant's signage and/or artwork on the exterior face of the
Premises, without Tenant's prior written consent, which shall not be
unreasonably withheld. The signage and architectural features attached to the
Premises shall be maintained in good condition and repair by Tenant, at its sole
cost and expense, including, without limitation, the prompt replacement of any
and all light fixtures, light bulbs, neon lights and other lighted elements and
components. All other signage erected, installed or constructed by Landlord
shall be maintained by Landlord in good condition and repair.
13.5 In the event (i) Landlord fails to promptly remove any signage
and/or artwork that violates the provisions of Section 13.3, or (ii) Landlord
and Tenant cannot agree as to the visibility and/or prominence of Tenant's
signage and/or artwork provided pursuant to Section 13.4, Tenant shall have, in
addition to all other remedies, the right to seek specific enforcement or an
injunction inasmuch as money damages or other relief may not adequately
compensate Tenant.
13.6 Landlord hereby grants Tenant the right, license and privilege over
such portions of the Property necessary to accommodate and provide access to the
signage permitted herein.
ARTICLE 14 FIXTURES AND EQUIPMENT; TENANT'S PROPERTY
14.1 Except as otherwise herein provided, any and all movable goods,
inventory, furniture, furnishings and fixtures and movable trade fixtures and
personal property furnished, constructed and/or installed by Tenant in or upon
the Premises which are not permanently affixed, shall be and remain property of
Tenant which Tenant may remove, at Tenant's expense, at any time on or before
the Expiration Date or earlier termination of this Lease (collectively "Tenant's
Property"). Tenant's Property as referred to in this Section 14.1 shall include
and shall be limited to, all movable goods, inventory, furniture, furnishings,
and movable trade fixtures and personal property which may be removed from the
Premises and is not permanently affixed (i) without causing damage thereto; or
(ii) if such removal causes damage to the Premises, Tenant shall have the right
to remove the same, provided Tenant immediately restores such damaged portion of
the Premises to good condition (normal wear and tear, excepted). Tenant's
Property shall not include present and future alterations, additions or
improvements made in, on or to the Premises, by either party, including, without
limitation, all equipment and non-trade fixtures, air-conditioning equipment,
pipes, ducts, conduits, plumbing, wiring, paneling, partitions, mezzanines,
floors, carpet, paint, wallpaper and similar items. Notwithstanding anything to
the contrary contained herein, Landlord shall at no time have any right to or
interest in any Hard Rock memorabilia, signage, merchandise and stained glass
("Tenant's Memorabilia") located at any time, and from time to time, on the
Premises; provided, however, the foregoing shall not limit or diminish
Landlord's rights set forth in the last sentence of Section 14.2 below. Tenant
shall have the right to remove any and all of Tenant's Memorabilia as Tenant
deems desirable, at its sole discretion, provided that Tenant immediately
restores any damage to the Premises caused by such removal. Landlord waives and
releases any lien or rights to a lien upon or against Tenant's Property,
including but not limited to, Tenant's Memorabilia.
23
14.2 If any of Tenant's Property is not removed on or before ten (10)
days after the Expiration Date or earlier termination of this Lease, Landlord
may retain Tenant's Property or remove and dispose of the same and may retain
the proceeds from the sale or other disposition thereof, if any. Notwithstanding
the foregoing, Landlord shall only have the right to retain Tenant's Memorabilia
or remove and dispose of the same and retain the proceeds from the sale or other
disposition thereof, if Tenant's Memorabilia is not removed by Tenant within
twenty (20) days after the Expiration Date or earlier termination of this Lease.
ARTICLE 15 MAINTENANCE AND REPAIRS
15.1 Subject to the terms of Articles 17 and 18, Tenant shall, at its
sole expense throughout the Term of this Lease, keep, maintain, repair and
replace with due diligence, as and when necessary, so that the same is kept
clean and in good condition and repair: (i) the interior, non-structural
portions of the Premises, including, but not limited to the floor, walls,
ceilings, doors, windows, utility meters, pipes and conduits, sprinkler
equipment, security grilles and similar enclosures, locks and closing devices
and all other equipment, facilities and fixtures in the Premises, including all
mechanical, electrical, and utility systems and the Tenant's heating,
ventilating and cooling system; (ii) the storefront of the Premises, including
all plate glass; (iii) all Tenant signage; artwork and architectural fixtures
located within or attached to the Premises; (iv) any item of the Premises which
is damaged due to any act, including any act of construction or repair, or any
act of neglect, fault or omission of Tenant, and its agents, servants, employees
or patrons. All damage or injury to the Premises caused by Landlord, its agents
or employees shall be repaired, restored or replaced at Landlord's sole cost and
expense. Regardless of which party is responsible for payment, all maintenance,
repair and replacement to the Premises (other than the Shell of the Premises)
required under this paragraph shall be made by Tenant or parties designated by
Tenant.
Notwithstanding anything contained in this Article to the contrary, in the
event that Tenant fails to make any such maintenance, repair, and replacement,
as required by the terms of this Article, after thirty (30) days notice to
Tenant (or such lesser time when an emergency dictates), Landlord shall have the
right, but not the obligation to make such maintenance, repair, and replacement,
and any such cost and expense, plus Interest from the date of the repairs, shall
be treated as additional rent and in, addition, Landlord shall have all other
remedies available under Article 23. Notwithstanding anything to the contrary,
any repair or restoration required as a result of Damage as defined in Section
17.1 shall be controlled by Article 17.
15.2 Landlord, shall promptly make all repairs necessary to maintain the
Shell of the Premises, Common Areas, the Hotel, the main lines for utilities to
the Premises and Parking Garage except to the extent the necessity for such
maintenance or repair is caused in whole or in part by the gross negligence or
intentional misconduct of Tenant, or its agents, servants or employees, in which
case Landlord or parties designated by Landlord shall make such maintenance or
repair, and Tenant shall pay to Landlord the actual cost of such maintenance and
repairs. Landlord shall send notice to Tenant of the need for the repairs
described in the aforesaid sentence. Subject to all other terms of the Lease, if
during the Term, in Tenant's commercially reasonable judgment, Landlord fails to
repair the Shell of the Premises as required hereunder, and such failure
materially and adversely affects Tenant's operations, and after thirty (30) days
prior written notice to Landlord (or such lesser time when emergency dictates),
24
Landlord fails to commence to repair same as required hereunder, then Tenant
may, in addition to other remedies available to Tenant under Article 23, make
such repairs. In the event Tenant makes such repairs, Tenant shall have the
right to seek reimbursement from Landlord for the cost thereof, plus Interest
from the date of the repair. In the event of casualty or eminent domain, the
obligations of Landlord and Tenant shall be controlled by Article 17 and 18,
respectively.
15.3 All of the aforesaid repairs (both Landlord's and Tenant's) shall be
made with reasonable diligence and in a good and workmanlike manner and in
accordance with applicable Laws. If any item requiring repair under this Article
is under warranty or guaranty, the parties hereto agree to make available the
benefit of the warranty or guaranty to the other party so that no such warranty
or guaranty shall be violated.
ARTICLE 16 TENANT'S ALTERATIONS
16.1 During the Term of this Lease, Tenant shall be entitled to perform
or undertake, at Tenant's sole cost and expense, any non-structural, interior
alteration, addition, improvement or construction to the Premises (each an
"Alteration" and collectively "Alterations"), in accordance with plans and
specifications prepared by Tenant; provided such Alterations(s) are approved in
advance by Landlord, lender or any other party having the right of approval
thereof, which approval shall not be unreasonably withheld or delayed. Tenant
shall send to Landlord a copy of its plans for any of the same at least thirty
(30) days prior to its commencement of such work. The procedure of Article 11
shall be followed in this regard. Any such Alterations shall not materially
diminish the size and shall not alter the value or structural integrity of the
Premises or alter its general use. Upon completion of any such Alterations
Tenant shall promptly furnish Landlord with a complete set of "as-built" or
"record" plans for such work.
16.2 With respect to every Alteration:
(a) Tenant shall, as its own cost and expense, procure
or cause to be procured all permits, approvals, consents, licenses
and filings of any kind required by applicable Laws or any
Governmental Entity having approval thereover;
(b) Tenant shall prosecute such Alteration with
reasonable diligence and in a good and workmanlike manner and in
accordance with applicable Laws; and
(c) Landlord shall provide to Tenant its reasonable
cooperation to allow Tenant to complete any Alteration authorized
herein and in all matters in connection therewith; provide the
Tenant pays all reasonable costs and expenses related thereto, if
any.
ARTICLE 17 DAMAGE AND RESTORATION
17.1 If the Premises, Shell of the Premises, Parking Garage, Common Area
or Hotel or any part thereof shall be damaged or destroyed by fire, flood,
hurricane, earthquake, tropical storm, tornado, lightning, wind damage,
infestation or other casualty ("Damage") and this Lease is not terminated
pursuant to this Article 17, Landlord shall proceed with due diligence to repair
25
or cause to be repaired the Damage to the Shell of the Premises, Parking Garage,
Common Area or the Hotel, but only to the extent Landlords' insurer makes the
proceeds of Landlord's Insurance available for repair of such Damage
("Landlord's Restoration Work"), and Tenant shall proceed with due diligence to
repair or cause to be repaired the Damage to the Premises (other than the Shell
of the Premises and Landlord's Development Obligations) to a condition similar
to that existing immediately prior to such Damage, but only to the extent
Tenant's insurer makes the proceeds of Required Insurance available for repair
of such Damage ("Tenant's Restoration Work"). If this Lease is not terminated,
Landlord shall make all proceeds of Landlord's Insurance (as defined below)
available for Landlord's Restoration Work. In the event (i) Landlord or its
insurer fails to make all proceeds of Landlord's Insurance available or the
aggregate proceeds of Landlord's insurance are insufficient, for whatever
reason, to pay all costs or expenses related to Restoration Work to a condition
substantially similar to that existing just prior to the Damage, and in either
of such events, Landlord's Restoration Work is not performed; or (ii) such
Damage is not covered by Landlord's Insurance, Tenant shall not be obligated to
repair or cause to be repaired Tenant's Restoration Work, if any, and Tenant
shall also have the right to terminate this Lease upon thirty (30) days notice
to Landlord given prior to the date that Landlord shall commence or cause to be
commenced Landlord's Restoration Work but not earlier than the date which is
ninety (90) days after the date that the Damage occurs, whereupon the parties
will be relieved of all obligations under this Lease which would otherwise
accrue following such date (except as stated in Section 35.12), unless prior to
the expiration of such thirty (30) day notice Landlord commences or causes to be
commenced Landlord's Restoration Work.
In the event of Damage, if (i) the Project shall be damaged to the extent
of more than fifty percent (50%) of the cost of replacement thereof; or (ii) the
proceeds of Landlord's insurance recovered or recoverable as a result of a
Damage and received and retained by Landlord shall be insufficient to pay fully
for the cost of replacement of the Shell of the Premises or the building in
which the Premises is located damaged; or (iii) the Shell of the Premises or the
building in which the Premises is located shall be damaged as a result of any
cause which is not covered by Landlord's insurance unless Landlord is required
to carry such insurance by the terms of this Lease and failed to do so; or (iv)
the Shell of the Premises shall be damaged in whole or in part during the last
two (2) Rental Years or in any partial Rental Year at the end of the Term
(unless Tenant has Options remaining thereafter, exercises the Option next
arising and agrees to reopen for business in the Premises); or (v) either or
both of the Shell of the Premises or the building in which the Premises is
located shall be damaged to the extent of fifty percent (50%) or more of the
cost of replacement thereof; or (vi) the Shell of the Premises are damaged to
such extent that in the reasonable judgment of Landlord, it cannot be operated
as an economically viable unit; or (vii) the Shell of the Premises are so
Damaged as to render the Premises untenantable by Tenant for a consecutive
period of more than twelve (12) months, then, in any such event, this Lease may
be terminated (1) by Landlord, with respect to subsections (i), (ii), (iii), (v)
and (vi) above, by providing thirty (30) days written notice given to Tenant
within ninety (90) days after the Damage; (2) by either Landlord or Tenant,
respect to subsection (iv) above, by providing thirty (30) days written notice
given to the other party within ninety (90) days after the Damage; or (3) by
either Landlord or Tenant, respect to subsection (vii) above, by providing
thirty (30) days written notice given to the other party within ten (10) days
after expiration of such twelve (12) month period, whereupon the parties will be
relieved of all obligations under this Lease which would otherwise accrue
following such date (except as stated in Section 35.12). The "cost of
26
replacement" shall be determined by the company or companies selected by
Landlord's insurers, or if there shall be no such determination, by a person
selected by Landlord qualified to determine such "cost of replacement".
17.2 Notwithstanding Section 17.1 above, if in the opinion of an
independent contractor or appraiser selected by Tenant, the Project, and/or
Premises are so Damaged as to require, for restoration, a reasonably estimated
expenditure of more than fifty percent (50%) of the value of the Project and/or
Premises, as applicable, as actually insured under Required Insurance and
Landlord's Insurance immediately prior to such Damage, and, provided further,
that in the event Landlord cannot or does not cause such damage to be fully
repaired within twelve (12) months after settlement with the insurers and
receipt of proceeds, subject to Force Majeure, within thirty (30) days after
expiration of such twelve (12) month period, Tenant may elect to terminate this
Lease by giving thirty (30) days notice to the Landlord, whereupon the parties
shall be relieved of all obligations under this Lease which would otherwise
accrue following such date, except as stated in Section 35.12.
17.3 If this Lease terminates pursuant to Sections 17.1 or 17.2, this
Lease shall expire as of the date on which such termination shall be effective
under those Sections, as if such date were the Expiration Date, and the parties
hereto shall thereafter be relieved of all rights and obligations hereunder
which would otherwise accrue after such date except as stated in Section 35.12,
and Tenant shall remit to Landlord the proceeds of all Required Insurance less
the portion thereof attributable to (i) Tenant's business interruption coverage,
(ii) Tenant's Property, including Tenant's Memorabilia that may be removed
pursuant to Section 13.1, and (iii) Tenant's Improvements.
17.4 In the event Tenant does not terminate this Lease pursuant to
Section 17.1 or 17.2 above, and this Lease is not terminated, Tenant shall
diligently proceed to repair or cause to be repaired Tenant's Restoration Work.
Tenant shall make a good faith, diligent effort to complete Tenant's Restoration
Work and be open for business as soon as practicable, but in any event on or
before the date which is one hundred eighty (180) days after Landlord has
redelivered the Premises to Tenant with the Shell of the Premises substantially
completed in accordance with the requirements of this Lease. Landlord and Tenant
acknowledge that no Gross Sales will be generated from the Premises from the
date Tenant is precluded from being open for business at the Premises due to
such Damage, and Tenant shall not be obligated to pay Percentage Rent from the
date Tenant ceases to be open for such business due to such Damage until the
earlier of one hundred eighty (180) days after Landlord has redelivered the
Premises to Tenant with the Shell of the Premises substantially completed or the
date Tenant reopens for business to the general public in the Premises.
Notwithstanding any provision to the contrary herein, in addition to the
acknowledgement regarding Gross Sales set forth previously in this paragraph,
Landlord and Tenant further acknowledge and agree that no Gross Sales will be
generated from the Premises from the date Tenant is precluded from being open
for business at the Premises due to such Damage, until the earlier of: (i) the
date upon which Tenant opens for business at the Premises, (ii) one hundred
eight (180) days from the date Landlord redelivers the Shell of the Premises, or
(iii) the date upon which this Lease is terminated in accordance with the terms
and conditions of this Article 17.
27
17.5 Tenant shall not conduct any activity upon the Premises which would
require Landlord to be exposed to a risk that requires additional insurance to
cover such activity, except for activities during Special Events for which
Tenant has provided an adequate additional coverage acceptable to Landlord,
rider or special coverage which names Landlord as an additional insured.
Notwithstanding anything herein to the contrary, Tenant shall not be entitled to
terminate the Lease pursuant to Sections 17.1 or 17.2 or an Abatement of Rent
pursuant to Section 17.5 and shall repair all Damage to the Premises, if Tenant
is found to have committed intentional acts, intentional omissions or otherwise
engaged in reckless behavior resulting in such Damage to the Premises as
determined by arbitration pursuant to Section 23.9.
17.6 This Article shall be considered an express agreement governing any
case of Damage to the Project and/or Premises, and any Laws of any Government
Entity which conflict with the provisions set forth herein are hereby waived by
each party hereto to the maximum extent permitted under applicable Law.
ARTICLE 18 CONDEMNATION
18.1 If, after the execution and before the Expiration Date of this
Lease: (i) more than twenty percent (20%) of the Premises is taken by eminent
domain or conveyed in lieu thereof; or (ii) the number of parking spaces in the
Parking Garage Area (as defined in Article 19) is reduced by ten percent (10%)
or more or the number of parking spaces does not equal at least the number
required to legally operate the Premises as a result of a taking by eminent
domain or a conveyance in lieu thereof; or (iii) any means of direct access to
the Premises is taken by eminent domain or conveyed in lieu thereof and the same
is not substituted with similar access within ninety (90) days of such taking or
conveyance; or (iv) twenty percent (20%) or greater of the Hotel is taken by
eminent domain or conveyed in lieu thereof; or (v) twenty percent (20%) or
greater of the Common Area is taken by eminent domain or conveyed in lieu
thereof; or (vi) thirty percent (30%) or greater of the Project is taken by
eminent domain or conveyed in lieu thereof; then, in any of the foregoing
events, Landlord shall have the right, to modify the Project, Hotel, Common
Area, Parking Garage, and/or Shell of the Premises in order to accommodate the
loss occasioned by such taking or conveyance by constructing or creating
alterations, modifications and/or replacement components of the Hotel, Common
Area, Parking Garage and/or Shell of the Premises to minimize the effect of such
taking or conveyance. If Landlord desires to pursue such accommodations,
Landlord will send to Tenant, for its review, copies of Landlord's plans for
altering, modifying and/or replacement components of the Project, Hotel, Common
Area, Parking Garage, and/or Shell of the Premises in order to accommodate the
loss occasioned by such taking or conveyance. Tenant shall have a period of
thirty (30) days after receipt of such plans to determine, in the exercise of
Tenant's reasonable business judgment, whether Tenant's business conducted at
the Premises, after completion of the alterations, modifications and/or
replacements proposed by Landlord, will continue to be Materially Adversely
Affected as a result of such taking or conveyance. In the event Tenant
reasonably determines in good faith within such thirty (30) day period that
Tenant's business conducted on the Premises will, after completion of the
alterations, modifications and/or replacements proposed by Landlord to the
Project, Hotel, Common Area, Parking Garage, and/or Shell of the Premises,
continue to be Materially Adversely Affected, Tenant may, at the option of
Tenant, terminate this Lease, and this Lease shall cease and terminate upon such
date as Tenant may designate in Notice to Landlord which date shall be no more
than six (6) months nor less than
28
one (1) month after the date of the Notice. In the event that Tenant does not
terminate this Lease within such thirty (30) day period, Landlord and Tenant
shall agree upon the commercially reasonable time period within which Landlord
shall construct and/or create alterations, modifications and replacement
components to the Project, Hotel, Common Area, Parking Garage, and/or Shell of
the Premises pursuant to and based upon the plans presented to Tenant; and
Landlord shall, after receipt of and to the extent of the condemnation proceeds,
promptly and diligently restore the Project, Hotel, Common Area, Parking Garage,
and/or Shell of the Premises to as near to their condition prior to such taking
or conveyance as is reasonably possible (taking into account the extent of the
condemnation proceeds) (but in any event to a good and usable condition).
Tenant, at its sole cost and expense, shall promptly and diligently repair and
restore Tenant's Improvements and Tenant's fixtures and equipment which were the
subject of the taking to the extent of the proceeds actually received by Tenant
for such items and after receiving such proceeds. In the event that Landlord
does not use diligent efforts to construct and/or create alterations,
modifications and replacement components to the Project, Hotel, Common Area,
Parking Garage, and/or Premises within such commercially reasonable time period,
subject to Force Majeure, Tenant Delays, and delays caused by any Governmental
Entity outside the reasonable control of Landlord, Tenant shall have the right
to terminate this Lease within ninety (90) days after such commercially
reasonable time period by serving Notice, unless prior to the expiration of such
ninety (90) day time period, Landlord shall have completed or caused the
completion of such alterations, modifications and replacement components to the
Project, Hotel, Common Area, Parking Garage, and/or Shell of the Premises. The
effective date of such termination which date shall be no more than six (6)
months nor less than one (1) month after the date of the Notice. Upon any
termination, the parties shall thereafter be relieved of all rights and
obligations hereunder which would otherwise accrue following such date (except
as stated in Section 35.12).
In the event that fifty percent (50%) or greater of the Project, and/or
Common Area and fifty percent (50%) or greater of the Premises are taken by
condemnation or conveyed in lieu thereof; then, the Term shall, at the option of
Landlord or Tenant, cease and terminate as of the day possession shall be taken
by eminent domain or conveyed in lieu thereof. Such option to terminate shall be
exercisable by Landlord or Tenant, as the case may be, by giving written notice
to the other party within sixty (60) days after the date that Landlord received
notice of such taking or conveyance, which notice shall provide for a
termination date for this Lease not later than ninety (90) days after the date
that such taking or conveyance shall occur. In the event that the entire Project
and the Premises are taken by condemnation or conveyance in lieu thereof, this
Lease shall automatically terminate as of the date of such taking or conveyance.
Landlord and Tenant acknowledge that during any period of time that, by
reason of such taking, Tenant is closed for business in any material portion of
the Premises, no Gross Sales will be generated from such closed portion of the
Premises, and Tenant shall not be obligated to pay Percentage Rent from such
closed portion of the Premises for the period commencing with such taking and
ending with: (i) the completion by Landlord of such work or repair and/or
restoration as Landlord is obligated to do in such closed portion; and (ii)
expiration of a period of one hundred eighty (180) days thereafter to enable
Tenant to restore Tenant's Restoration Work (which Tenant covenants it shall so
do if this Lease is not terminated pursuant to this Article), but said one
hundred eighty (180) day period shall be deemed to have ended if Tenant shall
reopen for business in the closed portion prior to the expiration thereof.
Tenant shall make a
29
good faith, diligent effort to complete Tenant's Improvements and be open for
business as soon as practicable, but in any event on or before the date which is
one hundred eighty (180) days after Landlord has redelivered the Shell of the
Premises to Tenant with the work or repair and/or restoration as Landlord is
obligated to do in such closed portion completed, subject to delays caused by
Force Majeure and Landlord Delay.
If less than twenty percent (20%) of the Premises shall be so taken or
conveyed, or if more than twenty percent (20%) of the Premises shall be so taken
or conveyed and Tenant or Landlord, as the case may be, does not terminate this
Lease as provided herein, then the Term shall cease only with respect to that
portion of the Premises so taken or conveyed, as of the day possession shall be
taken. Landlord shall, after receipt of and to the extent of the condemnation
proceeds, make all necessary repairs or alterations to the Shell of the Premises
so as to constitute the remaining Premises a complete architectural unit.
If the use or occupancy of all or any part of the Parking Garage, Common
Area, and/or Premises is taken by eminent domain during the Term for a period
not exceeding ninety (90) days, Tenant's obligations under this Lease shall not
change, and Tenant shall continue to pay all Rent and other amounts due
hereunder without reduction or abatement; provided, however, Tenant shall be
entitled to retain the portion of the condemnation award applicable to its
interest in the Property and any portion of such award applicable to the
measures of damages identified in Sections (a) through (d) in the following
paragraph hereof. A temporary taking in excess of ninety (90) days shall be
deemed to be a permanent taking hereunder, subject to all of the requirements of
Section 18.1 of this Lease.
In the event of any taking by eminent domain or condemnation or conveyance
in lieu thereof wherein the Premises or access thereto are materially and
adversely affected, whether or not this Lease has been terminated as a result
thereof in accordance with the provisions of this Article 18, provided
Landlord's award is not diminished, Tenant shall have the right to make any
separate claims allowed by the laws of the State of Mississippi against the
condemning authority for the following: (a) the value of its fixtures, equipment
and other personalty; (b) its relocation expenses; (c) loss of business; and (d)
the unamortized amount of the cost of the Work.
ARTICLE 19 ACCESS AND PARKING
19.1 Landlord represents and warrants to Tenant that the parking garage
to be constructed by Landlord in conjunction with the initial construction of
the Hotel (the "Parking Garage") shall (i) contain no less than one thousand
(1,000) parking spaces, (ii) in all events, have a sufficient number of parking
spaces to accommodate and serve the Hotel and the Premises and to comply with
all applicable Laws, and (iii) be located in reasonably close proximity to the
Premises. Landlord shall have the right to reserve a reasonable number of
parking spaces in one or more areas of the Parking Garage designated by
Landlord, for exclusive use by Landlord's management personnel. Except for such
designated assigned parking spaces, Landlord hereby grants Tenant a
non-exclusive license to use in conjunction with Landlord and other tenants in
the Hotel, all parking spaces in the Parking Garage.
19.2 Landlord shall be responsible for all costs and expenses of
maintenance and/or improvements to the Parking Garage, provided, however, that
Tenant shall be responsible for the
30
cost of any repairs to the Parking Garage necessitated by any damage to the
Parking Garage caused by gross negligence or intentionally wrongful act or
omission of Tenant or its agents, representatives, employees and contractors,
except to the extent such damage is covered by Landlord's Insurance.
19.3 Landlord shall, prior to the Required Opening Date, construct the
Parking Garage. Once constructed, except as may be required by applicable Law or
Governmental Entity, Landlord shall not alter, modify, relocate or amend the
Parking Garage in any material respect without the prior written consent of
Tenant, which consent may not be unreasonably withheld by Tenant.
Notwithstanding the foregoing, Landlord shall have the right to re-stripe the
parking spaces in the Parking Garage from time to time, so long as such
re-striping shall not reduce the number of parking spaces which existed in the
Parking Garage prior to such re-striping.
19.4 Landlord shall not charge, or permit any third party to charge
Tenant any fee for parking in the Parking Garage or anywhere else in the
Project. If, during the Term of this Lease, Landlord elects to charge a fee for
parking (self-parking, valet or otherwise), prior to institution of such
program, Landlord and Tenant shall agree upon the specific terms and conditions
of a validation program to be administered by Tenant, whereby any and all fees,
costs and charges associated with parking shall be waived for Tenant. The
validation program agreed upon by the parties shall enable Tenant (i.e., not
Landlord or any other third party), to directly provide its employees,
personnel, licensees, customers and patrons evidence of validation.
19.5 Except with respect to the representation and warranty given by
Landlord to Tenant provided in Section 19.1 hereof, the consent of Tenant
provided for in Section 19.3 hereof and the agreement to be reached by and among
Landlord and Tenant in Section 19.4 hereof, for purposes of this Article 19 a
reference to Tenant shall include Tenant's employees, agents, invitees, patrons
and guests.
ARTICLE 20 RESERVED
ARTICLE 21 LANDLORD'S ACCESS TO DEMISED PREMISES
Tenant authorizes Landlord, Landlord's agents, employees and
representatives to enter the Premises at any time upon twenty four (24) hours
notice (except in the case of emergencies where Landlord will endeavor to
provide as much notice as circumstances reasonably permit) to inspect the
Premises. Such notice must state the reason for such inspection. In addition,
Tenant authorizes Landlord, Landlord's agents, employees and representatives to
enter the Premises at any time upon twenty four (24) hours notice (except in the
case of emergencies where Landlord will endeavor to provide as much notice as
circumstances reasonably permit) to exhibit (but only during the last twelve
(12) months of the Term, taking into account any option periods exercised by
Tenant in accordance with terms and conditions set forth in Section 2.5 hereof)
the same to prospective tenants. Any entry shall be performed in such a manner
as not to materially interfere with Tenant's business operations on the
Premises.
Tenant authorizes Landlord, Landlord's agents, employees and
representatives to enter all parts of the Premises at any time to make any
repairs or alterations thereto as Landlord is required or permitted to perform
hereunder upon twenty-four hours notice to Tenant (except in
31
the event of an emergency in which case Landlord will endeavor to provide as
much notice as circumstances reasonably permit). An "emergency" repair is
defined as a repair which must be made promptly in order to avoid imminent
damage to the Premises or to the merchandise or equipment in the Premises or
danger or harm to human health and safety. In connection with the exercise of
any of this right, Landlord agrees that, to the extent practicable, Landlord
will use reasonable efforts to minimize any interference with the operation of
Tenant's business. At the request of Tenant, Landlord will perform repairs
during non-business hours, provided, however, that Tenant shall be responsible
for and shall reimburse Landlord upon demand for all additional costs (e.g.,
overtime costs) paid or incurred by Landlord of performing the repairs during
non-business hours. If as a result of Landlord's repairs or alterations, it is
necessary to close the business in a material portion of the Premises as
determined in the exercise of Tenant's commercially reasonable judgment, and
Tenant closes such portion of the Premises for a period in excess of twenty-four
(24) hours, Tenant shall not be obligated to pay Landlord any Percentage Rent
until the earlier of the date that Tenant is again able to open such portion of
the Premises for business or until Tenant opens its store for business.
ARTICLE 22 QUIET ENJOYMENT
Upon paying Rent and all other amounts payable by Tenant hereunder and
keeping and performing the terms, covenants, conditions and provisions of this
Lease, Landlord covenants and agrees that Tenant may lawfully and quietly hold
and enjoy the Premises including all rights and licenses granted hereunder
during the Term without hindrance, ejection, molestation, or interruption.
ARTICLE 23 DEFAULT AND TERMINATION
23.1 In the event of any failure of compliance by Tenant with any of its
obligations to Landlord as provided for in this Lease, such action shall
constitute a default by Tenant under this Lease. Upon any such failure of
compliance by Tenant with any of its obligations to Landlord as provided for in
this Lease, Landlord shall have the right, but not the obligation, to declare
Tenant in default of this Lease, by delivering to Tenant notice of such default,
which notice (a "Tenant Default Notice") shall state in reasonable detail the
actions Tenant must take to cure the same. Within (a) five (5) days following
the effective date of any Default Notice (sometimes hereinafter "Monetary
Default Cure Period") in the case of any default involving the payment of moneys
due and unpaid to Landlord hereunder; (b) ten (10) days following the date of
any Default Notice in the case of any default for failure to initially open for
business in the Premises in accordance with this Lease; and (c) in all other
cases, within twenty (20) days following the effective date of any Default
Notice (sometimes hereinafter "Non-Monetary Default Cure Period"), Tenant shall
have the right to effect cure of such defaults within the applicable cure period
referenced above. Notwithstanding anything herein contained, (i) Tenant reserves
the right, during any Monetary Default Cure Period, but does not have the
obligation, to pay any amount that Landlord alleges to be due and owing under
protest, thereby reserving Tenant's right to object to the amount so paid at a
later date; and (ii) in the case of non-monetary defaults, if any such default
by Tenant remains uncured at the conclusion of the Non-Monetary Default Cure
Period, and if the nature of Tenant's obligations are such that more time than
the Non-Monetary Default Cure Period is required to effect cure, then Landlord
shall not have the right to exercise Landlord's termination rights granted
herein as a result of any such default, if Tenant commences
32
cure within the Non-Monetary Default Cure Period and thereafter diligently and
continuously pursues cure to completion of performance. To be effective, any
cure involving the payment of moneys shall include the payment of Interest
calculated from the date the original payment was due until paid.
Notwithstanding the foregoing, if Tenant fails to effect any required cure
as provided for herein within the applicable cure period, Landlord shall also
have the right, at Landlord's sole option, and without prejudice to any other
rights or remedies of Landlord provided herein, to cure any such default if the
subject matter thereof is non-monetary by providing written notice of such
intention to Tenant (except in the event of an uncured default which constitutes
an emergency, in which case Landlord shall not be obligated to provide notice).
If Tenant has not reimbursed Landlord within thirty (30) days after receipt of
Landlord's xxxx, Landlord may deduct the reasonable cost incurred from any and
all amounts due from Landlord pursuant to any of the Related Agreements.
Notwithstanding anything to the contrary contained herein, if in Landlord's
reasonable judgment, an emergency posing imminent harm to persons or Landlord's
Property or the Project shall exist resulting from a Tenant default, Landlord
may cure such default in the Premises or any portion of the Project which, in
Landlord's reasonable discretion, affects the Premises or any portion of the
Project, after providing oral notice to Tenant. The self-help option given in
this Section is for the sole protection of Landlord, and its existence shall not
release Tenant from its obligation to perform the terms, provisions, covenants
and conditions herein provided to be performed by Tenant or deprive Landlord of
or otherwise modify, alter or affect any legal rights which Landlord may have by
reason of any such default by Tenant.
In the event Tenant fails to effect any required cure as provided for
herein, Tenant shall be deemed to be in uncured default hereunder, and Landlord
shall have the right, but shall not be obligated, at any time thereafter, to
exercise the following remedies (which remedies need not be used exclusively):
(i) Terminate this Lease. Such termination shall be
effective as of the date stated in Landlord's termination notice. In
the event of any such termination of this Lease, Landlord may then
or at any time thereafter, re-enter the Premises by summary
proceedings or other judicial process and remove therefrom all
persons and all of Tenant's Property, subject to the rights of
Tenant to remove certain Tenant's Property as permitted in Article
14 hereof, and repossess and enjoy the Demised Premises, or, at
Landlord's election, to store such Tenant's Property in a public
warehouse or elsewhere at the cost and for the account of Tenant, or
(subject to the rights of Tenant to remove certain Tenant's Property
as permitted in Article 14 hereof) retain Tenant's Property or
remove and dispose of the same and retain the proceeds from the sale
or other disposition, if any, for the account of Landlord, and
Tenant waives all claims to such proceeds, and without Landlord
being deemed guilty of trespass or becoming liable for any loss or
damage which may be occasioned thereby without prejudice to any
other remedies that Landlord may have by reason of Tenant's default
or of such termination.
If by reason of the occurrence of any default, the Term shall end before
the date originally fixed herein for the expiration thereof, or Landlord shall
take possession of the
33
Premises, or Tenant shall be ejected, dispossessed, or removed therefrom by
summary proceedings or in any other manner, whether or not specifically
enumerated in this Lease, or if the Premises become abandoned, Landlord, shall
use reasonable efforts to relet the Premises, or any part or parts thereof, in
the name of Landlord, for a term or terms which may, at Landlord's reasonable
option, be less than or exceed the period of the remainder of the Term, and at
such rent or rentals and upon such other conditions, which may include
commercially reasonable concessions, if any, as Landlord, in its sole
discretion, shall determine. Landlord shall receive the rents from such
reletting and shall apply the same first, to the payment of such expenses as
Landlord may have incurred in connection with re-entering, ejecting, removing,
dispossessing, reletting, altering, repairing, redecorating, subdividing or
otherwise preparing the Premises for reletting, including commercially
reasonable concessions and inducements, brokerage and reasonable attorneys' fees
and expenses (collectively, such concessions, inducements, fees and expenses are
referred to herein as "Reletting Expenses"); second, to the payment of any
indebtedness other than rents, charges and other sums due hereunder from Tenant
to Landlord; and the residue, if any, Landlord shall apply to the fulfillment of
the terms, covenants and conditions of Tenant hereunder, and Tenant hereby
waives all claims to the surplus, if any. Tenant shall be and hereby, agrees to
be liable for and to pay Landlord any deficiency between the Rent and all other
rent reserved hereunder (conclusively presuming the Percentage Rent to be the
same as payable for the Rental Year immediately preceding such termination or
reentry) and the net rentals, as aforesaid, of reletting, if any, for each month
of the period which otherwise would have constituted the balance of the Term.
Tenant hereby agrees to pay such deficiency in monthly installments on the days
specified in this Lease, and any suit or proceeding brought to collect the
deficiency for any month, either during the Term or after any termination
thereof, shall not prejudice or preclude in any way the rights of Landlord to
collect the deficiency for any subsequent month by a similar suit or proceeding.
Landlord shall in no event be liable in any way whatsoever for the failure to
relet the Premises or in the event of such reletting, for failure to collect the
rents reserved thereunder. Landlord is hereby authorized and empowered to make
such repairs, alterations, decorations, subdivisions or other preparations for
the reletting of the Premises as Landlord shall deem advisable, without in any
way releasing Tenant from any liability hereunder, as aforesaid. Notwithstanding
the foregoing, the Reletting Expenses shall be fully amortized over the first
year of the term of the reletting, and Tenant shall pay to Landlord each month
during the first twelve (12) months of the term of the reletting, the amount by
which one-twelfth (1/12th) of the total aggregate amount of Reletting Costs
exceeds the monthly rent, if any, collected by Landlord during the first twelve
(12) months of the term of such reletting of the Premises.
If by reason of the occurrence of any default, Landlord shall terminate
this Lease, Landlord shall be entitled to recover, in addition to all Rent
accrued and unpaid for the period up to an including such termination date, as
well as all other additional sums payable by Tenant, or for which Tenant is
liable or for which Tenant has agreed to indemnify Landlord under any of the
provisions of this Lease, which may be then owing an unpaid, and all costs and
expenses, including, without limitation, arbitration costs and attorneys' fees
paid or incurred by Landlord in the enforcement of rights and remedies
hereunder, and in addition, Landlord shall be entitled to recover from Tenant as
damages for loss of the bargain and not as a penalty, a lump sum payment equal
to the present value of the aggregate Rent which would have been payable after
the termination date for the full remaining Term of this Lease (excluding,
however, any renewal options not then exercised by Tenant) had this Lease not
been terminated, including, without
34
limitation, Percentage Rent in an amount projected to represent Percentage Rent
for the balance of the Term, which shall be based upon the average Percentage
Rent payable by Tenant for the Rental Years up to the date of termination
(excluding from such calculation the first two Rental Years during the Term of
this Lease for which Percentage Rent was abated), such present value to be
computed on the basis of an eight (8%) per annum discount from the respective
dates upon which such Percentage Rent would have been payable hereunder had this
Lease not been terminated. Notwithstanding the foregoing, in the event Landlord
shall relet the Premises before the end of the then remaining Term of this Lease
(excluding, however, any renewal options not then exercised by Tenant) had this
Lease not been terminated, and provided that Tenant shall have paid Landlord the
amounts required to be paid by Tenant as provided in this paragraph, Tenant
shall be entitled to receive monthly payments (referred to herein as "Recapture
Payments") equal to the amount, if any, remaining after subtracting from the
monthly rent collected by Landlord from such reletting applicable to the then
remaining Term of this Lease (excluding, however, any renewal options not then
exercised by Tenant) had this Lease not been terminated, the total amount
Reletting Expenses. Tenant shall not be entitled to receive any such Recapture
Payments unless and until all Reletting Expenses in connection with such
reletting have been fully and completely recovered by Landlord.
No such re-entry or taking possession of the Premises by Landlord shall be
construed as an election on its part to terminate this Lease unless Landlord
gives written notice to Tenant of such intention or the termination thereof
shall result as a matter of law or be decreed by an arbitrator in accordance
with Section 23.8 hereof. Notwithstanding any such reletting without
termination, Landlord may at any time thereafter elect to terminate this Lease
for such previous default;
(ii) Without terminating this Lease, to re-enter the
Premises by summary proceedings or other judicial process and remove
all persons and property, as provided in (i) above and Tenant shall
remain liable as set forth in (i) above. It is agreed that the
commencement and prosecution of any action by Landlord in unlawful
detainer, ejectment or otherwise, or any execution of any judgment
or decree obtained in any action to recover possession of the
Premises shall not be construed as an election to terminate this
Lease unless Landlord shall give written notice to Tenant of such
intention;
(iii) Notwithstanding any time period for Tenant to cure in
the event of a non-monetary default, pay and/or perform the item
which is the subject of the default. Tenant shall, within ten (10)
days after notice, reimburse Landlord, as Rent, for the reasonable
costs and expenses incurred by Landlord in rectifying Tenant's
defaults as aforesaid, including reasonable attorneys' fees and
Interest. Except for the gross negligence by Landlord or Landlord's
agents, employees, licensees or invitees, Landlord shall not be
liable or in any way liable for any loss, inconvenience, annoyance,
or damage resulting to Tenant or anyone holding under Tenant for any
action taken by Landlord pursuant to this Section. Landlord's paying
or performance of the item which is the subject of the default shall
not constitute a waiver or release of any Tenant's obligations under
this Lease; and
35
(iv) Exercise all other remedies at law or in equity.
23.2 In the event of any failure of compliance by Landlord with any of
its obligations to Tenant as provided for in this Lease, such action shall
constitute a default by Landlord under this Lease. Upon any such default by
Landlord, Tenant shall provide to Landlord notice of such default, which notice
(a "Default Notice") shall state in reasonable detail the actions Landlord must
take to cure the same. Within the Monetary Default Cure Period, in the case of
any default involving the payment of moneys due and unpaid to Tenant hereunder,
and, in all other cases, within the Non-Monetary Default Cure Period, Landlord
will have the right to effect cure within the above referenced cure periods.
Notwithstanding the foregoing provisions of this Section 23.2, (i) Landlord
reserves the right, during any Monetary Default Cure Period, but does not have
the obligation, to pay any amount that Tenant alleges to be due and owing under
protest, thereby reserving Landlord's right to object to the amount so paid at a
later date; and (ii) in the case of non-monetary defaults, if any such default
by Landlord remains uncured at the conclusion of the Non-Monetary Cure Period,
and if the nature of Landlord's obligations are such that more than the
Non-Monetary Cure Period is required to effect cure, then if Landlord commences
cure within the applicable Non-Monetary Cure Period and thereafter diligently
pursues cure to completion of performance, then such default shall be deemed
cured. To be effective, any cure involving the payment of moneys shall include
the payment of Interest from the date when the amount was originally due to
Tenant until the date paid.
In the event Landlord fails to effect any required cure as provided for
herein, Landlord shall be deemed to be in uncured default hereunder, and
provided that such uncured default of Landlord has a material and adverse affect
on Tenant's business operations conducted at the Premises, Tenant shall have the
right to terminate this Lease, by providing written notice to Landlord, which
termination shall be effective as of the date stated in Tenant's termination
notice, but in no event less than thirty (30) days after the date of such
notice. Notwithstanding the foregoing, if Landlord fails to effect any required
cure as provided for herein within the applicable cure period, Tenant shall also
have the right, at Tenant's sole option, to cure any such default if the subject
matter thereof is non-monetary by providing written notice of such intention to
Landlord (except in the event of an uncured default which constitutes a bona
fide emergency, in which case Tenant shall not be obligated to provide notice).
If Landlord has not reimbursed Tenant within thirty (30) days after receipt of
Tenant's xxxx, Tenant may deduct the reasonable cost incurred from any and all
amounts due from Tenant pursuant to this Lease. Notwithstanding anything to the
contrary contained herein, if in Tenant's reasonable judgment, an emergency
posing imminent harm to persons or Tenant's Property shall exist resulting from
a Landlord default, Tenant may cure such default in the Premises or any portion
of the Project which, in Tenant's reasonable discretion, affects the Premises,
after providing oral notice to Landlord. The self-help option given in this
Section is for the sole protection of Tenant, and its existence shall not
release Landlord from its obligation to perform the terms, provisions, covenants
and conditions herein provided to be performed by Landlord or deprive Tenant of
any legal rights which it may have by reason of any such default by Landlord.
23.3 In addition to the rights of Landlord as provided for in
Section 23.1 hereof, Landlord shall have the right, without prior notice to
Tenant, to exercise its remedies provided in Section 23.1, upon the occurrence
of any of the following events:
36
(i) The sale of Tenant's interest in the Premises under
attachment, execution, or similar legal process or if Tenant or any
guarantor of Tenant's obligations is adjudicated a bankrupt or
insolvent under any state bankruptcy or insolvency law or an order
for relief is entered against Tenant or any guarantor of Tenant's
obligations under the Federal Bankruptcy Code, and such attachment,
execution, adjudication, or order is not vacated within sixty (60)
days.
(ii) The commencement of any action under any chapter of
the Federal Bankruptcy Code by or against Tenant or any guarantor of
Tenant's obligations, or the filing of a voluntary or involuntary
petition proposing the adjudication of Tenant or any guarantor of
Tenant's obligations as bankrupt or insolvent and such action or
petition is not dismissed within sixty (60) days.
(iii) The appointment of a receiver or trustee for the
business or property of Tenant or any guarantor of Tenant's
obligations, unless such appointment shall be vacated within sixty
(60) days.
(iv) The making by Tenant or any guarantor of Tenant's
obligations of any general assignment for the benefit of its
creditors.
(v) The admission by Tenant or any guarantor of Tenant's
obligations of its inability to pay its debts when due.
(vi) A default by Tenant in the use requirements of
Section 8.1 or Section 8.2 at any time.
(vii) The failure of the Tenant to continuously conduct
business at Premises.
(viii) The making of any Transfer under this Lease or any
interest herein by Tenant, unless such Transfer is expressly
permitted or approved by Landlord under the terms of Article 25
hereof.
23.4 No failure by Landlord or Tenant to insist upon the strict
performance of any covenant, agreement, term or condition of this Lease or to
exercise any right or remedy consequent upon a breach thereof, and no acceptance
by Landlord of full or partial rent or Rent or any component of rent during the
continuance of any breach by Tenant, shall constitute a waiver of any such
breach or of such covenant, agreement, term or condition.
23.5 In addition to the rights of Tenant to terminate this Lease as
provided for in Section 23.2 hereof, Tenant shall be entitled to terminate this
Lease upon the terms and conditions for such termination by Tenant as are
provided for in Article 33 hereof.
23.6 Notwithstanding any other term or provision of Section 23.1 or 23.2
hereof, termination of this Lease by either party under such Section 23.1 or
23.2, and damages to either party, shall not be permitted solely as a result of
defaults by either party which are determined by a final and non-reviewable
determination in the Proceedings, to be both inconsequential to the
37
relative rights or obligations of the non-defaulting party hereunder and
non-curable. In no event, however, shall the payment of Rent be determined to be
inconsequential.
23.7 Neither the termination of this Lease, nor the exercise of any other
right or remedy by a party hereto, shall terminate the right of either party
hereto to commence arbitration or, if permitted pursuant to the terms of this
Lease, litigation.
23.8 With respect to arbitration:
(a) All controversies or claims between the parties hereto
shall (I.E., must) be submitted to binding arbitration, if at all, by
the party seeking arbitration, within one hundred eighty (180) days of
the last day of the Monetary Default Period or Non-Monetary Default
Period or, as the case may be, of any other applicable passage of notice
and opportunity to cure under this Lease, failing which the disputing
party shall have no further right to submit such dispute to arbitration
or any other judicial forum. In any such arbitration, the arbitrator
shall be: (a) any person selected by the parties to the dispute, if they
are able to so agree within ten (10) business days after any party
requests the other to so agree, which ten (10) day business period shall
be not later than ten (10) days after the matter is submitted to
arbitration, and, if the parties are unable to so agree then, (b) a
single certified arbitrator selected by the American Arbitration
Association ("AAA") in accordance with the arbitration rules of the AAA
using the Law of Mississippi, as the foregoing is in existence at the
time any such arbitration is commenced. Any award of the arbitrator
shall state the reasoning on which the award is based. Landlord and
Tenant agree to use reasonable efforts to expedite any arbitration
proceeding so that a decision is reached as expeditiously as possible.
(b) The provisions of this Section 23.8 shall be construed as
independent of any other covenant or provision of this Lease; PROVIDED,
HOWEVER, that if a court of competent jurisdiction or properly convened
arbitrators determine that any such provision is invalid or
unenforceable in any respect, such court or arbitrators shall modify or
interpret such provision to the minimum extent necessary to comply with
applicable Law and public policy. Notwithstanding any provision of this
Lease relating to the governing Law of this Lease, all issues relating
to arbitrability or the enforcement of the agreement to arbitrate
contained herein shall be governed by the Laws of the State of
Mississippi, without reference to the principles of comity or conflicts
of Laws.
(c) Judgment upon an arbitration award may be entered only in a
court of competent jurisdiction over the applicable party and its
property ("Court"), and shall be binding, final and non-appealable.
Landlord and Tenant hereby waive to the fullest extent permitted by Law,
any right to or claim for punitive or exemplary damages against the
other, and agree that in the event of a dispute between them, each shall
be limited to the recovery of any actual, incidental and consequential
damages sustained, along with reasonable attorneys fees or court costs
incurred in connection with any arbitration or litigation related
thereto and cost and expenses of investigation.
38
(d) The arbitration provisions contained within this Section
23.8 shall be deemed to be self-executing. In the event either party
fails to appear at any properly noticed arbitration proceeding, an award
may be entered against such party by default or otherwise
notwithstanding such failure to appear. If the Arbitration proceeding is
brought by Landlord, the Arbitration shall take place in the City of
Orlando, State of Florida. If the Arbitration proceeding is brought by
Tenant, the Arbitration shall take place in the Xxxxxxxx County,
Mississippi. In any arbitration conducted hereunder the rules of
evidence and civil procedure of the United States Arbitration Act (Title
9, U.S. Code) shall apply to the conduct of all arbitration proceedings.
23.9 Notwithstanding anything contained herein to the contrary, either
party shall have the right to seek specific enforcement or an injunction during
the pendency of any arbitration proceedings with regard to the actions of the
other party which are the subject matter at issue in connection with such
arbitration proceedings.
23.10 Intentionally Deleted.
23.11 Each of the parties hereto hereby irrevocably (i) consents to
personal and subject matter jurisdiction in any District Court for purposes of
enforcing any award authorized by the arbitrator; and (ii) waives any and all
objections any of them might otherwise now or hereafter have to the laying of
the venue of any such suit, action or proceeding in any of any such District
Court or to service of any writ, summons or other legal process in accordance
with any of the provisions therefor set forth referred to in this Article 23.
23.12 Intentionally Deleted.
23.13 The rights and remedies herein reserved by or granted to Landlord
and Tenant are distinct, separate and cumulative, and the exercise of any one of
them shall not be deemed to preclude, waive or prejudice Landlord's or Tenant's
right to exercise any or all others. Whether or not specifically enumerated in
this Lease, Landlord and Tenant each hereby reserves all rights and remedies at
law and in equity and nothing contained in this Lease shall be construed as a
limitation of any such rights or remedies.
23.14 Landlord and Tenant hereby expressly waive any right to assert a
defense based on merger and agree that neither the commencement of any action or
proceeding, nor the settlement thereof nor the entry of judgment therein shall
bar Landlord or Tenant from bringing any subsequent actions or proceedings from
time to time.
23.15 The words "re-enter", "re-entry" and "re-entered" as used in this
Lease shall not be deemed to be restricted to their technical legal meanings.
23.16 If the Tenant's interest in this Lease is assigned, or if the
Premises or any part thereof is sublet, Landlord may, after a default by Tenant,
terminate all subleases, concessions or the like or may, at the option of
Landlord, collect rent from the assignee or subtenant and apply the net amount
collected to the Rent and other components of rent due from Tenant. No such
collection shall be deemed a waiver of the covenant herein against sale,
transfer, mortgage, assignment and subletting or a release of Tenant from the
performance of the covenants herein contained. In the event of such default,
Tenant hereby assigns the rent due from the subtenant or
39
assignee to Landlord, and hereby authorizes such subtenant or assignee to pay
the rent directly to Landlord.
23.17 In the event that it shall become necessary for either Landlord or
Tenant to employ the services of attorneys to enforce any of their respective
rights under this Lease or to collect any sums due to them under this Lease or
to remedy the breach of any covenant of this Lease on the part of the other to
be kept or performed, the nonprevailing party (Tenant or Landlord as the case
may be) shall pay to the prevailing party such reasonable fee as shall be
charged by the prevailing party's attorneys for such services arising from or
related to the arbitration proceedings permitted herein and post-judgment
proceedings and such prevailing party shall also have and recover from the
nonprevailing party (Landlord or Tenant as the case may be) all other costs and
expenses of such arbitration or with respect to any post-judgment proceedings.
The prevailing party shall be the party which substantially prevails on the
merits of the arbitration, as determined by the arbitrator.
ARTICLE 24 INDEMNIFICATION
24.1 Tenant shall indemnify Landlord against, hold Landlord harmless
from, defend Landlord against, and reimburse Landlord for, any and all
obligations, liabilities, claims, suits, proceedings, losses, damages, costs,
and expenses, including, without limitation, reasonable attorneys' fees, court
costs (whether at trial or appeal [to the extent allowed herein], in
arbitration, or otherwise) and the costs and expenses of investigation
(collectively, "Liability" or "Liabilities," as appropriate), incurred by
Landlord or Landlord's lender, and either of their agents, representatives or
contractors, and which arise out of or result in connection with any injury or
damage to any person or property occurring in, on or about the Premises, except
for the same which is caused by the gross negligence or intentional misconduct
of Landlord or its employees, agents or contractors.
24.2 Landlord shall indemnify Tenant against, hold Tenant harmless from,
defend Tenant against and reimburse Tenant for, any and all Liabilities, as
defined in Section 24.1 hereof, incurred by Tenant or its agents,
representatives or contractors and which arise out of or in connection with any
injury or damage to any person or property occurring in, on or about the Project
(other than the Premises) or any part thereof, except for the same which is
caused by the gross negligence or intentional misconduct of Tenant or its
employees, agents or contractors.
24.3 In case any claim or proceeding (including, without limitation, any
claim, investigation, or proceeding by any Governmental Entity) shall be
instituted by any person not a party to this Lease affecting any indemnified
person in respect of which indemnity will be sought pursuant to Section 24.1 or
Section 24.2 hereof, such indemnified person shall promptly (considering the
circumstances but so as to not cause prejudice to the indemnifying person)
notify the indemnifying person in writing, and the indemnifying person, within
ten (10) days following such notification from the indemnified person, shall
retain counsel reasonably satisfactory to the indemnified person (which
satisfaction shall not be unreasonably withheld) to represent the indemnified
person and any others the indemnifying person may designate in such proceeding,
and shall pay the reasonable fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified person shall have the
right to retain its own counsel, but the fees and disbursements of such counsel
shall be at the expense of such
40
indemnified person unless: (i) the indemnifying person shall have failed to
retain counsel for the indemnified person as required herein; or, (ii) counsel
retained by the indemnifying person for the indemnified person would be
inappropriate due to actual or potential differing interests between such
indemnified person and any other person represented by such counsel in such
proceeding. It is understood that the indemnifying person shall not, in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and disbursements of more than one separate firm
qualified in such jurisdiction to act as counsel for the indemnified person. The
indemnifying person shall not be liable for any settlement of any proceeding
effected without its written consent (which consent shall not be unreasonably
withheld, conditioned or delayed), but, if settled with such consent, or upon a
final judgment, the indemnifying person shall, to the extent required pursuant
to the terms of this Article 24, indemnify the indemnified person from and
against any and all liabilities by reason of such settlement or judgment. The
indemnified person shall also have the right to consent in writing in advance of
any such settlement, but such consent shall not be unreasonably withheld.
Notwithstanding any other term or provision of this Article 24, no claim for
indemnification shall be permitted if the party making such claim fails to
provide timely notice as required pursuant to this Section 24.3, or otherwise,
by act or omission, causes the party from whom indemnification is sought to
suffer any waiver of a material defense, offset, or excuse.
24.4 The indemnity obligations set forth in this Article 24 shall survive
termination or expiration of this Lease for a period commensurate with any
statute of limitation applicable to the claim at issue.
ARTICLE 25 ASSIGNMENT AND SUBLETTING
Tenant shall not assign, sublet, or otherwise transfer this Lease, or any
part of Tenant's right, title or interest therein (collectively, a "Transfer"),
without the prior written consent of Landlord. Notwithstanding the foregoing,
Tenant shall have the right, without the prior written consent of Landlord, to
Transfer all of Tenant's interest in this Lease only to (1) a purchaser from
Hard Rock Cafe International (USA), Inc. (or any of its wholly owned affiliates)
of substantially all of the Hard Rock cafe and retail store assets, (2) any
corporate affiliate of Tenant which is a wholly owned subsidiary of Hard Rock
Cafe International (USA), Inc., or (3) an authorized franchisee ("Franchisee")
of Hard Rock Cafe International (USA), Inc. or any of its wholly owned
subsidiaries ("Franchisor"), provided, however, that a Transfer in subsection
(1), (2) or (3) shall be permitted without the prior written consent of Landlord
only if each of the following conditions are satisfied:
(A) Such transferee shall assume in writing, in a form acceptable
to Landlord, all of Tenant's obligations hereunder, and Tenant shall
provide Landlord with a copy of the proposed form of such
assumption/transfer document for review and approval at least twenty (20)
days prior to the effective date of such Transfer, and such
assumption/transfer document shall be reasonably acceptable to Landlord;
(B) Except as hereinafter expressly agreed, Tenant shall continue
to remain liable under this Lease for the performance of all terms,
including, but not limited to, payment of Rent and all other components of
rent due under this Lease;
41
(C) Tenant shall not be in default of this Lease, both at the time
Tenant gives the notice required herein and upon the effective date of the
Transfer, which shall include any monetary default;
(D) Tenant shall give the Tenant's Notice specified herein to
Landlord with respect to such intended Transfer;
(E) Such transferee shall use the Premises for the same use and
purposes as the Premises were utilized by Tenant, and in accordance with
all of the terms of this Lease pertaining to use; and
(F) In the case of a Transfer to a Franchisee, Tenant's Notice
shall include a true, accurate and complete copy of the franchise
agreement, and copies of all other documents, instruments and agreements
pertaining to the franchise arrangement between Franchisor and Franchisee
(referred to herein collectively as "Franchise Documents"), together with a
certification by the chief financial officer of Franchisor, certifying that
the Franchise Documents are true, accurate and complete, and represent the
entire franchise arrangement between Franchisee and Franchisor.
In no event shall Tenant use the provisions of this paragraph to
circumvent the other provisions of this Article regarding the need for Landlord
consent.
Except to the extent otherwise provided by the terms and conditions of the
preceding paragraph, all Transfers by Tenant may be made only upon the prior
written consent of Landlord, which consent may be withheld by Landlord in its
sole and absolute discretion.
If Tenant intends to seek to Transfer all or any portion of the Premises,
Tenant shall give written notice ("Tenant's Notice") to Landlord of such
intention at least thirty (30) days prior to the date of such attempt to
Transfer. If Landlord fails to respond within such thirty (30) day period,
Landlord shall be deemed to have disapproved such requested Transfer. Tenant
agrees that it shall not attempt to Transfer to more than two (2) assignees, and
that no proposed assignee shall operate a business in the Premises which is
prohibited by this Lease or otherwise inconsistent with the use of the Project.
Promptly following any permitted Transfer, Tenant shall deliver to Landlord a
copy of such executed assignment and an agreement by the assignee assuming and
agreeing to perform, fulfill and observe all of Tenant's representations,
warranties and agreements set forth in this Lease.
Tenant shall have the right to license the operation of concessions in the
Premises provided no more than twenty percent (20%) of the Premises is allocated
to concessions, and provided that: (a) licensees or concessionaires conform to
and abide by all the terms and conditions of the Lease; (b) all rental, fees and
other consideration received by Tenant from such licensee or concessionaire
shall be included in Gross Sales; and (c) any licensee or concessionaire shall
not have a separate sign on the storefront or a separate entrance into the
Premises. In the event that Tenant shall seek to enter into any license or
concession agreement which will cause more than a total of twenty percent (20%)
of the floor area of the Premises to be so licensed, Landlord's consent shall be
required, and Tenant shall seek such consent pursuant to the procedure in the
paragraph above.
42
Any Transfer by Tenant consented to by Landlord (or a Transfer is permitted
under this Article without Landlord's consent) shall be only for the uses
permitted hereunder and for no other purpose unless otherwise agreed to in
writing by Landlord, and in no event shall any Transfer (including a permitted
Transfer which satisfies the conditions set forth above) release or relieve
Tenant from any of its obligations under this Lease except as set forth below.
Notwithstanding anything contained herein to the contrary, Tenant shall remain
fully liable for the performance of all the terms and covenants of this Lease,
unless any assignee has an audited net worth in excess of Fifty Million Dollars
($50,000,000) ("Liability Threshold") at the time of the execution of the
assignment ("Assignment Date"), in which event Tenant shall be released from
liability under this Lease. Such Liability Threshold shall be increased annually
by the Index each twelve (12) full calendar months thereafter. The "Index" is
the National Customer Price Index for all Urban Consumers U.S. City Average (All
Items; 1982-84 = 100) (the "Index") reported for the month immediately preceding
the twelve (12) month anniversary in question and the denominator of which is
the Index as published for the month preceding the month of the Assignment Date.
If the Index shall be discontinued for any reason, Landlord shall designate from
indexes supplied by the Bureau an alternative index comparable to the Index,
together with information which will make possible the conversion to the
alterative index. If for any reason the Bureau does not furnish such an index
and such information, the parties shall thereafter accept and use such other
index of comparable statistics on the costs of living in Biloxi, Mississippi, as
shall be computed and published by an agency of the U.S. Government or by a
responsible financial periodical of recognized authority then to be selected by
Landlord (subject to the prior reasonable written approval of Tenant).
If Landlord consents to a Transfer (or a Transfer is permitted under this
Article without Landlord's consent), the permitted Transferee shall assume
Tenant's obligations under this Lease and such Transferee, within thirty (30)
days before the effective date of the permitted Transfer, shall deliver to
Landlord the proposed sublease, assignment and assumption agreement or other
instrument evidencing the Transfer. Such agreement regarding Transfer shall
specifically bind any transferee to the terms of this Lease and shall state, to
the extent the same is true in accordance with the terms of this Lease, that
Tenant shall remain liable hereunder. In the event of a Transfer in the nature
of a sublease, Tenant shall pay as additional rent to Landlord along with the
monthly payments of Rent due under this Lease, fifty percent (50%) of the rent
paid to Tenant by the sublessee which exceeds the Rent after a deduction has
been made for: any brokerage commission paid by Tenant in connection with the
sublease. If said Transfer requires the consent of Landlord pursuant to this
Article, Tenant shall pay to Landlord upon demand as additional rent Landlord's
reasonable attorneys' fees and administrative expenses incurred in connection
with any Transfer not to exceed Two Thousand Five Hundred Dollars ($2,500) per
Transfer.
Any Transfer requiring Landlord's consent which is made without Landlord's
consent shall not be binding upon Landlord, and shall confer no rights upon any
third person. Each such unpermitted Transfer shall, without notice or grace
period of any kind, constitute a default by Tenant under this Lease. The
acceptance by Landlord of the payment of Rent or any component of rent following
any Transfer prohibited by this Article shall not be deemed to be either a
consent by Landlord to any such Transfer or a waiver by Landlord of any remedy
of Landlord under this Lease. Consent by Landlord to any one (1) Transfer shall
not constitute a waiver of the requirement for consent to any other Transfer. No
reference in this Lease to assignees,
43
concessionaires, subtenants or licensees shall be deemed to be a consent by
Landlord to the occupancy of the Premises by any such assignee, concessionaire,
subtenant or licensee.
ARTICLE 26 COMMISSIONS
Landlord and Tenant acknowledge that no broker is entitled to a commission
in connection with such party's negotiation or execution of this Lease. Each
party shall indemnify, defend, and hold harmless the other party from and
against any liability arising out of a claim by any third person claiming
through such party a right to brokerage, finder's or similar fees in connection
with this transaction including, but not limited to, attorney's fees and
paralegal fees, court costs and expenses incurred by such party in any
arbitration and/or at the trial and appellate levels.
ARTICLE 27 NOTICES
All notices, demands, requests, consents, approvals, and other
communications (collectively, "Notices"), required or permitted to be given
hereunder, shall be in writing and sent by either: (i) United States registered
or certified mail, postage prepaid, return receipt requested; or, (ii) special
delivery service (E.G. Federal Express, DHL, UPS, ETC.); addressed to the party
to be so notified as follows:
IF TO LANDLORD: Premier Entertainment Biloxi LLC
00000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xx. Xxxxx X. Xxxxxxxx
WITH COPY TO: Xxxxx & Xxxxxxx LLP
0000 Xxxxxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxx, Esquire
WITH A FURTHER COPY TO: Xxxxx Xxxxxx LLP
000 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Esquire
AND A COPY TO: AA Capital Partners, Inc.
00 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx, Xx.
44
IF TO TENANT: Hard Rock Cafe International (STP), Inc.
0000 Xxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxx X. Xxxxxxxxx, Esquire,
Vice President and General Counsel
WITH A COPY TO: Akerman Senterfitt
Citrus Center, 17th Floor
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxx X. Xxxxx, Esquire
Each of the Notices sent in accordance with the requirements of this section
shall be deemed effectively given upon the day of receipt or refusal as
evidenced by records of the United States mail in regard to (i) and the records
of the overnight courier service in regard to (ii). Each person designated
herein to receive any of the Notices or a copy thereof may change the address at
which, or the person to whom, any of the Notices or a copy thereof is to be
delivered, by any form of the Notices given in accordance with the requirements
of this Section.
Tenant shall give prompt written notice to any mortgagee of any default of
Landlord under this Lease, and Tenant shall allow such mortgagee time in which
to cure any such default (and shall accept the cure of any default by such
mortgagee) as provided in Section 29 hereof or as may be provided in any
separate written agreement between Landlord and any such mortgagee. No notice
shall be effective unless and until a copy of the same shall also be sent to
such mortgagee in the manner prescribed in this Article and to such address as
mortgagee shall designate.
ARTICLE 28 INSURANCE
28.1 In this Lease "Required Insurance" means the insurance coverage
specified in EXHIBIT "J". At Tenant's sole cost and expense, and in accordance
with the terms of EXHIBIT "J", Tenant shall secure and keep in force all
Required Insurance at all times during the Term. In the event that Tenant fails
to keep in force all Required Insurance at all times during the Term, the
Landlord shall have the right, but not the obligation, to secure all or a
portion of the Required Insurance, in Landlord's sole discretion, and the cost
and expense of such insurance shall be treated as additional rent and, in
addition, Landlord shall have all other remedies under Article 23.
28.2 During the Term of the Lease, Landlord, at Landlord's sole cost and
expense shall secure and keep in force a policy or policies of all risk property
insurance, insuring the Project, against loss or damage by fire, tornado,
lightning, wind damage, infestation or other casualty which would be typically
insured against in the metropolitan Biloxi, Mississippi area in an amount equal
to the full replacement value (exclusive of foundations and footings) with
commercially reasonable deductibles. Landlord shall also secure and keep in
force a policy or policies of comprehensive general liability insurance written
on an "occurrence" basis with coverage limits of not less than Five Million
Dollars ($5,000,000) per occurrence for bodily
45
injury and property damages (collectively "Landlord's Insurance") and a
deductible of not more than Fifty Thousand Dollars ($50,000.00). Further, should
some entity other than Landlord operate and maintain the Common Areas and/or the
Hotel (i.e. a manager in the employ of Landlord), Landlord shall require such
entity to secure and maintain comprehensive general liability insurance policy
or policies of equal or greater coverage with commercially reasonable
deductibles. A duly executed certificate of such insurance shall be delivered to
Tenant upon written request to Landlord.
28.3 All Required Insurance and Landlord's Insurance shall be evidenced
by policies issued by an insurance company rated "A-VI" or better by A.M. Best &
Co., and licensed to do business in the State of Mississippi. Each such policy
is hereinafter referred to in this Lease as an "Insurance Policy". Each
Insurance Policy shall provide that the same shall not be amended or canceled
except after thirty (30) days prior written notice to both Landlord and Tenant
and except with respect to worker's compensation insurance carried by each of
the parties hereto, shall insure Landlord, Landlord's lender and manager, if
any, or Tenant, as applicable, as an additional insured and, in the case of
Landlord Insurance, except with respect to (i) worker's compensation insurance
carried by each of the parties hereto, and (ii) Landlord's property insurance
insuring the Project, shall list Tenant as an additional insured for the
Premises. Duly executed certificates of insurance shall be delivered by the
parties to each other no less than ten (10) days prior to Commencement Date and
upon the annual anniversary date thereof. Neither the issuance of any insurance
policy required under this Lease nor the minimum limit specified herein shall be
deemed to limit or restrict in any way either party's liability arising under or
out of this Lease.
If any of the foregoing policies are not available at commercially
reasonable prices, Landlord will use reasonable efforts to substitute reasonably
equivalent coverage, provided such substitute coverage is available at
commercially reasonable prices. If such substitute coverage is not available at
commercially reasonable prices, Landlord shall endeavor to obtain such
substitute coverage as may be available in the Biloxi, Mississippi commercial
area consistent with coverage for such risk carried by Beau Rivage or other
similar casinos in the Biloxi, Mississippi waterfront area.
Any insurance provided for in this Article to be maintained by either party
may be effected by a blanket policy or policies of insurance, or under so-called
"all risk" or "multi-peril" insurance policies, provided that the amount of the
total insurance available shall be at least the protection equivalent to
separate policies in the amounts herein required, and provided further that in
all other respects, any such policy or policies shall comply with the provisions
of this Article. An increased coverage or "umbrella policy" may be provided and
utilized by either party to increase the coverage provided by individual or
blanket policies in lower amounts, and the aggregate liabilities provided by all
such policies shall be satisfactory provided they otherwise comply with the
provisions of this Article. In any such case, it shall not be necessary for
either party to deliver the original of any such blanket policy to the other
party or any Mortgagee, so long as such other party upon request of the other
party is furnished with a certificate or duplicate of such policy reasonably
acceptable to such party upon request. If Landlord has effected policies of
insurance providing concurrent coverage with Tenant's insurance then such
insurance furnished by Landlord shall be regarded as excess and Tenant's
insurance as primary to the extent that Landlord's insurance shall not provide
for the payment of
46
loss until Tenant's insurance has been exhausted or in situations where Tenant's
insurance does not provide for coverage of loss. Notwithstanding the foregoing,
Tenant's comprehensive general liability insurance shall be primary to and not
contributory to any similar insurance carried by Landlord, and shall contain a
severability of interest clause. The existence of excess insurance shall not
reduce the protection or the payment to be made under Tenant's insurance.
Notwithstanding anything set forth in this Lease to the contrary, Landlord
and Tenant do hereby waive any and all right of recovery, claim, action or cause
of action against the other and their respective agents, representatives,
lenders or contractors (collectively the "Related Parties") for any loss or
damage that may occur to Landlord or Tenant or any party claiming by through or
under Landlord or Tenant, as the case may be, their respective property, the
Project or the Premises or any addition or improvements thereto, or any contents
therein, by reason of fire, the elements or any other cause, regardless of cause
or origin, including the negligence of Landlord or Tenant, or their respective
Related Parties, which loss or damage is covered by valid and collectible
policies of insurance, to the extent that such loss or damage is recoverable
under such insurance policies. All insurance policies carried by either party
with respect to the Project or the Premises, whether or not required to be
carried by this Lease shall permit the waiving of any right of recovery on the
part of the insured against the other party for any loss or damage to the extent
such rights have been waived by the insured prior to the occurrence of such loss
or damage. For the purpose of the foregoing waiver, the amount of any deductible
applicable to any loss or damage shall be deemed covered by and recoverable by
the insured under the insurance policy to which such deductible relates. In the
event that either party is permitted to by the terms of this Lease and
self-insures any risk which would have been covered by the insurance required to
be carried by this Lease or either party fails to carry any insurance required
to be carried pursuant to this Lease, then all loss or damage to the other
party, its business, its property, the Premises, the Project or any additions or
improvements thereto or contents thereof that would have been covered by such
insurance had such party maintained it shall, for purposes of the waiver set
forth in this Section, be deemed covered and recoverable by such party under
valid and collectible policies of insurance. The term insurance as used in this
Section shall be treated as if there had been no deductibles and that the
insurance provided for 100% of the replacement cost.
Neither Tenant nor any of Tenant's agents, representatives or contractors
shall do or fail to do anything which will (i) violate the terms of or increase
the rate of, any of Landlord's or any other tenant or occupant's insurance
policies; (ii) prevent Landlord from obtaining such policies of insurance
acceptable to Landlord or any mortgagee; or (iii) contravene the rules,
regulations and recommendations of Landlord's insurance companies, the Fire
Insurance Rating Organization or any similar body having jurisdiction over the
Premises or the National Board of Fire Underwriters or any similar body
exercising similar functions in connection with the prevention of fire or the
correction of hazardous conditions. In the event of the occurrence of any of the
events set forth in this Section, Tenant shall pay Landlord upon demand, as
additional rent, the cost of the amount of any increase in any such insurance
premium. If Tenant and other tenants have caused an increase in premium, Tenant
and all other tenants shall pay their proportionate share of such increase.
47
ARTICLE 29 MORTGAGE NON-DISTURBANCE AND SUBORDINATION
Concurrent with the execution and delivery of this Lease, each of Landlord
and Tenant agrees to execute and deliver the Subordination, Non-Disturbance and
Attornment Agreement with AA Capital Direct Investments Fund, L.P., a Delaware
limited partnership, in the form attached as EXHIBIT "K" hereto and made a part
hereof (referred to herein as the "AA Capital SNDA"). Failure by Landlord or
Tenant to execute and deliver the AA Capital SNDA shall, without notice or grace
period of any kind, constitute a default under this Lease by the party failing
to so execute and deliver the AA Capital SNDA.
Tenant agrees, upon the Landlord's request, to subordinate this Lease and
the rights included hereunder to any now or hereafter existing liens (or any
renewal, replacement or extension thereof) placed by the Landlord upon the
Property with any one or more insurance company, bank, or any other recordable
lender and/or any present and future ground lessor ("Lienholder"), provided that
such lien by its terms, or by separate agreement with the Tenant, provides that
this Lease shall not terminate as a result of the foreclosure of such lien
(unless required by the Law, but only if the entity entering into possession
enters into a lease with Tenant upon the same terms and conditions as contained
in this Lease), that if Tenant is not in default under the terms of this Lease
(beyond notice and applicable cure periods), Tenant's rights under this Lease
shall continue in full force and effect and its possession be undisturbed,
except in accordance with the provisions of this Lease, including, but not
limited to the terms of Article 23, and that Tenant shall attorn to any entity
entering into possession of the Property. The Tenant agrees that it will, upon
request of the Lienholder, be a party to such an agreement, and will agree that
if such Lienholder succeeds to the interest of the Landlord, the Tenant will
recognize said Lienholder (or successor-in-interest of the Lienholder) as its
Landlord under the terms of this Lease. The Tenant agrees to execute and deliver
upon the Landlord's demand such instruments which comply with all of the
provisions hereof and such other provisions reasonably requested by the
Lienholder. The Tenant expressly agrees that such instrument shall provide for
written notice of any default asserted by Tenant under this Lease to be
delivered to such Lienholder, and that such Lienholder shall be entitled to
substantially the same notices, secured party rights and cure periods provided
for in Section 24 of the License Agreement. Tenant also agrees to attorn to any
other successor-in-interest to Landlord, provided such successor-in-interest
agrees that this Lease shall not terminate, except in accordance with the
provisions of this Lease.
If a Lienholder shall so elect in a written instrument, this Lease and
Tenant's rights hereunder shall be superior and prior in right to its lien, with
the same force and effect as if this Lease had been executed, delivered and
recorded prior to the execution, delivery and recording of such lien.
ARTICLE 30 LANDLORD'S COVENANTS
30.1 Unless specifically waived by Tenant in writing, and provided that
Tenant is not in default of its obligations under the terms of this Lease in any
material respect after Notice and the expiration of applicable cure period(s),
during the Lease Term, Landlord covenants and agrees that no portion of the
Project or any other property owned (equitably or in fee) by Landlord within a
five (5) mile radius of the Premises (other than the Premises), shall be used
for
48
the sale of merchandise (including, but not limited to, wearing apparel,
clothing, souvenirs, gift items and/or accessories) bearing or displaying in any
manner whatsoever (i) the words (a) "Biloxi", (b) "Gulfport", (c) "Gulf Coast",
(c) "Playground of the South", or (d) "Bay St. Louis"; (ii) bearing the name of
any other geographic location or region within twenty-five (25) miles of the
Premises; (iii) bearing any now existing or hereafter created pseudonym,
marketing name, trade name or other variation of the words or geographic
locations or regions listed in Sections 30.1(i) or (ii); or (iv) bearing the
name "Hard Rock", or any variation thereof.
30.2 During the Term of this Lease (and any extension thereof), these
restrictions shall bind and inure to the benefit of Landlord and Tenant, their
respective successors and permitted assigns, and shall be binding on each person
or entity having any interest in the Property derived from Landlord or any owner
thereof, as a tenant, occupant, licensee or otherwise, provided, however, that
the restrictions contained in this Section shall not be in effect during any
period or periods during which Tenant is in default of its obligations under the
terms of this Lease in any material respect after Notice and the expiration of
applicable cure period(s). The restrictions contained in this Section constitute
a material consideration to Tenant in entering into this Lease. Landlord
acknowledges that in the event of material breach of these restrictions, as
determined by the arbitrator, which breach shall continue for a period of thirty
(30) days after delivery of written notice thereof by Tenant to Landlord, Tenant
shall be entitled to exercise its remedies under this Lease and, without any
further notice to Landlord, at Tenant's option, to cancel this Lease and receive
a reimbursement of the unamortized cost of all improvements installed, to
continue the Lease but at a Percentage Rate of one-half (1/2) of the applicable
Percentage Rate set forth in Section 4.1(c) hereof, or to obtain injunctive
relief or to seek any other relief. Tenant's remedies hereunder shall be
cumulative rather than exclusive.
30.3 Provided that Tenant shall execute and deliver the Memorandum of
Lease described in Section 35.9 hereof, Landlord shall, within thirty (30) days
after the date Tenant executes and delivers such Memorandum of Lease, at
Landlord's sole cost and expense, obtain and provide Tenant with an ALTA Form B
leasehold title insurance policy issued by First American Title Insurance
Company (or such other title insurance company selected by Landlord), having a
policy amount of One Million Dollars ($1,000,000.00) and insuring Tenant's
interest in and to the Premises and this Lease, which evidences that no
encumbrances affect the Premises other than those encumbrances shown as
exceptions to title therein. For a period of thirty (30) days following the
Effective Date, Tenant shall have the right to review all encumbrances to title
shown as exceptions to title on the commitment for such leasehold title
insurance policy. In the event Tenant reasonably determines that any such
encumbrances materially and adversely affect the marketability of title to the
leasehold estate of Tenant created by this Lease, or Tenant's use of the
Premises as permitted herein, Tenant shall notify Landlord of same before the
end of such thirty (30) day period. If Tenant fails to notify Landlord of any
objectionable title encumbrances within such thirty (30) day period, Tenant
shall be deemed to have approved of all matters relating to the condition of
title to the leasehold estate of Tenant created by this Lease as disclosed in
the leasehold title policy (or the title commitment relating thereto). If Tenant
gives Notice to Landlord of any objectionable title encumbrances within such
thirty (30) day period, Landlord shall have the right, but not the obligation,
for a period of one hundred twenty (120) days after receipt of Tenant's notice,
to attempt to remove such objectionable encumbrances from the leasehold title
policy (or the title commitment relating thereto), or to cause the title
insurance company to commit to insure over same in a manner
49
reasonably satisfactory to Tenant. If such objectionable encumbrances are not
removed or insured over in a manner reasonably satisfactory to Tenant within the
permitted time, Tenant shall have the right, but not the obligation, to
terminate this Lease by providing thirty (30) days written notice to Landlord.
30.4 Provided that Tenant is not in default of its obligations under the
terms of this Lease in any material respect after Notice and the expiration of
applicable cure period(s) during the Lease Term (including, without limitation,
remaining open during the hours and days specified in Section 8.1 hereof),
Landlord covenants and agrees that no portion of the Project (other than the
Premises) shall be used or operated as a retail store or shop selling or
offering for sale Sundry Items. For purposes of this Lease, the term "Sundry
Items" shall have the meaning generally ascribed to the same and shall include,
without limitation, personal items, over-the-counter drugs and medicines,
toiletries, sun care products, such as sun tan and sun-block lotions, oils and
creams, newspapers, magazines, books, games, snack foods, non-alcoholic canned
or bottled beverages, chewing gums, candies, cigarettes, cigars and other
tobacco products. Provided that Tenant is not in default of its obligations
under the terms of this Lease in any material respect after Notice and the
expiration of applicable cure period(s) during the Lease Term, Landlord further
covenants and agrees that no portion of the Project (other than the Premises)
shall be used or operated for the sale or distribution of: (i) personal items,
(ii) over-the-counter drugs and medicines, (iii) toiletries, (iv) newspapers,
magazines, books and games, (v) souvenirs, and (iv) Trade Name branded recorded
music, compact discs and videotapes (the items described in the preceding
clauses (i) through (iv) are referred to herein collectively as the "Exclusive
Sundry Items"; all Sundry Items other than Exclusive Sundry Items shall be
referred to herein collectively as the "Non-Exclusive Sundry Items"); provided,
however, that Landlord shall have the right to (a) offer and deliver to guests,
customers and patrons, without charge, newspapers and location-specific
magazines, (b) offer, sell and deliver to guests, customers and patrons (1)
games and toys for use in the pool, (2) recorded music, compact discs and
videotapes (other than recorded music, compact discs and videotapes branded with
the Trade Name), and (3) any Exclusive Sundry Items which Tenant refuses (after
receipt of a written request from Landlord) to offer for sale in the Premises.
Except for Tenant's exclusive right in the Project to (a) operate a retail store
or shop selling or offering for sale Sundry Items, and (b) offer for sale and
sell the Exclusive Sundry Items, Landlord shall have the right elsewhere in the
Project (other than the main lobby area of the Hotel) to sell or offer for sale
Non-Exclusive Sundry Items, including, without limitation, (i) the right of
waitpersons employed by Landlord to offer, sell and deliver Sundry Items to
customers in the casino and at the pool, (ii) in conjunction with the operation
of a pool cabana, restaurant or bar in the Project, (iii) from vending machines,
(iv) from kiosks and stands (whether attended by persons to take money and
assist in the sale or unattended), and (v) from mini bars in hotel rooms.
ARTICLE 31 ENVIRONMENTAL REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION;
ASSESSMENTS; REMEDIATION
31.1 Landlord hereby represents and warrants to Tenant that, as of the
Effective Date the Property and areas within and underlying the Property
(including the land and groundwater thereunder) is, to the actual knowledge of
Landlord without any investigation or inquiry whatsoever, and except as may be
disclosed in any environmental reports or other information pertaining to the
Project or the Premises (collectively, "Environmental Information") provided to
50
Tenant before the Effective Date, in compliance in all material respects with
all Laws of all Governmental Entities. The foregoing to the contrary
notwithstanding, if Tenant's review of such Environmental Information pertaining
to the condition of the Project or Premises reveals violations of such Laws that
would materially and adversely affect Tenant's development plans for the Project
or Premises, the operating of Tenant's business thereon or the costs associated
therewith, Tenant may terminate this Lease by notifying Landlord at any time
prior to the Commencement Date, unless the matter can be fully remediated as
required by Law by Landlord without delay to Tenant prior to the Commencement
Date. Upon the date set forth in such Notice the parties hereto shall thereafter
be relieved of all rights and obligations hereunder, except as expressly stated
herein as surviving. The term "Hazardous Substance" means (i) any substance
defined as a "hazardous substance" under CERCLA (as hereinafter defined), (ii)
petroleum, petroleum products, natural gas, natural gas liquids, liquefied
natural gas, and synthetic gas, and (iii) any other substance or material deemed
to be hazardous, dangerous, toxic, or a pollutant under any Law as of the
Effective Date.
31.2 Landlord hereby represents and warrants to Tenant the following
statements are true and correct as of the Effective Date:
(a) To the Landlord's actual knowledge and belief, without any
investigation or inquiry whatsoever, and except as may be disclosed in
any Environmental Information provided to Tenant before the Effective
Date, the Property, and, without limitation, all improvements thereon,
are free from all Hazardous Substances, there has not been thereon a
Release (as hereinafter defined), discharge or emission, or threat of
Release, discharge or emission, of any Hazardous Substance, and the
Property does not contain, nor is it affected by, any Hazardous
Substance, including asbestos, urea formaldehyde, polychlorinated
biphenyls, underground storage tanks, or landfills, land disposals or
dumps (whether permanent or temporary). As of the Commencement Date,
Landlord has not knowingly caused or permitted any Hazardous Substance
to be placed, held, located or disposed of on, under or at the Property
or any part thereof.
(b) To Landlord's actual knowledge, without any investigation
or inquiry whatsoever, and except as may be disclosed in any
Environmental Information provided to Tenant before the Effective Date
hereof, (i) is not required by Laws to give and has not received, any
notice, letter, citation, order, warning, complaint, inquiry, claim or
demand that the Landlord has violated any environmental Laws applicable
to the Property; (ii) is not aware of any Release of Hazardous
Substances as defined in Laws on the Property for which the Landlord is
presently or may be liable, in whole or in part, for the costs or
cleaning up or remediating Hazardous Substances; and (iii) is not
subject to a lien in favor of any Governmental Entity for any liability,
costs or damages under environmental Laws.
(c) To Landlord's actual knowledge, without any investigation
or inquiry whatsoever, and except as may be disclosed in any
Environmental Information provided to Tenant before the Effective Date
hereof, there is no environmental litigation or environmental
governmental proceeding pending, nor to the knowledge of the Landlord,
threatened, against the Landlord or affecting the Property.
51
31.3 Tenant acknowledges that Landlord has made available to Tenant a
copy of all Environmental Information pertaining to the environmental condition
of the Property, and Tenant is satisfied with the environmental condition of the
Property disclosed by the Environmental Information.
31.4 Except as set forth herein, Tenant shall not use or allow the
Premises to be used for the Release, storage, use, treatment, disposal or other
handling of any Hazardous Substance, without the prior consent of Landlord. The
term ""Release" shall have the same meaning as is ascribed to it in the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Section9601 ET SEQ., as amended, ("CERCLA").
31.5 Except to the extent provided in Section 31.6 below, Tenant shall
obtain the prior written consent of Landlord prior to conducting or permitting
to be conducted on the Premises any activity or operation which involves the
Release, use, handling, generation, treatment, storage, or disposal of any
Hazardous Substance ("Tenant's Hazardous Substance Activity"), which consent may
be withheld in Landlord's sole and absolute discretion. In the event Landlord
shall consent to Tenant's Hazardous Substance Activity on the Premises, Tenant
shall: (a) comply with all Laws, permits and licensing conditions governing the
Release, discharge, emissions, or disposal of any Hazardous Substance and
prescribing methods for or other limitations on storing, handling, or otherwise
managing Hazardous Substances, (b) at its own expense, promptly contain and
remediate any Release of Hazardous Substances arising from or related to
Tenant's Hazardous Substance Activity in the Premises, the Project, or the
environment, (c) give prompt notice to Landlord, and all appropriate regulatory
authorities, of any Release of any Hazardous Substance in the Premises or the
environment arising from or related to Tenant's Hazardous Substance Activity,
which Release is not made pursuant to and in conformance with the terms of any
permit or license duly issued by appropriate governmental authorities, any such
notice to include a description of measures taken or proposed to be taken by
Tenant to contain and remediate the Release and any resultant damage to
property, persons, or the environment, (d) at Landlord's request, which shall
not be more frequent than once per calendar year, retain an independent engineer
or other qualified consultant or expert acceptable to Landlord, to conduct, at
Tenant's expense, an environmental audit of the Premises and immediate
surrounding areas, and the scope of work to be performed by such engineer,
consultant, or expert shall be approved in advance by Landlord, and all of the
engineer's, consultant's, or expert's work product shall be made available to
Landlord, (e) at Landlord's request from time to time but no more often than one
(1) time per Rental Year, execute affidavits, representations and the like
concerning Tenant's best knowledge and belief regarding the presence of
Hazardous Substances in the Premises, and (f) upon expiration or termination of
this Lease, surrender the Premises to Landlord free from the presence and
contamination of any Hazardous Substance caused by Tenant or its affiliates,
agents, representatives or contractors.
31.6 Tenant shall have the right to store, use and handle at the Premises
cleaning supplies ordinarily stored, used and handled in the ordinary course of
Tenant's business, so long as they are stored, used and handled in strict
compliance with all applicable Laws and requirements of each and every
Governmental Entity.
52
ARTICLE 32 RESERVED
ARTICLE 33 TENANT'S RIGHT TO RENT ABATEMENT AND SPECIAL RIGHTS TO TERMINATE
33.1 In addition to any other rights of Tenant in this Lease as provided
herein and notwithstanding anything to the contrary contained herein, provided
that Tenant is not in default of its obligations under the terms of this Lease
after Notice and the expiration of applicable cure period(s), Tenant shall have
the following rights in the event of the occurrence of any of the following
(subject in each case to Force Majeure, to the extent applicable to such
occurrence):
(a) Notwithstanding anything in this Lease to the contrary,
provided that Tenant is not in default of its obligations under the
terms of this Lease after Notice and the expiration of applicable cure
period(s), Tenant shall have the right to terminate this Lease by
written notice to Landlord if any Governmental Entity having
jurisdiction over the Premises, for any reason beyond Tenant's
reasonable control, permanently prohibits the opening or operation as a
retail sales facility in a geographic area that includes the Premises,
and as a result thereof, Tenant is required to and does close the entire
Premises, provided Tenant has paid all applicable fees, diligently
pursued all commercially reasonable legal efforts and prosecuted all
available administrative and judicial appeals, to have such prohibition
rescinded. Failure of Tenant to comply with all applicable Laws (other
than Laws permanently prohibiting the opening or operation as a retail
sales facility) shall not be deemed to be a reason beyond Tenant's
reasonable control. Tenant shall supply written notice to Landlord of
such prohibition as soon as possible after the prohibition shall be
enacted. Tenant shall also provide to Landlord with its notice of
termination a reasonably detailed listing of its legal efforts to obtain
a rescission of such prohibition. Such termination shall be effective as
of the date of the termination notice. Upon termination, neither party
shall have any liability to the other except as expressly stated in this
Lease; or
(b) In the event Tenant is unable to obtain its signage
approval, building permit or other permits and approvals reasonably
necessary for the operation of Tenant's business on the Premises (the
"Approvals"), after (i) complying with all applicable requirements with
which Tenant can reasonably and economically comply, (ii) diligently
pursuing all commercially reasonable legal efforts, (iii) prosecuting
all available commercially reasonable administrative and judicial
appeals, and (iv) paying all applicable fees, that will substantially
adversely affect the opening of Tenant's business in the Premises,
Tenant shall notify Landlord of same within thirty (30) days of Tenant's
receipt of notice relating thereto. Landlord shall have the right, but
not the obligation, for a period of one hundred twenty (120) days after
receipt of Tenant's notice to obtain the Approvals for Tenant; provided,
however, all application fees related thereto shall be paid by Tenant,
and Tenant shall reimburse Landlord for any and all reasonable fees and
costs paid or incurred by Landlord in attempting to secure the Approvals
for Tenant. Tenant shall use good faith efforts to cooperate with
Landlord's efforts to obtain such Approvals. In the event Landlord is
53
unable to obtain the Approvals during such 120 day period for reasons
beyond the reasonable control of Tenant, Tenant shall have the right,
but not the obligation, to terminate this Lease by providing thirty (30)
days written notice to Landlord. Tenant hereby agrees to inform Landlord
upon its submission of plans and applications for permits and to allow
Landlord to aid Tenant in expediting the approval of the Approvals and
further agrees that Tenant shall submit the necessary plans and
applications for the building permit by the date which is ten (10) days
after Landlord delivers the Premises to Tenant, provided Tenant has
submitted Tenant's Plans in the time and manner required by Section 11.1
of this Lease and Landlord has finally approved Tenant's Plans for the
Premises as required in Section 11.1 within one hundred twenty (120)
days of the Effective Date. Notwithstanding the foregoing, in the event
Landlord is unable to obtain Approval for Tenant's signage by the
Required Opening Date for reasons beyond the reasonable control of
Tenant, Tenant shall have the right to terminate this Lease.
(c) In the event Tenant suffers the loss of any of the
Approvals, and the same is beyond Tenant's reasonable control and not
due to the neglect or wrongful failure of Tenant, after (i) using
diligent, good faith efforts to re-obtain the same, (ii) complying with
all applicable requirements with which Tenant can reasonably and
economically comply, (iii) diligently pursuing all commercially
reasonable legal efforts to re-obtain the same, (iv) prosecuting all
available commercially reasonable administrative and judicial appeals to
re-obtain the same, and (v) paying all applicable fees, and provided
that the loss of any such Approvals will substantially adversely affect
the operation of Tenant's business in the Premises, Tenant shall notify
Landlord of same within sixty (60) days of Tenant's receipt of notice
relating thereto. Landlord shall have the right, but not the obligation,
one hundred twenty (120) days after receipt of Tenant's notice to
re-obtain the Approvals for Tenant at the Tenant's cost. Tenant shall
use good faith efforts to cooperate with Landlord's efforts to re-obtain
such Approvals. Tenant shall reimburse Landlord for any and all
reasonable fees and costs paid or incurred by Landlord in attempting to
secure the Approvals for Tenant. In the event Landlord is unable to
re-obtain the Approvals during such 120-day period for reasons beyond
the reasonable control of Tenant, Tenant shall have the right, but not
the obligation, to terminate this Lease by providing thirty (30) days
written notice to Landlord.
(d) In the event the construction of the Hotel, Common Areas or
Parking Garage is not substantially completed (as defined in Article 10)
by the Required Opening Date, subject to delays caused by Force Majeure,
Tenant Delay or defaults on the part of Tenant; then, in such event, the
Tenant shall be entitled to one (1) day delay abatement of Rent for each
day after the date the Premises is open for business until the date the
last of the Common Areas, Hotel, and Parking Garage is substantially
complete (as defined in Article 10). In addition, if the construction of
the Hotel, Common Areas or Parking Garage is not substantially completed
(as defined in Article 10) by the Required Opening Date, subject to
delays caused by Force Majeure, Tenant Delay or defaults on the part of
Tenant, Tenant shall, at any time thereafter but before the Hotel,
Common Areas or Parking Garage is substantially completed, have the
right to terminate this Lease and, within thirty (30)
54
days of the last of the termination date and receipt of full lien
waivers and an invoice in reasonable detail from Tenant stating the
costs to be reimbursed, Landlord shall reimburse Tenant for all actual,
commercially reasonable, third-party costs expended by Tenant for
construction of the Premises, including, commercially reasonable costs
for the preparation and review of plans and specifications, and the
performance of the Work by Tenant, commercially reasonable attorneys'
fees and commercially reasonable training expenses from Landlord. Such
right of termination shall cease as to such event on the date that each
condition of which could trigger termination is met.
(e) If any of the Site Work, Off -Site Work or the Shell of the
Premises are not substantially complete by the date specified in
Landlord's Delivery Notice, Landlord shall reimburse Tenant for any
actual, commercially reasonable, out-of-pocket expenses incurred by
Tenant in preparing to perform its construction obligations under this
Lease (i.e., mobilization expenses).
(f) If at any time, for reasons other than those stated in
Articles 17 and 18, any of the Hotel, Common Areas, or Parking Garage
are not open for business (as defined in Article 10 hereof) or with
respect to the casino portion of the Hotel, except as required by a
Governmental Entity or determined by the Landlord for the safety and
protection of casino guests, (a "Co-Tenancy Violation"); provided,
however, closures caused by Casualty or Condemnation as set forth in
Articles 17 and 18, respectively, shall be deemed a "Co-Tenancy
Violation", then:
(1) For and with respect to the period commencing after (a) a
Co-Tenancy Violation has occurred and ending with (x) the date upon which the
last of the Hotel is again open and being operated, determined as above, or (y)
such condition is deemed waived (the "Co-Tenancy Rent Period"), Tenant shall pay
to Landlord an amount equal to one-half (1/2) of the applicable Percentage Rate
as set forth in Section 4.1(c) hereof multiplied by Tenant's Gross Sales during
the applicable calendar month, in lieu of any Rent due hereunder, for each
calendar month (or partial calendar month) during the Co-Tenancy Rent Period
(the "Co-Tenancy Rent"); and
(2) In the event that a Co-Tenancy Violation continuously exists
for twelve (12) consecutive calendar months, Tenant shall have the right to
terminate this Lease by serving thirty (30) days written notice upon Landlord
(which right shall continue until such time as the Co-Tenancy violation ceases),
and, within thirty (30) days of last of the termination date and receipt of an
invoice in reasonable detail from Tenant stating the costs to be reimbursed,
Landlord shall reimburse Tenant for all actual unamortized, third-party costs
expended by Tenant for construction of the Premises, including, costs for the
preparation and review of plans and specifications, and the performance of the
Work by Tenant, commercially reasonable attorneys' fees and commercially
reasonable training expenses from Landlord and Tenant's operating profit for two
(2) years. In the event that Tenant does not terminate this Lease as provided in
this paragraph, Tenant shall continue with payment of the Co-Tenancy Rent until
such time as the Co-Tenancy Violation ceases, whereupon Tenant shall return to
the payment of Rent in accordance with the terms of this Lease. Upon the date
set forth in Tenant's prior written notice to the Landlord for termination
pursuant to the terms of Section 33.1, the parties hereto
55
shall thereafter be relieved of all rights and obligations hereunder which would
otherwise accrue following such date, except as provided in Section 35.12.
33.2 Landlord and Tenant acknowledge that Landlord is obligated under
the License Agreement to pay Technical Service Fees (as defined in the License
Agreement), Continuing Fees (as defined in the License Agreement) and other
fees, costs and expenses (collectively "License Fees") to Licensor and that
Tenant and Licensor are related entities. Notwithstanding any provision
contained herein to the contrary, if Landlord fails to pay any License Fee when
due as prescribed in the License Agreement (after expiration of any applicable
notice and cure period), and after determination by an arbitrator in accordance
with the terms of the License Agreement that such amount is due, Tenant shall
have the right to offset against Rent, and any other amount due to Landlord
under this Lease, the amount so due. Similarly, if Tenant fails to pay any rent
when due as prescribed in this Lease (after expiration of any applicable notice
and cure period), and after determination by an arbitrator in accordance the
terms of this Lease that such amount is due, Landlord/Licensor shall have the
right to offset against any License Fees, and any other amount due to Licensor
under License Agreement, the amount so due.
ARTICLE 34 INTENTIONALLY DELETED
ARTICLE 35 MISCELLANEOUS
35.1 This Lease shall be governed by and construed in accordance with the
Laws of the State of Mississippi applicable to contracts made and to be
performed entirely in that state.
35.2 Exhibits "A" through "L" (and all accompanying schedules and
appendices) to this Lease are incorporated in this Lease as though fully set
forth herein.
35.3 The terms, covenants, conditions, and provisions of this Lease shall
bind and inure to the benefit of Landlord and Tenant and their respective
representatives, successors, and permitted assigns. Provided the new Landlord
agrees to accept the terms and conditions of this Lease, upon any sale or other
transfer by Landlord of its interest in the Premises, Landlord shall be relieved
of any obligations under this Lease occurring subsequent to such sale or other
transfer.
35.4 Landlord and Tenant represent and warrant to each other that the
execution, delivery and performance of this Lease has been duly authorized by
all necessary corporate, partnership, or other organizational action, as
required.
35.5 Landlord and Tenant shall promptly provide the other party, upon
written request, with a copy of all material written notices received from any
Governmental Entity in respect of the Premises.
35.6 At the request of either Landlord or Tenant, the other shall with
reasonable promptness (but in no event longer than thirty (30) days after
written request and without cost to the requesting party), deliver to the
requesting party a written and acknowledged statement that this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same is in full force and effect as modified and stating the
modifications), the dates, if any, to which the Rent, and other sums and
payments due under this Lease have been paid; such other
56
relevant information as any party or any mortgagee or purchaser of the Hotel may
reasonably request and that, to the best of the responding party's knowledge,
the requesting party is not in default under this Lease (or if the responding
party has knowledge that the requesting party is in default, identifying the
default).
35.7 No waiver of any covenant or condition or of the breach of any
covenant or condition of this Lease shall constitute a waiver of any subsequent
breach of such covenant or condition, or justify or authorize the nonobservance
on any other occasion of the same or of any other covenant or condition hereof.
35.8 In the event Tenant remains in possession of the Premises after the
Expiration Date or the earlier termination of the Term of this Lease, any
holdover tenancy created shall be on a month-to-month basis on the same terms
and conditions as stated in this Lease, except the rental shall be double that
required in the last month of the Term. If Tenant shall fail to surrender and
restore the Premises as required by the terms of this paragraph and the terms of
Section 2.5 of this Lease, Tenant shall indemnify, defend (with counsel
reasonably acceptable to Landlord [acting reasonably]) and hold the Landlord,
its agents, and lender harmless from and against all loss, liability, damages
and expense (including, without limitation, reasonable attorneys' fees)
sustained or incurred by any of the same on account of or resulting from such
failure, including, without limitation, claims made by any succeeding tenant of
all or any part of the Premises.
35.9 There is executed simultaneously with this Lease, and in
quadruplicate original, a Memorandum of
Lease Agreement in the form as attached
hereto and incorporated herein as EXHIBIT "L", an original of which shall be
recorded by Tenant, and at Tenant's expense, in the office of the Chancery Clerk
of the Second Judicial District of Xxxxxxxx County, Mississippi, within thirty
(30) days after the Possession Date. In the event Landlord does not have a legal
description of the Premises that precisely describes the Premises at the time
the Memorandum of
Lease Agreement is executed and recorded, Tenant shall, upon
Landlord's request, execute and deliver an Amended and Restated Memorandum of
Lease Agreement at such time as Landlord obtains a legal description that
adequately and precisely describes the Premises, which legal description shall
be attached to and recorded with the Amended and Restated Memorandum of
Lease
Agreement.
35.10 Landlord acknowledges the national market theme of rock'n'roll music
and entertainment played and promoted in and through the various retail venues
operated by Tenant and/or its parents or affiliates under the trade name "Hard
Rock" throughout the country and the world. Landlord further acknowledges and
agrees that Landlord shall not attempt to restrict or impede Tenant's use of the
Premises in furtherance of its rock'n'roll music and entertainment theme
provided Tenant's playing and promotion of its rock'n'roll music and
entertainment theme complies with applicable Laws. Landlord acknowledges that
playing music ("Tenant's Music") is integral to the Tenant's Use. Landlord and
Tenant each agree that Tenant's decibel levels shall not exceed 95 db, for
playing recorded music. Landlord agrees that Landlord shall, at its sole cost
and expense, provide any such noise attenuation in the Shell of the Premises as
Landlord deems necessary or advisable so that Tenant's Music shall not
constitute a nuisance to Landlord or other tenants. Further, in order to provide
video transmittal of recorded music and videos, Landlord agrees that, subject to
the approval of any Governmental Authority having
57
auspices thereover, if any, Tenant shall have the right to place, and
unrestricted access to, a satellite on the roof of the Premises in such roof
location as shall be reasonably mutually acceptable to Landlord and Tenant.
Tenant agrees that any and all work which affects the Premises relating to the
installation of such satellite, including, without limitation, any roof
penetrations, must be conducted by such contractor as Landlord requires. All
costs relating to the satellite shall be the responsibility of the Tenant.
Nothing herein shall diminish Tenant's obligations to comply with the terms of
the Lease.
35.11 Notwithstanding Landlord's entitlement to Rent or other rights under
this Lease, the Tenant reserves the right to manage the business, assets and
cash flows of each and every aspect of its operations as it deems necessary. All
decisions affecting or relating to the business, assets, cash flows or any other
aspect of Tenant's operations shall be made in the reasonable discretion and
judgment of Tenant and in accordance with Tenant's obligations under this Lease.
35.12 Any covenant, representation, warranty, term, or provision of this
Lease which, (i) expressly states that it shall survive the termination of this
Lease, or (ii) in order to be effective, must survive the termination of this
Lease, as it is applicable to the Term, shall survive any such termination.
Nothing contained herein in this Section 35.12 shall be interpreted to result in
the survival of Section 30.1 hereof.
35.13 If, for any reason, all or any part of any section, subsection,
and/or provision of this Lease is held to be invalid or unenforceable by an
arbitrator or a court (if otherwise permitted herein to make such a
determination) having valid jurisdiction and the same shall not impair the
operation of, or have any other effect upon, any other section, subsection,
and/or provision of this Lease as may remain otherwise valid and enforceable,
and the latter shall continue to be given full force and effect and bind the
parties hereto, and such invalid or unenforceable sections, subsections, and/or
provisions shall be deemed limited by construction in scope and effect to the
minimum extent possible to render the same valid and enforceable. Whenever used
herein, the singular shall include the plural and the plural shall include the
singular, as necessary, and the use of any gender shall include either gender,
as necessary.
35.14 This Lease, together with the Exhibits attached hereto, and all
other documents executed and delivered by the parties hereto to consummate the
transactions contemplated herein, constitute the entire understanding and
agreement of the parties hereto with respect to the subject matter hereof, and
supersede all prior written and all prior and contemporaneous oral agreements,
understandings, inducements, and conditions, express or implied, between the
parties with respect thereto. The express terms hereof control and supersede any
course of performance or usage of trade inconsistent with any of the terms
hereof.
35.15 This Lease may be executed in any number of counterparts, each of
which shall be an original as against any party whose signature appears thereon,
and all of which together shall constitute one and the same agreement.
35.16 Time is of the essence in connection with all terms and provisions
of this Lease.
35.17 This Lease has been negotiated by the respective parties hereto, and
the language hereof shall not be construed for or against any party. The titles
and headings herein are for
58
reference purposes only, and shall not in any manner limit the construction of
this Lease which shall be considered as a whole. All additions and deletions of
provisions from and all drafts of this Lease shall be of no force or effect in
interpreting the terms of this Lease or the intentions of the parties hereto.
35.18 Landlord shall cooperate reasonably with Tenant at no cost, expense
or liability to Landlord, with its efforts to market and promote the operation
of the business in the Premises, including by mentioning Tenant's business on
in-house television in the Hotel. Landlord shall use commercially reasonable
efforts to promote the Tenant's business and Tenant's products through
Landlord's marketing mediums and internet as may be appropriate in Landlord's
reasonable judgment. In addition, Landlord shall (a) provide Tenant's
promotional materials regarding the Tenant's business conducted in the Premises
in Landlord's hotel rooms located within the Hotel; (b) include the Tenant's
business in such of Landlord's advertisements as Landlord and Tenant reasonably
agree; (c) use reasonable efforts to promote the Tenant's business being
conducted in the Premises in connection with arrangements to market the Hotel
which Landlord may enter into, in Landlord's sole discretion, with other
business entities which may have ability to assist in such marketing of the
Hotel; (d) include Tenant in Landlord's guest directory as well as future
updates to the promotional CD-ROM sent to prospective guests; and (e) provide
reasonable signage in common areas of the Hotel, the locations of which shall be
mutually agreed upon by the parties. In addition, upon request of Landlord,
Tenant will develop and pay all costs associated with promotional materials
relating to the Tenant's business to be used as part of the promotional
materials of Landlord; provided however, that Landlord will bear the costs for
producing and distributing such promotional materials (e.g. if Landlord places a
page of advertising, a quarter of which promotes the Tenant's business, Tenant
will prepare the desired advertising materials at its cost and provide them to
Landlord and Landlord will be responsible for the cost of the advertisement), it
being agreed that all of such promotional materials will be prepared in
cooperation with Landlord and will be subject to the approval of Landlord, which
approval shall not be unreasonably withheld. In connection with the foregoing,
upon the General Manager's request, the Retail Store Manager shall meet with the
General Manager of the Hotel or his designee for coordinating such marketing and
ensuring marketing uniformity.
35.19 Except as otherwise required by applicable Law, or as necessary to
consummate the transactions contemplated herein, or except with respect to
necessary information provided to accountants, attorneys, other representatives
of each party and disclosures reasonably necessary to obtain the permits and
approvals contemplated in the Lease or to enforce rights hereunder, no
information concerning the economic terms of this Lease or the negotiations
underlying this Lease, will be released by any party hereto to the press, or to
any person or entity, or will otherwise be made public, without the prior
written consent of the Tenant and Landlord, as applicable. Notwithstanding
anything to the contrary set forth herein or in any other written or oral
understanding or agreement to which the parties hereto are parties or by which
they are bound, the parties acknowledge and agree that (i) any obligations of
confidentiality contained herein and therein do not apply and have not applied
from the commencement of discussions between the parties to the tax treatment
and tax structure of the transaction represented by this Lease (and any related
transactions or arrangements), and (ii) each party (and each of its employees,
representatives, or other agents) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the transactions
represented by this
59
Lease and all materials of any kind (including opinions or other tax analyses)
that are provided to such party relating to such tax treatment and tax
structure, all within the meaning of Treasury Regulations Section 1.6011-4;
provided, however, that each party recognizes that the privilege each has to
maintain, in its sole discretion, the confidentiality of a communication
relating to the transaction represented by this Lease, including a confidential
communication with its attorney or a confidential communication with a federally
authorized tax practitioner under Section 7525 of the Internal Revenue Code, is
not intended to be affected by the foregoing.
35.20 Landlord and Tenant acknowledge that in order to provide for the
seamless operation of the Project and to otherwise promote the Project, Landlord
may desire to create a program or multiple programs whereby patrons of the
Project (i) are entitled to charge the purchase of merchandise and services sold
in, at or from the Premises and elsewhere in the Project to such patrons'
account maintained by Landlord (the "Guest Account Program"), and (ii) earn
points or other credits which may be redeemed to purchase goods and services
(such as food, beverages, hotel rooms and merchandise) sold at or from the
Project (the "Point Redemption Program") (the Guest Account Program and the
Point Redemption Program shall be collectively referred to herein as the
"Promotional Programs"). Upon the request of Landlord, Tenant agrees to
negotiate in good faith the terms and conditions (i) upon which Tenant will
recognize and participate in the Promotional Programs instituted by Landlord;
(ii) of a program whereby some or all of the merchandise purchased from the
Premises through the Landlord's Point Redemption Program will be charged to
Landlord at discounted rates; and (iii) upon which Landlord will have the right
to purchase merchandise branded with the Trade Name at discounted rates, for use
in corporate meetings and other events held at the Hotel. While the parties have
an obligation in accordance with this Section 35.20 to negotiate in good faith
the terms and conditions upon of the programs referenced in the preceding
sentence, each party acknowledges and agrees that the failure of the parties to
reach an agreement regarding some or all of the issues contained in this Section
shall not be deemed a breach of this Lease.
35.21 Nothing contained in this Lease shall be deemed to be construed as
creating the relationship of principal and agent or of partnership or joint
venture between Landlord and Tenant, it being understood and agreed that neither
the method of computing Rent nor any other provision contained herein nor any
acts of the parties hereto shall be deemed to create any relationship between
the parties other than that of Landlord and Tenant.
35.22 If two (2) or more individuals, corporations, partnerships or other
persons (or any combination of two or more thereof) shall sign this Lease as
Tenant, the liability of each such individual, corporation, partnership or other
persons to pay the Rent and perform all other obligations hereunder shall be
deemed to be joint and several, and all notices, payments and agreements given
or made by, with or to any one of such individuals, corporations, partnerships
or other persons shall be deemed to have been given or made by, with or to all
of them. This Lease can be modified only by a written instrument signed by
Landlord and Tenant.
ARTICLE 36 COTERMINATION WITH LICENSE AGREEMENT
36.1 Notwithstanding the actual Term of this Lease, this Lease shall
automatically terminate, without necessity of any further action by the parties
hereto, simultaneously with the expiration or earlier termination of the License
Agreement.
60
36.2 If the License Agreement is terminated as a result of an uncured
breach thereof by Landlord (either directly or indirectly), as determined by an
arbitration award, Landlord shall, within fifteen (15) days after termination of
this Lease in accordance with this Article, reimburse Tenant for all actual
unamortized, commercially reasonable third-party costs expended by Tenant for
construction of the Premises, including, costs for the preparation and review of
plans and specifications, and the performance of the Work by Tenant,
commercially reasonable attorneys' fees and commercially reasonable training
expenses. The amortization of such costs shall be on a straight-line basis over
the period in which Tenant depreciates such costs for its accounting purposes.
Additionally, as liquidated damages toward Tenant's lost business, Landlord
shall pay Tenant an amount equal to Tenant's operating profit for the most
recently preceding two (2) Rental Years, or if Tenant has not been open for
business at the Premises for two (2) Rental Years, Tenant's operating profit for
the previous Rental Year multiplied by two (2).
36.3 If the License Agreement is terminated as a result of an uncured
breach thereof by Hard Rock Hotel Licensing, Inc. ("Licensor") (either directly
or indirectly), as determined by an arbitration award, Tenant shall, within
fifteen (15) days after termination of this Lease in accordance with this
Article, pay Landlord, as liquidated damages toward Landlord's lost rent, an
amount equal to the total Percentage Rent for the most recently preceding two
(2) Rental Years, or if Tenant has not been open for business at the Premises
for two (2) Rental Years, the total Percentage Rent for the previous Rental Year
multiplied by two (2).
36.4 Absent an independent breach of this Lease, a termination of this
Lease as a result of an uncured breach of the License Agreement in accordance
with this Article 36 shall not constitute a breach of this Lease. Upon
termination of this Lease in accordance with this Article 36, each party shall
comply with the obligations and responsibilities of such party accruing upon
termination of this Lease as set forth herein, including, but not limited to,
the obligation of Tenant to comply with Section 2.4 hereof. Failure of such
party to so comply shall be deemed an independent breach of this Lease, entitled
the non-breaching party to the remedies set forth herein.
36.5 The obligations of Landlord and Tenant under this Article shall
survive the termination or expiration of this Lease.
ARTICLE 37 GAMING REGULATION REQUIREMENTS
Landlord and Tenant acknowledge that Landlord may be required to report the
existence and terms of this Lease to the Mississippi Gaming Commission, pursuant
to the Regulations of the Mississippi Gaming Commission. Landlord and Tenant
further acknowledges that the Mississippi Gaming Commission has the power to
order this Lease rescinded if it finds that the Lease is inimical to the public
health, safety, morals, good order or general welfare of the people of the State
of Mississippi, or would reflect, or tend to reflect, discredit upon the State
of Mississippi. Accordingly, Landlord and Tenant agree that this Lease and the
duties and obligations of the parties arising hereunder shall automatically
terminate without necessity of any further action by the parties hereto upon any
such final order to rescind by the Mississippi Gaming Commission. If such order
is made after Tenant begins any of its work, it would be reasonable for Tenant
to want a provision for reimbursement of its start-up cost.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
61
IN WITNESS WHEREOF, Landlord and Tenant have respectively executed this
Lease as of the day and year first above written.
LANDLORD:
PREMIER ENTERTAINMENT BILOXI LLC,
a Delaware limited liability company
By: GAR, LLC,
its Managing Member
By: /s/ Xxx Xxxxxxxx, III
------------------------------
Name: Xxx Xxxxxxxx, III
By: /s/ Xxxxx Xxxxx Xxxx
------------------------------
Name: Xxxxx Xxxxx Xxxx
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxxx
TENANT:
HARD ROCK CAFE INTERNATIONAL (STP),
INC., a New York corporation
By: /s/ Xxx X. Xxxxxxxxx
---------------------------------
Name: Xxx X. Xxxxxxxxx
Title: Vice President & General Counsel
62
EXHIBIT "A"
PROJECT LEGAL DESCRIPTION
PARCEL 1
MARINER'S HARBOR
SURVEY DESCRIPTION
BEGIN at the northwest corner of Mariner's Harbor Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and run Easterly along the south right
of way line of West Beach Boulevard and along a curve to the left (having a
radius of 2323.00 feet, an internal angle of 9 degrees 49 minutes 19 seconds and
subtended by a chord of 397.73 feet along a bearing of South 89 degrees 08
minutes 12 seconds East) for 398.22 feet; thence run North 85 degrees 57 minutes
08 seconds East along said right of way line for 5.51 feet; thence run South 00
degrees 34 minutes 42 seconds East for 25.83 feet; thence run North 89 degrees
25 minutes 18 seconds East for 16.00 feet; thence run South 00 degrees 34
minutes 42 seconds East for 74.00 feet; thence run North 87 degrees 17 minutes
02 seconds West for 15.61 feet; thence run South 00 degrees 31 minutes 46
seconds East for 82.44 feet; thence run South 89 degrees 46 minutes 41 seconds
West for 47.01 feet; thence run South 00 degrees 36 minutes 03 seconds East for
20.05 feet; thence run North 89 degrees 45 minutes 09 seconds West for 108.51
feet; thence run North 00 degrees 50 minutes 05 seconds West for 20.00 feet;
thence run South 89 degrees 37 minutes 04 seconds West for 140.06 feet; thence
run South 00 degrees 22 minutes 56 seconds East for 18.33 feet; thence run South
88 degrees 59 minutes 05 seconds West for 107.95 feet; thence run North 00
degrees 31 minutes 32 seconds West for 207.91 feet; back to the POINT OF
BEGINNING.
Said parcel of land is part of Biloxi Section Block 100 and contains 77,476.59
square feet or 1.779 acres.
PARCEL 2
HARBOR VIEW PARCEL
SURVEY DESCRIPTION
BEGIN at the northeast corner of Harbor View Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District and run South 00 degrees 31 minutes 32 seconds East
for 239.05 feet; thence run North 89 degrees 28 minutes 33 seconds East for 3.66
feet; thence run South 00 degrees 23 minutes 59 seconds East for 124.18 feet;
thence run South 83 degrees 11 minutes 02 seconds East for 1.20 feet; thence run
South 01 degree 44 minutes 55 seconds East for 16.59 feet; thence run South 89
degrees 00 minutes 06 seconds West for 101.78 feet; thence run North 07 degrees
17 minutes 25 seconds West for 5.98 feet; thence run North 00 degrees 32 minutes
09 seconds West for 387.04 feet to the south right
X-0
xx xxx xxxx xx Xxxx Xxxxx Xxxxxxxxx; thence run South 83 degrees 25 minutes 27
seconds East along said right of way line for 98.37 feet back to the POINT OF
BEGINNING.
Said parcel of land is a part of Biloxi Section Block 130.5, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and contains 38,230.93 square feet or
0.878 acres.
PARCEL 3
XXXXXX PARCEL
SURVEY DESCRIPTION
COMMENCE at the northeast corner of Harbor View Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District and run North 83 degrees 25 minutes 27 seconds West
along the south right of way line of U.S. Highway 90 (Beach Boulevard) for 98.37
feet to and for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 32 minutes 09 seconds East
for 387.04 feet; thence run North 49 degrees 17 minutes 42 seconds West for 9.81
feet; thence run South 89 degrees 20 minutes 48 seconds West for 92.63 feet;
thence run North 00 degrees 32 minutes 09 seconds West for 395.33 feet to the
south right of way line of U.S. Highway 90 (Beach Boulevard); thence run South
82 degrees 14 minutes 40 seconds East along said right of way line for 101.07
feet back to the POINT OF BEGINNING.
Said parcel of land is a part of Biloxi Section Block 130.5, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and contains 38,822.43 square feet or
0.891 acres.
PARCEL 4
X'XXXXX PARCEL
SURVEY DESCRIPTION
COMMENCE at the northeast corner of Harbor View Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District and run North 83 degrees 25 minutes 27 seconds West
along the south right of way line of U.S. Highway 90 (Beach Boulevard) for 98.37
feet; thence run North 82 degrees 14 minutes 40 seconds West along said south
right of way line for 101.07 feet to and for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 32 minutes 09 seconds East
for 395.33 feet; thence run South 89 degrees 20 minutes 48 seconds West for
107.38 feet; thence run North 00 degrees 42 minutes 02 seconds West for 415.84
feet to the south right of way line of U.S. Highway 90 (Beach Boulevard); thence
run South 79 degrees 57 minutes 09 seconds East along said right of way line for
110.45 feet back to the POINT OF BEGINNING.
Said parcel of land is a part of Biloxi Section Block 130.5, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and contains 43,786.58 square feet or
1.005 acres.
X-0
XXXXXX 0
XXXXXX XXXXX, INC.
SURVEY DESCRIPTION
COMMENCE at an iron rod at the northeast corner of Harbor View Condominiums,
Biloxi, Xxxxxxxx County Second Judicial District as per the map or plat thereof
on file in Plat Book 9 at Page 19 in the office of the Chancery Clerk at the
Court House in Biloxi, Xxxxxxxx County Second Judicial District, Mississippi and
run North 83 degrees 25 minutes 27 seconds West along the south right of way
line of U.S. Highway 90 for 98.37 feet; thence run North 82 degrees 14 minutes
40 seconds West along the south right of way line of U.S. Highway 90 for 101.07
feet; thence run North 79 degrees 57 minutes 09 seconds West along the south
right of way line of U.S. Highway 90 for 110.45 feet to an "X" scribed in
concrete for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 42 minutes 02 seconds East
for 415.84 feet to an "X" scribed in concrete; thence run South 89 degrees 20
minutes 48 seconds West for 20.98 feet to an "X" scribed in concrete; thence run
North 42 degrees 47 minutes 11 seconds West for 127.48 feet to a nail set in a
wooden bulkhead; thence run North 00 degrees 27 minutes 42 seconds West for
343.52 feet to an "X" scribed in concrete on the south right xx xxx xxxx xx X.X.
Xxxxxxx 00; thence run South 78 degrees 42 minutes 32 seconds East along the
south right of way line of U.S. Highway 90 for 107.33 feet back to the POINT OF
BEGINNING.
Said parcel of land is part of Biloxi Section Block 130 in Fractional Section
00, Xxxxxxxx 0 Xxxxx, Xxxxx 0 Xxxx, Xxxxxx, Xxxxxxxx Xxxxxx Second Judicial
District, Mississippi and contains 41,167.34 square feet, or 0.945 acres.
PARCEL 6
FULL HOUSE PARCEL
SURVEY DESCRIPTION
Commence at an iron rod at the northeast corner of Harbor View Condominiums,
Biloxi, Xxxxxxxx County Second Judicial District as per the map or plat thereof
on file in Plat Book 9 at Page 19 in the office of the Chancery Clerk at the
Court House in Biloxi, Xxxxxxxx County Second Judicial District, Mississippi and
run North 83 degrees 25 minutes 27 seconds West along the south right of way
line of U.S. Highway 90 for 98.37 feet, thence run North 82 degrees 14 minutes
40 seconds West along the south right of way line of U.S. Highway 90 for 101.07
feet; thence run North 79 degrees 57 minutes 09 seconds West along the south
right of way line of U.S. Highway 90 for 110.45 feet to an "X" scribed in
concrete; thence run North 78 degrees 42 minutes 32 seconds West along said
south right of way line for 107.33 feet to and for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 27 minutes 42 seconds East
for 343.52 feet; thence run North 42 degrees 47 minutes 11 seconds West for 7.38
feet; thence run North 50 degrees 24 minutes 44 seconds West for 159.85 feet;
thence run North 38 degrees 12 minutes 35 seconds West for 27.81 feet; thence
run North 00 degrees 32 minutes 57 seconds
A-3
West for 248.40 feet to a point on the south right of way line of U.S. Highway
90 (Beach Boulevard); thence run South 76 degrees 47 minutes 55 seconds East
along the south right of way line of U.S. Highway 90 for 148.95 feet back to the
POINT OF BEGINNING.
Said parcel of land is part of Biloxi Section Block 130 in Fractional Section
00, Xxxxxxxx 0 Xxxxx, Xxxxx 0 Xxxx, Xxxxxx, Xxxxxxxx Xxxxxx Second Judicial
District, Mississippi and contains 43,164.89 square feet, or 0.945 acres.
A-4
EXHIBIT "B"
PREMISES
B-1
EXHIBIT "C"
HARD ROCK HOTEL RETAIL STORE SHELL IMPROVEMENTS BY LANDLORD
1. Landlord acknowledges the national market theme of rock `n roll music and
entertainment played and promoted in and through the "Hard Rock Cafe"
throughout the country and the world. Landlord further acknowledges and
agrees that the Landlord shall not attempt to restrict or impede Tenant's
use of the Premises in furtherance of its rock `n roll music and
entertainment theme, provided Tenant's playing and promotion of this rock
`n roll music and entertainment theme complies with the applicable Laws
and is not conducted in such a way as to become a nuisance to the other
Tenants, taking into consideration and allowing for the nature of and
style of Tenant's business.
2. Landlord shall provide glass store front window system and entry doors.
3. Landlord shall provide Hard Rock Hotel Store staff access to Hotel
employee washrooms.
4. Landlord shall provide fire protection service to the Hard Rock Hotel
Store lease space. Service shall be sized in accordance with NFPA 13 and
Factory Mutual Standards for proper flow at required pressure to
accommodate total fire protection coverage of the Hard Rock Store leased
space. Tenant to make adjustments to the fire protection system as
required to coordinate with its design.
5. Landlord to provide all fire separations between the Hard Rock Hotel Store
and all adjacent areas as required by the local jurisdiction and any other
governing agency.
6. Landlord shall provide fire rated shafts, ductwork within shaft and all
fire rated assemblies up to the roof or exterior in accordance with the
local jurisdiction or any other governing agency for the Hard Rock Hotel
Store.
7. Landlord shall provide all Heating, Ventilation and Air-Conditioning
(HVAC) for the space via dedicated units or from Hotel systems. The HVAC
system shall be designed to satisfy the Hard Rock Hotel Store
requirements. Hard Rock will provide all secondary distribution from the
main duct(s) provided by Landlord. HVAC control points shall be provided
to Hard Rock who will provide local thermostats and controls for the
branch system.
8. Landlord shall provide to the premises, as a minimum, an electrical
service at 200 AMP 120v/208v/3 Phase 4/wire. The service may increase as
required by the calculated demand load of the Hard Rock Hotel Store.
9. Landlord shall provide two (2) 1" conduits from the tenant space to the
base building telephone equipment room. Landlord will ensure that base
building telephone service
C-1
contains sufficient capacity to provide no less than eight (8) dedicated
phone lines for Hard Rock Hotel Store usage.
10. To ensure music compatibility with the Hotel Lobby, Landlord shall provide
one 1" conduit and input feed from the Hotel's main A/V room. Hard Rock
will terminate the wire to its audio rack to allow for connectivity with
the Hotel audio system.
11. Landlord shall provide a building that is structurally sound and
watertight, that complies with the local jurisdiction's requirements or
any other governing agency for the intended use and complies with the
requirements of this Exhibit "C" (the "Shell of the Premises"). Landlord
shall be responsible for maintaining the integrity of the exterior skin of
the building.
12. Landlord shall permanently seal all penetrations through the overhead
structure covering the Hard Rock Hotel Store tenant space.
13. Landlord shall provide all shell demising walls in a paint ready
condition.
14. Landlord shall provide all acoustical attenuation between tenant demises.
15. Landlord shall have a structural engineer registered in the state in which
the project is located certify that the floor's structural system is
adequate to support a live load of 100 lbs. per square foot and an
additional dead load of 35 lbs. per square foot.
16. Landlord shall provide a flat and level concrete floor slab meeting a
minimum of: Slab on Grade - FF25 and FL25;
Elevated Slab - FF25 and FL requiring 80% of all elevation points fall
within a envelope tolerance of 3/4" or less.
17. Landlord shall provide a concrete floor slab with a hard trowel finish
suitable for the future application of concrete stain floor finishes. Slab
shall not be treated with any penetrating cure or seal compound. All
control and expansion joints shall be neatly cut with no excessive
spalling.
18. Landlord shall provide a lease area that is free from any hazardous
substances or materials. Landlord shall provide any and all certificates
that may be required by the local jurisdiction or any other governing
agency.
19. Landlord shall provide a fully accessible and adequately illuminated route
for the public into the Hard Rock Hotel Store leased space.
20. To the extent that the Project is located in a multi-tenant development,
Landlord include, at its expense, Hard Rock Hotel Store signage in all
public directories located within the development and will permit, subject
to reasonable approval, the use of additional supplemental directional
signage provided and installed by Hard Rock.
C-2
21. Landlord shall provide access to all adjacent and remote spaces as
required for the completion of the Hard Rock Hotel Store tenant build out.
22. Landlord shall provide sufficient space and accommodation, in accordance
with the requirements of the local jurisdiction or any other governing
agency, for the adequate and proper access, handling, interim storage and
delivery of all food and merchandise and removal of all trash and waste
generated by the Hard Rock Hotel Store.
23. Landlord shall provide every available assistance in obtaining all
required local jurisdiction and any other governing agency approvals
necessary for the construction and operation of the Hard Rock Hotel Store.
24. Landlord shall obtain the local jurisdiction and any other government
agency approvals for all Hard Rock Hotel Store exterior signage including
but not limited to signs, awnings, flags, icons and marquees. Landlord
shall provide electrical service and all structural supports for the Hard
Rock Hotel Store signs. The signage will be supplied and installed by Hard
Rock.
25. Landlord shall designate an area, adjacent to the Project, for temporary
construction trailer and material storage, receiving and handling.
26. Landlord shall route all Hotel systems and utilities to avoid conflict
with Hard Rock's improvements. Any utilities that conflict with the retail
improvements shall be relocated by Landlord.
27. Landlord shall provide all partition framing between adjacent areas and
shall finish the exterior side of the partition walls. Hard Rock, as a
part of its Tenant Improvement work, shall provide and install all drywall
and finishes to the interior side of the partition walls. Landlord shall
provide all sound attenuation and insulation materials within the
partition walls.
*** End of Exhibit "C"" ***
C-3
EXHIBIT "D"
PROHIBITED USES
The Premises shall not be used for:
any gaming activities, machines or equipment, a bingo hall; bowling alley;
religious facility; for residential purposes; for industrial purposes; sales of
automobiles or other vehicles; funeral parlor; massage parlor; off-track betting
establishment; so-called "flea market"; manufacturing facility; coin operated
laundry; x-rated, pornographic, "adult" or sexually explicit entertainment,
books, magazines, newspapers, pictures, movies, videos (whether on tape or
disk), films, "adult" entertainment or nudity or other similar representation in
the Premises.
D-1
EXHIBIT "E"
RESERVED
E-1
EXHIBIT "F"
RESERVED
F-1
EXHIBIT "G"
SIGNAGE PLAN
G-1
EXHIBIT "H"
RESERVED
H-1
EXHIBIT "I"
RESERVED
I-1
EXHIBIT "J"
REQUIRED INSURANCE
The following is Required Insurance by Tenant under this Lease:
(1) Casualty insurance including business interruption insurance,
insuring Tenant's Property (including all leasehold improvements) located on the
Premises and the Work, all to the extent of Tenant's insurable interest therein
against loss or damage by fire or other casualty in an amount equal to the full
replacement value.
(2) Comprehensive general liability insurance containing the so-called
"occurrence" clause (which shall include specifically the Premises to the extent
of Tenant's insurable interest therein) with coverage limits not less than:
(i) bodily injury
each occurrence: $ 2,000,000
aggregate: 5,000,000
(ii) property damage
each occurrence: $ 2,000,000
aggregate: 5,000,000
(iii) coverage shall include also:
(A) broad form property damage including all CU hazards,
(B) independent contractors,
(C) contractual liability,
(D) products liability and completed operations,
(E) Liquor liability (Dram Shop) in an amount not less than
that required by State Law,
(F) advertising liability.
(3) Insurance upon Tenant's Property and the Work to the extent of
Tenant's insurable interest therein in an amount equal to the full replacement
value thereof, including any increase in value resulting from increased costs,
with coverage against such perils and casualties as are commonly included in
"all risk" insurance policies (including all risks of physical loss, fire,
extended coverage, boiler, breakage of glass, sprinkler leakage. explosion,
collapse, vandalism and malicious mischief) and
J-1
(4) Worker's compensation and employer's liability insurance as
follows:
(i) statutory worker's compensation including
occupational disease as required by the Law of the State; and,
(ii) employer's liability insurance with minimum
limits not less than the greater of $500,000 or the amount required
by the State.
(5) Umbrella Liability Insurance with minimum limits of:
(i) $5,000,000 for each occurrence, and
(ii) $5,000,000 aggregate each limit being in excess
of all underlying coverage, which insurance shall be increased from
time to time in such amounts as Tenant reasonably deems necessary
and that is compatible with Tenant's coverage in other locations.
(6) Tenant shall carry and maintain, at its expense, or Tenant shall
require any contractor performing work on the Leased Premises to carry and
maintain, at no expense to Landlord, in addition to worker's compensation
insurance as required by the jurisdiction in which the Premises are located, All
Risk Builder's Risk Insurance in the amount of the replacement cost of the Work
and Commercial General Liability Insurance (including, without limitation,
Contractor's Liability coverage, Contractual Liability coverage, Completed
Operations coverage, a Broad Form Property Damage coverage and Contractor's
Protective liability) written on an occurrence basis with a minimum per
occurrence limit of Two Million Dollars ($2,000,000) and a minimum combined
single limit of Five Million Dollars ($5,000,000); such limit may be
accomplished by means of an umbrella policy.
Tenant shall provide Landlord with a copy of all certificates of insurance
for the Required Insurance prior to the Commencement Date or, in the case of the
insurance in paragraph (6) prior to the Possession Date.
J-2
EXHIBIT "K"
FORM OF SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT
PREPARED BY: INDEXING INSTRUCTIONS:
_______________ Biloxi City Blocks 100, 130 and
_______________
_______________ 130.5, and Xxxxxxxxxx
Xxxxxxx 00, X0X-X0X
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
Hard Rock Lease (Retail Store)
This Subordination, Non-Disturbance and Attornment Agreement ("Agreement")
is made as of this _____ day of ___________, 200___, by and between HARD ROCK
CAFE INTERNATIONAL (STP), INC., a New York corporation ("Tenant"), and
________________________, a ______________ (together with its successors and
assigns, "Lender").
RECITALS
a. _______________, as trustee to and for the benefit of Lender, is the owner
and holder of that certain Deed of Trust dated of even date herewith from
_________________________, a ___________________ ("Borrower"), as recorded with
the Xxxxxxxx County, Mississippi Recorder's Office on ________________, in Deed
Book ________ at Page _________ (the "Deed of Trust"), covering the land and
improvements legally described in Exhibit "A" attached hereto and incorporated
herein (the "Property"). The Deed of Trust and any and all other documents or
instruments related thereto, and all renewals, amendments, supplements,
restatements, extensions, and modifications thereof and thereto, are hereinafter
collectively referred to as the "Loan Documents".
b. Tenant is the lessee of that portion of the Property described in Exhibit
"B" attached hereto (hereinafter also called the "Demised Premises"), such
Demised Premises having a common address of _________________________, Biloxi,
Mississippi, under and pursuant to provisions of a certain
Lease Agreement
(Retail Store) dated __________ ________________, 200___, between Borrower, as
landlord, and Tenant (said Lease Agreement (Retail Store) as the same may be
hereafter modified, amended or extended from time to time is hereinafter
collectively referred to as the "Lease").
c. Tenant has required the execution of this Agreement as a condition of
executing the Lease.
K-1
AGREEMENT
For good and valuable consideration, receipt of which is hereby acknowledged,
the parties agree as follows:
1. SUBORDINATION. The parties hereby agree that the Lease is and shall at all
times be subject and subordinate in all respects to the lien of the Deed of
Trust, to all indebtedness and obligations secured thereby, and to all renewals,
modifications, extensions, substitutions, rearrangements and replacements
thereof.; provided Lender agrees that in the event Lender assigns its interests
under the Loan Documents to an independent third party, the terms of this
Agreement shall no longer be of force and effect unless Tenant has consented to
such assignment, which consent Tenant may withhold in its sole discretion.
2. NON-DISTURBANCE. So long as Tenant pays all rents and other charges as
specified in the Lease and is not otherwise in default of any of its obligations
and covenants pursuant to the Lease beyond any applicable grace or cure periods
thereunder, Lender agrees that, subject to the terms and conditions of this
Agreement, (i) if any action or proceeding is commenced by Lender or at Lender's
behest for the foreclosure of the Deed of Trust or the sale of the Property or
other realization under the Loan Documents, whether by foreclosure, deed in lieu
of foreclosure or in any other proceedings made or brought to enforce the rights
of Lender, or by any successor to Lender, Tenant shall not be named as a party
therein (unless Lender is required to name Tenant in order to file a foreclosure
action) (unless required by law to properly foreclose upon the Deed of Trust),
and the sale of the Property in any such action or proceeding and the exercise
by Lender of any such action or proceeding and at the time of its other rights
under the Deed of Trust shall be made subject to all rights of Tenant under the
Lease,, and (ii) regardless of whether Landlord names Tenant in such foreclosure
action or other proceeding made or brought to enforce the rights of Lender or
any successor to Lender, provided that at the time of any such action or
proceeding and at the time of any such sale or exercise of any such other
rights, Tenant shall not be declared in default, and no event shall have
occurred which with the giving of notice or passage of time or both could result
in a default, under any of the terms, covenants or conditions of the Lease on
Tenant's part to be observed or performed Tenant's possession of the Demised
Premises and Tenant's other rights under the Lease will not be disturbed,
modified, enlarged or otherwise affected during the term of the Lease, as said
term may be extended pursuant to the terms of the Lease, and any successor in
interest to the rights and obligations of the Landlord under the Lease will
abide by the provisions of the Lease and unconditionally assume all obligations
of Landlord under the Lease, notwithstanding any other provisions in the Deed of
Trust. For purposes of this paragraph, a foreclosure shall include a sheriff's
or trustee's sale under the power of sale contained in the Deed of Trust and any
other transfer of the Landlord's interest in the Project Property under peril of
foreclosure, including without limiting the generality of the foregoing, an
assignment or sale in lieu of foreclosure.
3. ATTORNMENT. If the interests of Borrower in the Property and under the
Lease or any portion thereof are acquired by Lender, whether by purchase and
sale, foreclosure, deed in lieu of foreclosure or in any other proceeding made
or brought to enforce the rights of Lender, or by any successor to Lender,
including without limitation any purchaser at a foreclosure sale, Tenant shall
be bound to Lender, its successors and assigns under all of the terms, covenants
and
K-2
conditions of the Lease for the balance of the term thereof, with the same force
and effect as if they were named as landlord under the Lease, and Tenant does
hereby attorn to Lender, its successors and assigns as its landlord, said
attornment to be effective and self-operative immediately upon Lender's or its
successor's or assign's succeeding to the interests of Borrower in the Property
and under the Lease, without the execution of any other or further instruments
on the part of any party hereto. Tenant covenants and agrees from time to time
to do all acts and to execute all instruments (such instruments to be acceptable
to Lender and Tenant in their reasonable discretion) as may reasonably be
requested by Lender for the purposes of fully carrying out and effectuating the
purpose and intent of this Agreement, whether by filing with any public office
or agency or otherwise.
4. LENDER'S LIABILITY. If Lender succeeds to the interests of Borrower in the
Property and under the Lease, Lender shall thereupon be bound to Tenant under
all of the terms, covenants and conditions of the Lease and shall assume in
writing all of the Landlord's obligations under the Lease, and Tenant shall,
from and after Lender's succession to the interests of Borrower, have the same
rights and remedies against Lender for breach of the Lease that Tenant would
have had under the Lease against Borrower if Lender had not succeeded to the
interests of Borrower.
5. MODIFICATION. Tenant agrees that it shall provide Lender with prompt
written notice describing in reasonable detail any and all amendments or
modifications of the Lease.
6. NO MERGER. Unless Lender shall otherwise expressly agree in writing, fee
title to the Property and the leasehold estate created by the Lease shall not
merge but shall remain separate and distinct, notwithstanding the union of said
estates either in Borrower, in Tenant or in any third party, by purchase,
assignment or in any other matter.
7. NOTICE TO LENDER; RIGHT TO CURE. Tenant shall give Lender copies of all
written notices and other written communications given by Tenant to Borrower
relating to (a) defaults on the part of Borrower under the Lease, (b) any
violations of any ordinances, statutes, laws, rules, codes, regulations or
requirements of any governmental agency having jurisdiction over the Property,
and (c) any proposed or actual assignment or subletting of all or any portion of
the Demised Premises. Prior to pursuing any remedy available to Tenant under the
Lease, at law or in equity which Tenant may have as a result of any failure of
Borrower to perform or observe any covenant, condition, provision or obligation
to be performed or observed by Borrower under the Lease (any such failure
hereunder referred to as a "Borrower's Default"), Tenant shall provide Lender
with a notice of Borrower's Default (the "Tenant's Notice"), which notice may be
sent concurrently with any similar notice to Borrower, specifying the nature
thereof and the remedy which Tenant will elect under the terms of the Lease or
otherwise. Thereafter, the Lender may, by providing written notice of its
intention to cure any such default to Tenant within ten (10) days after receipt
of the Tenant's Notice, proceed to cure any such default. In the event the
Lender timely elects to proceed to cure such default, the Lender shall complete
such cure within thirty (30) days after the date of receipt of the Tenant's
Notice (or such lesser time if an emergency exists); provided, however, if (1)
the default is non-monetary and cannot reasonably be cured within such thirty
(30) day period, (2) the Lender materially commences cure of such non-monetary
default within such thirty (30) day period, and (3) after commencing efforts to
K-3
cure such non-monetary default, diligently and in good faith pursues same to
completion, then such thirty (30) day period shall be extended to a reasonable
amount of time (not to exceed ninety (90) total days from the Tenant's Notice)
to cure such non-monetary default. During any period in which Landlord has the
right to cure a default in accordance with this Section, Tenant shall not
exercise its right to terminate the Lease. If Landlord fails to provide notice
of its election to cure a default within ten (10) days after receipt of the
Tenant's Notice, Landlord shall be deemed to have waived its right to cure such
default.
8. ACCESS. Notwithstanding the provisions of the Lease, if Tenant shall not
have provided Lender with access to the Demised Premises, and if access is
required to remedy such default, the period of time set forth in the Lease in
which to remedy same shall not commence until such access is provided to Lender.
9. NOTICES. Except as otherwise expressly provided herein, any notice required
or desired to be served, given or delivered hereunder shall be in writing, and
shall be deemed to have been validly served, given or delivered upon the earlier
of (a) personal delivery to the address set forth below, (b) in the case of
facsimile transmission, when transmitted and (c) in the case of mailed notice,
three (3) days after deposit in the United States mails, with proper postage for
certified mail, return receipt requested, prepaid, or in the case of notice by
Federal Express or other reputable overnight courier service, one (1) business
day after delivery to such courier service; provided, however, that if any
notice is tendered to an addressee and delivery thereof is refused by such
addressee, such notice shall be effective upon such tender unless expressly set
forth in such notice. Notices to be provided pursuant to this Agreement shall be
as follows: (a) If to Lender at: ________________, ______________; Attention:
_____________; Telephone No. _____________; Facsimile No. ___________; with a
copy to: ___________, ______________________, ____________________; Attention:
________________; Telephone No. _______________; Facsimile No.
___________________; (b) If to Tenant at: 0000 Xxx Xxxx Xxxx, Xxxxxxx, Xxxxxxx
00000; Attention: Xxx X. Xxxxxxxxx, Esq., Vice President and General Counsel;
Telephone No. (000) 000-0000; Facsimile No. (000) 000-0000; with a copy to:
Akerman, Senterfitt & Xxxxxx, P.A., 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000; Attention: Xxxx X. Xxxxx, Esq.; Telephone No.: (000) 000-0000; Facsimile
No. (000) 000-0000; or to such other address as each party designates to the
other in the manner herein prescribed.
10. INTERPRETATION. Whenever possible each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited or invalid under such
law, such provision shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating the remainder of said document.
11. GOVERNING LAW; LITIGATION. THE VALIDITY OF THIS AGREEMENT, ITS
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF TENANT AND
LENDER SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEVADA WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. TO THE MAXIMUM EXTENT PERMITTED BY LAW, TENANT HEREBY AGREES
THAT ALL
K-4
ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED
AND DETERMINED ONLY IN THE STATE OR FEDERAL COURTS LOCATED IN THE COUNTY OF
XXXXXXXX, STATE OF MISSISSIPPI. TO THE MAXIMUM EXTENT PERMITTED BY LAW, TENANT
HEREBY EXPRESSLY WAIVES ANY RIGHT IT MAY HAVE TO ASSERT THE DOCTRINE OF FORUM
NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN
ACCORDANCE WITH THIS PARAGRAPH.
12. JURY WAIVER. TO THE MAXIMUM EXTENT PERMITTED BY LAW, TENANT AND LENDER EACH
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY ACTION, CAUSE OF
ACTION, CLAIM, DEMAND, OR PROCEEDING ARISING UNDER OR WITH RESPECT TO THIS
AGREEMENT, OR IN ANY WAY CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
DEALINGS OF TENANT AND LENDER WITH RESPECT TO THIS AGREEMENT, OR THE
TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE. TO THE MAXIMUM
EXTENT PERMITTED BY LAW, TENANT AND LENDER EACH HEREBY AGREES THAT ANY SUCH
ACTION, CAUSE OF ACTION, CLAIM, DEMAND OR PROCEEDING SHALL BE DECIDED BY A COURT
TRIAL WITHOUT A JURY AND THAT TENANT OR LENDER MAY FILE A COPY OF THIS EXECUTED
AGREEMENT WITH ANY COURT OR OTHER TRIBUNAL AS WRITTEN EVIDENCE OF THE CONSENT OF
TENANT AND LENDER TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
13. MISCELLANEOUS. This Agreement may not be amended or modified except by an
agreement in writing signed by the party to be charged. If any action or
proceeding is brought by any party against any other party arising from or
related to this Agreement or the Lease, the prevailing party shall be entitled
to recover its reasonable costs and attorneys' fees. This Agreement shall inure
to the benefit of and be binding upon the parties hereto, their heirs,
representatives, successors and assigns. Time is of the essence. This document
represents the entire agreement between the parties with respect to the subject
matter hereof and supersedes all prior agreements, representations and
covenants.
[signatures on following page]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
TENANT:
HARD ROCK CAFE INTERNATIONAL
(STP), INC., a New York corporation
By:
--------------------------
Its:
-------------------------
Duly Authorized
K-5
LENDER:
-----------------------------
By:
Name:
Title:
STATE OF _____________ )
)
COUNTY OF ____________ )
Personally appeared before me, the undersigned authority in the and for the
said county and state, on this the _____ day of ________, 200___, within my
jurisdiction, the within named, who acknowledged that he is a ________________
of HARD ROCK CAFE INTERNATIONAL (STP), INC., a New York corporation, and as the
act and deed of Hard Rock Cafe International (STP), Inc., he executed the above
and foregoing instrument, after first having been duly authorized by said entity
so to do.
----------------------------------
Notary Public
My Commission Expires:
-----------
STATE OF _____________ )
)
COUNTY OF ____________ )
Personally appeared before me, the undersigned authority in the and for the
said county and state, on this the _____ day of ______________, 200___, within
my jurisdiction, the within named, who acknowledged that he is an officer of
_______________________, a ___________________, and as the act and deed of
___________________, he executed the above and foregoing instrument, after first
having been duly authorized by said entity so to do.
----------------------------------
Notary Public
K-6
My Commission Expires:
-----------
K-7
EXHIBIT "A"
LEGAL DESCRIPTION
PARCEL 1
MARINER'S HARBOR
SURVEY DESCRIPTION
BEGIN at the northwest corner of Mariner's Harbor Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and run Easterly along the south right
of way line of West Beach Boulevard and along a curve to the left (having a
radius of 2323.00 feet, an internal angle of 9 degrees 49 minutes 19 seconds and
subtended by a chord of 397.73 feet along a bearing of South 89 degrees 08
minutes 12 seconds East) for 398.22 feet; thence run North 85 degrees 57 minutes
08 seconds East along said right of way line for 5.51 feet; thence run South 00
degrees 34 minutes 42 seconds East for 25.83 feet; thence run North 89 degrees
25 minutes 18 seconds East for 16.00 feet; thence run South 00 degrees 34
minutes 42 seconds East for 74.00 feet; thence run North 87 degrees 17 minutes
02 seconds West for 15.61 feet; thence run South 00 degrees 31 minutes 46
seconds East for 82.44 feet; thence run South 89 degrees 46 minutes 41 seconds
West for 47.01 feet; thence run South 00 degrees 36 minutes 03 seconds East for
20.05 feet; thence run North 89 degrees 45 minutes 09 seconds West for 108.51
feet; thence run North 00 degrees 50 minutes 05 seconds West for 20.00 feet;
thence run South 89 degrees 37 minutes 04 seconds West for 140.06 feet; thence
run South 00 degrees 22 minutes 56 seconds East for 18.33 feet; thence run South
88 degrees 59 minutes 05 seconds West for 107.95 feet; thence run North 00
degrees 31 minutes 32 seconds West for 207.91 feet; back to the POINT OF
BEGINNING.
Said parcel of land is part of Biloxi Section Block 100 and contains 77,476.59
square feet or 1.779 acres.
PARCEL 2
HARBOR VIEW PARCEL
SURVEY DESCRIPTION
BEGIN at the northeast corner of Harbor View Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District and run South 00 degrees 31 minutes 32 seconds East
for 239.05 feet; thence run North 89 degrees 28 minutes 33 seconds East for 3.66
feet; thence run South 00 degrees 23 minutes 59 seconds East for 124.18 feet;
thence run South 83 degrees 11 minutes 02 seconds East for 1.20 feet; thence run
South 01 degree 44 minutes 55 seconds East for 16.59 feet; thence run South 89
degrees 00 minutes 06 seconds West for 101.78 feet; thence run North 07 degrees
17 minutes 25 seconds West for 5.98 feet; thence run North 00 degrees 32 minutes
09 seconds West for 387.04 feet to the south right
K-8
of way line of West Beach Boulevard; thence run South 83 degrees 25 minutes 27
seconds East along said right of way line for 98.37 feet back to the POINT OF
BEGINNING.
Said parcel of land is a part of Biloxi Section Block 130.5, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and contains 38,230.93 square feet or
0.878 acres.
PARCEL 3
XXXXXX PARCEL
SURVEY DESCRIPTION
COMMENCE at the northeast corner of Harbor View Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District and run North 83 degrees 25 minutes 27 seconds West
along the south right of way line of U.S. Highway 90 (Beach Boulevard) for 98.37
feet to and for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 32 minutes 09 seconds East
for 387.04 feet; thence run North 49 degrees 17 minutes 42 seconds West for 9.81
feet; thence run South 89 degrees 20 minutes 48 seconds West for 92.63 feet;
thence run North 00 degrees 32 minutes 09 seconds West for 395.33 feet to the
south right of way line of U.S. Highway 90 (Beach Boulevard); thence run South
82 degrees 14 minutes 40 seconds East along said right of way line for 101.07
feet back to the POINT OF BEGINNING.
Said parcel of land is a part of Biloxi Section Block 130.5, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and contains 38,822.43 square feet or
0.891 acres.
PARCEL 4
X'XXXXX PARCEL
SURVEY DESCRIPTION
COMMENCE at the northeast corner of Harbor View Condominiums, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi as per the map or plat thereof on file
in the office of the Chancery Clerk at the Court House in Biloxi, Xxxxxxxx
County 2nd Judicial District and run North 83 degrees 25 minutes 27 seconds West
along the south right of way line of U.S. Highway 90 (Beach Boulevard) for 98.37
feet; thence run North 82 degrees 14 minutes 40 seconds West along said south
right of way line for 101.07 feet to and for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 32 minutes 09 seconds East
for 395.33 feet; thence run South 89 degrees 20 minutes 48 seconds West for
107.38 feet; thence run North 00 degrees 42 minutes 02 seconds West for 415.84
feet to the south right of way line of
K-9
U.S. Highway 90 (Beach Boulevard); thence run South 79 degrees 57 minutes 09
seconds East along said right of way line for 110.45 feet back to the POINT OF
BEGINNING.
Said parcel of land is a part of Biloxi Section Block 130.5, Biloxi, Xxxxxxxx
County 2nd Judicial District, Mississippi and contains 43,786.58 square feet or
1.005 acres.
PARCEL 5
SUNTAN MOTEL, INC.
SURVEY DESCRIPTION
COMMENCE at an iron rod at the northeast corner of Harbor View Condominiums,
Biloxi, Xxxxxxxx County Second Judicial District as per the map or plat thereof
on file in Plat Book 9 at Page 19 in the office of the Chancery Clerk at the
Court House in Biloxi, Xxxxxxxx County Second Judicial District, Mississippi and
run North 83 degrees 25 minutes 27 seconds West along the south right of way
line of U.S. Highway 90 for 98.37 feet; thence run North 82 degrees 14 minutes
40 seconds West along the south right of way line of U.S. Highway 90 for 101.07
feet; thence run North 79 degrees 57 minutes 09 seconds West along the south
right of way line of U.S. Highway 90 for 110.45 feet to an "X" scribed in
concrete for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 42 minutes 02 seconds East
for 415.84 feet to an "X" scribed in concrete; thence run South 89 degrees 20
minutes 48 seconds West for 20.98 feet to an "X" scribed in concrete; thence run
North 42 degrees 47 minutes 11 seconds West for 127.48 feet to a nail set in a
wooden bulkhead; thence run North 00 degrees 27 minutes 42 seconds West for
343.52 feet to an "X" scribed in concrete on the south right xx xxx xxxx xx X.X.
Xxxxxxx 00; thence run South 78 degrees 42 minutes 32 seconds East along the
south right of way line of U.S. Highway 90 for 107.33 feet back to the POINT OF
BEGINNING.
Said parcel of land is part of Biloxi Section Block 130 in Fractional Section
00, Xxxxxxxx 0 Xxxxx, Xxxxx 0 Xxxx, Xxxxxx, Xxxxxxxx Xxxxxx Second Judicial
District, Mississippi and contains 41,167.34 square feet, or 0.945 acres.
PARCEL 6
FULL HOUSE PARCEL
SURVEY DESCRIPTION
Commence at an iron rod at the northeast corner of Harbor View Condominiums,
Biloxi, Xxxxxxxx County Second Judicial District as per the map or plat thereof
on file in Plat Book 9 at Page 19 in the office of the Chancery Clerk at the
Court House in Biloxi, Xxxxxxxx County Second Judicial District, Mississippi and
run North 83 degrees 25 minutes 27 seconds West along the south right of way
line of U.S. Highway 90 for 98.37 feet, thence run North 82 degrees 14 minutes
40 seconds West along the south right of way line of U.S. Highway 90 for 101.07
K-10
feet; thence run North 79 degrees 57 minutes 09 seconds West along the south
right of way line of U.S. Highway 90 for 110.45 feet to an "X" scribed in
concrete; thence run North 78 degrees 42 minutes 32 seconds West along said
south right of way line for 107.33 feet to and for the POINT OF BEGINNING.
From said POINT OF BEGINNING, run South 00 degrees 27 minutes 42 seconds East
for 343.52 feet; thence run North 42 degrees 47 minutes 11 seconds West for 7.38
feet; thence run North 50 degrees 24 minutes 44 seconds West for 159.85 feet;
thence run North 38 degrees 12 minutes 35 seconds West for 27.81 feet; thence
run North 00 degrees 32 minutes 57 seconds West for 248.40 feet to a point on
the south right of way line of U.S. Highway 90 (Beach Boulevard); thence run
South 76 degrees 47 minutes 55 seconds East along the south right of way line of
U.S. Highway 90 for 148.95 feet back to the POINT OF BEGINNING.
Said parcel of land is part of Biloxi Section Block 130 in Fractional Section
00, Xxxxxxxx 0 Xxxxx, Xxxxx 0 Xxxx, Xxxxxx, Xxxxxxxx Xxxxxx Second Judicial
District, Mississippi and contains 43,164.89 square feet, or 0.945 acres.
X-00
XXXXXXX "X"
DEMISED PREMISES
K-12
EXHIBIT "L"
FORM OF MEMORANDUM OF LEASE
STATE OF MISSISSIPPI
COUNTY OF XXXXXXXX
SECOND JUDICAL DISTRICT
MEMORANDUM OF LEASE AGREEMENT (RETAIL STORE)
WHEREAS, heretofore, as evidenced by Lease Agreement (Retail Store) dated
the ____ day of ___________, 2003 (the "Lease"), PREMIER ENTERTAINMENT BILOXI
LLC, a Delaware limited liability company ("Landlord"), having an address 00000
Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 and a telephone number of (___) ____
- ______, as landlord, did execute and deliver unto HARD ROCK CAFE INTERNATIONAL
(STP), INC., a New York corporation ("Tenant"), having an address 0000 Xxx Xxxx
Xxxx, Xxxxxxx, Xxxxxxx 00000 and a telephone number of (___) ____ - ______ as
tenant, a Lease Agreement (Retail Store) covering certain portions of the
following described lands (the "Premises") located in Biloxi, Xxxxxxxx County,
Mississippi, and more particularly described on EXHIBIT "A" attached hereto and
made a part hereof.
WHEREAS, Landlord and Tenant acknowledge that said Lease is now in full
force and effect between the Landlord and Tenant.
WHEREAS, it is the desire of Landlord and Tenant that this Memorandum of
Lease Agreement (Retail Store) be placed of record.
NOW, THEREFORE, be it known to all persons by these presents, that in
consideration of the premises and the sum of One and no/100 Dollars ($1.00) cash
in hand paid and other good
L-1
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged and agreed, the, as Landlord and Tenant do hereby ratify, adopt,
approve, and confirm said Lease Agreement (Retail Store) dated the ____ day of
_____________, 2003, in all respects and Landlord hereby leases to Tenant and
Tenant hereby leases from Landlord for the Term (as defined in the Lease), the
Premises, together with all rights and appurtenances thereunder as provided in
the Lease, subject to and in accordance with all of the terms, conditions and
provisions set forth in the Lease, and Landlord and Tenant do hereby agree and
declare that said Lease and all of its terms, conditions and provisions are
binding upon Landlord and Tenant and that said Lease is a valid and subsisting
lease.
In addition, be it known that said Lease contains, INTER ALIA, the
following provisions:
Section 1.1 of the Lease provides, INTER ALIA, that the following terms
shall have the following meanings wherever used in the Lease:
"TERM" means the Initial Term (as defined in Section 2.2 of the
Lease), as extended (if at all) at the option of Tenant for not more than
two (2) separate, consecutive extension periods of ten (10) years each, in
accordance with and subject to the conditions set forth in Section 2.5 of
the Lease.
* * *
The Lease shall be for a period of twenty (20) years from the
Commencement Date as provided in Section 2.3 of the Lease, unless earlier
terminated or extended as provided in the Lease (the "Initial Term").
[SECTION 2.2]
The Term shall commence ("Commencement Date") upon the date which is
the earlier of (a) the date on which Tenant opens to the general public for
business in the Premises or (b) one hundred eighty (180) days from the
Possession Date. Landlord acknowledges and agrees that Tenant shall not be
considered open for business in the Premises during the time Tenant is not
opened to the general public, but has opened the Premises for purposes of
training Tenant's employees, which training shall not exceed twenty (20)
days. For purposes of this Lease, the term "Possession Date" shall mean the
later to occur of (i) the date upon which Landlord delivers the Premises to
Tenant with the Site Work and Off-Site Work substantially completed and the
Deficiency List (as defined in Section 10.5 hereof) items completed to the
reasonable satisfaction of Tenant (except to the extent any such Deficiency
List items have not been completed because under good construction
scheduling practices such work should be done after still
L-2
incomplete finishing or other work (or Work, as the case may be) to be done
by or on behalf of Tenant is completed), and (ii) the date specified in
Landlord's Delivery Notice (as hereinafter defined). As used in this Lease,
"substantially completed" shall mean that the Shell of the Premises has
been sufficiently constructed in accordance with the Landlord's Plans, such
that Tenant may, in Tenant's reasonable determination, reasonably commence
construction of the Work, regardless of whether Tenant has obtained the
permits, licenses and approvals it requires to construct the Work or for
the operation of Tenant's business. The Site Work and Off-Site Work shall
be deemed substantially completed notwithstanding the fact that Punchlist
Items (as hereinafter defined) or other minor or insubstantial details of
the work, mechanical adjustment or decoration remain to be performed or
portions of the Site Work or Off-Site have not been completed because under
good construction scheduling practices such work should be done after still
incomplete finishing or other work (or Work, as the case may be) to be done
by or on behalf of Tenant is completed. When the Possession Date has
occurred pursuant to this Section, Tenant shall execute a tenant acceptance
letter stating the date upon which the Possession Date has occurred, which
letter shall be countersigned and acknowledged by Landlord. [SECTION 2.3]
If Tenant shall not be in default under the terms and conditions of
this Lease at the time of delivering notice of its election to exercise an
extension option or on the commencement date of such extension term, beyond
applicable notice and cure periods under the terms of this Lease, then
Tenant may extend the Term of this Lease for up to two (2) separate,
consecutive, additional periods of ten (10) years each, on the terms and
conditions as apply to the Initial Term as set forth herein by notifying
the Landlord in writing not less than twelve (12) months prior to the then
current Expiration Date. Failure of Tenant to timely exercise any extension
option herein shall be deemed an election by Tenant not to exercise such
extension option and this Lease shall automatically terminate on the then
scheduled Expiration Date. [SECTION 2.5]
Unless specifically waived by Tenant in writing, and provided that
Tenant is not in default of its obligations under the terms of the Lease in
any material respect after Notice and the expiration of applicable cure
period(s), during the Lease Term Landlord covenants and agrees that no
portion of the Project or any other property owned (equitably or in fee) by
Landlord within a five (5) mile radius of the Premises, shall be used for
the sale of merchandise (including, but not limited to, wearing apparel,
clothing, souvenirs, gift items and/or accessories). [SECTION 30.1]
In the event of any conflict or inconsistency between the terms and
provisions of this Memorandum of Lease Agreement (Retail Store) and the terms
and provisions of the Lease Agreement (Retail Store), the terms and provisions
of the Lease Agreement (Retail Store) shall govern and control in all respects.
L-3
Landlord reserves the right to record a Supplement to this Memorandum of
Lease when the actual legal description of the Premises is known
This Memorandum of Lease Agreement (Retail Store) is not a complete summary
of the terms, conditions and provisions of the Lease Agreement (Retail Store).
Review should be had of the Lease Agreement (Retail Store) for a complete
description of all of the terms, conditions and provisions of the Lease
Agreement (Retail Store).
L-4
IN WITNESS WHEREOF, Landlord and Tenant have executed this Memorandum of
Lease Agreement (Cafe Lease) on the dates shown below.
LANDLORD: TENANT:
PREMIER ENTERTAINMENT BILOXI LLC, a HARD ROCK CAFE
Delaware limited liability company INTERNATIONAL (STP), INC., a New
York corporation
By: GAR, LLC,
its Managing Member By:
------------------------------------
By: Name: Xxx X. Xxxxxxxxx
-------------------------- Title: Vice President & General Counsel
Name: Xxx Xxxxxxxx, III
By: Date: _________________________, 2003
--------------------------
Name: Xxxxx Xxxxx Xxxx
By:
--------------------------
Name: Xxxxx X. Xxxxxxxx
Date: ____________________, 2003
INDEXING INSTRUCTIONS:
Biloxi City Blocks 100, 130, and 130.5 and
Fractional Xxxxxxx 00, Xxxxxxxx 0X, Xxxxx
0X, 2nd Judicial District, Xxxxxxxx County,
Mississippi
INSTRUMENT PREPARED BY:
Xxxx X. Xxxxx, Esq.
Akerman, Senterfitt & Edison, P.A.
Citrus Center, 17th Floor
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Telephone (000) 000-0000
AFTER RECORDING, RETURN TO:
Xxxxx Xxx, Esq.
Xxxxx & Xxxxxxx LLP
0000 00xx Xxxxxx
Xxxxxxxx, XX 00000
L-5
STATE OF MISSISSIPPI
COUNTY OF __________
Personally appeared before me, the undersigned authority in and for the
said county and state, on this the _____ day of __________, 2003, within my
jurisdiction, the within named Xxx Xxxxxxxx, III, Xxxxx Xxxxx Xxxx and Xxxxx X.
Xxxxxxxx, who acknowledged that they are Members of GAR, LLC, a Mississippi
limited liability company, Managing Member of PREMIER ENTERTAINMENT BILOXI LLC,
a Delaware limited liability company, for and on behalf of said companies and as
their act and deed, they executed the above and foregoing instrument, after
having been duly authorized so to do.
------------------------------------
NOTARY PUBLIC
My Commission Expires:
---------------------
STATE OF _____________
COUNTY OF ___________
Personally appeared before me, the undersigned authority in and for the
said county and state, on this the _____ day of ____________, 2003, within my
jurisdiction, the within named Xxx X. Xxxxxxxxx, who acknowledged that he is the
Vice President and General Counsel of HARD ROCK CAFE INTERNATIONAL (STP), INC.,
a New York corporation, for and on behalf of said corporation and as its act and
deed, he executed the above and foregoing instrument, after having been duly
authorized so to do.
---------------------------------
NOTARY PUBLIC
My Commission Expires:
---------------------
X-0
X-0
