EXHIBIT 10.9
XXXXXXX, LTD.
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000 Xxxx Xxxxxx Xxxxx, Xxxxx 000
X.X. Xxx 0000
October 19, 0000 Xx. Xxxxx, Xxxxxxxxx 00000
(000) 000-0000
(000) 000-0000
Xx. Xxxxxx X. Xxxxxxxxx Fax (000) 000-0000
Xx. Xxxxxxx X. Xxxxxxx
000 Xxxxxxxx Xxxxx Xxxxx
Xxxxxx Xxxxxx, XX 00000
RE: Letter of Agreement
Founders Food and Xxxxxxx Ltd.
Sioux Falls, South Dakota
Dear Xxxxx and Xxxx,
I am writing as a follow-up to our work concerning the development of your next
Granite City Food and Brewery Restaurant.
As you know, I have been diligently working on locations in Sioux Falls and
Fargo.
I am happy to report that we have reached an agreement and have signed a
purchase agreement with BLR Real Estate Partnership for our first choice
location at Xxxxx Xxxxxx Xxxxxx xxx Xxxx 00xx Xxxxxx in Sioux Falls, South
Dakota. The site contains approximately 93,770 square feet, or 2.15 acres. A
copy of the purchase agreement is attached to this letter.
We are also evaluation several sites in Fargo, both available vacant land and
two existing restaurants near the West Acres Mall.
The following is my understanding of what I believe we have agreed upon
regarding the development of your Sioux Falls restaurant.
The basic agreement would be as follows:
-The Premises: We will develop and build for you an approximately 10,000 -
11,000 square foot restaurant of masonry construction with 20 foot
sidewalls and a two-story mezzanine similar to the St. Cloud restaurant to
plans and specifications provided by you. We will need to address the roof
and/or xxxx tower appearance of the building with the city when designing
the building.
-We would provide: All of the exterior work including site work, parking
lot, landscaping, lighting and building finishing to your plans and
specifications, including an exterior water feature done in conjunction
with the adjacent office project. The exact size, configuration and
location of the water feature will need to be worked out with the adjacent
property owner.
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-We would provide to the building shell, utility services, including an
electrical panel sized for your usage and HVAC to your specifications. On
the interior, we would provide a concrete floor with utilities stubbed to
locations per your plans and specifications. The ceiling would be open to
bar-joists. The interior of the perimeter walls would be steel or wood
studs. We would provide the interior finishing and staining for any windows
and doors which were part of the exterior wall system. We would provide the
finished bathrooms. We would provide fire protection service to the
building. We would provide the mezzanine.
-You would be responsible for: All interior walls, ceiling and finishing,
HVAC and utilities, electrical and sprinklers inside the building, all
finishing, furnishings and equipment inside the building.
-The Location: Your new Sioux Falls restaurant facility would be located on
the site identified in the attached purchase agreement.
-Lease Term: Twenty (20) years, with two (2), five (5) year options to
renew.
-Rent: Based on a 15% return on the cash invested, plus the actual cost of
financing the remaining project cost over 20 years.
-Project Cost: To be developed, however it is currently estimated that our
portion of the project cost, based on the breakdown herein described would
be about $2,200,000.00. We understand you will be putting at least
$1,100,000.00 into the project.
-Net Lease: The lease would be absolute net, with the tenant paying all
costs of operation and maintenance including insurance and real estate
taxes.
-Lease Guaranty: The leases would be guaranteed by Xxxxx Xxxxxxxxx and
Xxxx Xxxxxxx.
-There would be a $25,000.00 development fee paid to Xxxxxxx, Ltd.
Development and Construction, Inc. as part of the project cost.
This letter constitutes a summary of the proposed terms and conditions for the
development and lease and does not result in any contractual obligations by
either party to the other. Final terms and conditions shall be included in a
lease document to be executed by landlord and tenant.
If the above general terms and conditions are acceptable, please sign below
where indicated and return one of the two originals enclosed herein to me by
November 5, 1999.
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I look forward to working with you on this exciting project.
Yours truly,
/s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
C. E. O.
Agreed and accepted:
Founders Food and Xxxxxxx, Ltd.
By: /s/ Xxxxxx X. Xxxxxxxxx
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Its: President
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Date: 11/14/99
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