UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB/A
Amendment No. 1
[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
For the fiscal year ended December 31, 1996
[ ] Transition Report Under Section 13 or 15(d) of the Securities
Exchange Act of 1934.
For the transition period from N/A to N/A
Commission File Number 0-28332
BRAUVIN NET LEASE V, INC.
(Name of small business issuer in its charter)
Maryland 36-3913066
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
150 South Wacker Drive, Chicago, Illinois 60606
(Address of principal executive offices) (Zip Code)
(312) 443-0922
(Issuer's telephone number)
Securities registered pursuant to Section 12(b) of the Exchange
Act:
Name of each exchange on
Title of each class which registered
None N/A
Securities registered pursuant to Section 12(g)of the Exchange
Act:
Common Stock, par value - $.01 per share
(Title of class)
Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12
months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No .
Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no
disclosure will be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]
State issuer's revenues for its most recent fiscal year:
$1,200,503.
The aggregate market value of the voting stock held by non-
affiliates computed by reference to the price at which the stock
was sold as of March 27, 1997 was $12,997,730. As of March 27,
1997, the registrant had 1,299,773 shares of Common Stock
outstanding.
Transitional small business disclosure format(check one)
Yes No X .
<PAGE>
Item 13. Exhibits and Reports on Form 8-K.
(a) The following documents are filed as part of this report:
Exhibits required by the Securities and Exchange
Commission Regulation S-B, Item 601:
Exhibit No. Description
*3(a) Amended Articles of Incorporation of
Brauvin Net Lease V, Inc.
*3(b) By-laws of Brauvin Net Lease V, Inc.
*4 Specimen Stock Certificate
**10(a) Advisory Agreement
**10(b) Assignment and Assumption Agreement
among Brauvin Realty Advisors V,
Inc., Brauvin Realty Advisors V,
L.L.C., the Fund and Jerome Brault
*10(c) Agreement of Purchase and Sale
between Country Harvest Buffet
Restaurants, Inc. and Brauvin, Inc.
on behalf of the Fund dated November
11, 1994
*10(d) Lease between Country Harvest Buffet
Restaurants, Inc. and Brauvin, Inc.
on behalf of the Fund dated November
21, 1994
*10(e) Agreement of Purchase and Sale
between Bomasada Investment Group
II, L.L.C. ("Bomasada") and Brauvin,
Inc. on behalf of the Fund dated
December 12, 1994 (with lease
between Bomasada and Blockbuster
Videos, Inc. dated March 23, 1994
attached)
*10(f) Testing and Remediation License
Agreement between Bomasada and
Diamond Shamrock Stations, Inc.
dated July 8, 1994
*10(g) Assignment of Shopping Center Lease
by and between Blockbuster
Investment Group II L.L.C. and the
Fund dated January 31, 1995
*10(h) Assignment of Testing and
Remediation License Agreement
between Bomasada and the Fund dated
January 31, 1995.
*10(i) Agreement of Purchase and Sale
between HMG/Courtland Properties,
Inc. ("HMG") and Brauvin, Inc., on
behalf of the Fund dated December
19, 1994 (with lease between Sugar
Grove Investment Associates, Ltd.
and On The Border Corporation dated
as of January 25, 1993, including
amendments, attached)
*10(j) Assignment and Assumption Agreement
(regarding On The Border Corporation
Lease) between HMG and the Fund
dated January 6, 1995.
*10(k) Contract for Sale and Purchase
between Chilly Land, Inc. and
Brauvin, Inc. on behalf of the Fund
dated March 28, 1995.
*10(l) Assignment of Lease and Other
Property (regarding the Chili's
Property) between Chilly Land, Inc.
and the Fund dated April 13, 1995
(with the Lease Agreement dated
December 7, 1988 between Birmingham
Retail Center Associates, Ltd. and
Sunstate Alabama Restaurant
Corporation, as amended by letter
agreements dated December 5, 1988
and February 15, 1989 attached).
*10(m) Agreement of Purchase and Sale
between KCBB, Inc. and Brauvin,
Inc., on behalf of the Fund dated
December 15, 1994 (with lease
between KCBB, Inc. and Just For
Feet, Inc. dated November 9, 1994
attached).
*10(n) Assignment of Lease (regarding Just
For Feet Lease) between Legacy Group
L.L.C. and Brauvin Net Lease V, Inc.
dated May 23, 1995.
*10(o) Agreement of Purchase and Sale
between Loves Park Development
Corporation ("Loves Park") and
Brauvin, Inc., on behalf of the Fund
dated July 11, 1995 (with lease
between Roscoe Development
Corporation (assignor to Loves Park)
and Video Watch, Inc. dated October
5, 1994 attached).
*10(p) Assignment of Lease (regarding Video
Watch) between Loves Park and
Brauvin Net Lease V, Inc. dated July
31, 1995.
10(q) Agreement of Purchase and Sale
between P. One Sioux Falls Investors,
Inc. and, Brauvin, Inc., on behalf
of the Fund dated February 12, 1996
(with lease between P. One Sioux Falls
Investors, Inc. and Pier 1 Imports (U.S.),
Inc. dated June 5, 1995 attached).
10(r) Assignment and Assumption Agreement
between P. One Sioux Falls Investors,
Inc. and the Fund dated February 12, 1996.
10(s) Purchase and Sale Ageement between Germantown
Associates Limited Partnership and Germantown
Associates, Inc., on behalf of the Fund dated
January 21, 1997 (with schedule of leases
between (1) Lewis J. Stowe, III and Firestone
Tire & Rubber Company now known as
Bridgestone/Firestone, Inc. as amended dated
September 25, 1986; and (2) Lewis J.
Stowe, III and Jiffy Lube of Pennsylvania,
Inc., as amended dated June 11, 1986. Both
leases are attached).
10(t) Assignment and Assumption Agreement
between Germantown Associates Limited
Partnership and Germantown Associates, Inc.
dated January 21, 1997.
***16 Letter of Ernst & Young LLP dated December 10,
1996.
****21 Subsidiaries of the small business issuer
23 Independent Auditors' Consent
****27 Financial Data Schedule
* Incorporated by reference from the exhibits filed with the
Fund's registration statement (Registration No. 33-70550) on
Form S-11 filed under the Securities Act of 1933.
** Management Contract
*** Incorporated by reference from Exhibit 16 filed with the
Fund's Form 8-K/A filed on December 12, 1996.
**** Exhibits filed with the Form 10-KSB on March 31, 1997.
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BRAUVIN NET LEASE V, INC.
(Registrant)
Date: June 19, 1997 By: /s/ Jerome J. Brault
Jerome J. Brault,
Chairman, President
and Chief Executive Officer
In accordance with the Exchange Act, this report has been signed
below by the following persons on behalf of the Registrant and in
the capacities and on the dates indicated.
Signature Title Date
/s/ Jerome J. Brault Chairman, President June 19, 1997
Jerome J. Brault and Chief Executive
Officer
/s/ Jeff A. Jacobson Director June 19, 1997
Jeff A. Jacobson
/s/ Kenneth S. Nelson Director June 19, 1997
Kenneth S. Nelson
/s/ James L. Brault Director, Executive June 19, 1997
James L. Brault Vice President and
Secretary
/s/ Gregory S. Kobus Director June 19, 1997
Gregory S. Kobus
/s/ Hugh K. Zwieg Director June 19, 1997
Hugh K. Zwieg
/s/ B. Allen Aynessazian Chief Financial June 19, 1997
B. Allen Aynessazian Officer (Principal
Accounting Officer)
<PAGE>
Exhibit 10 (q)
AGREEMENT OF PURCHASE AND SALE
AGREEMENT, made and entered into by and between P. ONE SIOUX
FALLS INVESTORS, INC., a Florida corporation, having its principal
office at 7380 Sand Lake Road, Suite 150, Orlando, Florida 32819
("Seller"), and BRAUVIN INC., an Illinois corporation, or its
assignee(s) or nominee(s), having its principal office at 150 South
Wacker Drive, Suite 3200, Chicago, Illinois 60606 ("Purchaser").
1. Sale. Seller agrees to sell and convey to Purchaser and
Purchaser agrees to purchase from Seller, for the Purchase Price
(hereinafter defined), and upon the terms and conditions hereinafter
set forth, that certain improved real estate completed in accordance
with the architectural "as built" certified plans and specifications
furnished or to be furnished to Purchaser and commonly known as 3801
West 49th Street, Sioux Falls, South Dakota 57102 (the "Site"), and
consisting of:
(a) Land. That certain tract of land which is described in
Schedule 1 (a), attached hereto and incorporated herein by this
reference (the "Land"), together with all rights, easements and
interests appurtenant thereto, including, but not limited to any
streets or other public ways adjacent to the Land and owned by
Seller and all water and mineral rights owned by Seller.
(b) Improvements. All buildings, improvements, fixtures
(provided however that all trade fixtures and equipment of Lessee
are excluded) and structures now or hereafter located on the Land,
consisting or to consist of one (1) building having the square
footage and such other related amenities and outdoor parking areas
as set forth in the "as built" certified plans and specifications;
and such other improvements and structures, if any, as are located
on the Land and used in connection with the operation thereof (the
improvements are hereinafter referred to, as the "Improvements").
The Land and the Site together with the Improvements are sometimes
hereinafter referred to as the "Location", or the "Project."
2. A. Purchase Price. The total purchase price (the "Purchase
Price") to be paid to Seller by Purchaser for the Project shall be
$1,410,000.00.
B. Ernest Money Deposit. Within five (5) days after the
expiration of the Investigation Period, and in such case this
Agreement being a binding obligation, Purchaser shall deposit the
sum of $25,000.00 (the "Deposit") into the Escrow (as defined in
Section 9(b)) to be held as earnest money in accordance with the
terms hereof. The Deposit shall be invested by the Title Company
as escrowee as directed by Purchaser and all interest earned on the
Deposit shall be deemed for the benefit of Purchaser. The Deposit
and all interest thereon shall be applied against the Purchase Price
at Closing. If this Agreement is terminated pursuant to any right
of termination granted to Purchaser or Seller by this Agreement, or
if the transaction contemplated by this Agreement fails to close due
solely to Seller's breach of or failure to fulfill any
representation, warranty, covenant or condition contained in this
Agreement, then the Deposit and all interest shall be paid to
Purchaser and this Agreement shall become null and void, provided,
however, that Purchaser shall not relinquish any rights or remedies
hereunder or in law or equity in the event such breach, etc., by
Seller shall be purposeful and within its reasonable power to cure.
In the event that the transaction contemplated by this Agreement
fails to close solely due to Purchaser's default hereunder then
Seller shall receive the Deposit and interest thereon as liquidated
damages in lieu of any other remedies which might otherwise be
available to Seller at law or in equity.
3. Purchaser's Investigation of the Project.
Purchaser shall have until the later of thirty (30) days from the
Agreement Date (as defined in Section 16) or five (5) business days
after Purchaser's receipt of the Level 1 Audit or a Level 2 Audit
(if required and performed pursuant to Section 5(e) hereof) during
which to make a complete investigation of Project ("Investigation
Period"). During the Investigation Period the Purchaser shall
determine whether the physical and financial condition of the
Project is, in the Purchaser's sole and absolute discretion,
satisfactory for the operation and ownership in the manner and on
the basis contemplated by the Purchaser. Within one (1) business
day following the expiration of the Investigation Period the
Purchaser shall notify the Seller as to whether Purchaser shall deem
the Project satisfactory or not satisfactory ("Investigation
Notification"). If Purchaser shall deem the Project not
satisfactory, this Agreement and the rights and obligations of the
parties hereto shall be deemed terminated and of no further force
and effect as of the Date of such Investigation Notification. If
Purchaser fails to timely send the Investigation Notification,
Purchaser shall be deemed to have exercised its right to terminate
this Agreement pursuant to this Section 3. Notwithstanding the
foregoing, Purchaser's investigation of the Project shall in no
event and in no manner abrogate, diminish or affect the warranties
and representations made by Seller hereinbelow. "Records" shall
include all books and records of Seller or in Seller's possession
or control and all other information reasonably required by
Purchaser to investigate the Project, including but not limited to,
the "as built" certified plans and specifications as hereinabove
more specifically set forth, the materials required to be provided
under Section 5 hereof, the financial statements of the Lessee (as
defined below) and other items as are more specifically set forth
in Section 9(11) below.
(i) In aid of Purchaser's investigation and inspection of the
Project, Seller agrees to reasonably cooperate with Purchaser and
provide Purchaser with access to the Project. Seller shall deliver
copies of any and all title insurance policies, surveys, engineering
studies (soils, hydrology, environmental), prior years tax bills,
zoning information and other Records, as may be in Seller's
possession;
(ii) Purchaser agrees that all Records and other information
delivered to Purchaser by Seller shall be treated as confidential
and shall be returned to Seller if this Agreement is terminated.
Purchaser does hereby indemnify Seller for any loss or damage caused
to the Project by Purchaser or Purchaser's agents during the
Investigation Period, which indemnity shall survive the closing or
any termination of this Agreement; and
(iii)Seller acknowledges that: (a) the termination right
extended to Purchaser under this Section 3 does not relieve Seller
of Seller's obligations under this Agreement; (b) Seller is bound
under the terms of this Agreement not to enter into any contract or
agreement for sale of the Project with any other person or entity;
and (c) Seller is obligated to hold the Project off the market
pending Purchaser's exercise or waiver of the termination right
extended in this Section 3.
4. Lease. Seller hereby represents, warrants and covenants to
Purchaser that Seller has entered into a lease for the Project (the
"Lease") with Pier 1 Imports (U.S.), Inc., a Delaware corporation
("Lessee"), a copy of which (including all amendments) is attached
hereto as Schedule 4, and by this reference made a part hereof.
5. Title and Survey Matters.
(a) Conveyance of Title. Seller agrees to deliver to
Purchaser a general warranty deed conveying to the Purchaser title
to the Land and Improvements of the Project free and clear of all
claims, liens and encumbrances, except for the Lease and exceptions
approved in writing by Purchaser (the "Permitted Exceptions").
(b) Title Commitment. Within fifteen (15) days from the
Agreement Date, the Seller, at Seller's sole expense, shall deliver
to Purchaser a commitment letter or binder ("Title Commitment")
showing title to the Land and Improvements of the Project in Seller,
dated after the date hereof, and issued by Commonwealth Land Title
Company/Guaranty National Title Company, downtown Chicago office or
any other company reasonably acceptable to Purchaser (the "Title
Company"), wherein the Title Company shall commit to issue to
Purchaser as to the Project, an owner's title insurance policy,
American Land Title Association ("ALTA") Form B marketability policy
in the amount of the Purchase Price, ("Title Policy"). The Title
Commitment shall include an extended coverage endorsement over the
all general title exceptions, subject only to the Permitted
Exceptions, together with the following additional endorsements, the
form of which shall be either "ALTA" or otherwise approved by the
Purchaser and are otherwise permissible in the state of Florida:
3.1 zoning modified for parking and showing the Project as a legal
and conforming use and structure, survey, contiguity, if applicable,
environmental, encroachment, if required, and access. The Title
Commitment shall also commit to insure, as additional parcels, all
recorded easement rights of the Seller, if any, being conveyed to
Purchaser or otherwise benefitting the Project. Concurrently with
delivery of the Title Commitment, Seller, at no cost to Purchaser,
shall furnish Purchaser with copies of all documents recorded with
respect to the Project which appear on the Title Commitment. As a
condition of the Closing, the Title Commitment shall be later-dated
to cover the Closing Date and the recording of the general warranty
deed. Seller shall pay for all title charges, including, but not
limited to, premiums for title insurance, all later-date fees,
general coverage premiums and endorsement fees. Escrow charges
shall be borne equally by the parties hereto. Seller shall pay for
all transfer fees, taxes and/or stamps required by any state, county
or local agency in connection with the purchase and sale
contemplated hereby.
(c) Survey. Within fifteen (15) days from the Agreement Date,
Seller, at its sole expense, shall deliver to Purchaser and Title
Company, an as-built survey (the "Survey") of the Site and the
easements benefiting the Site over the lands of others prepared by
a registered land surveyor or engineer, licensed in the state of
Florida, certified to the Title Company and to Purchaser and
Purchaser's lender, if any, in full ALTA form and dated after the
date hereof. The Survey shall conform with the requirements of the
Title Company to waive its survey exceptions from the Title Policy.
(d) UCC Searches. Prior to Closing, Seller, at Seller's sole
expense, shall deliver to Purchaser searches of all Uniform
Commercial Code financing statements filed and/or recorded, dated
on or after the date hereof, against the Seller. Such searches
shall reveal that there are no claims or liens against any of such
parties encumbering or which might encumber the Project subsequent
to the Closing Date. If claims or liens are revealed which do or
could encumber the Project, then the cure and termination and
election provisions set forth in Section 5(f) below shall apply.
(e) Hazardous Materials Site Investigation. Within fifteen
(15) days from the Agreement Date, the Seller shall, at its sole
cost and expense, cause a party reasonably acceptable to Purchaser
("Auditor"), to conduct a Level 1 Hazardous Materials Site
Investigation ("Level 1 Audit"), which Level 1 Audit shall complete
the following tasks at the Site:
(i) Review available materials that could indicate potential
environmental impairment. Such materials should include topographic
maps, air photos, boring logs and other references.
(ii) Conduct a physical site examination to include an
inspection for unusual land colorations, odors, and physical
irregularities as well as underground or above-ground tanks, and an
evaluation of current land use. Neighboring land owners are to be
contacted to determine actual historical site use.
(iii) Contact local and state health and environmental agencies
to determine if any hazardous materials incidents have occurred in
the area, including recorded or known landfill sites, or the
occurrence of any hazardous material event (spill, storage,
discharge, etc.).
(iv) Adjacent properties are to be surveyed for current land
use conditions that may adversely affect the subject property
including: underground or above-ground storage tanks, manufacturing
sites, landfills, etc.
(v) A summary report will be prepared, addressed and delivered
to Purchaser, within the above-stated time frame, indicating the
contacts made, data findings, photographs, and other pertinent
information and recommendations for a detailed Level 2 site
investigation ("Level 2 Audit") if significant evidence exists that
hazardous substances may have been released at or in close proximity
to the Site. If a Level 2 Audit is recommended, Seller shall
perform that investigation during the Investigation Period or shall
terminate this Agreement and reimburse Purchaser for all costs
expended by Purchaser in connection with this Agreement, including
reasonable attorney's fees, and each party shall have no further
liability to the other hereunder.
(f) Defects and Cure. The Title Commitment, Survey, UCC
searches, Level 1 Audit and Level 2 Audit if performed described in
this Section 5 are collectively referred to as "Title Evidence".
If the Title Evidence discloses, with respect to the Survey, Level
1 Audit or Level 2 Audit, conditions which might materially
adversely affect Purchaser or the Project or, with respect to the
Title Commitment, deficiencies in endorsements or matters other than
the Permitted Exceptions or, with respect to the UCC searches, liens
or claims not permitted hereunder (hereinafter collectively referred
to as the "Defects"), the Defects shall, as a condition of the
Closing, be cured by the Seller or, at Seller's option, endorsed
over by the Title Company within thirty (30) days from the delivery
of said Title Evidence and the Closing shall thereafter take place
either on the Closing Date hereinafter specified, or thirty (30)
days after the last Defect is cured or endorsed over, whichever is
later. If Seller fails to cure or cause the Title Company to
endorse over all Defect(s), as aforesaid, this Agreement shall
terminate without further action of the parties at the close of the
thirty first (31st) day following the last permitted cure period
except that alternatively, Purchaser may, at its sole election upon
written notice to Seller during the cure period, proceed to close
this transaction and take title to the Project subject to the
uncured Defects which the Title Company is incapable or unwilling
to endorse over, as aforesaid, without waiving its rights and
remedies herein provided.
6. Prorations and Adjustments. The following items shall be
prorated as of the Closing Date: general real estate taxes accruing
prior to the Lessee's obligation to pay same, current rents,
security deposits (and interest thereon, if any), unused decorating
allowances (if any), and expenditures required to complete any
tenant improvement work required of the lessor under the Lease and
incomplete on the Closing Date, together with any other items deemed
reasonable and customary under the circumstances.
7. Representations and Warranties of Seller. Seller hereby
represents and warrants to Purchaser (and, in respect of subpart (h)
hereof, Purchaser hereby represents to Seller) as to the following
matters, each of which is so warranted to be true and correct as of
the date hereof, and shall be deemed re-made at the Closing to be
true and correct as of the Closing Date:
(a) Title Matters. Seller has good and marketable fee simple
title to the Land and Improvements, all subject only to the
Permitted Exceptions.
(b) No Violations of Zoning and Other Laws. The existing or
proposed use and condition of the Project does not violate any
zoning, building, health, fire or similar statute, ordinance,
regulation or code and Seller has received no notice, written or
otherwise, from any governmental agency alleging a violation of the
foregoing. The Project is in full compliance with current zoning
requirements, including, without limitation, all parking
requirements, and is not a non-conforming or special use. The
Project, as conveyed to Purchaser, shall include all rights to any
off-site facilities necessary to ensure compliance with all zoning,
building, health, fire, water use or similar statutes, laws,
regulations and orders.
(c) Pending and Threatened Litigation. There are no pending
or to the best of Seller's knowledge threatened matters of
litigation, administrative action or examination, claim or demand
whatsoever relating to the Project.
(d) Eminent Domain, etc. There is no pending or to the best
of Seller's knowledge, contemplated eminent domain, condemnation or
other governmental taking of the Project or any part thereof.
(e) Access to Project; Utilities. To the best of Seller's
knowledge, no fact or condition exists which would result in the
termination or impairment of access to the Site from public or
private streets or ways adjoining the Site or which could result in
discontinuation of presently available or otherwise necessary sewer,
water, electric, gas, telephone or other utilities or services.
(f) Assessments. To the best of Seller's knowledge, there are
no public improvements in the nature of off-site improvements, or
otherwise, which have been ordered to be made and/or which have not
heretofore been assessed and there are no special or general
assessments not of record pending against or affecting the Project.
(g) Accuracy of Information. All documents and material and
Records being delivered or made available to Purchaser by Seller are
true, accurate and complete and present the information purportedly
set forth therein and do not fail to present any information or data
which would be necessary in order to prevent the information
contained therein from being misleading.
(h) Authority of Signatories: No Breach of Other Agreements:
etc. The execution, delivery of and performance under this
Agreement is pursuant to authority validly and duly conferred upon
the parties hereto and the signatories hereto. This Agreement
constitutes a legal, valid, binding and enforceable contract on the
part of each party. The consummation of the transaction herein
contemplated and the compliance by a respective party with the terms
of this Agreement do not and will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a default
under, any agreement, arrangement, understanding, accord, document
or instrument by which such party or the Project is bound; and will
not and does not constitute a violation of any applicable law, rule,
regulation, judgment, order or decree of any governmental
instrumentality or court, domestic or foreign, to which Seller or
the Project is subject or bound.
(i) Executory Agreements. Except for the Lease, Seller is not
a party to, and the Project is not subject to, any contract or
agreement of any kind whatsoever, written or oral, formal or
informal, with respect to the Project, other than this Agreement and
those contracts necessary to construct the Improvements as
contemplated herein. Purchaser shall not, by reason of entering
into or closing under this Agreement, become subject to or bound by
any agreement, contract, lease, license, invoice, bill, undertaking
or understanding which it shall not have previously agreed in
writing to accept.
(j) Insurability of Project. Neither Seller nor its agents
have received any formal or informal notice from any insurance
company of any defect or inadequacies in the Project or of any part
thereof which would adversely affect the availability or cost of
insurance for the Project.
(k) Mechanic's Liens. All bills and invoices for labor and
material of any kind relating to the Project have been paid in full
or, as to the Project, by the Closing Date will be paid in full and
there are no mechanic's liens or other claims outstanding or
available to any party in connection with the Project.
(l) Government Obligations. There are no unperformed
obligations relative to the Project outstanding to any governmental
or quasi-governmental body or authority.
(m) Condition of Improvements. The Improvements are in good
working order and repair and not in need of repair or replacement,
subject to ordinary wear and tear between the date hereof and the
Closing Date. The Project is free from animal and insect
infestation and damage therefrom.
(n) Utility Services. The sewage, sanitation, plumbing, water
retention and detention, refuse disposal and similar facilities in
and on and/or servicing the Project is fully adequate to service the
Project and Seller has received no notice of any violation of any
governmental and environmental protection authorities' laws, rules,
regulations and requirements.
(o) Soil Conditions and Flood Plain. The Improvements, as
built, were constructed in a manner compatible with the soil
conditions at the time of construction and all necessary excava-
tions, fill, footings, caissons or other installations were then or
have since been provided. The Project does not lie in a flood plain
and was not built, in whole or in part, on a land-fill and the soil
is not chemically contaminated. If Purchaser becomes aware of
contamination, Seller shall cause such contamination to be removed.
(p) Easements. The Project is adjacent to and has full and
free access on, to and from public roads and ways, such that no
private easements or agreements are necessary to afford access to
or from the Project.
(q) Hazardous Substances. No part of the Project contains
asbestos or, if friable asbestos has been used or is used in the
Project then, to the extent present, same shall be removed by
Seller, at its sole cost and expense, prior to the Closing Date.
During the period of Seller's ownership of the Project, there were
(a) no Hazardous Substances, as that term is hereinafter defined,
in, on or at the Project; (b) no spills, releases, discharges, or
disposal of Hazardous Substances,in, on or onto the Project; (c) no
spills or disposal of Hazardous Substances off the Project as a
result of any construction on or operation and use of the Project,
and there is (a) no presence of any equipment containing
polychlorinated biphenyl ("PCB"); and (b) no friable asbestos in use
at or on the Project.
In connection with Seller's construction of the Improvements,
Seller represents and warrants that to the best of its knowledge
there has been no failure to comply with any applicable local, state
and federal environmental laws, regulations, ordinances and
administrative and judicial orders relating to the generation,
recycling, reuse, sale, storage, handling, transport, and disposal
of any Hazardous Substances. "Hazardous Substances" shall mean any
substance or material defined or designated as hazardous or toxic
waste, hazardous or toxic material, a hazardous or toxic substance,
or other similar term by any federal, state or local environmental
statute, regulation or ordinance. If requested by Purchaser, Seller
shall render a certificate in favor of Purchaser setting forth the
matters set forth above.
Seller agrees to indemnify and hold Purchaser and any lender
of Purchaser harmless from and against any and all claims, demands,
damages, losses, liens, liabilities, penalties, fines, lawsuits or
other proceedings, costs and expenses (including, without
limitation, reasonable attorneys' fees) arising directly or
indirectly from, out of, or in any way connected with (a) the
presence of any Hazardous Substances on or off the Location or any
portion thereof during Seller's ownership thereof, (b) any violation
of any local, state or federal environmental law, regulation,
ordinance or administrative or judicial order relating to Hazardous
Substances, attributable to events occurring before the Closing Date
during Seller's ownership of the Location, and/or (c) a violation
of Article 31 of the Lease if the acts giving rise to such violation
occurred prior to Closing, and Seller covenants that it shall not
create, store or release or allow the creation, storage or release
of any Hazardous Substances on the Project.
(r) FIRPTA. Seller is not a foreign person or entity under
the Foreign Investment in Real Property Tax Act of 1980, as amended,
(the "Act") and no taxes or withholding under the Act shall be
assessed against or imposed upon Purchaser in connection with the
transaction contemplated by this Agreement.
(s) Lease. The Lease is the only lease demising any portion
of the Project and has not been amended or modified except as set
forth in Schedule 4. The Lease does not contain any option or right
of first refusal to purchase all or any part of the Project, to
extend the Lease term, or to cancel or terminate the Lease prior to
the end of its term. The Lessee has accepted and is occupying the
Project. The Lease is in good standing and in full force and effect
and no rights or interests of the lessor thereunder have been waived
or released. All of the lessor's obligations under the Lease have
been satisfied and neither the lessor nor the Lessee are in default
under the Lease nor is Seller aware of any condition or
circumstances which with the passage of time or giving of notice
would constitute a default thereunder. Lessee is not entitled to
any refund or reimbursement under the terms of the Lease.
In the event of the breach of any warranty or representation
made herein or elsewhere in this Agreement by Seller, Seller shall
and does hereby agree, warrant and covenant to indemnify and hold
Purchaser harmless from and against all losses, damages, liabili-
ties, costs, expenses (including reasonable attorneys' fees), and
charges which Purchaser may incur or to which Purchaser may become
subject as a direct or indirect consequence of such breach.
8. Covenants of Seller. To the extent that any work remains
incomplete in respect of the Project, Seller hereby covenants and
agrees with Purchaser that from the Agreement Date until the Closing
Date, Seller shall diligently complete all work necessary to
complete the Improvements and cause same to open for business to the
public and shall operate the Project in accordance with prudent
management and operating standards and practices, and, subject to
the limitations of Section 10 hereof, Seller shall make or cause to
be made all repairs, replacements and maintenance with respect to
the Project which may be necessary to maintain or place the Location
in a first-class condition. At the Closing, the Location shall be
delivered to Purchaser in a first-class condition. Seller shall pay
or cause to be paid on a prompt and timely basis all bills and
discharge all obligations arising from ownership, operation,
management, repair and maintenance of the Project, as payments for
same become due. Between the Agreement Date and the Closing Date,
Purchaser shall have the continuing right from time to time to
periodically inspect the Project and portions thereof to verify
Seller's compliance with the foregoing undertakings, but no such
inspections shall relieve Seller of its obligations hereunder or
constitute any waiver by Purchaser hereunder. Between the Agreement
Date and the Closing Date (i) Seller shall keep (or cause to be
kept) the Location fully insured in accordance with prudent and
customary practice; (ii) Seller shall not alienate, encumber or
transfer the Project or any part thereof in favor of or to any party
whomsoever; and (iii) Seller will neither execute any new lease nor
renew or modify the Lease without Purchaser's prior written consent.
9. Closing and Related Matters.
(a) The Closing Date.
(i) The purchase and sale of the Project (the "Closing") shall
be on the date ("Closing Date") which is five (5) business days
after the completion of the Investigation Period (provided a
permanent certificate of occupancy has been issued for the Premises
by the appropriate authority, and Seller has taken occupancy of the
Premises and received the first month's rent).
(ii) Subject to the provisions contained in Paragraph 5(f)
hereof, in the event the Closing has not occurred on or before sixty
(60) days after the Agreement Date and such failure to Close is not
a result of a default by either party hereto, then either party
shall have the right and option to terminate this Agreement.
(b) Escrow Closing. This transaction shall be closed through
an escrow (the "Escrow") with the Title Company acting as escrowee
in accordance with the provisions of a form of deed and money escrow
agreement (the "Escrow Agreement") acceptable to the Title Company
and the parties. The attorneys for Seller and Purchaser are
authorized to execute the Escrow Agreement, any amendments thereto
and all directions or communications thereunder. The Escrow
Agreement shall be auxiliary to this Agreement and, in the event of
any conflict or inconsistency between this Agreement and the Escrow
Agreement, the terms and provisions of this Agreement shall always
be controlling as between the Parties hereto.
(c) Seller's Duties at Closing. At the Closing and on the
Closing Date, Seller shall do or perform the following (unless
otherwise notified, all documents to be delivered by Seller shall
be deposited in the Escrow):
(1) execute, acknowledge and deliver to Title Company a
general warranty deed in recordable form dated as of the Closing
Date whereby the Location is conveyed by Seller to Purchaser,
subject only to the Permitted Exceptions; the Seller to pay all
transfer, mortgage, and intangible taxes and recording fees;
(2) deliver to Purchaser executed originals of the Lease;
(3) execute and deliver to Purchaser an Assignment of Lease;
(4) deliver to Purchaser a current estoppel certificate
addressed to Purchaser from Lessee stating (a) that the Lessee has
accepted and is occupying the Project, (b) that the Lease has not
been modified or amended, (c) that the Lease is in good standing and
in full force and effect, (d) that there are no defaults of the
landlord under the Lease, (e) that the Lessee is not entitled to
receive any concession (rental or otherwise) or other similar
compensation with renting the space it occupies, other than as set
forth in the Lease, (f) the amount of any security deposit being
held by the landlord under the Lease, (g) that any construction of
tenant improvements required to be completed by the landlord under
the Lease has been satisfactorily completed and all lien waivers
obtained, (h) the date on which rent payments commenced and that
date to which rent has been prepaid under the Lease, and (i) such
other matters as shall be reasonably requested by Purchaser, or as
otherwise required under the provisions contained in Article 28 of
the Lease.
(5) cause to be furnished and delivered to Purchaser, at
Seller's sole cost and expense, the later-dated Title Commitment in
accordance with Section 5(b);
(6) deliver sole and complete possession of the Project to
Purchaser, subject only to the Permitted Exceptions;
(7) deliver to Purchaser copies of all certificates of
occupancy, licenses, permits, authorizations and approvals required
by law and issued by all governmental authorities having
jurisdiction over the Project, together with copies of all certi-
ficates issued by any local board of fire underwriters (or other
body exercising similar functions) and the original of each bill for
current real estate and personal property taxes, together with proof
of payment thereof (if any of the same have been paid);
(8) deliver evidence that Seller is a corporation in good
standing in the state of Florida;
(9) delivery of the Insurance policies and/or Certificates of
Insurance, as the case may be, as required by the Lease;
(10) deliver an Assignment (to the extent assignable) of all
construction contracts and construction warranties (including roof)
with respect to the Project together with any consents to the
assignment as may be necessary or required at Seller's sole cost and
expense;
(11) deliver appropriate financial information of the Lessee
conforming to Rule 3-14 of Regulation S-X and which allows Purchaser
to meet its filing requirements under the federal securities laws
and, if required, the agreement of the Lessee to cause their
respective auditors to issue then current consents for the use of
the auditors' reports in any Post-Effective Amendment to Purchaser's
Registration Statement to be filed by Purchaser and to reference
such auditors under the heading "Experts" in such Post-Effective
Amendment. Further, if required, Lessee must consent on its own
behalf to the use of the audited financial statements and the
auditors' names as set forth above; and
(12) execute and deliver to Purchaser such other documents or
instruments as may be required under this Agreement or, in the
reasonable opinion of counsel for Purchaser, may be necessary to
effectuate the Closing.
(d) Purchaser's Duties at Closing. At the Closing and on the
Closing Date, Purchaser shall deliver to the Title Company cashier's
or certified checks (or wired funds) in the amount of the Purchase
Price and execute and deliver to Seller such other documents or
instruments as shall be reasonably required.
(e) Escrow for Completion of Improvements. If the Closing
occurs prior to the completion of the Improvements (for example, the
parking lot) and the Seller hereby acknowledges that landscaping
work approximating the sum of Fifteen Thousand Dollars ($15,000.00)
remains incomplete, an amount equal to one hundred fifty percent
(150%) of the cost thereof under the construction contract to
complete the open item(s) shall be deposited by Seller with the
Seller's attorney to guaranty the completion of the item(s) pursuant
to an escrow arrangement that is mutually satisfactory to the
parties hereto. The escrowed funds shall be paid out to reimburse
Seller for the cost of completion or may be paid directly to the
contractors upon submission of proper invoices and lien waivers.
If Seller fails to complete the open item(s), within a reasonable
time, Purchaser shall have the right to use the escrowed funds to
complete the construction of the open item(s).
10. Destruction or Loss of Project. If, between the Agreement Date
and the Closing Date, all or any portion of the Project is damaged
by fire or natural elements, or other causes beyond Seller's control
(the "Damage"), or the Project is taken or made subject to
condemnation, eminent domain or any portion thereof or other
governmental acquisition proceedings (collectively a "Taking") then
at Purchaser's sole option, Purchaser may elect, upon written notice
Seller given any time prior to Closing, to terminate this Agreement.
11. Default and Conditions Precedent to Closing. In all events,
the obligations of Purchaser to make the payments and to close this
transaction are contingent upon: (i) title to the Project being
shown to be good as required by this Agreement or being accepted by
Purchaser; (ii) the conditions precedent to Closing provided for in
this Agreement being satisfied (or, for any non-fulfilled
condition(s), a written waiver of each by Purchaser); (iii) the
representations and warranties of Seller contained in this Agreement
being true and accurate or waived by Purchaser in writing as of the
Closing Date; and (iv) Seller having performed all of its covenants
and otherwise having performed all of its obligations and fulfilled
all of the conditions required of it in order to close. In the
event Purchaser becomes aware of a breach of any of Seller's
representations or warranties or of Seller failing to perform all
of its covenants or otherwise failing to perform all of its
obligations and fulfill all of the conditions required of Seller in
order to close, Purchaser may, at its option and after notifying
Seller of the non-performance or breach and allowing the Seller ten
(10) days after delivery of said notice to Seller in which to cure
said breach or non-performance: (a) elect to enforce the terms
hereof by action for specific performance; or (b) attempt to cure
such breach or failure by or of Seller for a period of up to thirty
(30) days, charging Seller for any fees, costs and expenses
(including reasonable attorneys' fees) incurred in doing so and
following such attempt either: (1) terminate this Agreement without
waiving its rights to exercise any right or remedy available at law
or equity or (2) proceed to close this transaction notwithstanding
such breach or nonperformance without waiving its rights to exercise
any right or remedy available to it at law or in equity; (c)
proceed to close this transaction notwithstanding such breach or
non-performance without waiving its rights to exercise any right or
remedy available to it at law or in equity; or (d) terminate this
Agreement, without waiving its rights to exercise any right or
remedy available at law or equity. In all events, Purchaser's
rights and remedies under this Agreement shall always be
non-exclusive and cumulative and the exercise of one remedy shall
not be exclusive of or constitute the waiver of any other.
12. Binding Effect; Assignability. This Agreement shall inure to
the benefit of, and shall be binding upon, the successors and
assigns of the parties hereto, provided however, Seller may not
assign its obligations hereunder without the prior written consent
of Purchaser. At or prior to Closing, Purchaser shall have the
right to designate one or more partnerships, corporations or any
other legal entity(ies) to act as its assignee(s) or nominee(s), and
such entity shall thereafter be the party(ies) to which the Project
shall be conveyed and which shall execute the closing documents.
Seller agrees to look solely to and accept performance from such
assignee(s) or nominee(s), and all references to "Purchaser" in this
Agreement shall include said assignee(s) or nominee(s).
13. Brokerage. Purchaser represents and warrants to the Seller
that, in connection with this transaction, no third-party broker or
finder has been engaged or consulted by it. Each party hereby
defends, indemnifies and holds the other harmless against any and
all claims of brokers, finders or the like, and against the claims
of all third parties claiming any right to commission or
compensation by or through acts of that party or that party's
partners, agents or affiliates in connection with this Agreement.
14. Notices. Any and all notices required to be delivered
hereunder shall be deemed properly delivered when mailed by
registered or certified mail, return receipt requested, postage
prepaid (or sent by a recognized overnight courier service with
instructions and payment for delivery on the next business day to
the parties as set forth below:
If to Purchaser: Brauvin, Inc.
150 South Wacker Drive, Suite 3200
Chicago, Illinois 60606
Attn: Mr. Ralph Cram, Vice-President
Telephone: 1 (312) 443-0922
Facsimile: 1 (312) 443-8014
With a copy to: Allan L. Yusim, Esq.
Saitlin, Patzik, Frank & Samotny Ltd.
150 South Wacker Drive, Suite 900
Chicago, Illinois 60606
Telephone: 1 (312) 551-8300
Facsimile: 1 (312) 551-1101
If to Seller: P. One Sioux Falls Investors, Inc.
7380 Sand Lake Road, Suite 150
Orlando, Florida 32819
Attn: Mr. Jay Adams
Telephone: 1 (407) 351-3666
Facsimile: 1 (407) 351-6639
With a copy to: Jeff Rosenthal, Esq.
Kind, Rosenthal, Mopsick & Retamar
7000 West Palmetto Park Road, Suite 203
Boca Raton, Florida 33433
Telephone: 1 (407) 394-5555
Facsimile: 1 (407) 394-2919
Either party hereto may change the names and addresses of the
designee to whom notice shall be sent by giving written notice of
such change to the other party hereto in the same manner as all
other notices are required to be delivered hereunder.
15. Miscellaneous.
(a) Time is of the essence of this Agreement.
(b) Wherever under the terms and provisions of this Agreement
the time for performance falls upon a Saturday, Sunday or legal
holiday, such time for performance shall be extended to the next
business day.
(c) This Agreement may be executed in counterparts, each of
which shall constitute an original, but all together shall
constitute one and the same Agreement.
(d) The parties agree that this Agreement and all questions
of interpretation, construction and enforcement hereof, and all
controversies hereunder, shall be governed by the applicable
statutory and common law of the state in which the Project is
located.
(e) The terms, provisions, representations, warranties,
covenants and indemnities made herein shall survive the Closing and
delivery of the deeds and other instruments of conveyance, and this
Agreement shall not be merged therein, but shall remain binding upon
and for the parties hereto until fully observed, kept or performed.
(f) The captions at the beginning of the several Sections,
respectively, are for convenience in locating the context, but are
not part of the context.
(g) In the event any term or provision of this Agreement shall
be held illegal, invalid, unenforceable or inoperative as a matter
of law, the remaining terms and provisions of this Agreement shall
not be affected thereby, but each such term and provision shall be
valid and shall remain in full force and effect.
(h) This Agreement and any Schedules attached hereto or
required hereby embody the entire contract between the parties
hereto with respect to the Project and supersedes any and all prior
agreements and understandings, written or oral, formal or informal.
No extensions, changes, modifications or amendments to or of this
Agreement, of any kind whatsoever, shall be made or claimed by
Seller or Purchaser, and no notices of any extension, change,
modification or amendment made or claimed by Seller or Purchaser
(except with respect to permitted unilateral waivers of conditions
precedent by Purchaser) shall have any force or effect whatsoever
unless the same shall be endorsed in writing and fully signed by
Seller and Purchaser.
(i) If either Seller or Purchaser shall elect to bring a suit
to enforce their respective rights under and by virtue of this
Agreement, then the prevailing party in such action and/or in any
appellate action thereafter shall be entitled to claim and be
awarded all costs of litigation incurred in connection therewith
including, without limitation, court costs and reasonable attorneys'
fees.
(j) Either party hereto may upon notice to the other execute
and record a memorandum of this Agreement which shall disclose only
the existence of this Agreement, the parties hereto, the legal
description of the land and such other matters as the parties may
agree.
16. Seller Acceptance; Agreement Date. Seller shall have three (3)
days in which to accept the terms and conditions of this Agreement,
or this Agreement shall be null and void and of no further effect,
neither Purchaser nor Seller having any rights, duties or
obligations arising herefrom or hereunder. Every party hereto shall
date this Agreement below its signature with the date on which all
of the terms and provisions contained herein, as modified, were
accepted by such party, and the later of such dates shall be deemed
the "Agreement Date" as used in this Agreement.
IN WITNESS WHEREOF, the Purchaser has caused this Agreement to be
duly executed as of the year and day written below Purchaser's
signature. Seller shall acknowledge acceptance of this Agreement
by executing below.
PURCHASER:
BRAUVIN, INC.,
an Illinois corporation
By: /s/ Ralph Cram
Its: Vice-President
Date: February 9, 1996
SELLER:
P. ONE SIOUX FALLS INVESTORS, INC.,
a Florida corporation
By: /s/ Lee J. Maher
Its: President
Date: February 12, 1996
<PAGE>
SCHEDULE 1(a)
LEGAL DESCRIPTION
The East 165 Feet of the North 280 Feet of Lot 1 in
Block 2 of Valhalla Addition to the City of Sioux
Falls, Minnehaha County, South Dakota, according to the
recorded plat thereof.
<PAGE>
SCHEDULE 4
COPY OF LEASE
<PAGE>
LEASE AGREEMENT
TABLE OF CONTENTS
1 Demise and Premises . . . . . . . . . . . . . . . . . . 1
2 Term of Lease, Holdover and Options . . . . . . . . . . 1
3 Rents and Rent Schedule . . . . . . . . . . . . . . . . 2
4 Construction. . . . . . . . . . . . . . . . . . . . . . 2
5 Acceptance of the Premises. . . . . . . . . . . . . . . 3
6 Covenant of Title and Quiet Possession. . . . . . . . . 5
7 Use of Premises . . . . . . . . . . . . . . . . . . . . 5
8 Real Estate Taxes . . . . . . . . . . . . . . . . . . . 6
9 Cross Access Areas. . . . . . . . . . . . . . . . . . . 7
10 Maintenance by Landlord . . . . . . . . . . . . . . . . 7
11 Maintenance by Tenant . . . . . . . . . . . . . . . . . 8
12 Alterations, Additions and Improvements . . . . . . . . 8
13 Signs . . . . . . . . . . . . . . . . . . . . . . . . . 8
14 Landlord's Right of Entry . . . . . . . . . . . . . . . 9
15 Utilities . . . . . . . . . . . . . . . . . . . . . . . 9
16 Intentionally Deleted . . . . . . . . . . . . . . . . . 9
17 Intentionally Deleted . . . . . . . . . . . . . . . . . 9
18 Intentionally Deleted . . . . . . . . . . . . . . . . . 9
19 Intentionally Deleted . . . . . . . . . . . . . . . . . 9
20 Assigning and Subleasing. . . . . . . . . . . . . . . . 10
21 Insurance . . . . . . . . . . . . . . . . . . . . . . . 10
22 Indemnity . . . . . . . . . . . . . . . . . . . . . . . 11
23 Release and Waiver of Subrogation . . . . . . . . . . . 11
24 Fire and Casualty Damage. . . . . . . . . . . . . . . . 11
25 Condemnation. . . . . . . . . . . . . . . . . . . . . . 12
26 Default . . . . . . . . . . . . . . . . . . . . . . . . 13
27 Insolvency or Bankruptcy. . . . . . . . . . . . . . . . 15
28 Subordination, Non-Disturbance and Attornment . . . . . 15
29 Waiver. . . . . . . . . . . . . . . . . . . . . . . . . 16
30 Notices . . . . . . . . . . . . . . . . . . . . . . . . 16
31 Hazardous Materials . . . . . . . . . . . . . . . . . . 17
32 Miscellaneous . . . . . . . . . . . . . . . . . . . . . 18
EXHIBITS
Exhibit A Premises Legal Description
Exhibit B-1 Premises Site Plan
Exhibit B-2 Shopping Center Site Plan
Exhibit C Notice of Lease
Exhibit D Tenant's Program Documents
Exhibit E Tenant's Signage
Exhibit F Memorandum of Lease
Exhibit G Subordination, Non-Disturbance and Attornment Agreement
<PAGE>
LEASE AGREEMENT
This Lease Agreement (hereinafter the "Lease") is made and
entered into this 5th day of June, 1995, by and between P. One Sioux
Falls Investors, Inc. a Florida corporation, whose address is:
5750 Major Blvd. Suite 530
Orlando, Florida 32819
and whose Federal taxpayer identification number is 59-3317140
(hereinafter referred to as "LANDLORD"), and Pier 1 Imports (U.S.),
Inc., a Delaware corporation (hereinafter referred to as "TENANT").
ARTICLE 1 - Demise and Premises
1.1 LANDLORD, in consideration of the rents hereinafter
reserved and agreed to be paid by TENANT, hereby leases to TENANT,
and TENANT, upon the terms and conditions hereinafter set forth,
hereby leases from LANDLORD the following described premises
(hereinafter referred to as the "Premises"). Unless otherwise
indicated, the Premises shall include the improvements to be
constructed pursuant to Article 4 of this Lease. The Premises is
situated within the City of Sioux Falls, County of Minnehaha, State
of South Dakota, and is approximately 165' in overall width and 280'
in overall depth and shall include a building to be constructed
pursuant to Article 4 of this Lease containing Leasable Square
Footage (as defined in Section 3.1) of approximately ten thousand
nine hundred ninety-three (10,993) square feet along with other
improvements. The Premises shall include all of LANDLORD'S rights,
privileges, easements, and appurtenances in, over and upon adjoining
and adjacent public and private land, highways, roads and streets
reasonably required for ingress and egress to and from the Premises,
including but not limited, the area cross-hatched on Exhibit B-1.
1.2 The Premises is more particularly described with full
legal description in Exhibit A, and is outlined on Exhibit B-1
attached hereto and made a part hereof, being a site plan of the
Premises. The Premises is contemplated to be part of a Shopping
Center as shown on Exhibit B-2.
ARTICLE 2 - Term of Lease, Holdover and Options
2.1 TENANT shall have and hold the same for a term commencing
on the date of TENANT'S acceptance of the Premises as provided in
Article 5 below ("Commencement Date") and ending on the expiration
of the tenth (10th) Lease Year (as defined in Section 3.4), subject
to the timely exercise of any option contained herein to extend the
Lease term. Should the expiration of the term of this Lease
(whether the initial or an extended term) occur during the months
of September through and including February of any Lease Year, and
should TENANT not have exercised an option, if any is contained
herein, to extend the term of this Lease, then the Lease term then
expiring shall be extended so that the Lease expires on the last day
of February.
2.2 LANDLORD and TENANT agree to sign within thirty (30) days
after the Rent Commencement Date (as defined in Section 3.3), a
document entitled "Notice of Lease" in the form set forth in Exhibit
C, reciting the Commencement Date of the initial Lease term and the
Rent Commencement Date. The Notice of Lease shall be conclusive as
to the initial Lease term and the Rent Commencement Date.
2.3 Should TENANT continue to occupy the Premises with the
consent of LANDLORD, or any part thereof, after the expiration of
the initial or extended term of this Lease, unless otherwise agreed
in writing, such occupancy shall constitute and be construed as a
tenancy from month to month on the same terms and conditions of this
Lease then in effect.
2.4 LANDLORD does hereby grant to TENANT the right, privilege
and option to extend the term of this Lease for two (2) successive
periods of five (5) years each under the same terms and conditions
of this Lease in effect at the expiration of the initial term or
extended term hereof and the rental paid for any option period shall
be the amount indicated in Article 3 below. TENANT, if it elects
to exercise any option, shall do so by giving LANDLORD written
notice at least one hundred eighty (180) days prior to the
expiration (as defined in Section 2.1 above) of the initial term or
each extended term, as the case may be.
2.5 Notwithstanding the foregoing, in the event TENANT does
not exercise its option in the time period or in the manner provided
above, such option shall nevertheless continue in full force and
effect and shall not lapse until fifteen (15) days after LANDLORD
has notified TENANT that its option term will lapse if TENANT fails
to exercise such option within fifteen (15) days of its receipt of
LANDLORD'S written notice of such pending lapse. TENANT may
exercise such option during said fifteen (15) day period, but if
TENANT fails to do so during said period, such option shall
thereafter lapse and terminate, and be of no further force or
effect.
2.6 If TENANT desires to relet the Premises after the
expiration of the final option granted to and exercised by TENANT
pursuant to the provisions of Section 2.4, it shall give LANDLORD
written notice thereof at least twelve (12) months prior to the
expiration of the final option period. LANDLORD shall not offer the
Premises for rent to a third party for at least one hundred fifty
(150) days after TENANT gives LANDLORD notice of TENANT'S desire to
negotiate to relet the Premises. If after one hundred fifty (150)
days following LANDLORD'S receipt of TENANT'S notice, the parties
shall fail to agree on the terms of a lease, LANDLORD may offer the
Premises for Lease to a third party upon economic terms, and other
conditions and provisions no more favorable than those offered to
TENANT.
ARTICLE 3 - Rent and Rent Schedule
3.1 TENANT agrees and covenants to pay LANDLORD, or to such
other persons or entities on behalf of LANDLORD at such place or
places as LANDLORD may from time to time designate in a written
notice delivered to TENANT fixed rent (hereinafter "Fixed Rent")
equal to the dollar amount per square foot per year set forth in
Section 3.2 below, multiplied by the Leasable Square Footage
(defined herein) of the building to be constructed on the Premises
as established by the Square Footage Certificate. The Fixed Rent
shall be payable in advance on the first day of each calendar month
in equal monthly installments based upon the annual rates set forth
in Section 3.2. The Leasable Square Footage of the building shall
be determined and certified in writing (hereinafter the "Square
Footage Certificate") by an architect who is responsible for the
project of which the Premises is a part from "as built" drawings of
the Premises. The term "Leasable Square Footage" shall mean the
square footage of the building on the Premises measured from the
exterior of outside walls.
3.2 Rent Schedule:
Fixed Rent for each Lease Year of the initial term of the Lease
shall be as follows: Fourteen and 45/100 Dollars ($14.45) per
Leasable Square Foot per Lease Year as such square footage is
established by the Square Footage Certificate.
Fixed Rent for each Lease Year of the first option period of the
extended term of the Lease shall be as follows: Eighteen and 79/100
Dollars ($18.79) per Leasable Square Foot per Lease Year as such
square footage is established by the Square Footage Certificate.
Fixed Rent for each Lease Year of the second option period of the
extended term of the Lease shall be as follows: Twenty-one and
60/100 Dollars ($21.60) per Leasable Square Foot per Lease Year as
such square footage is established by the Square Footage
Certificate.
Notwithstanding the foregoing, the annual Fixed Rent for the
Premises shall not exceed One Hundred Fifty-eight Thousand Eight
Hundred Forty Eight and 85/100 Dollars ($158,848.85) for the first
full Lease Year subject to adjustment pursuant to Sections 3.3 and
4.4 of this Lease. The Fixed Rent for any additional months added
at the end of the initial or extended Lease term, as the case may
be, pursuant to the terms of Section 2.1, shall be at the same
monthly Fixed Rent rate for the month immediately prior to such
additional months.
3.3 TENANT'S obligation to pay rent and other charges shall
commence on the "Rent Commencement Date" which is defined as the
earlier of (i) forty five (45) days after the Commencement Date, or
(ii) the date TENANT first opens for business in the Premises. If
the Rent Commencement Date is not the first day of a calendar month,
the first month's rent shall be prorated on a thirty (30) day basis,
and shall be payable with the first full monthly rental due
hereunder.
3.4 The first "Lease Year" is herein defined as the first
partial calendar month, if any, plus the first twelve full calendar
month period following the Commencement Date, and each "Lease Year"
thereafter shall be each successive twelve calendar month period.
ARTICLE 4 - Construction
4.1(a) LANDLORD, at its sole risk and expense, shall (i)
completely construct the Improvements (as defined in Subsection
4.1(b)) in compliance with all applicable laws, codes, regulations,
ordinances and conditions of record which affect the Improvements
(collectively the "Law"), (ii) obtain, as required by Law for such
construction, all necessary permits, licenses and approvals of
governmental and quasi-governmental authorities having or claiming
jurisdiction, and (iii) completely construct the Improvements in
strict accordance with each page of TENANT'S program documents
attached hereto as Exhibit D (herein the "Program Documents").
LANDLORD shall obtain all necessary building permits, approvals and
licenses, and commence construction (the "Construction Commencement
Date") of the Premises on or before July 15, 1995.
(b) Within thirty (30) days from the date hereof, LANDLORD,
at its sole expense, shall cause its architect to prepare and submit
to TENANT, for TENANT'S review, two (2) original copies of a
complete set of construction documents, (i.e. plans and
specifications), fully incorporating the Program Documents and
including an anticipated construction schedule of key events and
their dates with respect to LANDLORD'S obligations pursuant to this
Article 4 (herein the "Construction Documents"), for the
Improvements to be constructed upon, and which shall become a part
of, the Premises and the Improvements provided in the Program
Documents to be constructed upon the common areas (herein the
"Improvements"). Within ten (10) days after receipt by TENANT of
two (2) complete sets of the Construction Documents, TENANT shall
return same to LANDLORD indicating that the Construction Documents
either comply or do not comply with the Program Documents. If the
Construction Documents do not comply, TENANT shall provide LANDLORD
with comments to enable LANDLORD'S architect to make the
Construction Documents comply with the Program Documents. Once
TENANT indicates in writing to LANDLORD that the Construction
Documents comply with the Program Documents, they shall not be
modified or amended without the prior written consent of LANDLORD
and TENANT. In the event LANDLORD and TENANT are unable to agree
upon satisfactory Construction Documents on or before July 15, 1995,
TENANT shall be entitled to terminate this Lease upon written notice
to LANDLORD without any liability therefore.
(c) Notwithstanding anything in this Lease to the contrary,
neither TENANT'S review of the Construction Documents nor any
subsequent approvals or inspections with respect to the construction
of the Improvements shall (i) relieve, or waive as to any specific
item(s), LANDLORD'S obligation to construct the Improvements in
strict accordance with the Program Documents and any deviation
therefrom shall be invalid unless specifically and expressly
consented to in writing by TENANT and (ii) be deemed to create any
express or implied warranties or representations by TENANT or any
of its employees, agents, representatives or designees as to the
structural integrity, technical or mechanical sufficiency, or safety
of the Improvements or as to any physical condition or feature
pertaining to the Premises.
4.2 Once TENANT indicates its review of the Construction
Documents as satisfactory (and not before), LANDLORD shall proceed
diligently to construct the Improvements in accordance with the
Construction Documents so that the Commencement Date shall occur on
or before October 1, 1995 subject only to Section 4.3 below.
4.3 If the Construction Commencement Date or the Commencement
Date is postponed because of labor disruptions, war, insurrection,
governmental restrictions, fire, flood, storm, or any other cause
not reasonably within the control of LANDLORD, the Commencement
Date, and, if applicable, the Construction Commencement Date may be
postponed, provided that upon the happening of the event which
caused the delay, LANDLORD notifies TENANT in writing of the delay
within three (3) business days of such event and specifies the
number of days that the Construction Commencement Date and/or the
Commencement Date, as the case may be, is delayed by the event which
caused the delay; otherwise such delay shall be waived by LANDLORD.
4.4 Subject to the provisions of Section 4.3, if the
Commencement Date is not on or before October 1, 1995, TENANT shall
deduct as liquidated damages from Fixed Rent, one day's rent
(calculated at a daily rate based on a thirty (30) day month) for
each day the Commencement Date is delayed beyond October 1, 1995.
It is hereby agreed that the liquidated damages to which TENANT is
entitled hereunder is a reasonable forecast of just compensation for
the harm that would be caused by LANDLORD'S failure to satisfy the
conditions for acceptance of the Premises provided in Article 5 on
or before October 1, 1995.
4.5 Notwithstanding anything in this Lease to the contrary,
including but not limited to Section 4.3 above, in the event (a) the
Construction Commencement Date has not occurred by August 15, 1995,
or (b) the Commencement Date has not occurred by November 1, 1995,
TENANT may, without liability or further obligation, terminate this
Lease upon written notice to LANDLORD and this Lease shall have no
further force or effect.
4.6 Notwithstanding anything herein to the contrary, LANDLORD
shall have no responsibility or obligation to install TENANT'S trade
fixtures and signage.
ARTICLE 5 - Acceptance of the Premises
5.1 TENANT shall accept the Premises, only after all of the
following conditions are satisfied:
(a) Substantial Completion (as defined in Section 5.2) of the
Improvements has occurred in accordance with the Construction
Documents;
(b) LANDLORD has provided TENANT with a permanent or temporary
certificate of occupancy issued by the appropriate authority in
localities where official certificates of occupancy are issued,
otherwise, by LANDLORD'S architect certifying that the building on
the Premises and the Premises may be lawfully occupied for the
conduct of business. Notwithstanding TENANT'S acceptance of the
Premises without a permanent certificate of occupancy, LANDLORD
shall obtain a permanent certificate of occupancy without any
interruption of TENANT'S business which is caused by the lack of a
permanent certificate of occupancy. If at any time TENANT is
required to close its business because it cannot lawfully conduct
its business without a permanent certificate of occupancy, all
rental charges herein shall abate until such permanent certificate
of occupancy shall be issued. LANDLORD shall be liable to TENANT
for the consequences of such closing of TENANT'S business due to
LANDLORD'S failure to obtain the permanent certificate of occupancy;
(c) LANDLORD has delivered an acceptable Square Footage
Certificate to TENANT;
(d) LANDLORD has delivered to TENANT all of the written
warranties as provided in Section 10.3 below;
(e) Upon Substantial Completion of the Improvements, as
certified by LANDLORD'S architect, LANDLORD shall notify TENANT of
same. Within ten (10) days of receipt of LANDLORD'S notice, TENANT,
along with LANDLORD, shall inspect the Premises. If TENANT'S
inspection discloses any item, excluding those items set forth in
Subsection 5.2(d), which is not in accordance with the Construction
Documents, LANDLORD shall correct such item before the Premises and
Improvements shall be accepted by TENANT.
(f) LANDLORD has completed or caused to be completed
construction of the common areas, parking facilities, Cross Access
Areas as defined in Section 9.1, drives and curb cuts and other
delivery and service areas shown in the Program Documents and
Exhibit B-1.
(g) The portion of 49th Street shown highlighted on Exhibit
B-2 has been constructed and is open to public vehicular and
pedestrian use.
(h) LANDLORD has completed construction of the dumpster pad,
masonry enclosure and doors as specified in the Construction
Documents.
(i) A loading area shall be provided adjacent to TENANT'S
loading doors constructed and shall be connected to a service
roadway, sufficient in size and design as shown in the Construction
Documents to accommodate 18-wheel truck-trailer combination of 65
foot length.
5.2 "Substantial Completion" of the Improvements shall occur
when in accordance with the Construction Documents: (a) construction
of the electrical system for the Improvements shall be finished and
connected to the lines of the appropriate utility company; (b)
LANDLORD shall have completed the installation of heating,
ventilation and air conditioning system for the building comprising
the Improvements; (c) LANDLORD shall have finished the installation
of the floor, ceiling, walls and storefront of the building
comprising the Improvements; (d) only mechanical adjustments or
minor details of construction or decoration or other items commonly
recognized in the construction industry as "punch list" items remain
to be done which do not unreasonably prevent TENANT from installing
trade fixtures and furnishings and readying the building comprising
the Improvements for the operation of TENANT'S business as it
normally operates its business in the stores of its chain.
5.3 Notwithstanding the terms of Section 5.2, during the first
six (6) months after its acceptance of the Premises, TENANT shall
be entitled to deliver to LANDLORD a written list of items which
TENANT may discover were not completed in accordance with the
Construction Documents whether or not TENANT has previously
delivered a list or lists of other deficiencies to be corrected by
LANDLORD. LANDLORD shall commence correction of such deficiencies
within ten (10) days after LANDLORD'S receipt of such list and shall
complete the correction of such deficiencies within thirty (30) days
of TENANT'S notice. In the event that LANDLORD fails to commence
or complete correction of such deficiencies to the satisfaction of
TENANT within the time periods required for LANDLORD to do so,
TENANT may cause such deficiencies to be corrected at LANDLORD'S
expense. LANDLORD shall reimburse such expenses to TENANT upon
demand and failure of LANDLORD to reimburse TENANT within thirty
(30) days of demand shall entitle TENANT to deduct such expenses
from TENANT'S next installment(s) of Fixed Rent.
5.4 Notwithstanding any provisions contained herein to the
contrary, until the first anniversary of the Rent Commencement Date,
LANDLORD shall correct all latent defects in the performance of its
work for which TENANT has given LANDLORD notice. LANDLORD shall
cause such latent defects to be corrected within thirty (30) days
after receipt of TENANT'S notice. In the event that LANDLORD fails
to correct such latent defects within the time period required for
LANDLORD to do so, TENANT may cause such latent defects to be
corrected at LANDLORD'S expense. LANDLORD shall reimburse such
expenses to TENANT upon demand and failure of LANDLORD to reimburse
TENANT within thirty (30) days of demand shall entitle TENANT to
deduct such expenses from TENANT'S next installment(s) of Fixed
Rent.
5.5 Anything in this Lease to the contrary notwithstanding,
TENANT shall not be required to accept the Premises between October
2nd and the next succeeding January 31st in any year.
ARTICLE 6 - Covenant of Title and Quiet Possession
6.1 LANDLORD represents and warrants to TENANT that LANDLORD
is solely vested with fee simple title to the real property
comprising the Premises and has full right and lawful authority to
lease the Premises to TENANT and shall provide upon TENANT'S request
written evidence of LANDLORD'S ownership of the Premises. LANDLORD
further represents and warrants to TENANT that there are no liens,
encumbrances, mortgages or other defects which will affect TENANT'S
use, occupancy, operation or enjoyment of the Premises, or which
will prevent the construction of the Improvements. If at any time
LANDLORD'S title or right to receive rent hereunder is disputed, or
if there is a change of ownership of LANDLORD'S estate by act of the
parties or operation of law, TENANT may withhold rent thereafter
accruing until TENANT is furnished proof, satisfactory to it, as to
the party entitled thereto. LANDLORD covenants with TENANT to keep
TENANT in quiet possession of the Premises during the term of this
Lease and any extensions thereof, provided TENANT performs all of
its duties and obligations under this Lease.
6.2 LANDLORD hereby represents and warrants to TENANT as
follows:
(a) LANDLORD'S title to the Premises is subject to certain
liens, easements, restrictions and encumbrances, herein referred to
as "Underlying Documents"; but none of the foregoing prohibit,
restrict or adversely affect the use of Premises as a Pier 1 Imports
store. As between LANDLORD and TENANT the terms and provisions of
any Underlying Document shall be subordinate to the terms and
provisions of this Lease.
(b) No existing zoning ordinance or restrictive covenant
prevents, restricts or adversely affects the use of the Premises for
the specific purposes set forth in Article 7 if the Premises is
constructed in accordance with the Construction Documents.
(c) No joinder or approval of another person is required with
respect to LANDLORD'S right and authority to enter into this Lease.
(d) The terms and conditions of this Lease, including the
exhibits attached hereto, are in compliance with and do not violate
the provisions of the Underlying Documents.
(e) Any approvals required pursuant to the terms of the
Underlying Documents have been obtained.
(f) Any approvals required by a lender or mortgagee have been
obtained.
(g) There is no underlying or senior lease.
6.3 The real property contiguous to the west side and the
south side of the Premises as shown on Exhibit B-2 is not owned nor
leased by LANDLORD. LANDLORD represents and warrants to TENANT that
(i) LANDLORD does have cross access, ingress and egress rights over
such property pursuant to one (1) or more cross access agreements
with the owners of such property ("Cross Access Agreements"), (ii)
that such rights are assignable, (iii) that such Cross Access
Agreements are effective and irrevocable through the initial term
of this Lease and any extensions of that term by TENANT, and (iv)
that the cross access rights pursuant to the Cross Access Agreements
cannot be altered, changed, obstructed or eliminated. LANDLORD
hereby non-exclusively transfers and assigns to TENANT for the
benefit of TENANT and its employees, agents, customers and
contractors LANDLORD'S rights over such property as shown cross-
hatched on Exhibit B-1 for vehicular and pedestrian access, ingress
and egress to and from the Premises. At no time during the initial
term or extended term of this Lease, as the case may be, will
LANDLORD amend or modify the Cross Access Agreements over such areas
nor allow the placement, whether permanently or temporarily, of any
above ground structure, fence or barrier along the boundary line
between the Premises and the real property contiguous to the
Premises.
ARTICLE 7 - Use of Premises
7.1 TENANT may use the Premises for the purposes of the
display and retail sale of merchandise and for any other lawful
purposes.
7.2 In the event that the Premises shall be closed for
business for a period of thirty (30) consecutive days or more, at
any time after the Rent Commencement Date, other than as a result
of a remodeling, or a cause or event referred to in Article 24 or
25 herein, or due to TENANT'S impending subletting of the Premises
or assigning of its interest in the Lease, as permitted hereinafter,
then at any time thereafter but prior to any day on which TENANT
shall give notice to LANDLORD that TENANT shall thereafter reopen
the Premises for business ("Tenant's Notice"), LANDLORD may, at its
election, terminate this Lease by giving TENANT notice thereof and
this Lease shall terminate on the thirtieth (30th) day after the
giving of such notice by LANDLORD to the same extent as if said date
were the date originally set forth herein for the expiration of the
Lease. If TENANT shall give Tenant's Notice as aforesaid, TENANT
shall reopen the Premises for business on or before the thirtieth
(30th) day after the date of Tenant's Notice. Nothing in this Lease
or otherwise shall require TENANT to open or once open to remain
open for business.
7.3 LANDLORD hereby represents and warrants that, upon the
Commencement Date, the Premises and all parts thereof shall be in
full compliance with the applicable laws, orders and regulations of
all federal, state, county and municipal authorities having
jurisdiction and with all regulations of any board of fire
underwriters having jurisdiction which affect TENANT'S intended use
of the Premises. LANDLORD shall be required to comply with all
legal requirements applicable to real estate generally with respect
to the Improvements, the Premises, and the Systems (as defined in
Section 10.3 of this Lease).
TENANT shall comply with the legal requirements which relate to
its use of the Premises, provided the cumulative cost of such
compliance does not exceed $10,000.00. LANDLORD and TENANT shall
share equally all such costs in excess of $10,000.00.
ARTICLE 8 - Real Estate Taxes
8.1 LANDLORD represents and warrants all taxes on the
Premises, except current taxes not delinquent, have been paid in
full and that the Premises constitutes one tax parcel for the
assessment of real property taxes and assessments.
8.2(a) For purposes of this Article 8, "real property taxes and
assessments" shall only mean the regularly imposed taxes and special
assessments commonly levied by municipal, county and district
governmental authorities (as distinguished from state and federal
governmental authorities), whether ordinary or extraordinary,
against the owners of real property, which taxes are measured on an
ad valorem basis separate and apart from any other property of the
owner of the subject property. Real property taxes and assessments
for the first and last Lease Years hereunder shall be prorated, if
necessary, based on a three hundred sixty-five (365) day year and
apportioned between LANDLORD and TENANT to coincide with the Rent
Commencement Date and the vacation by TENANT of the Premises, as the
case may be, such that TENANT only pays those real property taxes
and assessments solely allocable to the Lease term. Notwithstanding
anything contained in this Lease, TENANT shall not be required to
pay or discharge: (i) any tax or increase thereof which may be
levied as a result of the voluntary or involuntary assignment or
transfer of all or any portion of LANDLORD'S interest in the
Premises to an affiliated or related entity or person of LANDLORD,
or (ii) any tax upon the income, profits or business of LANDLORD,
or (iii) any personal property taxes, capital levy, franchise, gross
receipts, revenue, inheritance, estate, income, profit, gift,
payroll or stamp tax which may be levied against the estate or
interest of LANDLORD, however such taxes may be designated, even
though such taxes may become a lien against the Premises.
(b) TENANT shall pay the real property taxes and assessments
for the Premises prior to delinquency, provided LANDLORD has
provided TENANT with a copy of the tax bill at least thirty (30)
days prior to the due date. If LANDLORD fails to provide TENANT
with the tax bill at least thirty (30) days prior to its due date,
TENANT shall not be responsible for any late charges, interest or
penalties on such taxes, but shall remain responsible for the actual
taxes.
8.3(a) Assessments imposed on the Premises shall be computed as
if LANDLORD had elected to pay the same in installments over the
longest period of time allowed by applicable law and only those
installments (or partial installments) attributable to installment
periods (or partial periods) falling within the term of this Lease
shall be considered in determining TENANT'S tax liability.
(b) Notwithstanding any provision of this Lease to the
contrary, LANDLORD (and not TENANT) shall be obligated to pay any
assessment for special improvements heretofore installed or
installed in connection with the initial development of the
Premises, such as the widening of the exterior roads, the
installation and/or hook up to and maintenance of sewer and sewer
lines, sanitary and storm drainage systems and other utility lines
and installations (whether public or private).
(c) If at any time during the term of this Lease any
governmental subdivision proposes to create an improvement or
special assessment district the proposed boundaries of which include
the Premises, TENANT shall be entitled to appear in any proceeding
relating thereto and present its position as to whether the Premises
should be included or excluded from the proposed improvement or
assessment district and as to the degree of benefit to the Premises
resulting from inclusion. LANDLORD shall promptly advise TENANT in
writing of the receipt of any notice or other information relating
to the proposed creation of any such improvement or special
assessment district, the boundaries of which include the Premises.
(d) To the extent permitted by law, TENANT or its designees
shall have the right to apply to have any assessment for local
improvements imposed during the term of this Lease payable in annual
installments. LANDLORD shall permit any such application to be
filed in its name, if necessary or appropriate, and shall execute
any and all documents requested by TENANT to accomplish the
foregoing result.
8.4 TENANT shall receive any real property tax and assessment
refunds or rebates with respect to the Premises and attributable to
the term of this Lease or any extension thereof.
8.5 In order for TENANT to be liable for the payment of any
increase in real property taxes and assessments above the amount
paid by TENANT for the first full Lease Year, LANDLORD shall provide
TENANT with a copy of any tax assessment within five (5) days of its
receipt. If TENANT desires to contest any ad valorem assessment or
the validity of any tax and gives LANDLORD written notice of this
intention, then TENANT may contest the assessment or tax without
being in default hereunder. TENANT agrees to indemnify LANDLORD and
hold LANDLORD harmless from all costs, expenses and damages of
whatsoever nature arising out of any contest made by TENANT.
ARTICLE 9 - Cross Access Areas
9.1 LANDLORD hereby transfers and assigns to TENANT during the
term of the Lease or any renewal or extension thereof, for the
benefit of TENANT and TENANT'S subtenants, licensees and
concessionaires, and their respective employees, agents, customers,
invitees and deliverymen, LANDLORD'S rights to and over all of the
areas cross-hatched on Exhibit B-1 ("Cross Access Areas"), such
rights to be in common with LANDLORD and LANDLORD'S employees,
agents, customers, invitees and deliverymen and all other parties
granted rights to such areas pursuant to the Cross Access Agreements
in existence on the date of this Lease.
ARTICLE 10 - Maintenance by Landlord
10.1 In addition to LANDLORD'S obligation pursuant to Sections
5.3 and 5.4 above, LANDLORD shall at its sole expense (i) make all
structural repairs to the building on the Premises, including but
not limited to foundation, bearing walls and roof, (ii) keep the
roof free of leaks; (iii) maintain the underground and otherwise
concealed plumbing and the exterior surface of the outside walls,
excluding window glass, plate glass and doors unless such glass and
door damage is caused by a structural shift; and (iv) keep in good
order, condition and repair the down spouts and gutters of the
building on the Premises. LANDLORD shall also maintain at its sole
cost and expense the base and subbase (defined as the portion of the
parking lot below the first 1" of asphalt) of the parking area on
the Premises, the surface of such parking areas to the extent such
repair or maintenance is necessitated by defects in the base or
subbase and maintain and repair, or cause to be maintained or
repaired, all aspects of the cross-access areas cross-hatched on
Exhibit B-1.
10.2 If (i) LANDLORD fails or neglects to commence, or cause
commencement of, the repair of any of the above mentioned items
within five (5) days after receipt of TENANT'S written notice
stating the repairs required to be made, or (ii) LANDLORD fails to
complete, or cause completion of, such repairs within thirty (30)
days of such notice or such longer period of time as may be
reasonably necessary provided LANDLORD timely commenced or cause to
be commenced such repairs and is diligently and without interruption
pursuing such repairs to completion (provided, however, that such
time period shall not exceed ninety (90) days after TENANT'S written
notice); or (iii) in the event of an emergency, then TENANT may make
such repairs as it deems necessary for the account of LANDLORD.
Following TENANT'S completion of such repair work, LANDLORD shall
promptly reimburse TENANT for expenses incurred upon its receipt of
paid invoices and failure of LANDLORD to reimburse TENANT within
thirty (30) days of demand shall entitle TENANT to deduct such
expenses from TENANT'S next installment(s) of Fixed Rent.
10.3 LANDLORD as of the Commencement Date certifies that the
roof; heating, air conditioning, ("HVAC"); plumbing; and electrical
systems of the building on the Premises (herein "Systems") are new
and in good operating condition. Prior to the Commencement Date
LANDLORD shall furnish TENANT for all such Systems (excluding the
HVAC unit(s)) five (5) year minimum repair or replacement written
warranties which shall include payments for all labor, but same
shall not relieve LANDLORD of any obligations set forth in Section
10.1. With respect to the HVAC units, LANDLORD shall furnish to
TENANT a minimum repair or replacement written warranty equal to
that provided by the manufacturer of such units (exclusive of the
compressor), but not less than one (1) year, and with respect to the
compressor, not less than five (5) years.
10.4 The terms and conditions of Sections 24 and 25 shall
control with respect to repairs or maintenance required due to an
event described therein.
10.5 In the event access to the Premises is impaired due to
maintenance or repairs to the parking lots, public roadways or other
ways of access to the Premises and such impairment continues for ten
(10) days after TENANT'S written notice to LANDLORD, the rent and
other charges payable under this Lease shall be equitably adjusted,
or abated, for the period of such temporary impairment beyond ten
(10) days.
ARTICLE 11 - Maintenance by Tenant
11.1 At its expense, TENANT with respect to the building on the
Premises shall maintain in good repair and condition the exposed
interior plumbing, window glass, plate glass and doors, unless such
damage is caused by a structural shift; heating and air conditioning
systems (subject to Section 7.3 of this Lease); and the interior
surfaces of the building on the Premises. TENANT'S obligations
under this Section 11.1 shall not include repairs which are covered
by LANDLORD'S insurance and warranties. TENANT shall, at its
expense, be responsible for prompt extermination of termites,
rodents and other vermin within the building on the Premises.
In addition TENANT shall maintain the surface layer of the
parking lot and driveways on the Premises unless such maintenance
is necessitated by a failure of the base or subbase of such parking
lot, in which event LANDLORD shall maintain and repair the surface.
11.2 TENANT shall use reasonable care and diligence to keep and
maintain the Premises free from waste or nuisance and shall deliver
the Premises to LANDLORD broom clean at the expiration of this
Lease, reasonable wear and tear and casualty being excepted.
11.3 The terms and conditions of Sections 24 and 25 shall
control with respect to repairs or maintenance required due to an
event described therein.
ARTICLE 12 - Alterations, Additions and Improvements
12.1 TENANT shall not create any openings in the roof or
exterior walls, nor make any structural alterations, additions or
improvements to the building on the Premises without prior written
consent of LANDLORD, which consent shall not be unreasonably
withheld. TENANT shall have the right at all times to erect or
install shelves, bins, electrical outlets, machinery, air
conditioning or heating equipment, satellite communication
equipment, and trade fixtures, provided, TENANT complies with all
applicable governmental laws, ordinances and regulations.
12.2 All alterations, additions or improvements made by TENANT
which are permanently attached to and made a part of the Premises
shall become the property of LANDLORD at the expiration of the Lease
term and any extensions thereof, except for signs, trade fixtures,
display furnishings, satellite communication equipment and equipment
used on the Premises and furnished by TENANT (for Federal income tax
purposes only, TENANT'S signs, trade fixtures and display
furnishings are defined herein as equipment).
12.3 TENANT in its sole discretion shall have the right to make
alterations or remodeling, of a non-structural nature to the
Premises.
ARTICLE 13 - Signs
13.1 LANDLORD warrants and represents that there are no signage
restrictions imposed by a restrictive covenant or uniform sign plan
filed of record or with the local governing authority which would
prevent TENANT from erecting its signage substantially as shown on
Exhibits D and E. LANDLORD hereby approves the dimensions, color,
content and design of TENANT'S proposed signage as set forth in
Exhibit E, and agrees that TENANT may, at its expense, erect and
maintain its standard signs on the Premises as shown in Exhibit D.
If, for any reason TENANT is unable to erect its signage as
described in Exhibits D and E, TENANT may terminate this Lease on
written notice to LANDLORD and all rent and additional charges shall
be abated as of the date of this notice.
13.2 During the term hereof TENANT shall not be required to
remove its signs unless required to do so by local codes enacted
subsequent to the date hereof. TENANT may at any time remodel or
replace the sign facia to conform with TENANT'S then standard
signage so long as such signage does not violate applicable deed or
master lease restrictions or sign ordinances. TENANT shall have the
right to affix window appliques and other treatments commonly used
at TENANT'S store locations. TENANT shall remove all signs and
appliques at the termination of this Lease, and shall repair any
damage caused by such removal. LANDLORD shall not allow any signage
other than TENANT'S to be erected on the Premises.
13.3 A monument sign is shown on the site plan in Exhibit D,
LANDLORD represents, warrants, and agrees that TENANT may, at its
expense, erect and maintain its standard monument sign as shown in
Exhibit E at the location noted on Exhibit D.
13.4 TENANT or TENANT'S agent shall have the right to erect a
temporary "Coming Soon" sign, or signs, on or near the Premises
prior to the Commencement Date.
ARTICLE 14 - Landlord's Right of Entry
14.1 Subject to TENANT'S consent, which shall not be
unreasonably withheld, LANDLORD and its authorized agents may enter
the Premises during TENANT'S normal business hours for the following
purposes: (a) to inspect the general conditions and state of repair
of the Premises; (b) to make repairs required of LANDLORD; and (c)
to show the Premises to any prospective purchaser or mortgagee.
Such entry by LANDLORD shall be under the supervision of TENANT.
LANDLORD shall not interfere with, or create a hazard to, TENANT'S
normal business operations during such entry. In the event of an
emergency condition arising within the Premises which endangers
property or the safety of individuals such consent is waived by
TENANT.
14.2 Within sixty (60) days prior to the expiration of the
term, including extensions hereof, LANDLORD may enter the Premises
during TENANT'S normal business hours to show the Premises to
prospective tenants or purchasers. During the final thirty (30)
days of the term, including extensions hereof, LANDLORD and its
authorized agents may erect on, or about, the Premises its customary
sign advertising the property for sale or lease, provided such sign
does not interfere with or create a hazard to TENANT'S normal
business operation.
ARTICLE 15 - Utilities
15.1 TENANT will pay before delinquency all charges for gas,
water, electricity, and any other utility services used solely on
the Premises during the term hereof by TENANT.
15.2 LANDLORD, at its expense, shall cause the Improvements to
be individually metered for each utility service and provide the
service connections specified in Exhibit D and as otherwise
customarily provided. In the event of any interruption in service,
LANDLORD shall diligently pursue the resumption of service. During
the period of such interruption, if such interruption is caused by
the negligence of LANDLORD and if TENANT is not able to conduct its
customary level of sales for similar periods, LANDLORD and TENANT
agree to equitably adjust the rent for such period.
ARTICLE 16 - Intentionally Deleted
ARTICLE 17 - Intentionally Deleted
ARTICLE 18 - Intentionally Deleted
ARTICLE 19 - Intentionally Deleted
ARTICLE 20 - Assigning and Subleasing
20.1 TENANT may assign this Lease or sublease the Premises, in
whole or in part, with the express written consent of LANDLORD,
which consent, including consent to a proposed change in use if
required by the express terms of this Lease, shall not be
unreasonably withheld. LANDLORD shall consent or withhold such
consent by notice to TENANT within thirty (30) days of TENANT'S
notice requesting LANDLORD'S consent. If LANDLORD fails to respond
to TENANT'S request within such thirty (30) day period, LANDLORD
shall be deemed to have consented to such assignment or subletting.
It shall be unreasonable for LANDLORD to withhold its consent to an
assignment or a subletting if the proposed assignee or sublessee is
of such financial standing and responsibility at the time of such
assignment or sublet as to give reasonable assurance (i) of the
payment of all rental and other amounts reserved in this Lease and
(ii) of compliance with all of the terms, covenants, provisions and
conditions of this Lease.
20.2 Anything herein to the contrary notwithstanding and
without the express written consent of LANDLORD, TENANT may assign
or sublease this Lease, in whole or in part, to:
(i) any corporation into which or with which TENANT has merged
or consolidated;
(ii) any parent, subsidiary, successor, or affiliated
corporation of TENANT;
(iii) any corporation which acquires all or substantially all
of the assets or issued and outstanding shares of capital stock of
TENANT; or
(iv) any partnership, the majority interest of which shall be
owned by the parent of TENANT;
provided the resulting entity from such merger or consolidation or
the transferee, other than a parent, subsidiary or affiliated
corporation of TENANT from any such acquisition shall have a net
worth not less than TENANT'S prior to the merger, consolidation,
acquisition or transfer; and provided further any such assignee or
sublessee, as the case may be, shall agree in writing to assume and
perform all of the terms and conditions of this Lease on TENANT'S
part to be performed from and after the effective date of such
assignment or subletting.
20.3 Provided an assignee pursuant to Section 20.1 has a
current net worth of Twenty Five Million Dollars ($25,000,000) or
greater at the time of the assignment, such assignment shall operate
to release TENANT of its liabilities and obligations arising
hereunder after the date of such assignment. Any assignment
pursuant to Section 20.2(i)-(iv) shall operate to release TENANT of
its liabilities and obligations arising under this Lease.
20.4 Provided any assignee of LANDLORD assumes in writing all
of LANDLORD'S obligations under this Lease and so notifies TENANT,
LANDLORD may assign its interest in Lease during the term hereof;
provided, however, TENANT shall make all payments required under
this Lease to LANDLORD until TENANT is furnished documentation
evidencing such assignment, and TENANT shall in no way be liable to
any assignee for any rentals due hereunder until TENANT is furnished
documentation evidencing such assignment.
ARTICLE 21 - Insurance
21.1 During the Lease term, TENANT shall maintain in full force
general liability insurance written on an occurrence basis, at
TENANT'S sole expense. The policy(ies) shall be issued by one or
more insurance carriers, insuring TENANT against liability for
injury to or death of persons and loss of or damage to property
occurring in and on the Premises. Such liability insurance shall
name LANDLORD as an additional insured. The coverage limits of the
policy shall be a combined single limits for bodily injury and
property damage in an amount of at least One Million Dollars
($1,000,000.00) per occurrence.
21.2 During the Lease term, LANDLORD shall maintain in full
force the following insurance at LANDLORD'S sole expense.
(a) General liability insurance issued by one or more
insurance carriers, insuring against liability for injury to or
death of persons and loss of or damage to property arising from
LANDLORD'S performance of its duties under this Lease. The coverage
limits of the policy shall be a combined single limits for bodily
injury and property damage in an amount of at least One Million
Dollars ($1,000,000.00) per occurrence. LANDLORD shall name TENANT
as an additional insured on such insurance policy.
(b) All risk property damage insurance including a standard
extended coverage endorsement issued by one or more insurance
carriers covering the Premises including the Improvements to the
extent of their full replacement value exclusive of foundation and
excavation costs. All proceeds of such insurance applicable to the
Premises shall be applied to the restoration of the Premises as
required by this Lease.
TENANT shall, once per Lease Year, reimburse LANDLORD for the
cost and expense of the insurance carried by LANDLORD pursuant to
Section 21.2(a) and (b). Such reimbursement shall be made by TENANT
within thirty (30) days after its receipt of the invoice for such
insurance cost and expense as paid by LANDLORD.
21.3 LANDLORD and TENANT may comply with their insurance
obligations hereunder by endorsement to any blanket policy of
insurance. Provided TENANT has a net worth greater than or equal
to Fifty Million Dollars ($50,000,000.00), TENANT may comply with
its general liability insurance obligations by self-insurance.
TENANT may self-insure in all other instances, including for all
deductibles, regardless of its net worth.
21.4 LANDLORD and TENANT shall deliver to each other
certificates issued by the authorized representative of the
insurance carrier or carriers for each policy of insurance they are
required to maintain pursuant to the terms of this Lease.
21.5 Any insurance required by this Article 21 to be procured
by one party for the benefit of another party shall contain a
provision that the other party's insurance cannot be terminated
without thirty (30) days prior written notice to both parties. All
insurance under this Article 21 shall be maintained with insurance
companies rated at lest A XV in "Best's Insurance Guide" and
qualified to do business in the state in which the Premises is
located.
21.6 TENANT shall not knowingly conduct any operation in the
Premises which would cause suspension or cancellation of such all
risk insurance coverage carried by LANDLORD.
21.7 LANDLORD covenants that it will seek competitive rates on
all insurance and provide TENANT evidence of such bids on its
request.
ARTICLE 22 - Indemnity
22.1 TENANT and LANDLORD (each an "Indemnitor") will indemnify
the other (each an "Indemnitee") against, and hold Indemnitee
harmless from all claims, liabilities, demands or causes of action,
including all reasonable expenses of the Indemnitee incidental
thereto, for injury to or death of any employee, agent or invitee
of indemnitee arising within the Premises and caused by Indemnitor's
negligent act or omission or the negligent act or omission of any
employee, agent or invitee of Indemnitor. The liability of
Indemnitor to indemnify indemnitee as hereinabove set forth shall
not extend to any matter against which Indemnitee shall be
effectively protected by insurance; provided, however, that if any
such liability shall exceed the amount of the effective and
collectable insurance in question, the said liability of Indemnitor
shall apply to such excess.
ARTICLE 23 - Release and Waiver of Subrogation
23.1 Notwithstanding anything to the contrary contained in this
Lease, LANDLORD and TENANT hereby waive and release each other of
and from any and all rights of recovery, claim, action or cause of
action against each other, their agents, officers, directors,
partners and employees, for any loss or damage that may occur to the
Premises, Improvements or personal property including building
contents within the building on the Premises, by reason of fire or
the elements of nature regardless of cause or origin including
negligence of LANDLORD or TENANT and their agents, officers,
directors, partners and employees. Because this Section 23.1 will
preclude the assignment of any claim mentioned in it by way of
subrogation or otherwise to any insurance company or any other
person, each party to this Lease agrees immediately to give to each
insurance company which has issued to it policies of insurance
covering all risk of direct physical loss, written notice of the
terms of mutual waivers contained in this Section 23.1, and to have
the insurance policies properly endorsed to prevent the invalidation
of such insurance coverage by reason of these waivers. Each party
shall provide the other annually with evidence that its policies
have been so endorsed. The foregoing shall not, however, release
the parties from their obligations as set forth in Article 24.
ARTICLE 24 - Fire and Casualty Damage
24.1 If all or any part of the Premises and/or the Cross Access
Areas (defined in Section 9.1) are damaged or destroyed by fire or
other casualty, TENANT shall promptly notify LANDLORD in writing.
24.2 If the Premises and/or the Cross Access Areas should be
damaged by fire or other casualty such that rebuilding or repairs
cannot be completed within one hundred eighty (180) days from the
date of such damage, TENANT may, within thirty (30) days of the
determination of the number of days necessary to restore the
Premises and/or the Cross Access Areas, terminate this Lease on
written notice to LANDLORD and rent and all additional charges shall
be abated as of the date of the happening of the damage.
24.3 (a) If the Premises and/or the Cross Access Areas should
be damaged by a fire or other casualty prior to the final eighteen
(18) full calendar months of the Initial Lease term or extended
lease term to such extent that rebuilding or repairing can be
completed within one hundred eighty (180) days from the date of the
happening of such damage, LANDLORD shall, at its sole cost and risk,
diligently proceed forthwith to rebuild or repair, or cause to be
rebuilt or repaired, the Premises and/or the Cross Access Areas to
substantially the condition which existed prior to such damage
except that TENANT shall have the right to require LANDLORD to make
changes to the Premises in the course of such restoration. If the
cost and expense of restoration of the Premises is increased by any
change or changes made by TENANT, then TENANT shall pay LANDLORD,
as other charges, promptly upon demand, the amount or amounts by
which the cost or expense of restoration of the Premises was thereby
increased.
(b) If the Premises and/or the Cross Access Areas should be
damaged by a fire or other casualty during the final eighteen (18)
full calendar months of the initial term or extended lease term
TENANT may exercise its option, if any, to extend the term within
sixty (60) days of the date of the casualty, in which case LANDLORD
shall at its sole cost and risk, proceed forthwith to rebuild or
repair such damage; otherwise, LANDLORD shall not be required to
rebuild or repair, or cause to be built or repaired, such damage and
this Lease shall automatically terminate and rent and all additional
charges shall be abated as of the date of such damage.
(c) If the existing laws do not permit restoration of the
Premises to substantially the same condition as they were in
immediately before the date of the damage, then TENANT at its
option, may (i) require LANDLORD to restore the Premises so as to
comply with the then existing laws or codes, or (ii) terminate this
Lease immediately by giving written notice to LANDLORD, in which
case the Lease shall cease as of the date of the damage.
24.4 The determination of whether the Premises and/or the Cross
Access Areas can be rebuilt or repaired within one hundred eighty
(180) days from the date of any damage shall be in the mutual
judgment of both LANDLORD and TENANT and such determination shall
be made within thirty (30) days of the date of such damage. If
LANDLORD and TENANT cannot agree, the determination shall be made
by an independent contractor mutually acceptable to both LANDLORD
and TENANT who commits in writing to complete, or cause to be
completed, the necessary repairs and/or reconstruction within such
one hundred eighty (180) day period.
24.5 If so much of the Premises and/or the Cross Access Areas
shall be damaged so that TENANT is unable to conduct business from
the Premises, in its sole judgment, TENANT may discontinue the
conduct of business from the Premises and all Fixed Rent, additional
rent and all other charges shall abate and the term shall toll
thereafter. The rent abatement and tolling of the term shall end
on the earlier to occur of the date on which the damage shall be
repaired or replaced or the date on which the conduct of business
from the Premises shall be resumed. To the extent that TENANT
continues to operate the business from the Premises, however, during
the period from the date of destruction to the date of completion
of the reconstruction, LANDLORD and TENANT shall agree on an
equitable adjustment to Fixed Rent, additional rent and other
charges.
24.6 If LANDLORD does not commence within sixty (60) days from
date of notification pursuant to the terms of Section 24.1 and with
reasonable dispatch continue to restore the Premises and/or the
Cross Access Areas, TENANT shall have the right to terminate this
Lease on written notice to LANDLORD, and all rent and all additional
charges shall be abated as of the date of such damage. In the event
that LANDLORD should fail to complete any repairs or rebuilding
within the time periods required by the terms of this Article 24,
TENANT may terminate this Lease on written notice at such time to
LANDLORD, and rent and all additional charges shall be abated as of
the date of such damage. The date on which rebuilding work or
repairs are deemed to be complete shall be the date on which the
Premises and/or the Cross Access Areas are acceptable to Tenant
pursuant to the terms of Article 5, to the extent applicable.
ARTICLE 25 - Condemnation
25.1 In the event any part of the Premises and/or the Cross
Access Areas is taken or condemned by any competent authority,
TENANT shall have the right: (a) to terminate this Lease as of the
earlier of the date of title transfer or the date of the taking of
possession by the condemning authority in which event the term
hereof and rent and all other charges shall be abated and any
unearned rent paid or credited will be refunded by LANDLORD to
TENANT; or (b) to continue the Lease in full force and effect with
a reduced Fixed Rent commensurate with the reduced area and/or
reduced utility of the Premises and/or the Cross Access Areas, in
lieu of the amount of rental hereinabove provided, which reduced
rental will become effective upon the earlier of the date of title
transfer or the date of such taking. TENANT shall elect between
these rights and give notice to LANDLORD of its election within
sixty (60) days after the date of the final written determination
of the portion of the Premises and/or the Cross Access Areas to be
taken, and written notification to TENANT of such determination.
25.2 If TENANT does not elect to terminate this Lease as set
forth herein, then the award or payment for the taking shall be paid
to and used by LANDLORD to restore, and LANDLORD shall, except as
otherwise provided in this paragraph, commence, and with reasonable
dispatch continue, out of the proceeds of the award to restore the
portion of the Premises and/or the Cross Access Areas remaining
after the taking to substantially the same condition and
tenantability as existed immediately preceding the taking, except
that TENANT shall have the right to require LANDLORD to make changes
to the Premises in the course of such restoration, provided that if
the cost and expense of restoration of the Premises is increased by
any change or changes made by TENANT, then TENANT shall pay to
LANDLORD, as other charges, promptly upon demand the amount by which
the cost and expense of restoration of the Premises was thereby
increased.
25.3 If LANDLORD does not commence within thirty (30) days of
receipt of the award, and with reasonable dispatch continue, to
restore the portion of the Premises and/or the Cross Access Areas,
as aforesaid, TENANT shall have the right, upon giving notice to
LANDLORD, in addition to other rights provided herein, to (i)
restore the Premises and/or the Cross Access Areas at LANDLORD'S
sole cost and expense, or (ii) terminate this Lease on written
notice to LANDLORD, and all rent and all additional charges shall
be abated as of the date of such notice. If TENANT elects to
restore, LANDLORD shall promptly pay to TENANT any award or payment
made as to the taking of the Premises and/or the Cross Access Areas,
and in addition thereto shall reimburse TENANT upon demand for any
cost and expense incurred by TENANT for such restoration in excess
of said award or payment received by TENANT, plus interest at the
reference (prime) rate of Morgan Guaranty Trust, New York, New York
or its successor, plus one percent (1%) per annum. Until Tenant has
been fully reimbursed for such cost and expense plus interest,
TENANT may fully abate its rent. If, at the end of this Lease,
TENANT has not been fully reimbursed therefore, TENANT shall have
the right to extend the term of this Lease for any period of time
selected by TENANT which is less than or equal to the period which
shall enable TENANT to recover such cost and expense plus interest
at the reference (prime) rate of Morgan Guaranty Trust, New York,
New York or its successor, plus one percent (1%) per annum by
abatement from Fixed Rent, as aforesaid.
25.4(a) Termination of this Lease because of condemnation shall
be without prejudice to the rights of either LANDLORD or TENANT to
recover from the condemning authority compensation and damages for
the injury and loss sustained by them as a result of the taking, and
TENANT shall have the right to make a separate claim against the
condemning authority for the reasonable value of TENANT'S trade
fixtures, furniture, personal property, interruption and/or
dislocation of business in the Premises, loss of good will and for
moving and remodeling expenses and the depreciated book value of any
leasehold improvements made by TENANT on or to the Premises.
(b) If TENANT cannot by law make a separate claim and TENANT'S
claim must be embodied in LANDLORD'S claim for a condemnation award,
to the extent LANDLORD'S award includes an award for the items set
forth in Subsection 25.5(a), LANDLORD shall pay over such portion
of the award to TENANT.
ARTICLE 26 - Default
26.1 (a) An event of default by TENANT shall occur if one or
more of the following events shall occur:
(i) If TENANT shall fail to pay Fixed Rent or additional rent
when due and such failure shall continue for a ten (10) day period
after LANDLORD shall have given TENANT written notice of TENANT'S
failure to pay.
(ii) If TENANT shall fail to perform any of its other
obligations under this Lease and such failure shall continue for a
thirty (30) day period after LANDLORD shall have given TENANT
written notice of its failure to perform.
(b) However, if TENANT shall fail to perform an obligation,
other than an obligation to pay Fixed Rent or additional rent, and
the failure cannot reasonably be cured by TENANT within thirty (30)
days after LANDLORD shall have given written notice of such failure,
an event of default shall not occur if TENANT commences to cure such
failure within the thirty (30) day period and diligently thereafter
prosecutes the cure to completion.
26.2 If an event of default by TENANT shall have occurred under
the terms of Section 26.1, LANDLORD shall as its sole and exclusive
remedy:
(a) Give TENANT a notice of LANDLORD'S intention to end the term
of this Lease at the expiration of the ten (10) day period after
such notice of cancellation is given. Unless the default is cured
before the expiration of the ten (10) day period, this Lease shall
be canceled, and all of the obligations and responsibilities of the
parties under this Lease shall terminate except for accrued
liabilities and except that TENANT shall surrender the Premises to
LANDLORD in accordance with Section 11.2;
(b) Give TENANT a notice of intention to cure TENANT'S default
for the account of and at the expense of TENANT. If LANDLORD gives
TENANT a notice of intention to cure, LANDLORD may cure the default
for the account and at the expense of TENANT, and TENANT shall
reimburse LANDLORD for the reasonable cost of curing TENANT'S
default. If TENANT fails to reimburse LANDLORD for the reasonable
cost within thirty (30) days after demand, the amount to which
LANDLORD shall be entitled shall be added to, and become a part of,
the next monthly installment of Fixed Rent;
(c) Terminate TENANT'S right to possession of the Premises with
due process of law, in which case this Lease shall terminate and
TENANT shall immediately surrender possession of the Premises to
LANDLORD. In such event and should an event of default have
occurred pursuant to Subsection 25.1(a)(1), LANDLORD shall be
entitled to recover from TENANT (i) the worth at the time of award
(as determined by the court having jurisdiction thereof) of any
unpaid rent that has been earned at the time of such termination;
plus (ii) the worth at the time of award (as determined by the court
having jurisdiction thereof) of the amount by which the unpaid rent
that would have been earned after termination until the time of
award exceeds the amount of such rental loss which could have been
reasonably avoided; plus (iii) the worth at the time of award (as
determined by the court having jurisdiction thereof) of the amount
by which the unpaid rent for the balance of the term after the time
of such award exceeds the amount of such rental loss which could be
reasonably avoided; plus (iv) LANDLORD'S reasonable expense of
reentering, repossessing, reletting, and repairing the Premises
including LANDLORD'S reasonable attorney's fees and brokerage
commissions. The term "rent" as used in this Subsection 26.2(c)
shall be deemed to mean Fixed Rent required to be paid by TENANT
pursuant to the terms of this Lease to LANDLORD. The "worth at the
time of award" of the amounts referred to in Subsection 26.2(c)
Items (i) and (ii) above, shall be computed by allowing interest at
the discount rate of the Federal Reserve Bank nearest the Premises
at the time of the award plus three percent (3%). The "worth at the
time of award" of the amount referred to in Subsection 26.2(c) Item
(iii) shall be computed by discounting such amount at the discount
rate of the Federal Reserve Bank nearest the Premises at the time
of the award plus three percent (3%); or
(d) Without terminating this Lease, recover all rent as it
becomes due under the Lease.
26.3 In the event this Lease is assigned by TENANT and TENANT
remains liable for the performance of TENANT'S obligations under
this Lease, and should any default occur requiring notice as
provided in this article, LANDLORD agrees that it will furnish
TENANT with a copy of the notice at the same time it is sent to the
assignee. In the event that the default is not corrected by the
assignee during the specified time periods, TENANT shall have an
additional period of ten (10) days to correct the default, and, upon
correction of the default, LANDLORD agrees that TENANT shall have
the right and option to resume actual possession of the Premises as
TENANT for the unexpired term of this Lease subject to the terms and
provisions of the assignment document.
26.4 An event of default by LANDLORD shall occur if LANDLORD
fails to perform any of its obligations under this Lease and such
failure to perform shall continue for a thirty (30) day period after
written notice from TENANT to LANDLORD or such longer period of time
if reasonably necessary and LANDLORD is diligently pursuing the cure
of such failure; however, in no event shall such additional period
exceed ninety (90) days. If such event of default by LANDLORD shall
occur, TENANT may remedy the breach or default and deduct the
reasonable cost, including interest at the rate of one percent (1%)
per month on same, from rentals due or to become due LANDLORD, or
pursue any other legal or equitable remedy for which it is entitled.
If TENANT has not been reimbursed for its reasonable cost in
remedying LANDLORD'S breach or default at the expiration of the term
of this Lease, or if LANDLORD is indebted to TENANT because of a
breach or default of this Lease at the expiration of the term,
TENANT may, at its option, extend this Lease on the same terms and
conditions then in effect until the costs and indebtedness are fully
paid by application of all rental thereto.
26.5(a) Neither LANDLORD nor TENANT shall have any right arising
from a failure to remedy a default against the other unless an event
of default shall have occurred.
(b) Except for defaults arising from a failure to pay Fixed Rent
or additional rent, no event of default shall be deemed to have
occurred if a party disputes in good faith that it is in default and
gives notice to that effect to the other party. If notice of
default is given to a party and the party contends that it is not
in default, that party may bring legal action to determine whether
it has failed to perform the obligation underlying the claimed
default. No default shall be deemed to have occurred during the
pendency of the action or during the pendency of any appeal promptly
taken. If it is determined that a party is in default pursuant to
a nonappealable final judgment, no remedy may be exercisable with
respect to the judgment for a reasonable period after entry of the
judgment. If the default is cured within the period, the default
shall be forgiven. The period shall be thirty (30) days unless the
default, by its nature, cannot be cured within thirty (30) days.
If, by its nature, the default cannot be cured within thirty (30)
days, the period shall be extended as long as the cure is prosecuted
diligently and in good faith.
ARTICLE 27 - Insolvency or Bankruptcy
27.1 TENANT Insolvency or Bankruptcy. If at any time during
the term of this Lease, (i) proceedings in bankruptcy shall be
instituted by or against TENANT that result in an adjudication of
bankruptcy, (ii) TENANT shall file, or any creditor of TENANT shall
file, any petition under any provision of the United States
Bankruptcy Code, as the same is now in force or may hereafter be
amended and TENANT'S obligation to pay Fixed Rent as set forth in
this Lease shall be modified; (iii) if a receiver of the business
or assets of TENANT be appointed and this appointment not be vacated
within sixty (60) days after notice to TENANT, or (iv) TENANT makes
an assignment for the benefit of creditors, or any sheriff, marshal,
constable, or keeper takes possession of any assets of TENANT by
authority of any judicial attachment or execution proceedings and
offers same for sale publicly, then LANDLORD may, at its option, in
any of these events, upon ten (10) days written notice to TENANT
take possession of the Premises and terminate this Lease. Upon this
termination, all installments of rent earned and issued to the date
of termination and unpaid shall at once become due and payable.
Notwithstanding the foregoing paragraph, this Lease shall not be
terminated by LANDLORD so long as the obligations of TENANT are
being performed by TENANT or its successors in interest or assigns.
27.2 LANDLORD Insolvency or Bankruptcy. If pursuant to an
order, judgment or decree entered by any court of competent
jurisdiction (i) the receiver, trustee or liquidator of LANDLORD,
or of all or substantially all of the assets of LANDLORD, shall be
appointed, (ii) LANDLORD shall be adjudicated as bankrupt or
insolvent or (iii) a petition seeking reorganization of LANDLORD or
an arrangement with creditors or a petition to take advantage of any
insolvency law shall be approved, and upon the happening of any such
event, the trustee of LANDLORD or LANDLORD, as the case may be,
shall fail to assume affirmatively this Lease or any covenant
therein within the statutory period alloted for such assumption, or
if this Lease be deemed rejected after an order is entered directing
that a trustee not be appointed, and as a result of the happening
of any such event, the Fixed Rent or other charges payable pursuant
to this Lease, or TENANT'S right or obligations hereunder, or
LANDLORD'S obligations hereunder shall be modified in any manner,
then TENANT shall have the right, at its option, to terminate this
Lease, by the service upon LANDLORD and the trustee (if appointed)
of the notice of termination of this Lease, stating the date of
termination which day shall be at least thirty (30) days after the
date of such notice, and upon the date specified on such notice this
Lease and the term hereof shall automatically cease and expire and
TENANT shall vacate the Premises; provided, however, that TENANT
shall be entitled to a refund of any Fixed Rent and/or additional
rent paid in advance for any period beyond the stated date of
termination pursuant to the notice and TENANT shall additionally
have the right to assert any and all claims TENANT may have for loss
of the leasehold estate.
ARTICLE 28 - Subordination, Non-Disturbance and Attornment
28.1 LANDLORD agrees that before it shall have the right to
subordinate this Lease to the lien of any loans or mortgages placed
upon LANDLORD'S interest in the Premises and the real property tract
of which the Premises is a part LANDLORD shall have first secured
for TENANT'S benefit a written non-disturbance agreement, in the
form of Exhibit G and acceptable to TENANT, and TENANT will then
execute and deliver an instrument subordinating this Lease to the
lien of any such loan or mortgage.
28.2 In the event LANDLORD herein is the tenant under the terms
of any prime lease, LANDLORD agrees that prior to the commencement
of construction it shall secure from any such prime landlord an
agreement satisfactory to TENANT in recordable form whereby the
prime landlord, upon a default of LANDLORD herein under the prime
lease or a termination of such lease, and for so long as TENANT
herein shall not be in default hereunder, shall not deprive or
disturb TENANT'S use and possession of the Premises so long as
TENANT attorns to such prime landlord which TENANT herein agrees it
shall do.
28.3 If LANDLORD defaults in making payment under any mortgage
or mortgages, or if LANDLORD is in breach or in default of any
mortgage or mortgages in any respect, TENANT shall have the right
but not the duty to make all rental payments thereafter becoming due
under this Lease to the mortgagee in lieu of LANDLORD, and payments
so made shall discharge the obligation of TENANT hereunder
respecting the payment of rent. Should LANDLORD, in connection with
the mortgaging of the tract of which the Premises is a part, execute
a conditional assignment of rentals, TENANT will execute an
acceptance of such assignment, provided the assignment recognizes
TENANT'S rights under this Lease.
28.4 TENANT and LANDLORD shall each, at any time and from time
to time, within twenty (20) days after written request therefore by
the other party certify to the best of their knowledge, in a written
instrument duly executed and acknowledged, to the requesting party:
(a) as to whether this Lease has been supplemented or amended; (b)
as to the validity and force and effect of this Lease in accordance
with its terms as then constituted; (c) as to the existence of any
default by the requesting party pursuant to this Lease; (d) as to
the existence of any offsets, counterclaims or defenses on the part
of the party so certifying; (e) as to the Commencement Date and the
expiration date of the term of this Lease; and (f) as to the amounts
of Fixed Rent payable under this Lease.
ARTICLE 29 - Waiver
29.1 The failure of LANDLORD or TENANT to insist upon prompt
and strict performance of any of the terms, conditions or
undertakings of this Lease, or to exercise any right herein
conferred, in any one or more instances, except as to the option to
extend or renew the term, shall not be construed as a waiver of the
same or any other term, condition, undertaking, right or option.
ARTICLE 30 - Notices
30.1 Any notice, approval, consent, or communication required
to be given to TENANT under the terms of this Lease ("notice") shall
be effective upon receipt by TENANT or refusal to accept delivery,
provided such notice is in writing and mailed by certified mail
return receipt requested or sent by overnight courier to the
appropriate address listed below:
For Certified Mail by the U.S. Postal Service:
Pier 1 Improts (U.S.), Inc.
Attention: Vice President - Real Estate
P.O. Box 961020
Fort Worth, Texas 76161-0020
Copy: Legal Department
For delivery by Airborne, Federal Express & other Courier
Services:
Pier 1 Imports (U.S.), Inc.
Attention: Vice President - Real Estate
301 Commerce Street, Suite 600
Fort Worth, Texas 76102
Copy: Legal Department
For invoices/statements:
Pier 1 Imports (U.S.), Inc.
Occupancy Accounting Department
P.O. Box 17688
Fort Worth, Texas 76102-7688
or to any such other address as TENANT may furnish to LANDLORD in
writing.
30.2 Any notice, approval, consent or communication required
to be given to LANDLORD under the terms of this Lease ("notice")
shall be effective upon receipt by LANDLORD or refusal to accept
delivery, provided such notice is in writing and mailed by certified
mail return receipt requested or sent by overnight courier to
LANDLORD at the address given on page one of this Lease, with a copy
to Jeff Rosenthal, c/o Kind, Rosenthal, Zane, Mopsick, 7000 Palmetto
Park Road, Suite 203, Boca Raton, Florida 33433 or to such other
address as LANDLORD may furnish to TENANT in writing. Rental
payments shall be forwarded to LANDLORD at the referenced address
by first class mail. If at any time or from time to time, there
shall be more than one LANDLORD, LANDLORDS shall designate a party
to receive all notices and rent payments, and service upon or
payment to the designated party shall constitute service upon or
payment to all. TENANT shall not be required to issue multiple
checks for any single payment of rent or other charges hereunder.
ARTICLE 31 - Hazardous Materials
31.1 TENANT represents, warrants and covenants that it will
exercise its best efforts to prevent the release (as defined herein)
by TENANT of Hazardous Materials (as defined herein) in or on the
Premises in violation of any Environmental Laws (as defined herein).
LANDLORD represents, warrants and covenants that it will not release
Hazardous Materials on the Premises in violation of any
Environmental Laws and that neither it nor any third party has
released Hazardous Materials on the Premises. LANDLORD further
represents, warrants and covenants that the Premises is and will
remain in compliance with Environmental Laws and do not contain and
have not contained any underground or aboveground storage tanks, any
PCB items, PCB-contaminated Electrical Equipment or any asbestos.
Notwithstanding this provision, in the event TENANT or LANDLORD
becomes aware that a release or threat of release of Hazardous
Materials on, onto or from the Premises has occurred, such party
agrees to give timely and appropriate required regulatory notices,
copying the other party.
31.2 Should LANDLORD fail to comply with any of its
representations, warranties or covenants established pursuant to
this Article 31, or become aware of any conditions on or at the
Premises not solely attributable to TENANT that constitute a
violation of any Environmental Laws or that either as a matter of
law or of reasonable care should be remediated, LANDLORD shall
conduct and complete any necessary actions (a) in accordance with
Environmental Laws, and (b) in accordance with the orders and
directives of all federal, state, and local governmental
authorities. LANDLORD shall defend, indemnify, and hold harmless
TENANT and its employees, agents, attorneys, consultants,
contractors, officers, and directors, successors and assigns from
and against any and all claims, losses, demands, penalties, fines,
liabilities, settlements, charges, damages, judgments,
administrative orders, remedial action requirements, enforcement
actions of any kind, and all costs or expenses of whatever kind or
nature, known or unknown, contingent or otherwise, arising out of,
or in any way related to, (i) the presence, disposal, handling,
transport, use, release, or threatened release of any Hazardous
Materials on or at the Premises not solely attributable to TENANT,
(ii) any failure to comply with the representations, warranties and
covenants contained herein; (iii) any failure to provide required
notice of a release or threatened release of Hazardous Materials on
or at the Premises to any governmental agency; (iv) any lawsuit
brought or threatened, settlement reached, or government order
relating to such Hazardous Materials on or at the Premises or (v)
any violation of Environmental Laws, or demands of government
authorities which are based upon or in any way related to such
Hazardous Materials on or at the Premises, including, without
limitation, attorney and consultant fees, investigation and
laboratory fees, court costs, and litigation expenses.
Responsibility for on-site conditions that either as a matter of law
or of reasonable care require remediation shall be LANDLORD'S unless
such conditions are solely attributable to activities of TENANT on
the Premises. LANDLORD shall have the burden of establishing by a
preponderance of the evidence in any later proceeding that any such
conditions are solely attributable to TENANT. If written notice of
such conditions is not presented to TENANT within thirty (30) days
after termination of this Lease, it shall be conclusively presumed
that any such conditions were not attributable to TENANT.
31.3 Should LANDLORD establish by a preponderance of the
evidence in any later proceeding that any condition on the Premises
that either as a matter of law or of reasonable care should be
remediated is solely attributable to TENANT, TENANT shall conduct
and complete any necessary actions (a) in accordance with
Environmental Laws, and (b) in accordance with the orders and
directives of all federal, state, and local governmental
authorities. Where LANDLORD can establish by a preponderance of the
evidence in any later proceeding that such conditions are solely
attributable to TENANT, TENANT shall defend, indemnify, and hold
harmless LANDLORD and its employees, agents, attorneys, consultants,
contractors, officers, and directors, successors and assigns from
and against any and all claims, losses, demands, penalties, fines,
liabilities, settlements, charges, damages, judgments,
administrative orders, remedial action requirements, enforcement
actions of any kind, and all costs or expenses of whatever kind or
nature, known or unknown, contingent or otherwise, arising out of,
or in any way related to, (i) the presence, disposal, handling,
transport, use, release, or threatened release of any Hazardous
Materials on or at the Premises solely attributable to TENANT; (ii)
any failure to comply with the representations, warranties and
covenants contained herein; (iii) any failure to provide required
notice of such release or threatened release of such Hazardous
Materials on or at the Premises to any governmental agency; (iv) any
lawsuit brought or threatened, settlement reached, or government
order relating to such Hazardous Materials on or at the Premises;
or (v) any violation of Environmental laws, or demands of government
authorities which are based upon or in any way related to such
Hazardous Materials on or at the Premises, including, without
limitation, attorney and consultant fees, investigation and
laboratory fees, court costs, and litigation expenses.
31.4 For purposes of this Article 31, "Hazardous Materials"
includes, without limit, any flammable explosives, radioactive
materials, petroleum, natural gas liquids, hazardous materials,
hazardous wastes, hazardous or toxic substances, or any pollutant
or contaminant defined as such, in or used by any federal, state or
local law, ordinance, rule, regulation, standard, order or decree
which relates to protection of the public health, welfare and the
environment, including without limitation those relating to the
storage, handling and use of chemicals and other hazardous
materials, those relating to the generation, processing, treatment,
storage, transport, disposal or other management of waste material
of any kind and those relating to the protection of environmentally
sensitive areas ("Environmental Laws"). The term "release" as used
herein means depositing, spilling, leaking, pumping, pouring,
emitting, erupting, discharging, injecting, escaping, leaching,
dumping or disposing into the environment.
31.5 The provisions of this Article 31 shall be in addition to
any and all other obligations and liabilities LANDLORD and TENANT
may have to the other at common law with respect to Hazardous
Materials and shall survive the transaction contemplated herein to
the extent such party is responsible as set forth herein except as
explicitly limited in Section 31.2 above.
31.6 If LANDLORD or TENANT is required, but fails, under
Section 31.2 or 31.3, respectively, to correct, contain, remove,
clean up or otherwise remedy the release of Hazardous Materials from
the Premises, the other party shall have the right (but not the
obligation), upon ten (10) days written notice to the party failing
to take such action, to take or complete such action on behalf of
the failing party. The party failing to take action, if such party
is required to take such action by this Lease, shall be liable to
the other party for all costs and expenses, including without
limitation, reasonable attorneys' and experts' fees, expenses and
disbursements, paid or incurred on account of such actions
undertaken on the failing party's behalf and shall promptly
reimburse the other party therefore on written demand.
ARTICLE 32 - Miscellaneous
32.1 Recordation, Short Form. LANDLORD agrees to execute a
short form of this Lease, entitled Memorandum of Lease in the form
attached hereto as Exhibit F, upon TENANT'S request. TENANT may
record the Memorandum of Lease at its expense following the date
hereof. The provisions of this Lease shall control, however, in
regard to any omissions from the Memorandum of Lease, or in respect
to any provisions hereof which may be in conflict with the
Memorandum of Lease.
32.2 Parties Bound. The terms, covenants, agreements,
conditions and undertakings contained herein shall be binding upon
and shall inure to the benefit of the heirs, successors in interest
and assigns of the parties hereto. Where more than one party shall
be LANDLORD in this Lease, the word "LANDLORD", whenever used in
this Lease, shall include all landlords jointly and severally.
32.3 Entire Agreement; Modification; Severability. This Lease
contains the entire agreement between the parties hereto and no
representations, inducements, promises or agreements, oral or
otherwise, entered into prior to the execution of this Lease, will
alter the covenants, agreements and undertakings herein set forth.
This Lease shall not be modified in any manner, except by an
instrument in writing executed by the parties. If any term or
provision of this Lease or the application thereof to any person or
circumstance shall, to any extent, be invalid or unenforceable, the
remainder of this Lease, or the application of such term or
provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby
and each term and provision of this Lease shall be valid and be
enforced to the fullest extent permitted by law.
32.4 Number and Gender. All of the terms and words used in
this Lease, regardless of the number and gender in which they are
used, shall be deemed and construed to include any other number
(singular and plural), and any other gender (masculine, feminine or
neuter), as the context or sense of this Lease or any section or
clause hereof may require, the same as if the words had been fully
and properly written in the number and gender.
32.5 Construction. The parties acknowledge that each party
and, if it so chooses, its counsel have reviewed and revised this
Lease and that the normal rule of construction to the effect that
any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of this Lease or any
amendments or exhibits hereto.
32.6 Exhibits. All exhibits, attachments and addenda referred
to herein shall be considered a part hereof for all purposes with
the same force and effect as if copies at verbatim herein. The
exhibits and/or addenda attached hereto are listed as follows:
Exhibit A - Premises Legal Description
Exhibit B-1 - Premises Site Plan
Exhibit B-2 - Shopping Center Site Plan
Exhibit C - Notice of Lease
Exhibit D - Tenant's Program Documents
Exhibit E - Tenant's Signage
Exhibit F - Memorandum of Lease
Exhibit G - Subordination, Non-Disturbance and Attornment
Agreement
32.7 Liens. If a mechanic's or other lien or order for the
payment of money shall be filed against the Premises or lands of
which the Premises is a part, due to an act or omission of TENANT,
TENANT shall, at its own cost and expense, within thirty (30) days
after notice by LANDLORD to TENANT of the filing thereof, cause the
same to be cancelled and discharged of record, or furnish LANDLORD
with a surety bond issued by a surety company, protecting LANDLORD
from any loss because of TENANT'S non-payment of such lien claim.
In the event TENANT does post bond, TENANT shall be entitled to
contest any such lien claims by appropriate judicial proceedings.
32.8 License.
(a) LANDLORD grants TENANT, its employees and agents a license
to enter the Premises including the building on the Premises for the
purpose of inspecting LANDLORD'S construction and finish-out work
prior to the Commencement Date.
(b) This license to enter before the Commencement Date is
conditioned upon TENANT'S employees and agents working in harmony
and not interfering with the workmen, mechanics and contractors of
LANDLORD and of any other tenant.
(c) Such entry shall be deemed to be under all the terms,
covenants, provisions and conditions of this Lease except the
covenant to pay rent. All TENANT'S materials, work, installations
and decorations of any nature brought upon or installed in the
Premises before the Commencement Date shall be at TENANT'S risk, and
neither LANDLORD nor any party acting on LANDLORD'S behalf shall be
responsible for any damage thereto or loss or destruction thereof.
32.9 Last Execution and Effective Date. This Lease shall
become effective on the date hereof. Any reference contained in
this Lease to the "date of last execution" or "date hereof" shall
mean the date inserted in the preamble paragraph of this Lease.
32.10 No Partnership Formed. LANDLORD does not become a partner
of TENANT in the conduct of its business or otherwise, or a joint
venturer or a member of a joint enterprise with TENANT by virtue of
this Lease.
32.11 Authority to Execute Lease. TENANT and LANDLORD each
warrant and represent that the party signing this Lease on behalf
of each has authority to enter into this Lease and to bind TENANT
and LANDLORD respectively to the terms, covenants and conditions
contained herein. Each shall deliver to the other upon request, all
documents reasonably requested by the other evidencing such
authority including, without limitation, a copy of all corporate
resolutions, consents or minutes reflecting the authority of persons
or parties to enter into agreements on behalf of TENANT or LANDLORD.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Lease to be duly
executed as of the dates set forth below for LANDLORD AND TENANT,
and to be effective as stated in Section 32.9 of this Lease.
LANDLORD:
P. ONE SIOUX FALLS INVESTORS INC.
a Florida corporation
WITNESS OR ATTEST:
By:/s/ Lee J. Maher
Date: Title: President
TENANT:
PIER 1 IMPORTS (U.S.), INC.
a Delaware corporation
WITNESS OR ATTEST:
By: /s/ J. Rodney Laurence
Date: Title: Senior Vice Pres.
<PAGE>
Exhibit A
The East 165 Feet of the North 280 Feet of Lot 1 in Block 2 of
Valhalla Addition to the City of Sioux Falls, Minnehaha County,
South Dakota, according to the recorded plat thereof.
<PAGE>
Exhibit 10 (r)
ASSIGNEMENT AND ASSUMPTION AGREEMENT BY AND
BETWEEN
P. ONE SIOUX FALLS INVESTORS, INC.
AND
BRAUVIN NET LEASE V, INC.
In consideration of the sum of Ten Dollars ($10.00) and other
good and valuable consideration paid to it, the receipt of which is
acknowledged, P. ONE SIOUX FALLS INVESTORS, INC., hereinafter
referred to as "Assignor", hereby sells, transfers, sets over,
confirms, bargains and assigns to Brauvin Net Lease V, Inc.,
hereinafter referred to as "Assignee", all right, title, and
interest of Assignor in and under that certain "Lease Agreement"
entered into on June 5, 1995, that certain Letter Agreement dated
January 26, 1996 ("First Letter Agreement"), that certain Letter
Agreement dated March 13, 1996 ("Second Letter Agreement"), and that
certain "Third Amendment to Lease Agreement" dated May 1, 1996, all
by and between P. ONE SIOUX FALLS INVESTORS, INC., as "Landlord",
and Pier One Imports (U.S.), Inc., as "Tenant" for the premises
commonly known as 3801 West 49th Street, Sioux Falls, South Dakota
(collectively referred to as the "Lease"). Reference is hereby made
to the Lease for the description of the real property and other
particulars thereof.
In consideration of the assignment made to Assignee, Assignee
fully and completely assumes all of the liabilities of the Assignor
under the Lease and assumes and agrees to perform all of Assignor's
duties and obligations under the Lease including but not limited to
the completion of the construction of the Premises as provided in
the Lease as if Assignee were the original landlord pursuant to the
Lease Agreement.
Assignee agrees to hold Assignor harmless from and defend and
indemnify Assignor against any and all claims, causes of action,
losses, liabilities, costs and expenses (including, without
limitation, reasonable attorney's fees) incurred of suffered by or
asserted against Assignor arising out of or relating to Assignee's
failure to perform or observe any of the duties or obligations of
the landlord under the Lease during Assignee's ownership of the
Property after the date and time hereof.
Assignor agrees to hold Assignee harmless from and defend and
indemnify Assignee against any and all claims, causes of action,
losses, liabilities, costs and expenses (including, without
limitation, reasonable attorney's fees) incurred of suffered by or
asserted against Assignee arising out of or relating to Assignor's
failure to perform or observe any of the duties or obligations of
the landlord under the Lease during Assignor's ownership of the
Property on and prior to the date and time hereof.
Assignor warrants and represents to Assignee and Tenant that
Assignor has the full right and authority to enter into this
Agreement without the joinder or approval of any other person or
entity.
Executed at Boca Raton, FLA., on May 2, 1996.
ASSIGNOR
P. One Sioux Falls Investors, Inc.
By: /s/ Lee J. Maher
Lee J. Maher, President
Executed at Chicago, Illinois, on May 3, 1996.
ASSIGNEE
Brauvin Net Lease V, Inc.
By: /s/ James L. Brault
James L. Brault, Vice President
<PAGE>
Exhibit 10 (s)
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT ("Agreement") entered into the
21st day of January, 1997, by and between GERMANTOWN ASSOCIATES
LIMITED PARTNERSHIP, a Delaware limited partnership ("Seller") and
GERMANTOWN ASSOCIATES, INC., an Illinois corporation ("Purchaser").
WITNESSETH:
In consideration of the mutual covenants set forth herein and
the Earnest Money paid by Purchaser, the parties hereto, intending
to be legally bound, hereby, agree as follows:
Section 1. Sale and Purchase.
Seller hereby agrees to sell, convey, and assign to Purchaser
and Purchaser hereby agrees to purchase and accept from Seller, for
the Purchase Price (hereinafter defined) and on and subject to the
terms and conditions herein set forth, all of the land and piece of
ground, and all buildings and improvements therein located at 12-14
West Germantown Pike, East Norriton Township, Montgomery County,
Pennsylvania, as more fully described on Exhibit "A," attached
hereto and made a part hereof (the "Real Estate"), including
without limitation, Seller's now or later acquired interest in all
leases, franchises, licenses, occupancy agreements, or other
agreements demising space in, providing for the use or occupancy
of, or otherwise similarly affecting or relating to, the
Improvements or Land (the "Leases") as identified in Exhibit "B"
attached hereto, and, to and only to, the extent Seller has
received on or prior to the Closing Date any of the following:
prepaid rents, for any period subsequent to the actual Closing Date
and all other security deposits, if any, (the "Deposits") made by
the tenants (the "Tenants") holding under the Leases; to the extent
they are assignable, are owned and actually held by Seller, all
documents in the possession of Seller that relate to the design,
construction, ownership, or operation of the Land, Improvements,
Leases, Deposits, or Personalty, and, to the extent they exist, any
and all: (i) contracts or agreements, such as utility contracts
(the "Property Agreements") (ii) warranties, guaranties,
indemnities and claims (iii) licenses, permits, or similar
documents (iv) telephone exchanges, trade names, marks, and other
identifying material, excluding Seller's name, and (v) plans,
drawings, specifications, surveys, engineering reports, and other
technical descriptions, all in its and their "AS-IS" condition at
the time of Closing, and all without representation, warranty or
recourse of any kind. No contracts shall be assumed by Purchaser
except those that are of record.
The above listed items are herein collectively called the
"Property". All of the Property shall be conveyed, assigned and
transferred to Purchaser at Closing (hereinafter defined) free and
clear of all liens, claims, and encumbrances except for the
Permitted Encumbrances (hereinafter defined), in "AS-IS" and "WHERE
IS" condition without recourse, warranty or representations. No
implication, direct or indirect, is herein made that Seller in fact
possesses any of the aforesaid except for the Real Estate and the
Leases.
Section 2. Purchase Price
The price ("Purchase Price") for which Seller agrees to sell and
convey the Property to Purchaser, and which the Purchaser agrees to
pay to Seller is the amount of ONE MILLION FOUR HUNDRED FIFTY
THOUSAND DOLLARS ($1,450,000.00) to be paid at Closing as provided
in Section 5(b)(1) hereof. The Purchase Price as adjusted for
credits and prorations as provided herein (the "Closing Payment")
shall be payable at the Closing by federal wire transfer funds or
other immediately available funds.
Section 3. Delivery of Information from Seller: Purchaser's
Inspection Period.
(a) Seller has, at its sole cost and expense, delivered or
caused to be delivered prior hereto to Purchaser the following:
(1) A copy of a recent title report (the "Title Report"),
abstracting Seller's title to the Real Estate, which shall show fee
title to the Real Property in the name of Seller.
(2) copies of all Property Agreements, warranties,
certificates of occupancy and/or compliance, as may be within
Seller's possession, if any.
(3) copies of each of the Leases and amendments thereto
within Seller's control, as described on Exhibit "B" attached
hereto and made a part hereof.
(4) such plans, drawings, and specifications if any,
(including "as built" plans and drawings, if any) as Seller
possesses with regard to the Improvements and Personalty and copies
of any engineering, environmental or similar reports Seller may
possess relating thereto.
(5) a copy of a Phase I environmental report with respect
to the Property performed for Seller or its affiliate or lender and
dated November 2, 1995.
(b) Seller has for several weeks prior hereto provided
Purchaser with access to the Property for the purpose of Purchaser
making and/or confirming such reasonable inspections,
verifications, studies, tests, surveys and title searches with
respect thereto as Purchaser deems reasonably necessary (herein
collectively called "Purchaser's Inspection").
(c) All exceptions to title to the Property set forth at
Exhibit "C," attached hereto and made a part hereof are herein
called the "Permitted Encumbrances".
(d) All of Purchaser's surveys, title searches, inspections,
tests, studies and investigations with respect to the Property
shall be at Purchaser's sole cost and expense. Purchaser agrees
that Purchaser will repair all damage to the Property caused by
Purchaser's inspections, tests, studies and investigations, and
indemnify and hold Seller harmless from any and all claims,
judgments, fines, penalties, costs, expenses and liabilities,
including attorney's fees, if any, arising or resulting from such
inspections, tests, studies and investigations of Purchaser. A
default under this subsection shall constitute a material default
under this Agreement entitling Seller to all remedies set forth in
this Agreement and or otherwise available at law or in equity. If
any such damage or injury occurred and any claim or cost or expense
is incurred as aforesaid, and Seller does not elect to declare a
default hereunder, then Purchaser shall take the Property subject
to and with all such damages, injuries, claims, expenses and costs,
and shall solely bear the same and shall release, hold harmless,
defend and indemnify Seller for, from and against the same and all
costs including legal fees and disbursements that arise in relation
thereto. For the purposes of this Section, "Purchaser" shall also
mean Purchaser's successors and assigns.
(e) Any documentation, reports and other information provided
to Purchaser shall be considered confidential and if closing does
not occur as contemplated herein, all of same shall be promptly
returned to Seller. Except as may be otherwise specifically agreed
to herein, Seller does not warrant or represent the accuracy or
completeness of any plans, drawings, reports, certificates or
documents provided to Purchaser.
Section 4. Closing.
(a) The closing ("Closing") of the sale of the Property by
Seller to Purchaser shall occur contemporaneously with the full
execution of this Agreement (the "Closing Date") at the offices of
Seller's counsel. To the extent feasible, a closing by telephone
and telecopy, with executed documents and wired funds submitted to
the Title Company shall be permissible, and the parties shall
cooperate with one another and the Title Company to achieve the
aforesaid.
(b) At the Closing, the following shall occur:
(1) Purchaser, at its sole cost and expense, shall deliver
or cause to be delivered to Seller:
(i) wire transfer of immediately available federal
funds to the Title Company, in the amount of the Purchase Price,
adjusted as provided for in Section 5(c) hereinbelow.
(ii) evidence satisfactory to Seller and the
Purchaser's title company ("Title Company") that the person
executing the Closing documents on behalf of Purchaser has full
right, power, and authority to do so, and such other documents,
certificates, instruments and affidavits as Seller or the Title
Insurance Company shall reasonably request.
(2) Seller, at its sole cost and expense, except as set
forth below, shall deliver or cause to be delivered to Purchaser
the following:
(i) Special Warranty Deed, fully executed and
acknowledged by Seller conveying to Purchaser the Land and
Improvements, subject only to the Permitted Encumbrances, in
"AS-IS, WHERE IS" condition without recourse and negating any
warranties as to condition, fitness or merchantability, or as to
environmental matters, or otherwise, title to the same being
otherwise good and marketable or insurable as such at regular
rates;
(ii) "As-Is" Bill of Sale and Assignment and
Assumption Agreement in form and substance reasonably acceptable to
Seller, fully executed and acknowledged by Seller, assigning,
conveying, and transferring all of the Personalty, the Leases and
all of the other Property except the Land and Improvements to
Purchaser, subject only to the Permitted Encumbrances, all of which
is being conveyed and assigned "AS-IS" "WHERE IS" without recourse
(except as specifically set forth in Sections 6(b)(8) and 8
herein), and negating any representation and warranties as to
title, condition, fitness, merchantability or any other matter.
The "As-Is" Bill of Sale and Assignment and Assumption Agreement
shall contain provisions whereby the Seller agrees to be
responsible for and indemnify Purchaser against claims incurred
during Seller's ownership of the Property, and whereby Purchaser
agrees to be responsible for and indemnify Seller against claims
incurred thereafter;
(iii) a certificate meeting the requirements of
Section 1445 of the Internal Revenue Code executed and sworn to by
Seller;
(iv) evidence reasonably satisfactory to Purchaser and
the Title Company that the person or persons executing the Closing
documents on behalf of Seller have full right, power and authority
to do so;
(v) any other instruments reasonably required by the
Title Company to close this Agreement and transaction, including,
a standard form affidavit of title and closing statements, provided
that Purchaser has specifically notified Seller and provided it
with copies thereof at least ten (10) days prior to Closing of all
such required documents.
(vi) an Estoppel Certificate from any Tenants executed
within 90 days of Closing certifying to the best of Tenant's
knowledge as much of the following as Tenant reasonably knows: the
amount of rent currently due under its lease; the lease term; the
amount of its security deposit, if any; the amount of prepaid rent,
if any; and whether there exists an event of default by either
party under its lease.
(c) All normal and customarily proratable items, including
without limitation, real estate and personal property taxes,
utility bills, service contracts, and rents shall be prorated as of
the Closing Date, on the basis of a 365 day year unless otherwise
instructed, Seller being charged and credited for all of same up to
such Closing date and Purchaser being charged and credited for all
of same on and after such date. If the actual amounts to be
prorated are not known as of the Closing Date, the prorations shall
be made by Title Company on the basis of the best evidence then
available, and thereafter, when actual figures are received, a cash
settlement will be made between Seller and Purchaser. All Deposits
shall be credited against the Purchase Price. No prorations shall
be made in relation to delinquent rents existing as of the Closing
Date, but Purchaser shall make a good faith attempt (but Purchaser
shall not be required to institute any suit) to collect the same
for Seller's benefit after the Closing and such collections, if
any, shall be remitted to Seller promptly upon receipt by
Purchaser. Seller shall retain the rights to any delinquent
remedies existing as of Closing and shall be entitled to pursue all
available remedies for collection of same other than locking out or
evicting any tenant. The provisions of this Section 5(c) shall
survive the Closing. Purchaser shall pay for the cost of the
owner's and mortgagee's (if any) policies of title insurance,
surveys, title searches and reports. Purchaser and Seller shall
split and pay equally between them all transfer taxes.
(d) Upon completion of the Closing, Seller shall deliver to
Purchaser possession of the Property in the same condition as on
the date hereof, excepting only normal wear and matters permitted
under Section 7 hereof.
Section 5. Destruction, Damage or Taking Prior to Closing.
If, prior to Closing, the Improvements are destroyed or damaged,
or become subject to condemnation or eminent domain proceedings,
Purchaser shall nevertheless proceed with the Closing (subject to
the other provisions hereof) but Purchaser shall be entitled to any
and all insurance proceeds and condemnation proceeds payable as a
result of such damage, destruction or taking and, to the extent the
same may be necessary or appropriate, Seller shall assign to
Purchaser at Closing Seller's rights to such proceeds.
Section 6. Representations of Purchaser and Seller.
Seller and Purchaser respectively hereby make the
representations set forth below. Unless otherwise agreed to in
writing by Seller and Purchaser, such representations shall also be
deemed made as of the Closing Date and the remedies for breach
thereof shall survive Closing and shall be exercisable for a period
of one year after Closing, but not thereafter, any and all other
limitation periods for the bringing of such actions being hereby
waived.
(a) Purchaser's Representations.
Purchaser represents to and covenants with Seller that:
(1) Purchaser is purchasing the Property and all Leases in
their "AS IS" "WHERE IS" condition with no warranties by Seller as
to merchantability, suitability, habitability, accuracy or fitness
for any particular use, or otherwise, it being understood and
agreed that Purchaser is an experienced real estate professional
and is relying solely on its own inspections, investigation, due
diligence, analysis, research, inquiries, engineering studies and
reports, feasibility studies, environmental audits or inspections
and examinations of the Property and the Leases (or inspections and
examinations of information, reports or studies prepared by third
parties for Seller and furnished to Purchaser at Purchaser's
specific request but with respect to any of which reports,
information or studies Seller has no liability and makes no
representation or warranty of any kind or nature whatsoever), in
Purchaser's determination of the condition of the Property and any
improvements, fixtures, equipment, Leases, documents and
personalty, if any, to be sold to Purchaser under the Agreement and
PURCHASER HEREBY AFFIRMATIVELY RELEASES AND HOLDS SELLER HARMLESS
FROM ANY AND ALL LIABILITY, OBLIGATION, COST AND EXPENSE FROM THE
SAME, INCLUDING BUT NOT LIMITED TO ANY OF THE SAME RELATING TO
ENVIRONMENTAL, HEALTH, SAFETY AND LEGAL MATTERS. Purchaser
acknowledges that the Property is and has been used by a tire,
battery and accessory establishment and a "quick" lube and oil
change establishment, both performing work on automobiles and
using, storing, handling, releasing and generating petroleum and
petroleum products and byproducts and other hazardous or noxious
substances, and that there are several other facilities located
near the Property, including without limitation an Amoco gas
station immediately adjacent to the Property, which do, may or have
also stored, used, generated, released and handled petroleum
products and byproducts and/or other hazardous and/or noxious
substances, and that Seller specifically makes no representation as
to the condition of the Property or any adjacent properties with
respect to these or any other matters.
(2) Except for this Agreement, Purchaser has entered into
no other purchase or commission agreement with respect to the
Property that it believes in good faith to be currently valid.
(3) Purchaser shall pay prior to Closing all claims,
liabilities or expenses as associated with its inspection of the
Property, or, if Closing shall be completed herein provided, then
in lieu of such payment, shall agree to indemnify, defend and hold
Seller harmless of, from and against all such claims, liabilities
and expenses, including all of Seller's legal fees and
disbursements in connection therewith. Seller shall promptly
notify Purchaser of all such claims.
(4) Purchaser has not (a) made a general assignment for
the benefit of creditors, (b) filed any voluntary petition or
suffered the filing of an involuntary petition by Purchaser's
creditors, (c) suffered the appointment of a receiver to take all,
or substantially all, of Purchaser's assets, (d) suffered the
attachment or other judicial seizure of all, or substantially all,
of Purchaser's assets, or (e) admitted in writing its inability to
pay its debts as they fall due, and no such action is threatened or
contemplated. If any of such actions have been taken or brought
against Purchaser, then prior to the date hereof the same have been
fully disclosed and Purchaser discharged therefrom so that there
are no prohibitions or conditions upon Purchaser's ability to
purchase the Property.
(5) Neither the execution and delivery of this Agreement
nor the consummation of the transaction contemplated by this
Agreement will result (either immediately or after the passage of
time and/or the giving of notice) in breach or default by Purchaser
under any agreement or understanding to which Purchaser is a party
or by which Purchaser may be bound or which would have an effect
upon Purchaser's ability to fully perform its obligations under
this Agreement.
(6) Purchaser has the right, power and authority to
execute, deliver and perform this Agreement without obtaining any
consents or approvals from, or the taking of any action with
respect to, any third parties. This Agreement when executed and
delivered by Purchaser and Seller, will constitute the valid and
binding Agreement of Purchaser enforceable in accordance with its
terms.
(7) The representations and warranties of Purchaser made
in this Agreement shall survive Closing for a period of one year;
the release made by Purchaser in subparagraph (1) of this Section
shall survive Closing without limitation.
(b) Seller's Representations and Covenants.
Seller represents to, and covenants with, Purchaser that:
(1) Seller now has good and indefeasible title in fee
simple to the Land and Improvements, which, to the best of Seller's
knowledge, is free and clear of all liens and encumbrances, except
as of record or noted on the Title Report and except for the
Permitted Encumbrances.
(2) Except for this Agreement, Seller has entered into no
other outstanding purchase agreement with respect to the Property
that it believes in good faith to be currently valid. Seller had
entered into a provisional agreement with United Municipal Leasing
Corporation which Seller believes in good faith to be void and of
no force and effect as of the date hereof.
(3) Seller has not (a) made a general assignment for the
benefit of creditors, (b) filed any voluntary petition or suffered
the filing of an involuntary petition by Seller's creditors, (c)
suffered the appointment of a receiver to take all, or
substantially all, of Seller's assets, (d) suffered the attachment
or other judicial seizure of all, or substantially all, of Seller's
assets, or (e) admitted in writing its inability to pay its debts
as they fall due, and no such action is threatened or contemplated.
If any of such actions have been taken or brought against Seller,
then prior to the date hereof the same have been fully disclosed
and Seller discharged therefrom so that there are no prohibitions
or conditions upon Seller's transfer of the Property.
(4) From the date hereof until the Closing Date, Seller
shall (i) maintain and operate the Property in substantially the
same manner as Seller has heretofore maintained and operated same;
(ii) continue the Leases in full force and effect and neither
cancel, amend nor renew any of the existing Leases nor execute any
new Lease without Purchaser's prior written consent; and (iii) not
grant rent abatements nor accept advance rentals for more than one
month, without Purchaser's prior written consent.
(5) Seller has the right, power and authority to execute,
deliver, and perform this Agreement, and this Agreement, when
executed and delivered by Seller and Purchaser, will constitute the
valid and binding Agreement of Seller enforceable in accordance
with its terms.
(6) Seller has not retained Arnold Kramer or United
Municipal Leasing Corporation as a broker or consultant with
respect to the Property.
(7) All of Seller's representations and covenants in this
Agreement and all exhibits attached to this Agreement are limited
as set forth in this subparagraph. Seller acquired equitable title
to the Property at a Sheriff Sale held on or about June 18, 1996 at
which it was the successful bidder, and thereafter fee simple title
by Sheriff's Deed. Therefore, Seller's covenants to provide
information and documentation and all of Seller's representations
are limited to Seller's period of ownership of the Property and the
actual knowledge gained by Seller with respect to the Property
during such period of ownership. As to the period prior to
Seller's ownership, Seller can make no representation. However,
Seller shall provide such information and documentation as required
in this Agreement as is in Seller's possession or control. Seller
makes no representations of any kind whatsoever with respect to the
condition of the Property, the construction or condition of the
improvements or personalty thereon sold pursuant to this Agreement,
nor the accuracy of any information or documents supplied by it.
Seller shall not be a warrantor or guarantor of any studies or
tests conducted or certified by any person (other than specifically
in writing by Seller itself) whether or not provided to Purchaser
pursuant to this Agreement, or otherwise. For the purposes of this
Agreement or any of Seller's Closing Documents, the phrase "to the
best knowledge of Seller", or phrases of similar import shall mean
the actual knowledge of Seller's officers and employees gained
during and through its period of ownership of the Property, without
having conducted, or undertaken to so conduct, any independent
investigations or studies as to the completeness or accuracy of
same, or having undertaken any past, present, or future duty to so
investigate or update same.
(8) The remedies for any breach of any representations and
warranties of Seller made in this Agreement shall survive Closing
for a period of one year.
Section 7. Notices.
Any notice provided or permitted to be given under this
Agreement must be in writing and may be served: by depositing same
in the United States mail, addressed to the party to be notified,
postage prepaid and certified mail with return receipt requested;
or by delivering the same in person to such party; or by recognized
national overnight commercial courier such as, by way of example
only, UPS Overnight, Federal Express, DHL or the like; or by
facsimile copy thereof followed by actual delivery on the next
business day. Notice given in accordance herewith shall be
effective upon receipt at the address of the addressee, or in the
case of U.S. Mail, three business days following due deposit. For
purposes of notice, the addresses of the parties shall be as
follows unless and until changed by such party in the manner
provided for in this Section:
If to Seller, to: Germantown Associates Limited Partnership
c/o Houlihan-Parnes Realtors, LLC
455 Central Park Ave. - Suite 308
Scarsdale, NY 10583
FAX No: 914-472-6073
Attention: Fred Stahl
with copy Andrew Gowa, Esquire
delivered in the Suite 3600
same manner to: 1600 Market Street
Philadelphia, PA 19103
FAX No: 215-972-7676 or 215-751-2071
If to Purchaser,
to: Germantown Associates, Inc.
150 South Wacker Drive
Chicago, IL 60606
Attention: James L. Brault, Vice President
with copy Allan L. Yusim, Esquire
delivered in the Saitlin, Patzik, Frank & Samotny Ltd.
same manner to: 150 South Wacker Drive, Suite 900
Chicago, Illinois 60606
FAX NO: 312-551-1101
Section 8. Commissions and Indemnification.
Purchaser represents and warrants to Seller that Purchaser has
not employed or dealt with a broker, intermediary, consultant or
finder in connection with this transaction except Houlihan-Parnes
Realtors, LLC and David Bennett/Osborn Judson Associates, Inc..
Seller shall be responsible for paying a real estate commission to
Seller's Agent, Houlihan-Parnes Realtors, LLC and David
Bennett/Osborn Judson Associates, Inc. pursuant to the provisions
of a separate agreement. Seller and Buyer each represent and
warrant to the other that no other salesperson, agent,
intermediary, consultant or broker has had any part in bringing
about this Agreement (or the sale contemplated herein) or has been
consulted by it in connection therewith. Seller and Buyer each
agree to indemnify the other and to hold the other harmless with
regard to any breach of the foregoing representation and warranty,
provided, however, that nothing contained herein shall in any
manner serve to abrogate, nullify or modify any term of the
Indemnity Agreement dated as of even date herewith, by and between
Seller and Buyer (the "Indemnity Agreement"), the terms and
provisions of which: (i) are hereby reaffirmed; (ii) are
specifically agreed to survive Closing without limitation; and
(iii) are paramount to and supersede any and all inconsistent or
contrary provision herein.
Section 9. Financing.
This Agreement is not contingent upon Purchaser's obtaining a
mortgage or other financing of any kind.
Section 10. Governing Law and Jurisdiction.
This Agreement shall be governed and construed in accordance
with the laws of the Commonwealth of Pennsylvania. With respect to
any and every dispute relating to this Agreement or the Property,
the parties hereto hereby irrevocably consent to the exclusive
jurisdiction and venue of the state and federal courts situate
within the Eastern District of Pennsylvania and the appellate
courts having jurisdiction there over.
Section 11. Entire Agreement.
This Agreement is the entire agreement between Seller and
Purchaser concerning the sale of the Property and supersedes all
prior understandings, representations and agreements with respect
to the subject matter hereof. No modification hereof or subsequent
agreement relative to the subject matter hereof shall be binding on
either party unless reduced to writing and signed by the party to
be bound.
Section 12. Exhibits.
Exhibits "A," "B," and "C" inclusive, attached hereto are
incorporated herein by this reference for all purposes.
Section 13. Counterparts.
This Agreement may be executed in multiple counterparts, all of
which together shall constitute one agreement. The parties may
rely on facsimile signatures providing that originals thereof are
delivered promptly to the person entitled to rely on them.
Section 14. Time of Essence.
Time is important to both Seller and Purchaser in the
performance of this Agreement, and they have agreed that strict
compliance is required as to any date or time period set out or
described herein. If the final date of any period which is set out
in any paragraph of this contract falls upon a Saturday, Sunday or
legal holiday under the laws of the United States or the
Commonwealth of Pennsylvania, then, and in such event, the time of
such period shall be extended to the next day which is not a
Saturday, Sunday or legal holiday.
Section 15. Effectve Date.
Whenever the term or phrase "effective date hereof" or "date
hereof" or other similar phrases describing the date this Agreement
becomes binding on Seller and Purchaser are used in this Agreement,
such terms or phrases shall mean and refer to the date on which a
counterpart or counterparts of this Agreement is (are) executed by
Seller and Purchaser.
Section 16. No Recording.
Neither this Agreement nor any short form or memorandum thereof
shall be recorded in any public records.
IN WITNESS WHEREOF, and intending to be legally bound hereby,
the parties hereto have executed this Agreement as of the date and
year first above written.
WITNESS: SELLER: GERMANTOWN ASSOCIATES
LIMITED PARTNERSHIP
BY: GERMANTOWN REALTY CORP.,
Its General Partner
BY: /s/ Theodore Sannella
Name: Theodore Sannella
Title: Vice-President
ATTEST: BUYER: GERMANTOWN ASSOCIATES, INC.
an Illinois corporation
BY: /s/ James L. Brault
Secretary Name: James L. Brault
Title: Sr. Vice President
<PAGE>
Exhibit "A"
ALL THAT CERTAIN parcel or tract of land with the buildings and
improvements erected thereon, situate in the Township of East
Norriton, County of Montgomery and Commonwealth of Pennsylvania,
bounded and described in accordance with a Subdivision Plan
property of C.V. Strouse, et al, dated September 27, 1984, last
revised November 5, 1984 and recorded in Plan Book A-46 page 27, as
follows, to wit:
BEGINNING at a point on the Southwesterly side line of Germantown
Pike (U.S. TR 422) said side line being 48 feet Southwesterly from
and parallel to the centerline, said point also being at the
distance of 150.00 feet measured North 39 degrees 16 minutes West
along the said side line from its intersection with the
Northwesterly side line of DeKalb Pike (U.S. TR 202) said side line
being 40 feet Northwesterly from and parallel to the centerline;
thence from said point of beginning along lands of Strouse, et al,
South 45 degrees 14 minutes West 167.49 feet to a point a corner;
thence along Parcel 2, as shown on said plan, North 44 degrees 46
minutes West 96.69 feet to a point a corner; thence still along
said Parcel 2, South 45 degrees 14 minutes West 43.00 feet to a
point, a corner; thence along Parcel 1, as shown on said plan,
North 44 degrees 46 minutes West 263.67 feet to a point a corner on
or near an existing stream as shown on said plan; thence still
continuing along Parcel 1, North 04 degrees 08 minutes West 31.92
feet to a point, a corner in line of lands of Philadelphia Electric
Company; thence along the said Philadelphia Electric Company, North
85 degrees 52 minutes East 285.75 feet to a point a corner on the
aforementioned Southwesterly side line of Germantown Pike, the side
line at this point being 40 feet Southwesterly from and parallel to
the centerline; thence along the said side line, South 39 degrees
16 minutes East 198.41 feet to a point a corner; thence continuing
along the said Germantown Pike, South 50 degrees 44 minutes West
8.00 feet to a point, a corner; thence still along the said
Southwesterly side line of Germantown Pike, the side line at this
point being 48 feet Southwesterly from and parallel to the
centerline, South 39 degrees 16 minutes East 1.78 feet to the first
mentioned point and place of beginning.
BEING Parcel Number 3 on the above plan.
CONTAINING 1.490 acres.
BEING PARCEL NUMBER 33-00-03062-00-1.
BEING the same premises which the Sheriff of Montgomery County by
Sheriff Deed Poll dated July 3, 1996 and recorded July 12, 1996 in
the Office for the Recording of Deeds, in and for the County of
Montgomery, Commonwealth of Pennsylvania in Deed Book 5154 page 629
granted and conveyed unto Germantown Associates Limited
Partnership, a Pennsylvania Limited Partnership, its successors and
assigns, in fee.
<PAGE>
EXHIBIT "B"
SCHEDULE OF LEASES
1. LEASE dated September 25, 1986, by and between Lewis J.
Stowe, III, and The Firestone Tire & Rubber Company,
now known as Bridgestone/Firestone, Inc., as amended.
2. Lease dated June 11, 1986, by and between Lewis J. Stowe,
III, and Jiffy Lube of Pennsylvania, Inc., as amended.
<PAGE>
EXHIBIT "C"
PERMITTED ENCUMBRANCES
1. Terms and conditions of any unrecorded lease or rights of
parties in possession, as to Firestone and Jiffy Lube only.
2. Possible additional assessments for taxes for new construction
or for any major improvements pursuant to provisions of
Acts of Assembly relating thereto, not yet due and payable.
3. Lease between Lewis J. Stowe, III and The Firestone Tire &
Rubber Company, dated 9/25/1986 and recorded 3/13/1987 in Deed
Book 4831 page 1979.
4. Declaration of Taking: Commonwealth of Pennsylvania, Department
of Transportation -vs- C.V. Strouse, Inc., et al, C.P. #73-3903
filed 3/30/1973, an excerpt of which is recorded in
Deed Book 3838 page 16.
5. Rights granted to The Bell Telephone of Pennsylvania as in Deed
Book 4417 page 456 and Deed Book 4859 page 2458.
6. Plan dated 9/27/1984 last revised 11/5/1984 and recorded in
Plan Book A-46 page 27 shows building set back lines,
proposed sanitary sewer easement extending through
premises, 20 feet wide storm sewer easement extending
through premises, drainage swale extending through premises,
NOTES thereon, access easement extending through premises and
ultimate right of way line of Germantown Pike.
7. Declaration of Easements and Related Agreements dated 11/9/1984
and recorded in Deed Book 4752 page 2147.
8. Reciprocal Easement Agreement, dated 11/12/1984 and recorded
in Deed Book 4753 page 2070.
9. Supplemental Declaration of Easements, dated 11/14/1985 and
recorded in Deed Book 4791 page 1198.
10. Deed of Easement between Lewis J. Stowe, III and The
Township of East Norriton, dated 7/21/1986 and recorded
9/9/1986 in Deed Book 4812 page 963.
11. Rights granted to Philadelphia Electric Company as in Deed
Book 4831 page 1442.
12. Final Land Development Plan made for L.J. Stowe Development
Corporation as being recorded in Plan Book A-47 page 393
shows the following:
(a) building set back lines;
(b) notes as set forth thereon;
(c) ultimate right of way line along Germantown Pike;
(d) various utility and sewer easements and rights of way
extending through premises;
(e) various conditions and stipulations as set forth
thereon.
13. Subject to facts as shown on survey by Showalter &
Associates dated 12/12/96 showing the following:
(a) 20' storm sewer easement;
(b) 20' sanitary sewer easement;
(c) building set-back lines;
(d) ultimate right of way for Germantown Pike;
(e) utility lines;
(f) railroad retaining wall off title line;
(g) hospital signs and water meter;
(h) notes; and
(i) access easement.
<PAGE>
LEASE
LEASE covering certain premises situated on Germantown
Pike in the Township of East Norriton, State of Pennsylvania.
1. THIS LEASE, dated for reference purposes only, this
25th day of September, 1986, by and between LEWIS J. STOWE, III
with an office at 370 Plymouth Meeting Executive Campus 600 W.
Germantown Pike, Plymouth Meeting, Pennsylvania, 19462, hereinafter
called LANDLORD, and THE FIRESTONE TIRE & RUBBER COMPANY, an Ohio
corporation with its principal office at 1200 Firestone Parkway,
Akron, Ohio 44317, hereinafter called TENANT.
2. DESCRIPTION. LANDLORD hereby leases to TENANT and
TENANT hires from LANDLORD the premises situate in East Norriton
Township, Montgomery County, Pennsylvania, which is a portion of
the lot described on Exhibit "A" being a legal description of
LANDLORD'S tract, and more particularly that portion which is
outlined in red on Exhibit "B" being a site plan of LANDLORD'S
tract, together with the building and improvements thereon to be
erected (hereinafter referred to as the Premises or the Demised
Premises) and which is adjoining the Hechinger Plaza Shopping
Center described in Exhibit "C" attached hereto, for the term and
upon the conditions hereinafter set forth, containing approximately
39,000 square feet, being 60 feet fronting on Germantown Pike,
approximately 238 feet deep and 150 feet wide, together with all
appurtenances, rights and privileges thereto, and all improvements
that have been or may be placed thereon, and TENANT is hereby
granted the right of ingress and egress to the extent of LANDLORD'S
rights over all roads, streets, alleys, sidewalks and ways, whether
public or private, bounding or serving the Demised Premises. The
Demised Premises are demised subject and subordinate to all
agreements, conditions, encumbrances, easements, reciprocal
construction operating the easement agreements, as shown on
LANDLORD'S title report referred to below in Paragraph 3,
including, but not limited to, the Declaration of Easements and
Related Agreements attached hereto, made a part hereof and marked
Exhibit "D" (hereafter Declaration of Easements), restrictions,
covenants, zoning laws and governmental or any other regulations,
now or hereafter affecting or governing the LANDLORD'S tract and
the adjoining Hechinger Plaza Shopping Center. LANDLORD reserves
unto itself, its successors and assigns, for the purpose of
construction and/or repair, the use of the walls and roof of the
building, together with the right to install, maintain, use, repair
and replace pipes, ducts, conduits, wires and structural elements
leading through the Demised Premises in locations which will not
materially interfere with TENANT'S use of the Demised Premises.
3. QUIET POSSESSION. LANDLORD covenants and warrants
that LANDLORD has full right and lawful authority to enter into
this lease for the full term hereof, and for all extensions herein
provided, and that LANDLORD is lawfully seized of the Demised
Premises and adjacent property for ingress and egress purposes and
has good title thereto free and clear of all tenancies, liens and
encumbrances, except those set forth on LANDLORD'S title report, a
copy of which is attached hereto, made a part hereof and marked
Exhibit "E". Provided TENANT is not in default of the terms,
covenants or conditions of this lease, TENANT shall have and enjoy
under this lease the quiet and undisturbed possession of the
Demised Premises. LANDLORD covenants that during the term of this
lease or any extension thereof it will neither engage in the
business of buying, selling, or repairing tires, tubes or batteries
within a radius of five hundred (500) feet of the Demised Premises,
nor sell, lease or consent to a sale or lease of other lands in
which it has an interest whereon shall be conducted a business that
is substantially engaged in the buying, selling or repairing of
tires, tubes or batteries within a radius of five hundred (500)
feet of Demised Premises.
If at the time of delivery of the Demised Premises to
TENANT there shall be any mortgage affecting the LANDLORD'S tract,
or if any subsequent mortgagee shall request subordination of this
lease to a subsequent mortgage, LANDLORD shall obtain and deliver
to TENANT within thirty (30) days thereafter, a Non-Disturbance
Agreement in respect of such mortgage in recordable form by the
terms of which any such mortgagee agrees not to disturb the
possession and other rights of TENANT under, pursuant and for the
term of this lease so long as TENANT continues to perform its
obligations hereunder, and in the event of acquisition of title, or
coming into possession by said mortgagee through foreclosure
proceedings or otherwise, to accept TENANT as TENANT of the Demised
Premises under the terms and conditions hereunder (but only while
owner of the Demised Premises), and to assume and perform all of
LANDLORD'S obligations hereunder. TENANT agrees to recognize such
holder or any other person acquiring title to the Demised Premises
as LANDLORD.
4. TERM AND USE. This lease shall be for a term of
twenty-five (25) years from and including the first day of the
month following completion of the building to be erected by
LANDLORD, as set forth hereinafter, to be presently used for the
purpose of conducting a business for the sale, service and
installation of tires, gasoline, motor vehicle parts, oil, any and
all automobile supplies and tire repairing, retreading, vulcanizing
and for a general automotive service station, for a general retail
and wholesale business, and for such other lawful uses as may be
necessary or incidental thereto, provided the same are permitted by
law or local ordinance; and further provided that any such use
shall not be in violation of the Declaration of Easements, nor
shall the Demised Premises be used for the sale or rental of
pornographic material, including, but not limited to, books, film
or video tape. This clause shall not be construed to prevent
TENANT from exercising its sole discretion in utilizing the Demised
Premises for less than all of the aforementioned uses.
5. RENTAL. The rental to be paid by TENANT during the
first five (5) years of the term of this lease shall be Seven
Thousand, One Hundred, Sixty-Six and 66/100 Dollars ($7,166.66) per
month, subject to adjustment as hereinafter provided in this
section and Section 7 hereof, payable in advance on the first day
of each month of said term, without offset or deduction except as
may otherwise be provided for herein, to LANDLORD at the address
specified herein, or to such other party or at such other place as
LANDLORD may from time to time in writing designate. Such rental
shall be increased by ten percent (10%) at the beginning of each
subsequent five (5) year period during the term of this lease or
any renewal or extension hereof whereby the rental for the
immediately preceding five (5) year period shall be so increased.
No change in ownership of the Demised Premises, or assignment of
this lease, or of the rental provided for herein, shall be binding
upon TENANT for any purpose until after TENANT has been furnished
with evidence, including photostat or certified copy of deed or
assignment, showing change in ownership or assignment. No rental
shall accrue or become due until after fifteen (15) days from the
date said premises are first placed by LANDLORD in a broom clean,
tenantable condition, ready for delivery as required by this lease
or any supplementary building or alterations agreement, if any, or
the date Demised Premises shall be first opened to the public by
TENANT for business, whichever date is earlier.
TENANT shall have the right to install its
merchandise, goods, fixtures and equipment during the completion of
any construction work and said time period as provided above. The
Rental Commencement Date of this lease shall be the first day of
the month following the date rental starts to accrue in accordance
with the above terms and conditions; however, TENANT shall pay
LANDLORD prorata rental based upon the above monthly rental, from
such date that rental starts to accrue, for the remainder of the
preceding month.
The terms "rent" or "rental" as used herein shall
include minimum rent, contingent rent, and any other payments
required to be made by TENANT hereunder.
6. CONTINGENT RENTAL. In addition to the monthly
rental payments hereinabove provided for, TENANT agrees to pay to
LANDLORD that sum by which three percent (3%) of annual net retail
sales exceeds $1,500,000 ("base sales figure"). This base sales
figure shall be increased by fifteen percent (15%) each time rental
is increased under Section 5 hereof.
If the amount of the above deductions in any lease
year exceeds the amount of the aforesaid percentages of net sales
payable that year, then such excess shall be carried forward and
applied to reduce the amount of contingent rental payable in the
next succeeding lease year.
The term "net retail sales" as used in this lease
shall include all retail sales and service for cash or credit
rendered to the public by the store operating on Demised Premises,
but not including "net wholesale sales" and "net commercial sales"
as hereinafter defined.
The term "net commercial sales" as used in this
lease shall include all sales and service for cash or credit
rendered to fleet operators or any business firm operating cars and
trucks for commercial purposes by the store operating on Demised
Premises.
The term "net wholesale sales" shall include all
wholesale sales and service to dealers for cash or credit rendered
by the store operating on Demised Premises, subject to earned bonus
and other quantity discounts which may be credited to dealers.
There shall be deducted from all retail sales the
following: price credits, discounts incurred on credit
transactions, and merchandise adjustments, including goods sold on
approval and later returned or repossessed, interest income,
license or occupational tax, excise tax and any tax based upon or
measured by said sales or receipts from sales made by TENANT which
is added to or made apart of the purchase price, whether included
in billing price or stated separately. Sales and service to
mileage accounts, national commercial accounts including purchase-
resale deliveries and direct-billed commercial accounts not billed
on store books, federal, commonwealth, state, county or city
governments, or any other governmental body or agencies thereof,
and to other stores of TENANT made only for the convenient
operation of TENANT'S business and not to consummate a sale made
in, at, or from the Demised Premises, shall not be included in net
retail sales.
TENANT shall, not later than two (2) months after
each lease year, furnish LANDLORD with a statement certified by an
authorized employee of TENANT'S accounting department located at
its home office in Akron, Ohio of the business conducted during the
next preceding lease year by the store operating on Demised
Premises. With said statement TENANT shall forward payment of said
additional rent (if any) for said next preceding lease year
computed as above provided. TENANT further agrees that it will at
all times during the term of this lease keep accurate and correct
books showing the business conducted upon Demised Premises and said
books shall be open and available for examination by LANDLORD at
TENANT'S nearest accounting office at reasonable times and
intervals. If any audit or examination made by LANDLORD discloses
that net retail sales for any lease year, or part thereof, have
been understated by more than three percent (3%), TENANT shall pay
for the reasonable cost of the audit or examination and the
deficient amount. The acceptance of rent by LANDLORD shall be
without prejudice to LANDLORD'S right to examine or audit TENANT'S
books and records. TENANT shall keep complete records of all sales
in each lease year for a period of three (3) years thereafter.
It is understood and agreed by LANDLORD that TENANT
has made no representation of any kind as to any annual or monthly
volume or type of retail sales which TENANT may or shall make in
any lease year during the term of this lease. LANDLORD agrees not
to divulge to any person or persons, firm or corporation the amount
of net retail sales made by TENANT in Demised Premises except to
prospective mortgagees, purchasers or when required by law.
With respect to the phrase "lease year" as used
hereinabove, the first lease year is hereby defined to mean the
twelve (12) full calendar months, plus the partial month, if any,
immediately following the commencement of the term hereof, and
thereafter "lease year" is hereby defined to mean each twelve (12)
calendar month period following the expiration of the first lease
year of the term hereof.
For any period of TENANT'S occupancy which is less
than a full lease year, TENANT shall pay as contingent rental an
amount equal to the amount by which the aforesaid percentages of
net sales during such period exceed the rental payable with respect
to such period; such payment shall be made within sixty (60) days
after the end of such period.
7. PERMITS AND BUILDING. TENANT shall have the right
to terminate this lease if, within one hundred and eighty (180)
days after execution of this lease by both parties, LANDLORD shall
have failed to procure any and all permits, zoning variances and
changes, licenses, and easements as may be necessary for or
reasonably required by TENANT to operate a general automobile
service center pursuant to the uses set forth in Section 4 hereof,
for ingress and egress, and those necessary for the building
construction and site improvements, as provided in this lease.
Said permits, zoning variances and changes, shall include approval
as may be necessary or reasonably required by TENANT for the use of
the Demised Premises in parking of cars, construction of subject
building and site improvements, erection and installation of signs
as permitted by local ordinance, without need for a special
exception or variance with regard to signs, the storage of gasoline
and oil with tanks, pumps and other handling equipment,
modification of setback lines and removal, relocation or adding of
poles, hydrants, trees, catch basins, curb openings and entrances.
LANDLORD shall expeditiously exert its best efforts to obtain said
permits.
LANDLORD shall, as soon as reasonably possible,
erect on the Demised Premises a sales and service building in
accordance with TENANT'S Plan No. , prints of which are
attached hereto and marked Exhibit "F" . TENANT has furnished to
LANDLORD copies of plans and specifications which are referred to
on the above mentioned Exhibit "F" and they are incorporated herein
to the same effect as if they were attached hereto for the purposes
stated on said Exhibit "F". It is understood that said Exhibit
"F", and plans and specifications referred to thereon, shows the
basic requirements of TENANT and that the building shall be
constructed complete and ready for TENANT'S occupancy in all
respects and in accordance with good construction practices, and
that good materials, workmanship, and design shall be used, and
that the building shall be in accordance with all applicable rules,
regulations, codes, and zoning ordinances having jurisdiction.
LANDLORD shall obtain all permits and changes of zoning as may be
required to permit the construction of all improvements, including
signs, except as is otherwise provided above, driveways, and curb
openings, as stipulated on said plans, and zoning permits necessary
to permit the operation by TENANT of the business stated in Section
4 of this lease. LANDLORD shall not be required to obtain or
defray the cost of sign permits or any general licenses, for the
conduct of TENANT'S type of business. LANDLORD shall prepare at
LANDLORD'S expense, detailed plans and specifications in compliance
with the above requirements and shall submit them to TENANT for
TENANT'S approval, which shall not be unreasonably withheld,
delayed or denied, and when such approval has been obtained
LANDLORD shall proceed with the construction and complete it as
soon as reasonably possible. LANDLORD agrees to comply with
TENANT'S reasonable suggestions regarding same.
LANDLORD shall submit to TENANT for TENANT'S
approval elevation or perspective drawings showing the proposed
architectural treatment as proposed by LANDLORD'S architect before
the detailed plans are prepared, and LANDLORD agrees, within
reason, to conform to TENANT'S suggestions, provided the same are
permitted by and are in compliance with any governmental rules,
regulations or ordinances.
LANDLORD shall submit to TENANT for TENANT'S
approval, which shall not be unreasonably withheld, delayed or
denied, at the time the preparation of the detailed plans
commences, a drawing showing the proposed floor and concourse
elevations and contour lines, and agrees to conform to TENANT'S
reasonable suggestions, provided the same are permitted by and are
in compliance with any governmental rules, regulations or
ordinances, so that the grades of the floors and concourse will be
the most suitable for TENANT'S use. This grade and contour plan
shall also show the grades and contours of the adjoining driveways
and parking lot.
TENANT agrees to notify LANDLORD within twenty (20)
days from receipt thereof whether or not said elevation drawing,
contour plan, and the detailed plans and specifications are
consistent with the above mentioned requirements. In the event of
the failure of such notice LANDLORD shall notify TENANT that such
notice has not been received, and that LANDLORD intends to proceed
on the basis that such plans and specifications are consistent.
As soon as possible after detailed plans and
specifications are completed, LANDLORD with TENANT'S assistance
shall obtain quotations from contractors selected by LANDLORD and
TENANT for the construction of the building in accordance with
those plans and specifications. TENANT may then approve one of the
bids, or may cooperate with LANDLORD in negotiating with one or
more of the building contractors to reduce the cost. If it is
TENANT'S reasonable opinion that such bids are excessive, TENANT
shall have the right to obtain bids from other contractors and/or
TENANT may modify or change the plans and specifications for the
purpose of reducing the cost. This may be done one or more times
until TENANT is satisfied with the resulting cost but shall not be
permitted beyond ninety (90) days from the date that TENANT first
receives bids from other contractors, which date TENANT shall
certify to LANDLORD in writing. If the lowest total building cost
which TENANT is able to negotiate in accordance with the above
procedure, on plans and specifications reasonably acceptable to
TENANT, exceeds $430,000.00, TENANT shall pay to LANDLORD
additional rental equal to thirteen percent (13%) of the total
building cost in excess of $430,000.00, not to exceed $1,000.00 per
year additional rental. Notwithstanding the foregoing, however, if
the total building cost is less than $430,000.00, TENANT'S rental
shall be reduced by thirteen percent (13%) of the difference
between $430,000.00 and the total building cost. If TENANT elects
to use a pre-engineered type of building construction, TENANT may
negotiate building quotations with suppliers of that type of
building construction and submit them to LANDLORD, within the time
period set forth above, for approval which shall not be
unreasonably withheld, delayed or denied, provided the same are
permitted by and are in compliance with any governmental rules,
regulations or ordinances.
When the total building cost has been established
and approved by TENANT in accordance with plans and specifications
approved by TENANT, and all approvals, permits, etc., as referred
to hereinabove have been obtained, LANDLORD shall promptly contract
for the building construction in accordance with such approved
plans and specifications and approved bid and cost. TENANT shall
assist LANDLORD in preparing the building contract and shall
approve the contract before the fully signed copies are delivered
to the contractor, which approval shall not be unreasonably
withheld, denied or delayed. LANDLORD shall notify TENANT when
construction on the site has commenced and LANDLORD shall give
TENANT periodic progress reports as to the status of construction.
LANDLORD shall diligently follow the construction work in order to
carry it through to completion as quickly as reasonably possible,
and in this connection due regard shall be given to delays caused
by strikes, riots, and other circumstances beyond the control of
either party and/or the contractor. TENANT may inspect the work
from time to time during construction and on its completion to see
that it is carried out in accordance with the approved plans and
specifications and the contract. After the letting of the building
contract, no changes shall be made to the approved plans,
specifications and building contract without TENANT'S approval in
writing, which shall not be unreasonably withheld, denied or
delayed. If TENANT notifies LANDLORD that the plans and
specifications are not being, or have not been, followed by the
contractor, LANDLORD shall see that the necessary changes or
revisions are made so that the completed building conforms to the
approved plans, specifications and contract, except those changes
which have been approved by TENANT in writing.
The "total building cost" as referred to above shall
include the cost of the survey and soil tests, if required, and all
work and installations called for on the detailed plans and
specifications as referred to above. This shall include a building
complete in all respects and in accordance with all applicable
codes and regulations having jurisdiction. If all utilities (gas,
electricity, telephone, sanitary sewer and storm sewer) are not
available to TENANT, LANDLORD shall bring any utility service not
available to TENANT'S lease line and LANDLORD'S cost for such work
shall not be part of the total building cost referred to herein.
The total building cost as referred to herein shall
not include any attorneys' fees of any kind for either party, or
any other fees, cost or charges for services by either party, in
connection with the obtaining of permits, licenses, or franchises,
or in connection with the negotiation or preparation of the lease,
construction contract, or detailed plans and specifications, but
the total building cost shall include the amount of the actual fees
or charges for any of the permits, licenses or franchises, as
prescribed by statute, ordinance, or any other appropriate
regulation, and shall include the cost of all architectural,
engineering, and site development fees and costs actually performed
by someone other than LANDLORD or TENANT, but at their request, and
the costs of improvements or construction work of any kind included
in the erection of the new building or required incidental to the
construction of the building and improvements, except for any
improvements existing as of the date of execution of this lease.
Any expenses incurred by either party to inspect Demised Premises
or work conducted thereon shall not be included as part of the
total building cost.
LANDLORD agrees to use every practicable means to
enforce against contractor or suppliers of materials any reasonable
request of TENANT arising out of their failure to comply with
provisions of the plans, specifications and contract.
TENANT may make such changes during said
construction as TENANT may reasonably desire from the approved
plans and specifications subject to the approval of LANDLORD which
approval shall not be unreasonably withheld, delayed or denied
provided that any such changes in cost shall be reflected in the
total building cost referred to hereinabove.
LANDLORD warrants that Demised Premises will be
ready for delivery not later than one hundred eighty (180) days
from the issuance of a building permit or the execution of this
lease, whichever date shall be later, unless LANDLORD'S failure so
to complete is due to causes beyond the reasonable control of
LANDLORD (such as governmental restrictions, strikes, shortages of
material or labor, etc.) in which event the aforesaid date shall be
adjusted to the extent that such causes have delayed construction.
If LANDLORD shall not have completed construction by the aforesaid
date, adjusted as hereinabove provided, TENANT shall have the right
to cancel this lease at any time thereafter by giving sixty (60)
days advance written notice of such cancellation to LANDLORD, at
the end of which period this lease shall become null and void,
unless LANDLORD completes construction within said sixty (60) day
notice period, at which time said notice of cancellation shall be
null and void and of no effect. Such right of cancellation shall
be the sole and exclusive remedy available to TENANT in the event
of LANDLORD'S failure so to complete construction within the time
specified.
8. TITLE. LANDLORD shall furnish TENANT, at LANDLORD'S
expense, when requested by TENANT, a title insurance report, or
LANDLORD'S attorney's opinion reasonably suitable to TENANT,
extended to show LANDLORD has good and marketable title to Demised
Premises and LANDLORD'S tract as of the date of execution of this
lease, free of all encumbrances except this lease, and for current
taxes and installments of any assessments, and except for any
encumbrances which are referred to in Section 3 of this lease. If
there are any mortgages or trust deeds on Demised Premises , said
title report or attorney's opinion shall show the original amount
of the mortgage or trust deed as well as the amount now due. If
such title is not good and marketable in LANDLORD, LANDLORD shall,
within sixty (60) days, or such additional time as is reasonably
required to correct any such defects, provided LANDLORD shall
commence the curing of the same promptly and diligently proceeds to
cure the same, correct the defects which TENANT in writing
specifies.
9. UTILITIES. TENANT shall pay the rent or charge
imposed for water, sewerage, electric current, and gas used or
consumed by it on Demised Premises during the term of TENANT'S
occupancy. Any water charge in connection with sprinkler system
(if any) shall be paid by LANDLORD.
10. CONDITION OF PREMISES. LANDLORD shall deliver
Demised Premises to TENANT in good condition and warrants that the
electrical, plumbing, heating and air conditioning systems, and
fixtures of such systems (and elevator and sprinkler system, if
any), are adequate and in good order and condition, in compliance
with all applicable governmental codes, statutes, regulations or
ordinances governing such systems, and that the heating facilities
are of sufficient capacity to maintain a temperature of 70 degrees
Fahrenheit in the offices and merchandise display rooms, 65 degrees
Fahrenheit in the service rooms and 50 degrees Fahrenheit in the
storage rooms, under the extreme winter weather, and that air
conditioning facilities in offices and merchandise display rooms
are adequate in accordance with good design practice. If Demised
Premises are leased primarily for warehouse purposes, LANDLORD
warrants that all floors are structurally adequate to sustain a
load of 150 pounds of merchandise per square foot. TENANTS taking
possession of the Demised Premises shall be conclusive evidence of
TENANT'S acceptance thereof in good order and satisfactory
condition, with the exception of latent defects and except for
certain punch list items which will be remedied within thirty (30)
days from the date that LANDLORD is given a written punch list by
TENANT.
11. TAXES AND OBLIGATIONS. LANDLORD shall pay all taxes,
assessments (whether general or special) and any other obligations
which are or may become a lien on or levied against the Demised
Premises and improvements as they may become due and payable during
the term of TENANT'S occupancy thereof, and make all payments
required to be made under the terms of any mortgage or deed of
trust wherein LANDLORD is the mortgagor or obligor which may at any
time be a lien on the premises. TENANT shall pay all taxes and
assessments on its merchandise, trade fixtures and equipment. The
terms "taxes" and "assessments" shall mean and include all real
estate taxes, public and governmental charges and assessments,
including all extraordinary or special assessments, costs and fees
incurred by LANDLORD in contesting or negotiating with public
authorities as to any of the same, and all sewer and other taxes
and charges.
During the term of this lease or any renewal
thereof, upon receipt of written notice from LANDLORD together with
paid tax bills or photostatic copies thereof, TENANT agrees to
reimburse LANDLORD for TENANT'S pro rata share (i.e., the ratio
that the Demised Premises is as to the entire tax parcel) of the
taxes and assessments as hereinafter provided commencing in the
first tax year after the commencement of the term of this lease in
which the building to be constructed has been completely assessed
and included on the tax rolls for computation of taxes. Such
payment of taxes and assessments shall be deemed additional rent.
LANDLORD agrees to submit said notice and paid tax
bills within six (6) months after payment of such taxes by
LANDLORD.
TENANT'S payment of any tax or assessment for the
first and last years of TENANT'S occupancy shall be apportioned or
prorated so that TENANT pays the taxes or assessments only for the
period of time that the Demised Premises are occupied or in
possession of TENANT during that tax year.
It is understood that TENANT'S liability for payment
of taxes and assessments will be computed on and limited to the net
amount due after discount, and LANDLORD will be expected to take
advantage of any discounts, but failure of LANDLORD to obtain
discount will not affect TENANT'S liability for net payment.
TENANT shall not be obligated to pay any income or
profit taxes or inheritance or estate or transfer taxes, or any
personal or corporation taxes, or franchise or license taxes,
levied, assessed against, or payable by LANDLORD, even though the
same may be liens against or collectible as against Demised
Premises, or any taxes except such as are directly levied or
imposed against the Demised Premises, and provided further that
TENANT may contest any such tax and have the same reviewed,
reduced, equalized or abated as hereinafter provided.
Provided TENANT is not in default of any of the
terms, covenants or conditions of this lease, TENANT shall have the
right, at its own cost and expense and in its own name, or in the
name of LANDLORD, to protest or contest, or to seek to have
reviewed, reduced, equalized or abated any tax by legal proceedings
or in such manner as it deems advisable. LANDLORD agrees to join
with TENANT and to execute any and all documents, applications,
petitions, instruments or complaints necessary for any such
contest, review or other proceedings desired by TENANT, provided,
however, such contest, review or proceeding shall be carried on by
TENANT, at its sole cost and expense, and upon the final
determination of any such contest, review or proceeding, TENANT
shall pay the taxes as are so finally determined, and all penalties
and/or costs which may thereupon be due. TENANT is furthermore
permitted to institute, carry on and complete any such contest,
review or proceedings hereinabove mentioned, and to sign the name
of LANDLORD to any documents, papers, applications, petitions,
instruments or complaints in connection therewith, provided TENANT
promptly provides LANDLORD with true and complete copies of any
such documents, etc. TENANT agrees to indemnify and hold LANDLORD
harmless from and against any claim, obligation, liability or
costs, including reasonable attorneys fees, which LANDLORD may
incur as a result of any such protest or contest. The legal
proceedings herein referred to may include, among other things,
applications to any governmental authority, proceedings before any
Board of Equalization, suits and actions, and appeals from any such
applications, proceedings, suits or actions, but all such
proceedings shall be begun as soon as possible after the imposition
of any contested tax and shall be prosecuted to final adjudication
with all promptness and dispatch.
LANDLORD hereby agrees to pay all other taxes,
assessments and obligations assessed against it and/or against its
successors or assigns, such as mortgages, income tax, estate tax,
special assessments for improvements or any other tax or
imposition, Federal or State, as they become due and payable during
the term of TENANT'S occupancy thereof, so as to keep the Demised
Premises free and released therefrom. If LANDLORD should fail to
make such payment herein agreed to be paid by it by the terms of
this lease, except, however, the taxes which become a direct levy
against the Demised Premises and which TENANT has hereinabove
agreed to pay, then in the event of a foreclosure of any such lien
and sale of said Demised Premises thereunder caused by the default
of LANDLORD, TENANT shall have the right to bid for said premises
and improvements for its own account, subject to redemption
according to law, at any sheriff's, judicial, or foreclosure sale.
If LANDLORD cannot arrange for the Demised Premises
to be assessed and billed separately for real estate taxes, then
TENANT shall reimburse LANDLORD for TENANT'S proportionate share of
real estate taxes on the entire tax parcel computed on the
hereinafter formula. TENANT'S share of real estate taxes shall
apply separately to taxes on the assessed value of the buildings of
the tax parcel and to taxes on the land comprising the tax parcel
only if the taxing bodies change the current method of tax
assessment to apply a separate assessment for buildings and land.
TENANT'S reimbursement to LANDLORD for payment of real estate taxes
shall be its proportionate share of the real estate taxes on all of
the buildings of the tax parcel computed on the ratio which the
total rentable floor area of the building on Demised Premises bears
to the total rentable floor area of all the buildings of the tax
parcel existing when buildings were assessed prior to the first
lease year. Any increase in building assessment after the first
lease year due to future buildings, alterations or additions shall
be entirely excluded before computing TENANT'S share of real estate
taxes. Any increase in real estate taxes on buildings prior to the
first lease year due to future building additions or alterations on
Demised Premises by TENANT shall be paid entirely by TENANT.
TENANT'S reimbursement to LANDLORD for real estate
taxes on the land of the Demised Premises shall be its
proportionate share of the real estate taxes on all of the land of
the tax parcel computed on the ratio which the area of the land of
Demised Premises bears to the total area of the land in the tax
parcel.
Notwithstanding anything to the contrary contained
in this lease relating to the payment of real property taxes,
charges and assessments, LANDLORD and TENANT each agree that in the
event the Demised Premises are re-assessed for real property tax
purposes because of transfer of ownership during the initial or any
extended term of this lease, TENANT shall not be responsible for
payment of any increase in real property taxes, charges and
assessments attributable to such re-assessment which increase shall
be the sole responsibility of LANDLORD.
In the event of any dispute hereunder, TENANT shall
pay the amount due in accordance with the applicable bill or
statement, and such payment shall be without prejudice to TENANT'S
position. If the dispute shall be determined in TENANT'S favor, by
agreement or otherwise, LANDLORD shall pay to TENANT, within thirty
(30) days following such determination, the amount of TENANT'S
overpayment resulting from compliance with such bill or statement.
Any such bill or statement shall be deemed binding and conclusive
if TENANT fails to object thereto within sixty (60) days after
receipt thereof.
TENANT shall pay, before delinquent, any and all
taxes, licenses, fees, and public charges levied, assessed, or
imposed and which become payable during the lease term upon
TENANT'S fixtures, furniture, appliances and personal property
located or installed in the Demised Premises.
12. INSURANCE AND DAMAGE. In case the building and
improvements on the Demised Premises shall be destroyed, in whole
or in part, by any of the perils covered under the fire and
extended coverage insurance on the usual standards form of
insurance policy in use in the state within which the Demised
Premises are situated, TENANT agrees to repair such damage and
restore the building and improvements to their status prior to such
damage; however, the herein Alterations Clause, Section 16, shall
prevail in the event of any repair or restorations performed under
this clause. If requested by LANDLORD, or by any mortgagee of a
mortgage on the Demised Premises, TENANT shall furnish to LANDLORD
or to that mortgagee a letter certifying that TENANT has provided
for this coverage in TENANT'S insurance system and that such
coverage in TENANT'S insurance system shall be subject to the
provisions hereof, or, if TENANT has elected to carry outside
insurance, TENANT shall furnish a certificate of such insurance.
If the building and improvements on the Demised
Premises should be damaged by the causes stated above to an extent
of fifty percent (50%) or more of their then value during the last
seven (7) years of the original twenty-five (25) year lease term or
during any of the five (5) year renewal options, TENANT may, if it
elects, instead of restoring the building and improvements to their
status prior to such damage, cancel this lease and promptly pay to
LANDLORD the same sum, in cash, which LANDLORD would have received
from an insurance company if LANDLORD had been carrying with that
insurance company standard fire and extended coverage insurance in
the state of the Demised Premises to the extent of the full
insurable value of the buildings and improvements. In any case in
which the Demised Premises are damaged and TENANT retains
possession, rents from the time of commencement of the damage to
the time of completion of repairs and restoration shall be reduced
pro rata to the extent that Demised Premises have been
untenantable; however, this is on condition that TENANT shall make
such repairs and restorations as quickly as reasonably possible.
In further consideration of the rental payments to
be made by TENANT, and except for the obligations of TENANT as set
forth in this section, LANDLORD covenants that TENANT, and any
subtenant or assignee, shall not be liable for damage to or
destruction of LANDLORD'S property by any casualty from any cause
whatsoever, except for the negligence of TENANT, its agents or
employees, or any subtenant or assignee. TENANT covenants that
except for the negligence of LANDLORD or his agents or employees,
LANDLORD shall not be liable for damage to or destruction of
TENANT'S property by any fire or other casualty from any cause
whatsoever.
TENANT shall not do, suffer to be done, or keep, or
suffer to be kept anything in, upon or about the Demised Premises
which will contravene LANDLORD'S policies insuring against loss or
damage by fire or other hazards, including, but not limited to,
public liability or which will prevent LANDLORD from procuring such
policies in companies acceptable to LANDLORD.
13. SIGNS. TENANT, at TENANT'S sole expense, may erect
such signs on or about the Demised Premises or the improvements
thereon provided the same are permitted and are in compliance with
any governmental rules, regulations or ordinances.
14. ORDINANCES. LANDLORD shall at LANDLORD'S expense
take such action as may be necessary or appropriate to cause the
Demised Premises and the common areas, upon the execution of this
lease and during the entire term and extensions and renewals
hereof, to comply with all federal, state, county and city laws and
ordinances and all rules, regulations and orders of all duly
constituted authority, present or future. TENANT shall, at its sole
expense, comply with all laws, ordinances, rules, regulations and
orders of all duly constituted authorities, present or future,
which affect the carrying on of the business being conducted in the
Demised Premises, as distinguished from the physical facilities in
which such business is being conducted, and which do not require
the making of any alterations to the Demised Premises.
15. SUBLETTING, ASSIGNING. Provided TENANT is not in
default of the terms, covenants and conditions of this lease,
TENANT may: (a) assign this lease and/or sublet the Demised
Premises, or any part thereof, after first, in each instance,
obtaining the prior written permission of LANDLORD, which shall not
be unreasonably withheld, delayed, or denied; (b) without
LANDLORD'S permission, assign this lease and/or sublet the Demised
Premises, or any part thereof, to an authorized Firestone dealer,
or an affiliated subsidiary, or reorganized corporation of TENANT,
provided that under this Paragraph 15(b) such assignee or sublessee
continues to use the Demised Premises in strict conformance with
the requirements of Section 4 herein. No assignment or subletting
shall relieve TENANT of the obligations imposed upon it by the
terms of this lease. In the event that TENANT is unable to assign
or sublet the Demised Premises within twelve (12) months of its
desire to do so, LANDLORD'S only remedy shall be the right, but not
the obligation, to terminate this lease and recapture the Demised
Premises by sixty (60) days written notice to TENANT.
16. ALTERATIONS. TENANT may from time to time make, at
its expense, nonstructural alterations or additions, to the then
existing improvements or any parts thereof as may be, in TENANT'S
opinion, reasonably necessary or desirable for the conduct,
improvement or expansion of TENANT'S business, provided the
alterations do not diminish the value of the then existing
improvements. Relocation or removal of partitions shall not be
deemed to affect such value.
All alterations, improvements and additions made by
TENANT as aforesaid, except for TENANT'S trade and business
fixtures and subject to Section 23 hereof, shall remain upon the
Demised Premises at the expiration or earlier termination of this
lease and shall become the property of LANDLORD unless LANDLORD
shall, prior to or after the termination of this lease, have given
written notice to TENANT to remove same, in which event TENANT
shall remove such alterations, improvements and additions and
restore the Demised Premises to the same good order and condition
in which it was at the commencement of this lease, reasonable wear
and tear excepted. Should TENANT fail to do so, with sixty (60)
days following LANDLORD'S notice, LANDLORD may do so collecting at
LANDLORD'S option the cost and expense thereof from TENANT as
additional rent. All of such alterations, improvements or
additions shall be made solely at the expense of TENANT; and TENANT
agrees to protect, indemnify and save harmless LANDLORD on account
of any injury to third persons or property by reason of any such
changes, additions or alterations, and to protect, indemnify and
save harmless LANDLORD from the payment of any claim of any kind or
character on account of bills for labor or materials furnished or
claimed to have been furnished in connection therewith. TENANT
agrees to procure all necessary permits before undertaking such
work and to do such work in a good and workmanlike manner,
employing materials of first quality and complying with all
applicable governmental requirements.
17. DEFAULT.
A. Failure to Pay Rent or Perform Other
Obligations. This lease and the term and estate hereby granted
are subject to the further limitation that:
(i) Whenever TENANT shall default in the
payment of any installment of minimum rent or contingent rent, on
any day upon which the same shall be due and payable, and such
default shall continue and shall not be remedied by TENANT within
ten (10) days after LANDLORD shall have given to TENANT written
notice specifying such default, or
(ii) Whenever TENANT shall default in the
payment of any installment of taxes, TENANT'S proportionate share
of common area and other charges, or any other charge or payment
due or payable by TENANT under this lease for any reason
whatsoever, on any day upon which the same shall be due and payable
under the terms of this lease and such default shall continue and
shall not be remedied by TENANT within ten (10) days after LANDLORD
shall have given to TENANT written notice specifying such default,
or
(iii) Whenever TENANT shall default in the
performance of any other obligation, covenant or agreement by it to
be performed or observed under this lease, and such default shall
continue and shall not be remedied by TENANT within thirty (30)
days after LANDLORD shall have given to TENANT a written notice
specifying the same, or, in the case of a happening or default
which cannot with due diligence be cured within a period of thirty
(30) days and the continuance of which for the period required for
cure will not subject LANDLORD to the risk of criminal liability or
termination of any superior lease or foreclosure of any superior
mortgage, if TENANT shall not duly institute within such thirty
(30) day period and promptly and diligently prosecute to completion
all steps necessary to remedy the same, or
(iv) If TENANT shall fail for any reason to
assume occupancy of the Demised Premises pursuant to the provisions
of this lease (provided that all of the conditions therein set
forth shall have occurred), and such failure continues for sixty
(60) days after notice from LANDLORD or
Then at any time after the occurrence of any one or
more of such events LANDLORD may give to TENANT a written notice of
intention to end the term of this lease at the expiration of ten
(10) days and this lease and the term and estate hereby granted,
whether or not the term shall theretofore have commenced, shall
terminate, unless any such defaults are cured within said ten (10)
day period, with the same effect as if that day were the expiration
date, but TENANT shall remain liable for damages as herein
provided.
17.B. Insolvency, etc. This lease and the term
and estate hereby granted are subject, inter alia, to the
limitation that whenever TENANT under this lease shall make an
assignment for the benefit of creditors; or shall file a voluntary
petition under any bankruptcy or insolvency law; or an involuntary
petition alleging an act of bankruptcy or insolvency is filed
against TENANT; or whenever a petition shall be filed by or against
TENANT seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any
present or any future state or federal bankruptcy act or any other
present or future applicable federal, state or other statute or
law; or whenever TENANT shall seek or consent to or acquiesce in
the appointment of any trustee, receiver or liquidator of TENANT or
of all or any substantial part of its properties; or whenever a
permanent or temporary receiver of TENANT or of or for the property
of TENANT shall be appointed; or whenever TENANT shall plead
bankruptcy or insolvency as a defense in any action or proceeding;
or an order, judgment or decree shall be entered by any court of
competent jurisdiction on the application of a creditor
adjudicating the TENANT a bankrupt or insolvent, or approving a
petition seeking reorganization of the TENANT, or appointment of a
receiver, trustee or liquidator of the TENANT or of all or
substantially all of any of TENANT'S assets; or any department of
the state or the federal government, or any officer thereof, duly
authorized, shall take possession of the business or property of
the TENANT by reason of insolvency or alleged insolvency of the
TENANT; or whenever the TENANT shall permit or otherwise suffer
this lease to be taken under any writ of execution; or if this
lease shall pass to or devolve upon, by law or otherwise, to one
other than TENANT, except as may be otherwise provided for in
Section 15 herein, then and in any one or more of such events, the
LANDLORD (a) at any time after receipt of notice of the occurrence
of any such event, or (b) if such event occurs without the
acquiescence of TENANT, at any time after the event continues for
ninety (90) days, may give TENANT a notice of intention to end the
term of this lease at the expiration of ten (10) days from said
notice, and this lease and the term and estate hereby granted,
whether or not the term shall theretofore have commenced, shall
terminate with the same effect as if that day were the expiration
date, but TENANT shall remain liable for damages as hereinelsewhere
provided.
17.C. Right to Relet: Damages for Breach. Should
LANDLORD take possession pursuant to legal proceedings or pursuant
to any notice provided for by law, it may either terminate this
lease or it may from time to time without terminating this lease
make such alterations and repairs as may be necessary in order to
relet the Demised Premises and relet said premises or any part
hereof for such term or terms (which may be for a term extending
beyond the term of this lease but TENANT's exposure or liability
hereunder shall not hereby be expanded) and at such fair market
rental or rentals and upon such other terms and conditions as
LANDLORD in its sole discretion may deem advisable; upon each such
reletting all rentals received by the LANDLORD from such reletting
shall be applied, first, to the payment of any indebtedness other
than rent due hereunder from TENANT to LANDLORD; second, to the
payment of any costs and expenses of such reletting, including
brokerage fees payable by LANDLORD to its agent under both this
lease and the reletting, and reasonable attorneys' fees and of
costs of such alterations and repairs; third, to the payment of
rent due and unpaid hereunder and the residue, if any, shall be
held by LANDLORD and applied in payment of future rent as the same
may become due and payable thereunder. If such rentals received
from such reletting during any month be less than that to be paid
during that month by TENANT hereunder, TENANT shall pay any such
deficiency to LANDLORD. Such deficiency shall be calculated and
paid monthly. No such re-entry or taking possession of said
Demised Premises by LANDLORD shall be construed as an election on
its part to terminate this lease unless a written notice of such
intention be given to TENANT or unless the termination thereof be
decreed by a court of competent jurisdiction. Notwithstanding any
such reletting without termination, LANDLORD may at any time
thereafter elect to terminate this lease for such previous breach.
17.D. Damages Upon Termination. Should LANDLORD at
any time terminate this lease for any breach hereof, then, in
addition to any other remedies it may have, LANDLORD may recover
from TENANT all damages it may incur by reason of such breach,
including the cost of recovering the Demised Premises, reasonable
attorneys' fees and the amount of rent and charges equivalent to
rent reserved in this lease for the remainder of the stated term,
all of which amounts shall be immediately due and payable from
TENANT to LANDLORD, and LANDLORD shall thereafter pay to TENANT, at
such time or times as LANDLORD shall be in receipt of the same, the
rent for the Demised Premises for the remainder of the stated term
collected from tenants thereafter using the Demised Premises, up to
the amount of the rent reserved which has theretofore been
collected from TENANT, less costs of reletting, including brokerage
commissions, reasonable attorneys's fees, costs incurred in making
necessary repairs, replacements or decorations in the Demised
Premises, advertising expenses and all other costs and expenses
incidental or consequent to such reletting. In determining the
rent payable by TENANT hereunder subsequent to default, the fixed
minimum annual rent for each year of the unexpired portion of the
lease term shall equal the average fixed minimum rent plus the
average contingent rent which TENANT was obligated to pay (i) from
the commencement of the lease term to the time of default, or (ii)
during the three (3) lease years last preceding such default
whichever period is shorter. It is hereby further understood that
any such reletting may be for a period shorter or longer than the
remaining term of this lease, but in no event shall TENANT be
entitled to receive any excess of such net rents over the sums
payable by TENANT to LANDLORD hereunder, nor shall TENANT be
entitled to credit in respect of any net rents from such a
reletting (except to the extent that such net rents are actually
received by LANDLORD).
17.E. Waiver of Jury Trial. The parties hereto shall
and they hereby do waive trial by jury in any action, proceeding or
counterclaim brought by either of the parties hereto against the
other on any matters whatsoever arising out of or in any way
connected with this lease, the relationship of LANDLORD and
TENANT, TENANT's use and occupancy of the Demised Premises and/or
any claim of injury or damage.
17.F. Recovery of Legal Expenses. In case suit shall
be brought for recovery of possession of the Demised Premises, for
the recovery of rent or any other amount due under the provisions
of this lease, or because of the breach of any other covenant
herein contained on the part of LANDLORD or TENANT to be kept or
performed, and a breach shall be established, the party prevailing
shall be entitled to all expenses incurred therefor, including all
court costs and reasonable attorneys' fees.
17.G. No Counterclaim. In the event LANDLORD
commences any summary proceeding or other action for non-payment of
minimum rent, percentage or contingent rent or any sum payable as
rent, TENANT covenants and agrees that it will not interpose any
counterclaim of whatsoever nature or description in any such
proceeding. This shall not, however, be construed as a waiver of
the TENANT'S right to assert such claims in any separate action or
actions brought by TENANT. TENANT further waives any right of
defense which it may have to claim a merger and neither the
commencement of any action or proceeding nor the settlement
thereof, or the entering of judgment therein, shall bar LANDLORD
from bringing subsequent actions or proceedings from time to time.
17.H. Accord and Satisfaction. No payment by TENANT
or receipt by LANDLORD of a lesser amount than the monthly rent
herein stipulated shall be deemed to be other than on account of
the earliest stipulated rent, nor shall any endorsement or
statement on any check or any letter accompanying any check or
payment as rent be deemed an accord and satisfaction and LANDLORD
shall accept such check or payment without prejudice to LANDLORD'S
right to recover the balance of such rent or pursue any other
remedy in this lease provided.
17.I. Landlord's Default. The LANDLORD covenants
with the TENANT that if LANDLORD shall violate or neglect any
covenant, agreement, or stipulation herein contained on its part to
be kept, performed or observed, and any such default shall continue
for thirty (30) days after written notice thereof is given by
TENANT to LANDLORD, then and in addition to the remedy of specific
performance and other remedies and causes of action now or
hereafter provided by law or in equity, TENANT may, at its option,
remedy the condition or need referred to in such notice, or make
the payment which LANDLORD has not made, but should have made, and
LANDLORD shall reimburse TENANT for such reasonable cost or expense
upon demand.
18. WAIVER. Failure of either party to insist upon
strict performance of any covenant or condition of this lease in
any one or more instances shall not be construed as a waiver for
the future of any such covenant or condition, but the same shall be
and remain in full force and effect.
19. INTERFERENCE. Should an adjudication of a competent
court or regulation of any government authority prohibit TENANT
from establishing its business on Demised Premises, or order TENANT
to discontinue, in whole or in part, its business thereon, then
TENANT may terminate this lease, unless such order results from
willful negligence of TENANT in its use of Demised Premises.
20. REPAIRS. LANDLORD may enter the Demised Premises to
inspect same at all reasonable times and intervals, and shall be
responsible for and keep the roof, structure and exterior of the
building on the Demised Premises with its appurtenances in good
condition and repair, provided TENANT has given LANDLORD written
notice of the need for the same. LANDLORD shall be liable for any
loss or damage to TENANT'S property sustained by TENANT resulting
from the failure of LANDLORD to make any of said repairs, provided
LANDLORD has had reasonable time to make such repairs after receipt
of written notice from TENANT. Emergency repairs which shall be
necessary to protect the buildings or contents may be made by
TENANT without notice to LANDLORD, and the cost of such repairs,
not to exceed One Thousand Dollars ($1,000.00) in any one instance,
shall promptly be paid to TENANT by LANDLORD upon LANDLORD'S
receipt of a paid invoice therefor, provided such emergency repairs
are the responsibility of LANDLORD hereunder. TENANT shall be
responsible, at its sole expense, for all other repairs, except
those warranted by LANDLORD or his contractors, including, but not
limited to, all electrical, plumbing, heating, air conditioning,
and other mechanical installations, all doors and all plate glass,
whether or not any of the aforesaid were initially installed or
furnished by LANDLORD.
21. CONDEMNATION. If, during TENANT'S occupancy, any
part of the premises of which the Demised Premises is a part is
condemned for public use under right of eminent domain, and if the
remainder of the Demised Premises, in TENANT'S reasonable opinion,
is not suitable for its purposes, TENANT may, at its option,
terminate this lease, and TENANT shall have no claim against
LANDLORD for the value of the unexpired term of this lease; but if
it shall not elect so to do, LANDLORD shall restore and rebuild the
Demished Premises, to the extent of condemnation proceeds
available, to provide TENANT, as far as possible, all the
improvements and building facilities existing before the taking,
and the fixed minimum monthly rental thereafter to be paid shall be
abated proportionately. In any such proceeding whereby all or a
part of the premises of which the Demised Premises is a part are
taken, whether or not TENANT elects to terminate this lease, each
party shall be free to make claim against the condemning party for
the amount of the actual provable damage done to each of them by
such proceeding. In the event streets, alleys, driveways (public
or private), or sidewalks abutting the premises or areas TENANT has
parking or access rights to are changed in any manner whatsoever by
condemnation or otherwise, by city, state or any public authority,
in such manner as to injure, in TENANT'S reasonable opinion, the
parking and/or ingress and egress of vehicular or pedestrian
traffic to the Demised Premises, and LANDLORD has not taken
immediate steps to remedy the situation, TENANT may cancel this
lease after sixty (60) days advance written notice to LANDLORD.
In the event of any condemnation or taking, whether
whole or partial, TENANT shall not be entitled to any part of the
award, as damages or otherwise, for such condemnation and LANDLORD
or any mortgagee of LANDLORD are to receive the full amount of such
award as their respective interests may appear, the TENANT hereby
expressly waiving any right or claim to which it might become
entitled. However, TENANT shall have the right to the extent that
same shall not diminish the LANDLORD'S or such mortgagee's award to
claim and recover from the condemning authority, but not from
LANDLORD or such mortgagee, such compensation as may be separately
awarded or recoverable by TENANT under the Eminent Domain Code of
Pennsylvania.
22. USE IN COMMON WITH OTHERS AND COMMON AREA CHARGES.
TENANT shall have the non-exclusive right, in common with others
lawfully entitled thereto, to the use of all exits, entrances, and
driveways in the Hechinger Plaza Shopping Center as shown on
Exhibit "C" and on LANDLORD'S tract as shown on Exhibit "B" for
ingress, egress and related accommodation of automobiles and trucks
of TENANT, its officers, agents, employees and customers, and any
other rights granted under that certain "Declaration of Easements
and Related Agreements", dated November, 1984, attached as Exhibit
"D", by and among Norristown Properties, Inc., a Delaware
corporation, Wendy's Old Fashioned Hamburgers of New York, an Ohio
corporation, and Hechinger Company, a District of Columbia
corporation. TENANT is hereby granted the non-exclusive right of
ingress and egress to the extent of LANDLORD'S rights over all
roads, streets, alleys, sidewalks, and ways, whether public or
private, bounding or serving the Demised Premises or the Shopping
Center.
TENANT agrees to pay LANDLORD its pro rata share of
LANDLORD'S annual cost for snow removal from such exits, entrances
and driveways, repair and maintenance of same and for electrical
current for lighting said areas of the LANDLORD'S tract, and
LANDLORD'S operating cost of common facilities and services,
computed on the ratio which the total rentable floor area of
Demised Premises bears to the total rentable floor area of all
buildings on LANDLORD'S tract. TENANT'S pro rata share of
LANDLORD'S common area maintenance cost shall be apportioned or
prorated during the first and last year of TENANT'S occupancy so
the TENANT only pays its pro rata share of LANDLORD'S common area
maintenance cost while TENANT is occupying or in possession of
Demised Premises.
For the purpose of this Section 22, LANDLORD'S
operating cost of common facilities and services ("Common Area
Charges") is defined as including all reasonable costs and expenses
incurred by LANDLORD in operating, managing, equipping, lighting,
repairing, replacing and maintaining said facilities and services,
including, without limitation, landscaping, sanitary control,
cleaning, lighting, snow removal, resurfacing, painting, fire
protection, operation, repair and maintenance of storm water
retention facilities and common area maintenance costs as set forth
in the Declaration of Easements, public liability and property
damage insurance, repairs and policing, including the cost of
personnel to implement such services and maintain such facilities
and administrative and overhead costs equal to fifteen (15%)
percent of all of the foregoing.
LANDLORD agrees that it will keep accurate and
correct books showing the expenditures for which TENANT is
obligated to remburse LANDLORD for its pro rata share, as referred
to above, and said books shall be open and available for
examination by TENANT at reasonable times and intervals. LANDLORD
shall submit accounting and computations of TENANT'S pro rata share
of the above specified expenditures promptly after the end of each
year that is established by LANDLORD for the purpose of this
accounting, and TENANT shall make reimbursement of its pro rata
share within thirty (30) days after receipt of said billing.
23. FIXTURES. Provided TENANT is not in default of the
terms, covenants or conditions of this lease, TENANT may, at the
expiration or sooner termination of this lease, remove all shelving
and fixtures, equipment, or other personal property of TENANT,
improvements or building appurtenances, which it owns, may have
installed or placed at its own expense on Demised Premises or which
it furnished and LANDLORD installed, or otherwise acquired. TENANT
shall promptly repair any damage to Demised Premises caused by such
removal.
24. RENEWAL. Provided TENANT is not in default of the
terms, covenants or conditions of this lease, TENANT shall have the
right to renew or extend the within lease for a period of five (5)
years, following the expiration of the original term hereof, at a
rental to be determined as set forth in Section 5 hereof and under
the same terms and conditions as for the original term as set out
herein. In the event TENANT exercises this option to renew or
extend, written notice thereof shall be given LANDLORD at least
ninety (90) days prior to the commencement of such renewal or
extension period.
25. RENEWAL. Provided TENANT is not in default of the
terms, covenants or conditions of this lease, TENANT shall have the
right to renew or extend the within lease for a period of five (5)
years, following the expiration of the renewed or extended term
provided for in Section 24 hereof, at a rental to be determined as
set forth in Section 5 hereof and under the same terms and
conditions as for the original term as set out herein. In the
event TENANT exercises this option to renew or extend, written
notice thereof shall be given LANDLORD at least ninety (90) days
prior to the commencement of such renewal or extension period.
26. AUTOMATIC RENEWAL. Provided TENANT is not in
default of the terms, covenants or conditions of this lease, if
TENANT fails to notify LANDLORD of any renewal option which TENANT
has the right to exercise hereunder prior to the required time, its
option(s) to renew or extend shall nevertheless remain in full
force and effect for a period of thirty (30) days after receipt of
written notice from LANDLORD subsequent to the required time
setting forth the expiration date of this lease and advising TENANT
that notice of renewal has not been received.
27. FIRST REFUSAL TO LEASE. Provided TENANT is not in
default of the terms, covenants or conditions of this lease,
subject to and not limiting TENANT'S rights to renew or extend as
set forth herein, LANDLORD grants to TENANT an additional right of
first refusal to lease the Demised Premises only upon the same
terms and conditions as contained in any valid, acceptable, bona
fide lease offer LANDLORD or any subsequent LANDLORD may receive
prior to the cancellation or termination of this lease, as
extended. TENANT shall have fifteen (15) days after receipt from
the LANDLORD of written notice of such offer (with certified full
written statement of such offer or certified copy thereof) within
which time to exercise said option and accept any such lease terms.
LANDLORD agrees to promptly notify TENANT of receipt of any such
acceptable offer.
28. HOLDING OVER. If at the expiration or sooner
termination of this lease, TENANT should continue to occupy the
premises without an agreement in writing as to the terms of such
continued possession, then such additional tenancy shall be on a
month-to-month basis at the fixed minimum rental and under the same
terms and conditions as provided in this lease or last renewal
thereof. In case of such continued possession, the month-to-month
tenancy created thereby may be cancelled at the end of any calendar
month by not less than thirty (30) days prior written notice from
either party.
29. COMMENCEMENT DATE OF LEASE. In order to establish
the specific commencement date of this lease, LANDLORD and TENANT
shall enter into a supplemental agreement immediately upon
completion of construction establishing the commencement date of
the primary lease term, as set forth in Section 4 herein, and the
options to renew this lease, as provided hereinabove. It is
understood that none of the terms of this lease shall be changed by
said supplemental agreement and that its sole purpose shall be to
establish the commencement date of the lease term and of the option
terms.
30. NOTICES. Any notice to LANDLORD provided for
herein shall be deemed to have been served only when such notice in
writing addressed to LANDLORD has been deposited in a U.S. Post
Office by registered or certified mail, return receipt requested,
addressed to the place where the rent shall be paid. Any notice to
TENANT as provided for herein shall be deemed to have been served
only when in writing and when delivered by registered or certified
mail to The Firestone Tire & Rubber Company, Real Estate/BK62, P.O.
Box 81073 A.M.F., Cleveland, Ohio 44181, or to such other party or
at such other place as TENANT may from time to time in writing
designate. Any notice to TENANT delivered to any other department,
office, or city shall be of no force and effect. Either party may
change its address by notice to the other in accordance with the
above terms.
31. CAPTIONS. The captions appearing at the beginning
of each of the sections of this lease are for reference only and
are not to be considered a part of this lease.
32. TIME. It is expressly stipulated that time shall be
of the essence of this lease.
33. BINDING ON HEIRS, ETC. This lease shall be binding
upon the heirs, devisees, executors, administrators, successors in
interest, and assigns of the parties hereto.
34. MODIFICATION. This lease constitutes the whole
agreement between the parties. There are no terms, obligations,
covenants or conditions other than contained herein. No
modification or variation thereof shall be deemed valid unless
evidenced by an agreement in writing.
35. EVIDENCE OF LEASE. TENANT agrees not to record the
within lease, but each party hereto agrees, on the request of the
other, to execute an evidence of lease in form recordable and
reasonably satisfactory to LANDLORD'S attorneys. In no event shall
such evidence of lease set forth the rental or other charges
payable by TENANT under this lease; and any such evidence of lease
shall expressly state that it is executed pursuant to the
provisions contained in this lease and is not intended to vary the
terms and conditions of this lease.
36. BROKERAGE FEES. TENANT shall have no obligation for
payment of any brokerage fees in connection with this lease, and if
any such payment is due to any party it shall be paid by LANDLORD.
TENANT warrants and represents to LANDLORD that TENANT has dealt
with no brokers in connection with this lease and that the Demised
Premises was not called to TENANT'S attention by any broker, except
John Wolfrom of Tornetta Realty Co., and TENANT agrees to be
responsible for and to indemnify and save LANDLORD harmless from
and against any claim for a commission or other compensation by any
other broker claiming to have negotiated with TENANT with respect
to the Demised Premises or to have called the Demised Premises to
TENANT'S attention.
37. EXECUTION. The submission of this lease for
examination by TENANT does not constitute an offer or an option to
lease the Demised Premises, nor is it intended as a reservation of
the Demised Premises for the benefit of TENANT. It is expressly
understood and agreed that this lease shall not be effective or
binding upon the parties until it is fully and properly executed by
TENANT and LANDLORD and a duplicate original thereof is delivered
to TENANT.
38. SEVERABILITY. The invalidity of one or more
phrases, sentences, clauses or paragraphs contained in this lease
shall not affect the remaining portions of this lease or any part
thereof, and in the event that any one or more of the phrases,
sentences, clauses or paragraphs contained in this lease should be
declared invalid by the final order, decree or judgment of a court
of competent jurisdiction, this lease shall be construed as if such
invalid phrases, sentences, clauses or paragraphs had not been
inserted in this lease.
39. RELEASE OF LIABILITY AND INDEMNIFICATION. TENANT
agrees that it shall indemnify and save LANDLORD harmless from any
and all liability, damage, expense, including reasonable attorney's
fees, cause of action, suits, claims, or judgments, resulting from
injury to persons or property of others on the Demised Premises
which arise out of any acts of TENANT, or TENANT'S failure to act,
in connection with TENANT'S use of the Demised Premises, or
negligence of TENANT, its agents, workmen or employees. LANDLORD
agrees that in case any claim is asserted or any action brought to
recover such damage, LANDLORD will give immediate notice thereof in
writing to TENANT and will cooperate in every way in the
investigation and defense of any such claim or action, and that the
handling and settlement of any such action shall be performed and
concluded by TENANT.
Except for the negligence of LANDLORD or his agents
or employees, or LANDLORD'S failure to repair pursuant to the terms
of this lease, and to the extent not covered by LANDLORD'S
liability insurance, LANDLORD and LANDLORD'S agents and employees
shall not be liable for, and TENANT waives all claims for, loss or
damage to TENANT'S business or loss of profits or damage to persons
or property sustained by TENANT or any person claiming through
TENANT resulting from any accident or occurrence in or upon the
Demised Premises, or any other part of the Center, including, but
not limited to, claims for damage resulting from: (i) any equipment
or appurtenances becoming out of repair; (ii) any defect in or
failure of plumbing, heating or air conditioning equipment,
electric wiring or the installation thereof, gas, water, railings
or walks; (iii) broken glass; (iv) the backing up of any sewer pipe
or downspout; (v) the bursting, leaking or running of any tank,
tub, washstand, water closet, waste pipe, drain or any other pipe
or tank in, upon or about the Demised Premises, or any other
building or buildings in the Center; (vi) water, snow, or ice being
upon or coming through the roof, stairs, doorways, show windows,
walks or any other place upon or near the Demised Premises, or
otherwise; (vii) the falling of any fixture, plaster, tile or
stucco; and (viii) any act of owners of adjacent or contiguous
property except where LANDLORD is such adjacent owner and is
legally responsible for any such damage; (ix) loss of profits.
40. MECHANICS LIENS. Except for original construction
by LANDLORD, TENANT shall promptly pay all contractors and
materialmen so as to minimize the possibility of a mechanic's or
materialman's lien attaching to the Demised Premises. Should any
such lien be made or filed, TENANT shall bond against or discharge
the same within ten ((10) days after written request by LANDLORD,
and in the event that TENANT shall fail to do so, LANDLORD may
discharge the lien by payment of the amount secured thereby, and
any amount so paid by LANDLORD, along with any attorney's fees or
other costs relating to the discharge of such lien, shall be deemed
additional rent and shall be immediately payable by TENANT to
LANDLORD.
41. INSPECTION OF PREMISES; REPAIRS. LANDLORD reserves
the right at all reasonable times, by itself or its duly authorized
agents, to go upon and inspect the Demised Premises and every part
thereof, and at its option to make repairs for which LANDLORD is
responsible, alterations and additions to the Demised Premises or
the building of which the Demised Premises are a part; provided,
however, that nothing herein contained shall be deemed or construed
as an obligation of LANDLORD to undertake or effect any such
repairs, alterations or additions other than as herein specifically
set forth.
42. EXECUTION OF FINANCING OR SECURITY AGREEMENTS
PROHIBITED. TENANT agrees not to enter into, execute or deliver
any financing agreement or security agreement that can be
considered as a priority to any mortgage or deed of trust
pertaining to the Demised Premises and, in the event TENANT does so
execute or deliver such financing agreement or security agreement,
such action on the part of TENANT shall be considered a breach of
the terms and conditions of this lease entitling LANDLORD to such
remedies as are provided for herein, including, but not limited to,
termination of this lease.
43. TRANSFER OF LANDLORD'S INTEREST. In the event of
any transfer or transfers of LANDLORD'S interest in the Demised
Premises, the transferor shall be automatically relieved of any and
all obligations on the part of LANDLORD accruing from and after the
date of such transfer, provided that (a) the interest of the
transferor, as LANDLORD, in any funds then in the hands of LANDLORD
in which TENANT has an interest shall be turned over, subject to
such interest, to the then transferee; and (b) notice of such sale,
transfer or lease shall be delivered to TENANT as required by law.
44. LIABILITY OF LANDLORD. If LANDLORD shall fail to
perform any covenant, term or condition of this lease upon
LANDLORD'S part to be performed, and if as a consequence of such
default TENANT shall recover a money judgment against LANDLORD,
such judgment shall be satisfied only out of the proceeds of sale
received upon execution of such judgment and levied thereon against
the right, title and interest of LANDLORD in the Demised Premises
and/or LANDLORD'S tract and out of rents or other income from such
property receivable by LANDLORD, or out of the consideration
received by LANDLORD from the sale or other disposition of all or
any part of LANDLORD'S right, title and in the LANDLORD'S tract.
45. MORTGAGEE PROTECTION. TENANT agrees to give any
mortgagee(s), by certified or registered mail, a copy of any
notice of default served upon the LANDLORD, provided that prior to
such notice, TENANT has been notified, in writing of the address of
such mortgagee(s). TENANT further agrees that if LANDLORD shall
have failed to cure such default within the time provided for in
this lease, then the mortgagee(s) shall have thirty (30) days
following their receipt of such notice within which to cure such
default or if such default cannot be cured within that time, then
such additional time as may be necessary if, within such thirty
(30) days any mortgagee has commenced and is diligently pursuing
the remedies necessary to cure such default (including, but not
limited to, commencement of foreclosure proceedings, if necessary,
to effect such cure), in which event this lease shall not be
terminated while such remedies are being so diligently pursued.
46. LANDLORD'S MORTGAGEE'S APPROVAL OF THIS LEASE. If
LANDLORD'S present mortgagee will approve this lease only upon the
basis of modification of the terms and provisions of this lease,
other than those provisions relating to the size and location of
the Demised Premises, the term and renewal options and the amount
of rent and charges payable hereunder, and the use for which TENANT
is permitted to operate the Demised Premises, LANDLORD shall have
the right to cancel this lease if TENANT refuses to approve in
writing any such modifications within thirty (30) days after
LANDLORD'S request therefor, which request may not be made later
that forty-five (45) days after the delivery of possession of the
Demised Premises to TENANT. If such right to cancel is exercised,
this lease shall thereafter be null and void, and neither party
shall have any liability to the other by reason of such
cancellation. This clause shall not affect or apply to any
subsequent mortgagees, and any such subsequent mortgagee shall have
no approval rights of or under this lease.
47. LAW GOVERNING. The terms and provisions of this
lease shall be interpreted in accordance with and governed by the
laws of the Commonwealth of Pennsylvania without regard to
principles of conflicts of law.
IN WITNESS WHEREOF, LANDLORD has caused his name to be hereunto
subscribed and TENANT has caused its corporate name to be hereunto
subscribed by its duly authorized officers as of the day and year
appearing in their respective notary acknowledgments.
WITNESS AS TO LANDLORD: LANDLORD:
__________________________ /s/ Lewis J. Stowe, III (SEAL)
Lewis J. Stowe, III
TENANT:
THE FIRESTONE TIRE & RUBBER
COMPANY
__________________________ By: /s/T.J. Reinninger, Vice Pres.
T.J. Reinninger, Vice President
__________________________ Attest:/s/ G.C. Zeman
G.C. Zeman
Assistant Secretary
(Corporate Seal)
<PAGE>
LEASE
THIS LEASE made and entered into this 11th day of June, 1986,
by and between LEWIS J. STOWE, III, with offices at Plymouth
Meeting Executive Campus, 600 W. Germantown Pike, Suite 370,
Plymouth Meeting, Pennsylvania, 19462, herein after called
"Landlord", and JIFFY LUBE OF PENNSYLVANIA, INC., a Pennsylvania
corporation with offices at One Valley Square, Suite 233, 512
Township Line Road, Blue Bell, Pennsylvania 19422, hereinafter
called "Tenant".
WITNESSETH:
In consideration of the covenants and promises contained herein
and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is agreed by the
parties hereto as follows:
1. PREMISES. Landlord hereby leases to Tenant and Tenant
hereby leases from Landlord the property lying and being situated
in the Township of East Norriton, County of Montgomery,
Commonwealth of Pennsylvania, which is a part of the lot described
on Exhibit "A" being a legal description of Landlord's tract, and
more particularly that portion which is outlined in red on Exhibit
"A-1" being a site plan of Landlord's tract, together with the
building and improvements thereon or to be erected (hereinafter
referred to as the "Premises" or the "Demised Premises"), and which
is adjoining the Hechinger Plaza Shopping Center described in
Exhibit "A-2" attached hereto, for the term and upon the conditions
hereinafter set forth.
Tenant shall have the non-exclusive right, in common with
others lawfully entitled thereto, to the use of all exits,
entrances, driveways and parking areas in the Landlord's tract for
the accommodation and parking of automobiles and trucks of Tenant,
its agents and employees and of its customers. Tenant is hereby
granted the non-exclusive right of ingress and egress to the extent
of Landlord's rights over all roads, streets, sidewalks and ways,
whether public or private, bounding or serving the Premises or the
Landlord's tract. In the event that Landlord designates a
particular area of the parking lot in Landlord's tract, or provides
other parking within a reasonable distance for employees of Tenant,
and for the employees of other tenants, it is agreed that Tenant's
employees shall conform to the requests of Landlord in using such
employees parking space.
Landlord shall have the right, subject to Tenant's written
consent which shall not be unreasonably withheld, delayed or
denied, to designate from time to time and to change from time to
time portions of the Landlord's tract which shall be used as
parking areas, approaches, exits, entrances, roadways and the like,
and enlarge or diminish the size of the buildings indicated on
Exhibit "A-1", provided the two-way roadways abutting the premises
for their full length as shown on Exhibit "A-1" are not changed in
size or relocated under any circumstances, and provided no building
is erected in the parking areas except where reserved for future
buildings, if any. It is agreed that the driveways and common
roads immediately adjacent to the Premises shall be designated and
maintained for two-way traffic as designated on Exhibit "A-2".
The Demised Premises are demised subject and subordinate to
all encumbrances, easements, reciprocal construction, operating
and easement agreements, including those referred to in
Declaration of Easements dated November, 1984, a true and complete
copy of which is attached hereto as Exhibit "B", restrictions,
covenants, zoning laws and governmental or any other regulations,
now or hereafter affecting or governing the Landlord's tract and
the adjoining Hechinger Plaza Shopping Center.
2. LANDLORD'S IMPROVEMENTS. Landlord agrees to erect upon
the Premises the improvements as described on Exhibit "A-1" and as
more particularly described on Exhibit "C" attached hereto and by
this reference, made a part hereof (said improvements described on
Exhibit "A-1" and on Exhibit "C" being hereinafter collectively
referred to as the "Improvements"). Landlord will complete the
Improvements in substantial compliance with Exhibit "C" and in a
good, safe and workmanlike manner and will use its best efforts to
see that the Improvements are completed and ready for use on or
before 120 days after permits are issued subject to delays due to
strikes, acts of God, unavailability of materials or other causes
beyond Landlord's control; provided, however, that if Landlord is
unable to deliver possession on such date, Landlord shall not be
liable to Tenant for damages, and this Lease shall not be affected
in any manner if Landlord completes the Improvements within three
(3) months after that date, subject, again, to delays due to
strikes, acts of God, unavailability of materials or other causes
beyond Landlord's control. The Improvements shall comply with the
laws, ordinances and regulations, municipal or otherwise, that may
govern the construction of same.
3. ACCEPTANCE OF THE IMPROVEMENTS. Promptly upon completion
of the Improvements, Landlord will give written notice thereof to
Tenant. If, in Tenant's reasonable opinion, the Improvements have
not been completed in substantial accordance with Exhibit "C" it
shall be Tenant's obligation to so notify Landlord in writing
within ten (10) days after receipt of notice of completion. If no
such notice is given by Tenant, then it shall be conclusively
presumed, ten (10) days after receipt by Tenant of Landlord's
notice of completion, that the Improvements are acceptable to
Tenant, and Tenant shall be deemed to have accepted the
Improvements as being satisfactory and in good condition.
Thereafter, rent in accordance with Paragraph 6 of this Lease shall
become due and payable without any abatement whatsoever. If notice
shall be validly given that the Improvements have not been
completed in substantial accordance with Exhibit "C", the Landlord
shall immediately proceed to make the necessary corrections and
thereafter new notices as provided for in this Paragraph 3 shall be
given.
Nothing herein, however, shall preclude Landlord and Tenant
from agreeing in writing that the Tenant has accepted the
Improvements prior to the expiration of the ten (10) day period
described in the preceding paragraph.
4. TENANT'S IMPROVEMENTS. Upon acceptance of the
Improvements, as hereinabove provided, Tenant shall promptly
install, at Tenant's sole cost and expense, the structures,
fixtures, equipment and other property necessary to complete the
Premises for the operation of a JIFFY LUBE SERVICE CENTER, in
substantial accordance with the plans and specifications attached
hereto as Exhibit "D" and by this reference made a part hereof.
Tenant accepts all risk of loss for Tenant's Improvements and
understands and acknowledges that Landlord has no liability
whatsoever. All such work may be inspected by Landlord, and Tenant
agrees to make, at its sole expense, any changes, additions or
alterations requested by Landlord to conform such work, in
Landlord's sole discretion, to the requirements of Exhibit "D".
Tenant shall promptly and diligently perform its work hereunder in
accordance with all applicable federal, state and local statutes,
codes and regulations; and Tenant shall do all that is reasonably
necessary to promptly open the JIFFY LUBE SERVICE CENTER as soon as
possible after acceptance of the Improvements. Tenant agrees, at
Tenant's expense, to obtain and maintain for so long as Tenant's
work continues, public liability insurance and workers compensation
insurance adequate to fully protect Landlord as well as Tenant from
and against all liability for death or injury to persons or damage
to property caused in or about, or by reason of, the construction
of Tenant's work. Tenant shall furnish to Landlord certificates
evidencing said coverage prior to commencement of Tenant's work.
5. TERM, COMMENCEMENT OF TERM; OBLIGATIONS PRIOR TO
COMMENCEMENT OF TERM.
(a) Term and Commencement: Unless sooner terminated in
accordance herewith, the term of this Lease shall commence
("Commencement Date") upon the first day of the month following the
earliest of (i) the opening for business of the JIFFY LUBE SERVICE
CENTER on the Premises, (ii) ten (10) days after Tenant's
acceptance of the Improvements, or (iii) the issuance of a
certificate of occupancy, and end on the twentieth anniversary of
the Commencement Date and in addition, at the sole option of the
Tenant, provided Tenant is not in default of any of the terms,
covenants or conditions of this Lease, the Lease will be renewed
for two additional five (5) year terms. The parties agree to
execute the lease commencement page attached hereto. Any such
renewal shall be deemed effectively exercised only if Tenant has
given Landlord written notice of such intention not later than 180
days prior to the expiration of the original term, or the initial
renewal term. All terms and provisions of this Lease shall be
applicable during such renewal term or terms and Rent shall be as
provided in Section 6 hereof.
(b) Period Prior to Commencement: During the period
commencing with Tenant's acceptance of the Improvements, as
hereinabove provide, or Tenant's occupancy of the Premises,
whichever shall occur first, and ending with the Commencement Date
of the term of this Lease, Tenant shall comply with every
obligation, covenant and condition required by Tenant to be
observed in this Lease; provided, however, that the obligation to
pay either Minimum Rent or Percentage Rent shall be only as is
described in subsection (c) of this Paragraph 5.
(c) Rental During Period Prior to Commencement: During
the period beginning with the earlier of (i) the opening for
business of the JIFFY LUBE SERVICE CENTER on the Premises, or (ii)
ten (10) days after Tenant's acceptance of the improvements, and
ending with the Commencement Date of the term of this Lease, as
provided in Paragraph 5 (a) hereof, Tenant shall pay without any
abatement whatsoever a pro rata portion of the Minimum Rent, and
Percentage Rent as hereinafter defined, for such partial month, to
Landlord, at the address specified in this Lease. Such portion
shall be calculated by multiplying the Minimum Rent and Percentage
Rent by a fraction, the numerator of which is the number of days in
such a period and the denominator of which is that number of days
in the respective month.
(d) The term "Rent" as used in this lease shall include
Minimum Rent, Percentage Rent, and any other payments required to
be made by Tenant herein.
(e) Lease Year: "Lease Year", as used herein, means a
period of twelve consecutive months during the Lease Term
commencing on the yearly anniversary date of the first Lease Year,
the first Lease Year commencing on the first day of the calendar
month in which the Commencement Date occurs.
6. RENT.
(a) Fixed Minimum Rent for the term shall be as
follows:
Annual Total Total
Years Land Building Annual Monthly
0-1 $24,000 $39,000 $63,000 $5,250.00
2-5 $30,000 $39,000 $69,000 $5,750.00
6-10 $33,000 $42,900 $75,900 $6,325.00
11-15 $36,300 $47,190 $83,490 $6,957.50
16-20 $39,930 $51,909 $91,839 $7,653.25
21-25 $43,923 $57,100 $101,023 $8,418.59
26-30 $48,315 $62,810 $111,125 $9,260.42
PLUS
(b) Percentage Rent:
6% of Gross Sales, as hereafter defined, in amounts in excess
of $500,000 but less than $600,000.
4% of Gross Sales in amounts in excess of $600,000 but less
than $700,000.
2% of Gross Sales in excess of $700,000.
The gross sales amounts shall be increased by ten percent
(10%) at the beginning of the 6th, 11th, 16th, 21st, and 26th lease
years.
Notwithstanding the foregoing, in the event that the
development and construction costs of the Landlord exceed or are
less than the sum of $300,000 ("Estimated Cost"), the Building Rent
set forth in Paragraph 6(a) shall be increased or decreased by the
same proportion in which the actual development and construction
costs of Landlord, as hereinafter defined, exceed or are less that
the Estimated Cost.
For the purposes of this paragraph, the actual
development and construction costs of Landlord shall include: (1)
all government permits, licenses and fees; (2) the costs of all
materials and labor; (3) attorneys fees; (4) interest, points and
commitment fees; and, (5) site development, architectural and
engineering costs and expenses; (6) project management and
development fees of 12% of actual construction costs, excluding
interest and related financing expenses; and (7) any other items of
cost incurred by the Landlord in connection with its obligations
hereunder, except that the Tenant's written approval, which shall
not be unreasonably withheld, delayed or denied, will be required
for any additional items of cost which would bring the development
and construction costs to a total which exceeds $300,000. At the
request of the Tenant, Landlord will meet with Tenant to review
construction progress, proposed design changes, and revised cost
estimates, so that Tenant may have the opportunity to propose
approaches to minimizing costs.
For the purpose of this Lease, the term "Gross Sales"
shall mean the entire amount of sales and business receipts of
Tenant at, through or from the Premises, including, but not limited
to, retail sales and any other sums collected for services provided
and sales of used products such as used oil, but excluding sales
and use taxes, gross receipts taxes and similar taxes paid by
Tenant based on sales, and bona fide refunds, rebates or discounts
to customers.
Tenant shall keep and preserve complete records of all
Gross Sales conducted in any Lease Year for a period of three (3)
years thereafter, Tenant shall permit Landlord or Landlord's
representatives to examine or audit the records at any and all
reasonable times, and shall, upon Landlord's request, explain the
methods of keeping records. The books and records shall include
cash register tapes, properly identified, sales journal, general
ledger, profit and loss statements, balance sheets, purchase
invoices, bank statements with cancelled checks and deposit
advices, corporate books and records, including, but not limited
to, minute books, and stock certificate books, state sales tax
return, federal income tax return, retailers occupation tax return
or similar returns required to be filed by the state in which the
Premises are located as they pertain to this Lease.
Tenant shall, upon request, deliver to Landlord a written
statement, certified by Tenant or an officer of Tenant, showing
Gross Sales made to the date of such request, and any fractional
month, if any, prior to the commencement of the first Lease Year.
Within thirty (30) days after the end of each Lease Year during the
term of this Lease, or sooner termination hereof, and within thirty
(30) days after the end of this Lease, Tenant shall deliver to
Landlord, at the place last fixed for the payment of Rent, a
statement Certified by Tenant or an officer of Tenant reflecting
Gross Sales during the preceding Lease Year, and at such time
Tenant shall pay to Landlord all sums due based upon Gross Sales as
shown in the statement for the period covered by the statement.
The acceptance by Landlord of payments of Percentage Rent
shall be without prejudice to Landlord's right to an examination of
Tenant's books and records of its gross receipts from the Premises
in order to verify the amount of gross receipts. If Landlord is
dissatisfied with any such statement furnished by Tenant, Landlord
may notify Tenant, and Landlord, at its option, may then cause
Tenant's books to be examined by Landlord or by a Certified Public
Accountant selected by Landlord. If such examination shall
disclose any underpayment of Percentage Rent, Tenant shall promptly
pay the deficient amount and, in addition if the deficiency is more
that four (4%) percent, Tenant shall pay interest thereon at the
rate of two percent (2%) per month, as well as reimburse Landlord
for the cost, if any, of having Tenant's books examined or audited.
(c) Accord and Satisfaction: No payment by Tenant or
receipt by Landlord of a lesser amount than the Rent herein
stipulated shall be deemed to be other than on account of the
earliest Rent then due, nor shall any endorsement or statement on
any check or any letter accompanying any check or payment as Rent
be deemed an accord and satisfaction. Landlord may accept such
check or payment without prejudice to Landlord's right to recover
the balance of such Rent or pursue any other remedy provided for in
this Lease, or at law.
(d) Late Charges: In the event Tenant fails to pay any
portion of the Minimum Rent or Percentage Rent (including any
additional rental due hereunder) on the date due, or within five
(5) days thereafter, a late charge of two (2%) percent (or the
highest rate permitted by law) per month of the delinquent rental
shall be added to said rental and paid to Landlord together
therewith.
7. PAYMENT OF TAXES, FEES, ASSESSMENTS AND UTILITIES.
(a) Payment of Taxes, Fees and Assessments: Landlord
shall pay all taxes, assessments (whether general or special) and
any other obligations which are or may become a lien or levied
against the Premises and improvements as they may become due and
payable during the term of Tenant's occupancy thereof; provided,
however, that if authorities having jurisdiction assess real estate
taxes, assessments, or other charges on the Premises which Landlord
deems excessive, Landlord may defter compliance therewith to the
extent permitted by applicable laws, so long as the validity or
amount thereof is contested by Landlord in good faith and so long
as Tenant's occupancy of the premises is not materially disturbed.
Tenant shall pay all taxes and assessments on its merchandise,
trade fixtures, and equipment and also general license and
franchise taxes, if any, which may be required for the conduct of
Tenant's business. The term "taxes" and "assessments" shall mean
and include all real estate taxes, public and governmental charges
and assessments, including all extraordinary or special
assessments, all costs and fees, including reasonable attorney's
fees, incurred by Landlord in contesting or negotiating with public
authorities as to any of the same, and all sewer and other taxes
and charges.
(b) Tax Year: The term "Tax Year" shall mean the
twelve (12) month period established as the real estate tax year by
the taxing authorities having jurisdiction over the Landlord's
tract.
(c) Tenant's Tax Charge: The term "Tenant's Tax
Charge" shall mean an amount equal to the product obtained by
multiplying the taxes for each Tax Year by a fraction, the
numerator of which is the gross floor area in the Demised Premises
and the denominator of which is the leasable ground floor area in
Landlord's tract at the beginning of such Tax year, but only to the
extent such area is included in the improvements assess under the
tax bill for said taxes.
(d) Payment of Real Estate Taxes by Tenant: Tenant's
Tax Charge (as the same may be subsequently increased or decreased)
shall be paid to Landlord in equal monthly installments in advance
on the first day of each calendar month during each Lease Year. If
on the first day of any calendar month the amount of taxes payable
during the then current Tax Year shall not have been determined by
the taxing authority, then the Tax Charge then payable by Tenant
shall be estimated by Landlord subject to (i) adjustment when the
amount of such taxes shall be determined, and (ii) payment upon
submission of a statement therefor by Landlord.
Within sixty (60) days after the end of each Tax Year, Landlord
shall deliver a copy to Tenant of all tax bills for such Tax Year,
and certify to Tenant the amount of Tenant's Tax Charge. If the
amount of such monthly payments paid by Tenant exceeds the actual
amount due, the overpayment shall be credited on Tenant's next
succeeding payment or during the last lease year of the term,
Landlord will refund such excess to Tenant within thirty (30) days
following the expiration of the term, if Tenant is not in default
hereunder. If the amount of such monthly payments paid by Tenant
shall be less than the actual amount due, Tenant shall pay to
Landlord the difference between the amount paid by Tenant and the
actual amount due, within ten (10) days after demand from Landlord.
For the Tax Year in which this Lease commences or terminates,
Tenant's Tax Charge shall be prorated.
(e) Personal Property Taxes and Assessments: Tenant
shall pay, before delinquent, any and all taxes, licenses, fees,
and public charges levied, assessed, or imposed and which become
payable during the lease term upon Tenant's fixtures, furniture,
appliances and personal property located or installed in the
Demised Premises.
(f) Payment of Utilities: Tenant shall pay for all
water, gas, sewer, electric and all other utilities serving the
Premises.
8. AUTHORIZED USES. Tenant shall use the premises for the
purpose of operating a JIFFY LUBE SERVICE CENTER and for no other
purposes whatsoever, without the prior written consent of Landlord,
which consent shall not be unreasonably withheld; provided any such
use shall not be in violation of any terms, covenants or conditions
of the Declaration of Easements attached hereto and marked Exhibit
"B"; and further provided that Tenant is not in default of any
terms, covenants and conditions of this Lease.
9. COMPLIANCE WITH LAWS; LICENSES AND PERMITS.
(a) Compliance with Laws: Tenant shall not use, or
permit any person to use, the Premises or any part thereof for any
use or purpose in violation of federal, state or local law,
including, but not limited to, present and future ordinances or
other regulations of any municipality in which the Premises are
situated, and Tenant agrees, if, during the term of this Lease new
laws and regulations be imposed, Tenant will, at the sole cost and
expense of Tenant, make alterations or improvements in or to the
Premises which may be required by any federal, state or local law,
or by any municipal ordinance, or regulation applicable thereto.
Tenant shall also comply with all orders, directives, rules and
regulations of all governmental bodies, bureaus and offices having
jurisdiction over Tenant or the Premises, or Tenant's use of the
Premises.
(b) Licenses and Permits: Tenant shall procure and
maintain at Tenant's own expense and responsibility all licenses,
permits or inspection certificates required by any governmental
authority respecting Tenant's use of the Premises or the operation
of Tenant's business thereon. Tenant may contest any such law,
ordinance or regulation, and if required, may join Landlord's name
in any such contest. In such event, however, Tenant shall
indemnify Landlord against any costs, penalties or attorney's fees
incurred by or asserted against Landlord by virtue thereof.
(c) Occupancy: Tenant will not at anytime use or occupy
the Premises in violation of the certificate of occupancy issued
for the Premises, or in violation of Section 8 of this Lease.
10. LIABILITY INSURANCE, EMPLOYER'S INSURANCE AND INDEMNITY.
(a) General Liability Insurance: Tenant shall, during
the entire term of this Lease, at Tenant's own expense, keep in
force by advance payment of premiums, public liability insurance in
an amount not less than $1,000,000 for injury to or death of one
person as a result of one occurrence and not less than $1,000,000
for injury to or death of more than one person as a result of one
occurrence and for damage to property in the amount of $100,000 per
occurrence, insuring Tenant, Landlord and any Mortgagee of Landlord
against any liability that may accrue against them or any of them
on account of any occurrence in or about the Premises during the
term of this Lease or in consequence of Tenant's occupancy thereof
and resulting in personal injury, death or property damage. All
policies of insurance, as aforesaid, shall provide that they cannot
be cancelled, terminated, or amended without thirty (30) days prior
written notice to Landlord and Tenant. Tenant shall furnish to
Landlord, before Tenant may operate as a JIFFY LUBE SERVICE CENTER,
copies of policies or certificates of insurance required by this
Lease.
(b) Employer's Liability Insurance: Tenant shall,
during the entire term of this Lease, at Tenant's own expense, pay
for and maintain employer's liability insurance ($100,000 minimum
limit) and workmen's compensation insurance, as prescribed by the
law of the state in which the Premises are located, and shall
furnish to landlord copies of policies or certificates of insurance
evidencing such coverage.
(c) Indemnity: Tenant agrees to indemnify and save
harmless Landlord from and against all claims of whatever nature
arising from (i) any act, omission or negligence of Tenant, or
Tenant's contractors, agents, servants or employees, or (ii)
arising from any accident, injury or damage whatsoever caused to
any person or to the property of any person occurring during the
term hereof in or about the Premises, where such accident, damage
or injury results or is claimed to have resulted from an act or
omission on the part of Tenant or Tenant's undertakings in this
Lease. This indemnity and hold harmless agreement shall include
indemnity against all costs, expenses and liabilities in connection
with any claim or proceeding brought thereon and the defense
thereof, including reasonable attorneys' fees. Tenant's obligation
to observe or perform this covenant shall survive the expiration or
other termination of this Lease.
(d) Special Definition for the Term Landlord: As used in
Articles 10, 11, and anywhere else expressly designated, the term
"Landlord" includes the Landlord, any Landlord of the Landlord and
the owner of Landlord's property if applicable.
11. FIRE AND EXTENDED COVERAGE INSURANCE. Tenant agrees, at
its sole cost and expense, during the entire term of this Lease, to
keep the Premises, the Improvements, all other improvements,
equipment and any supplies thereon adequately insured by reliable
companies "for full replacement value" whereby the insurer will be
obligated to pay full cost of repair or replacement as of the date
of loss against damages caused by fire, smoke, explosion and other
risks covered by standard extended coverage endorsement. Tenant
shall also carry insurance against the risks of loss of rents and
income resulting from any such hazards, which policy must provide
coverage for six months estimated income from the Premises. All
such policies shall name Landlord, and Landlord's mortgagee, if
required, as a co-insured, as their respective interests may
appear. Such insurance may be carried under a blanket-type policy
issued to Tenant and all such insurance must provide that it cannot
be cancelled, terminated, or amended without thirty (30) days prior
written notice to Landlord and Tenant. Tenant will deliver to
Landlord certificates evidencing the aforesaid insurance. The
proceeds of any loss claims collected by Landlord on such policy
shall be credited or payable by Landlord to Tenant in reimbursement
of any expenditures made on account thereof by Tenant pursuant to
Tenant's maintenance and repair obligations hereunder.
12. MAINTENANCE AND COSTS OF COMMON FACILITIES AND SERVICES.
(a) Tenant will at all times during the term of this
Lease keep the Premises, appurtenances, fixtures, installations and
equipment attached and related thereto, including any parking area
and driveways, in good condition and repair, at Tenant's expense,
and upon termination hereof, shall surrender same in such good
repair, reasonable wear and tear excepted. Tenant will keep all
fire extinguishers in the Premises filled and in good condition at
Tenant's own cost and expense. Should any portion or all the
Premises be damaged or destroyed by fire, the elements or any other
cause, with or without fault on the part of Tenant, Tenant shall
promptly rebuild or replace any such damages or destroyed portions.
Tenant will make all repairs at its sole cost and expense, both
interior and exterior, structural or non-structural, ordinary or
extraordinary, and foreseen and unforeseen. "Repairs" shall
include all necessary rebuilding, replacements, renewals,
alterations, additions and betterments. All repairs made by Tenant
shall be equal in quality and class to the original work. Tenant
will also do or cause others to do all necessary shoring of
foundations and walls of any structure and every other act or thing
for the safety and preservation thereof which may be necessary by
reason of any excavation or other building operation upon any
adjoining property, street, alley or passageway.
(b) Except as otherwise specifically provided herein,
damage to or destruction of any portion or all of the Premises, by
fire, the elements or any other cause, with or without fault on the
part of Tenant, shall not terminate this Lease or entitle Tenant to
any abatement of or reduction in the Rent payable, or otherwise
affect the respective obligations of the parties hereto.
(c) Common Area, Maintenance, etc.: Landlord covenants
and agrees to construct the parking lots, driveways, sidewalks,
entrances and exits as substantially shown on Exhibit "A-1" and to
pave them with bituminous concrete, or other hard surface, and to
maintain said pavement in good condition. Landlord shall keep the
above areas which are not a part of the Premises free from snow and
in a clean and orderly condition, and shall provide and operate
reasonable lighting in those areas during the night hours that the
Premises is opened for business, unless prevented from doing so by
causes beyond Landlord's reasonable control. Maintenance and
lighting of the Premises will be the responsibility of the Tenant.
(d) Control of Common Use Areas and Services: All
facilities and services furnished by Landlord and designated for
the general use, in common, of occupants of Landlord's tract,
including Tenant hereunder, their officers, agents, employees and
customers, including, but not limited to, parking areas, streets,
sidewalks, roadways, loading platforms, washrooms, ramps,
landscaped areas and other similar facilities, shall at all times
be subject to the exclusive control and management of Landlord, who
shall have the right from time to time to change the area, level,
location and arrangement of such parking areas and other facilities
above referred to; to restrict parking by tenants and their
employees to employee parking areas; and to make all rules and
regulations pertaining to and necessary for the proper operation
and maintenance of the common facilities and services.
(e) Tenant's Share of Costs of Common Facilities and
Services: In each lease year Tenant will pay to Landlord as
additional Rent hereunder such proportion of Landlord's operating
cost of common facilities and services as the gross floor area of
Demised Premises bears to the gross rentable floor area of all of
the buildings of Landlord on the Landlord's tract. In no event
will the Tenant's proportion of such costs exceed the ratio of the
floor area of the Premises as built to the floor area of the
proposed Firestone store as shown on Exhibit "A-1", whether or not
the proposed Firestone store is built. For the purpose of this
paragraph "Landlord's Operating Cost of Common Facilities and
Services" (hereafter "Common Area Charge") is defined as including
all reasonable costs and expenses incurred by Landlord in
operating, managing, equipping, lighting, repairing, replacing and
maintaining said facilities and services, including, without
limitation, landscaping, sanitary control, cleaning, lighting, snow
removal, resurfacing, painting, fire protection, operation, repair
and maintenance of storm water retention facilities and common area
maintenance costs as defined in the Declaration of Easements,
public liability and property damage insurance, repairs and
policing, including the cost of personnel to implement such
services and maintain such facilities and administrative and
overhead costs equal to fifteen (15%) percent of all of the
foregoing.
(f) Payment of Tenant's Share of Costs of Common
Facilities and Services: Tenant's pro rata share of the Common
Area Charge under this Article shall be paid in advance in monthly
installments on the first day of each calendar month during each
lease year in an amount estimated by Landlord. Within ninety (90)
days after the end of each calendar year (or partial calendar
year), Landlord shall furnish Tenant a statement summarizing the
actual operating cost for the preceding calendar year (or partial
calendar year) and setting forth the method by which the Common
Area Charge payable by Tenant was arrived at as herein provided.
To the extent the aggregate of the monthly Common Area Charge paid
by Tenant during such calendar year (or partial calendar year)
exceeds the amount which is payable by Tenant for such calendar
year (or partial calendar year) as hereinabove provided, the
difference shall be credited against the next succeeding monthly
Common Area Charge to be made by Tenant under this Article. If the
aggregate of the monthly Common Area Charges paid by Tenant during
such calendar year (or partial calendar year) is less than the
actual amount due, Tenant shall pay Landlord the difference between
the amount paid by Tenant and the actual amount due, within ten
(10) days of demand therefor by Landlord. For the calendar year
(or partial calendar year) in which this Lease commences or
terminates, Tenant's Common Area Charge shall be prorated, if
applicable.
13. REPAIR BY LANDLORD. Landlord shall not be required to
furnish any services or facilities to the Premises after acceptance
of the Improvements. Landlord shall have no obligation to repair,
maintain, alter, replace or modify the Premises or any part
thereof, including but not limited to any plumbing, heating,
electrical, air conditioning or other mechanical installation
therein. Tenant hereby assumes the full and sole responsibility
for the condition, operation, repair, rebuilding, replacement,
maintenance and management of the Premises. Landlord will assign
all contractor's and manufacturer's warranties to Tenant.
14. RIGHT OF ENTRY BY LANDLORD. Tenant shall permit
inspection of the Premises during reasonable business hours by
Landlord or Landlord's agents or representatives for the purpose of
ascertaining the condition of the Premises. One hundred eighty
(180) days prior to the expiration of this Lease, Landlord may post
suitable notice on the Premises that the same are "For Rent" and
may show the Premises to prospective tenants at reasonable times.
Landlord may not, however, thereby unnecessarily interfere with the
use of the Premises by Tenant.
15. ALTERATIONS, FIXTURES, CONDITION ON TERMINATION.
(a) Alterations: Provided Tenant is not in default of
the terms, covenants and conditions of this Lease, Tenant, after
receiving the written consent of Landlord, at Tenant's sole cost
and expense, in a good workmanlike manner, may make such
alterations to the Premises as Tenant may require for the conduct
of its business without materially altering the basic character of
the buildings or improvements thereon, or weakening any structure
on the Premises. Any such alterations shall be subject to
Landlord's inspection upon completion, and Tenant agrees to make
whatever changes or additions to such alterations as are requested
by Landlord. Tenant shall also have the right, with the written
consent of Landlord, to erect, at Tenant's sole cost and expense,
such temporary partitions, including office partitions, as may be
necessary to facilitate the handling of Tenant's business and to
install telephones and telephone equipment and wiring, and
electrical fixtures, additional lights and wiring and other trade
appliances. Tenant shall, before making any alterations,
additions, installations or improvements, at its expense, obtain
all permits, approvals and certificates required by any
governmental or quasi governmental bodies and (upon completion)
certificates of final approval thereof and shall deliver promptly
duplicates of all such permits, approvals and certificates to
Landlord and Tenant agrees to carry and will cause Tenant's
contractors and subcontractors to carry such workmen's
compensation, general liability, personal and property damage
insurance as Landlord may require.
(b) Fixtures: Any alterations or improvements to the
Premises, including partitions, all electrical fixtures, lights and
wiring, shall become the property of Landlord at the expiration or
sooner termination of this Lease. Should Landlord request the
removal of all or any part of the above mentioned items, however,
Tenant at its own expense, shall do so prior to the expiration of
this Lease and repair the Premises as described herein. At the
expiration or sooner termination of this Lease, tenant shall be
entitled to remove Tenant's personal property and trade fixtures,
provided that Tenant is not in default of any terms, covenants or
conditions of this Lease and that Tenant repairs, in a good
workmanlike manner, all damage done to the Premises by such
removal. Nothing in this Article shall be construed to give
Landlord title to Tenant's trade fixtures.
(c) Condition of Premises on Termination: Tenant agrees
to surrender the Premises at the expiration, or sooner termination,
of this Lease in the same condition as when the Premises were
delivered to Tenant, or as altered pursuant to the provisions of
this Lease, ordinary wear and tear excepted.
16. SIGNS. Tenant may, if applicable laws permit, place
suitable signs, emblems, logos, lettering and pictorial materials
on the Premises for the purpose of indicating the nature of the
business carried on by the Tenant in said Premises; provided,
however, that any such signs, emblems, logos, lettering and
pictorial materials must first be consented to by Landlord. In the
event Tenant places any signs, emblems, logos, lettering or
pictorial materials on the Premises without Landlord's consent,
Landlord has the right to remove the same. Any damage to the
Premises caused by installation or removal of signs, emblems,
logos, lettering or pictorial materials shall be repaired at the
expense of Tenant. All work shall be completed in a good and
workmanlike manner. Landlord hereby agrees that Tenant, at
Tenant's sole expense, may place standard Jiffy Lube fascia signage
on the building which is as large as permitted by applicable laws,
and further agrees that Tenant may place a free standing Jiffy Lube
sign with readerboard on the Premises, which sign may be as large
as permitted by applicable laws; provided, however, such signs are
permitted by applicable laws.
17. GLASS. Tenant agrees, at its own expense, to immediately
replace all glass broken or damaged on the Premises during the term
of this Lease with glass of the same quality as that broken or
damaged.
18. ASSIGNMENT AND SUBLETTING. Tenant shall not allow or
permit transfer of this Lease or any interest hereunder by
operation of law or otherwise, nor assign, sublease, convey,
mortgage, pledge or encumber this Lease or any part thereof by
another without, in each case, obtaining Landlord's prior written
consent, and further provided that Tenant shall give Landlord not
less than 30 days prior written notice of any proposed assignment
or subletting setting forth the full identity and address of the
proposed assignee or sublessee including a true and correct copy of
any agreements relating to such assignment or subletting. However,
provided Tenant is not in default of the terms, covenants and
conditions of this Lease, Landlord's prior written consent shall
not be required for an assignment or subletting of this Lease to
Jiffy Lube International, Inc. or to an authorized and licensed
Jiffy Lube franchisee, or to an authorized subsidiary of Jiffy Lube
International, Inc., provided that in any such event the use of
the Premises shall in all respects be in compliance with the
provisions of paragraph 8 herein. No assignment (with or without
Landlord's consent) shall release Tenant from any of its
obligations hereunder.
19. ASSIGNMENT BY LANDLORD. Landlord shall have the right
to assign its interests under this Lease. Upon receipt of notice
of such assignment, Tenant shall look solely to the new assignee
for the performance of all obligations of Landlord under this
Lease.
20. QUIET ENJOYMENT. Landlord covenants and agrees that
Tenant, upon paying the Rent and all other charges provided for in
this Lease, and upon observing and keeping all of the covenants,
conditions and provisions of this Lease on its part to be observed
and kept, shall lawfully and quietly hold, occupy and enjoy the
Premises during the term of this Lease, without hindrance or
molestation by or from anyone claiming by, through or under
Landlord, subject to the terms of any primary Lease, this Lease and
any mortgage or encumbrance now or hereafter placed on the Premises
by Landlord. Landlord further warrants and represents as of this
date, as a material condition hereof, that under the zoning laws
and all other laws, regulations and ordinances pertaining to the
Premises and the contemplated improvements thereon, Tenant or its
sublessee may now conduct business and thereafter shall not be
prohibited from carrying on business in said Premises for the uses
and purposes of operating a Jiffy Lube Service Center by reason of
any law, regulation, ordinance or order of any governmental
authority.
21. TENANT'S DEFAULT:
(a) If Tenant (i) shall fail to pay any installment of
Fixed Minimum Rent or Percentage Rent or any additional sum when
due hereunder within ten (10) days after notice of such default to
Tenant; (ii) shall default in any of the covenants, agreements,
conditions or undertakings herein agreed to be kept, observed and
performed by the Tenant other than the payment of Rent (Fixed
Minimum and Percentage Rent or additional Rent) or any part thereof
when due, and such default shall continue for twenty (20) days
after notice thereof in writing to Tenant; or (iii) shall vacate or
abandon the Premises; or if (iv) proceedings in bankruptcy or for
liquidation, reorganization or rearrangement of Tenant's affairs
are instituted by or against Tenant; or if (v) a receiver or
trustee is appointed for all or substantially all of the Tenant's
business or assets on the grounds of Tenant's insolvency; or if
(vi) Tenant makes an assignment of the benefit of its creditors; or
(vii) a reorganization under the Bankruptcy Act of the United
States; or (viii) this Lease or Tenant's interest herein or in the
Premises or any Improvements thereon or any property of Tenant are
executed on or attached; or (ix) the Premises come into the hands
or any person other than expressly permitted under this Lease; or
(x) Tenant's failure to execute instruments or certificates
provided for in this Lease within fifteen (15) days after the
mailing by Landlord of a written request; or (xi) Landlord
determines that Tenant has knowingly submitted any false report
required to be furnished hereunder, then in any of the above
events, Landlord, at its election, may terminate this Lease and,
either with or without process of law, re-enter, expel, remove and
put out Tenant and all persons who may be occupying the Premises
under Tenant, using such force and other means as may be lawful and
necessary in so doing, and repossess and enjoy the Premises. Such
re-entry and repossession shall not work a forfeiture of the rents
to be paid and the covenants to be performed by the Tenant during
the full term of this Lease. If any applicable law requires any
additional notice or greater period during which Tenant may attempt
to cure a default before termination, this Lease shall be deemed to
be modified to comply with such law.
Upon the expiration of the term of this Lease by reason of the
happening of any of the events hereinabove described, or in the
event of the termination of this Lease or right to possession or
both, as the case may be, by summary dispossession proceedings or
under provision of any law now or at any time hereinafter in force,
by reason of or based upon or arising out of a default under or
breach of this Lease on the part of Tenant, or upon Landlord
recovering possession of the Premises under any of the foregoing
circumstances whatsoever, whether with or without legal
proceedings, Landlord may, at its option, at any time and from time
to time, relet the Premises or any part of parts thereof for the
account of Tenant or otherwise, and receive and collect the rents
therefor, applying the same first to the payment of such expense as
Landlord may have incurred in recovering possession of the
Premises, including legal expense and attorneys fees, and for
putting the Premises into good order or condition or preparing or
altering the same for re-rental, expenses, commissions and charges
paid, assumed or incurred by Landlord in connection with the
reletting of the Premises, and then to the fulfillment of the
covenants of Tenant hereunder. Any such reletting herein provided
may be for the remainder of the term of this Lease or for a longer
or shorter period. In any such case, and whether or not the
Premises or any part thereof be relet, Tenant shall pay to Landlord
the Fixed Minimum Rent, Percentage Rent, any item of additional
Rent due hereunder, and all other charges required to be paid by
Tenant up to the time of such termination of this Lease, or of such
recovery of possession of the Premises by Landlord, as the case may
be; and thereafter Tenant covenants and agrees, if required by
Landlord, to pay to Landlord until the end of the term of this
Lease the equivalent of the amount of all the Fixed Minimum Rent,
and Percentage Rent, reserved herein and all other charges required
to be paid by Tenant less the net rentals received from reletting,
if any, and the same shall be due and payable by Tenant to Landlord
on the several rent days above specified. Percentage Rent for each
year of the unexpired portion of the lease term shall equal the
average Percentage rents which Tenant was required to pay from the
commencement of the lease term to the time of default, or during
the preceding three (3) full lease years, whichever period is
shorter. In any of the circumstances hereinabove mentioned in
which Landlord shall have the right to hold Tenant liable upon the
several rent days herein specified to pay Landlord the equivalent
of the amount of all the Fixed Minimum Rent, Percentage Rent, and
all other charges required to be paid by Tenant less the net
rentals received from reletting, if any, Landlord shall also have
at its sole election, in place and instead of holding Tenant so
liable, to forthwith recover against Tenant as damages for loss of
the bargain and not as a penalty, an aggregate sum which, at the
time of such termination of this Lease, or of such recovery of
possession of the Premises by Landlord, as the case may be,
represents the then present worth of the excess, if any, of the
aggregate of the Fixed Minimum Rent, Percentage Rent as calculated
in this Article 21, and all other charges payable by Tenant
hereunder that would have accrued for the balance of the term over
the aggregate rental value of the Premises for the balance of such
term. Nothing herein contained shall limit or prejudice Landlord's
right to prove and obtain as liquidated damages arising out of such
breach or termination the maximum amount allowed by any statute or
rule of law which may govern the proceeding in which such damages
are to be proved, whether such amount be greater, equal to, or less
than, the amount of the then present worth of the excess of the
Fixed Minimum Rent, Percentage Rent, and all other charges payable
by Landlord hereunder over the rental value referred to above.
(b) Waiver of Jury Trial: The parties hereto shall and
they hereby do waive trial by jury in any action, proceeding or
counterclaim brought by either of the parties hereto against the
other on any matters whatsoever arising out of or in any way
connected with this lease, the relationship of Landlord and Tenant,
Tenant's use and occupancy of the leased premises and/or any claim
of injury or damage.
(c) Waiver of Redemption: Tenant hereby expressly
waives any and all rights of redemption granted by or under any
present or future laws in the event of Tenant being evicted or
dispossessed for any cause, or in the event of Landlord obtaining
possession of the Premises by reason of the violation by Tenant of
any of the covenants or conditions of this lease, or otherwise.
(d) Recovery of Legal Expenses: In case suit shall be
brought for recovery of possession of the Premises, for the
recovery of rent or any other amount due under the provisions of
this lease, or because of the breach of any other covenant herein
contained on the part of Tenant to be kept or performed, and a
breach shall be established, Tenant shall pay to Landlord all
expenses incurred therefor, including all court costs and
reasonable attorneys' fees.
(e) Confession of Judgment: In the event of any default
by Tenant either in the payments of rent or any other charge herein
reserved, or in the performance of any of the terms, conditions,
provisions and covenants herein set forth, either during the
original term of this lease or any extension thereof or after the
expiration of the lease term or sooner termination thereof, Tenant
hereby empowers any Prothonotary or attorney of any court of record
to appear for Tenant in any and all actions which may be brought
for rent or the charges, payments, costs and expenses reserved as
rent, or agreed to be paid by the Tenant, and to sign for Tenant an
agreement for entering in any competent court an amicable action or
actions for the recovery of rent or other charges of expenses, and
in said suits or in said amicable action or actions to confess
judgment against Tenant for all or any part of the rent specified
in this lease and then unpaid and other charges, payments, costs
and expenses reserved as rent or agreed to be paid by the Tenant,
and for interest and costs together with an attorneys' commission
of five percent (5%). Such authority shall not be exhausted by one
exercise thereof, but judgment may be confessed as aforesaid from
time to time and as often as any of said rent or other charges
reserved as rent shall fall due or be in arrears, and such powers
may be exercised during the original terms, during any extension or
renewal term, or after the expiration of any such term.
In the event that, and when, the lease shall be determined by
term, covenant, limitation or condition broken, as aforesaid,
either during the original term of this lease, or any extension
thereof, and also when and as soon as the term hereby created, or
any extension thereof shall have expired, it shall be lawful for
any attorney or attorneys for Tenant, including any Prothonotary or
attorney of any court of record who might be empowered to appear
for Tenant in any action brought for rent, to sign an agreement for
entering in any competent court an amicable action and judgment in
ejectment, without any stay of execution or appeal against Tenant
and all persons claiming under Tenant for the recovery of Landlord
of possession of the herein Demised Premises, without any liability
on the part of the said attorney, for which this shall be a
sufficient warrant; whereupon, if Landlord so desires, a writ of
habere facias possession with clauses of fieri facias for costs may
issue forthwith without any prior writ of proceedings whatsoever.
And provided that if for any reason after such action has been
commenced the same shall be determined and the possession of the
premises hereby demised remain in or be restored to Tenant, the
Landlord shall have the right in any subsequent default or defaults
to bring one or more further amicable actions in the manner and
form hereinbefore set forth to recover possession of said premises
for such subsequent default. No such determination of this lease,
no taking, nor recovering possession of the premises shall deprive
Landlord of any remedies or action against Tenant for rent or for
damages due or to become due for the breach of any condition or
covenant or condition nor the resort to any other remedy herein
provided for the recovery of rent or damages for such breach be
construed as a waiver of the right to insist upon the forfeiture
and to obtain possession in the manner herein provided.
In any amicable action of ejection or for rent in arrears,
Landlord shall first cause to be filed in such action an affidavit
made by it or some acting for it setting forth the facts necessary
to authorize the entry of judgment, of which facts such affidavit
shall be conclusive evidence, and, if a true copy of this lease be
filed in such action, it shall not be necessary to file the
original as a warrant of attorney, any rule of court, custom or
practice to the contrary notwithstanding.
(f) No Counterclaims: In the event Landlord commences
any summary proceeding or other action for non-payment of minimum
rent, percentage or contingent rent or any sum payable as rent,
Tenant covenants and agrees that it will not interpose any
counterclaim of whatsoever nature or description in any such
proceeding. This shall not, however, be construed as a waiver of
the Tenant's right to assert such claims in any separate action or
actions brought by Tenant. Tenant further waives any right of
defense which it may have to claim a merger and neither the
commencement of any action or proceeding nor the settlement
thereof, or the entering of judgment therein, shall bar Landlord
from bringing subsequent actions or proceedings from time to time.
22. LANDLORD'S DEFAULT. Landlord shall in no event be
charged with default in any of its obligations hereunder unless and
until Landlord shall have failed to perform such obligations within
thirty (30) days (or such additional time as is reasonably required
to correct such default) after Landlord's receipt of notice from
Tenant, specifically describing such failure.
23. RIGHT TO PERFORM FOR TENANT. If Tenant should fail to
perform any of its obligations under the provisions of this Lease,
Landlord shall have the right but not obligation to do the same or
cause the same to be done and Tenant agrees to reimburse any and
all expenses incurred by Landlord in connection therewith five (5)
days after receipt by Tenant of Landlord's invoice. These expenses
include, but are not limited to, filing fees, legal fees and bond
premiums. Landlord may charge such expenses to Tenant as
additional Rent due from Tenant to Landlord, together with interest
thereon, at the rate of two percent (2%) per month (or the highest
interest rate permitted by law), in the event that Tenant does not
reimburse Landlord within the five (5) days prescribed. Nothing in
this paragraph shall be construed to limit any and all other rights
and remedies of Landlord.
24. WAIVER. No delay or omission of Landlord to exercise
any right or power arising from any default shall impair any such
right or power or be construed to be a waiver of any such default
or an acquiescence therein. No waiver shall be effective unless in
writing, signed by Landlord, and no waiver of any breach of any of
the covenants of this Lease shall be construed, taken or held to be
a waiver of any other breach, or waiver, acquiescence in or consent
to any further or succeeding breach of the same covenant.
25. REMEDIES CUMULATIVE. The remedies herein granted to
Landlord shall not be exclusive or mutually exclusive and Landlord
shall have such other and additional remedies against Tenant as may
be permitted in law or in equity at any time. Any exercise of a
right of termination by Landlord shall not be construed to
eliminate or discharge any right of Landlord to damages on account
of any default of Tenant.
26. LIENS. Nothing in this Lease shall authorize Tenant
to do any act which shall in any way encumber the title of Landlord
(as defined in Article 10(d)) in and to the Premises. The interest
or estate of the Landlord (as defined in Article 10(d)) shall not
in any way be subject to any claim by lien or encumbrance, whether
by operation of law or by virtue of any express or implied contract
by Tenant. Tenant shall not permit the Premises to become subject
to any mechanic's laborer's or materialman's lien on account of
labor or material furnished to Tenant in connection with work of
any character performed or claimed to have been performed on the
Premises by or at the direction of, or sufferance of Tenant.
In the event any lien is filed against or attached to the
Premises, or Tenant's interest herein, at Landlord's option, Tenant
shall either pay the amount of said lien in full or shall, upon
demand of Landlord, provide and pay for a non-cancellable bond,
placed with a reputable company, approved by Landlord, in an amount
equal to one and one half (1-1/2) times the amount of such lien and
insuring the interest of Landlord (as defined by Article 10(d)) and
any mortgagee from any loss by reason of the filing of such lien.
Tenant shall immediately pursue in good faith its legal remedies to
the end of obtaining removal of said lien, Landlord shall have the
right but not the obligation to post the bond under the provisions
of paragraph 23.
27. CONDEMNATION. If after the execution of this Lease and
prior to the expiration of the term of this Lease, the Premises
shall be taken in its entirety under the power or eminent domain or
voluntarily sold under threat of such taking, or if such portion of
the Premises is taken so as to render the Premises unusable for the
operation of a JIFFY LUBE SERVICE CENTER, than the term of this
Lease shall cease as of the date when the Premises is so taken, and
Rent shall be apportioned and adjusted as of the date of the taking
or the sale in lieu thereof.
If only a part of the Premises shall be taken under the power
of eminent domain or sold under threat of such taking, and such
partial taking shall not render the Premises unusable for the
operation of a JIFFY LUBE SERVICE CENTER, then this Lease shall
continue in full force and effect as to the portion not taken and
the rent shall abate proportionally on such part taken under the
power of eminent domain or sold under threat of such taking.
In the event of any taking of the Premises under the power of
eminent domain or a voluntary sale under threat of such taking,
whether in part or in whole, the entire award granted in
compensation for the value of the Premises, or the proceeds of a
voluntary sale of same under threat of taking, shall belong to the
Landlord. The parties hereto acknowledge that, upon condemnation,
this Lease terminates as to any portion taken, or as to the whole
if the taking of any portion renders the remainder unusable, and
consequently Tenant shall have no claim to any portion of the
condemnation award. Nothing herein contained shall be construed,
however, as a release or waiver by Tenant of any right it may have
as a lessee to obtain compensation from the condemnor for business
interference or interruption, relocation costs, and moving costs.
28. SUBORDINATION AND NON-DISTURBANCE. This lease and
all of Tenant's rights, title and interest in and under the Lease
shall be subject, subordinated and inferior to the lien of any and
all ground leases, underlying leases, mortgages and deeds of trust
and to any and all terms, conditions, provisions, extensions,
renewals or modification of any such leases, mortgages or deeds of
trust which landlord or any grantee or assignee of Landlord has or
may place upon the Premises in the same manner and to the same
extent as if this Lease had been executed subsequent to the
execution, delivery and recording of such lease, mortgage or deed
of trust.
In the event that a mortgagee, trustee or any other person
acquires title or any other interest in the Premises pursuant to
the exercise of any remedy provided for in any mortgage or deed of
trust exchanged subsequent to the date hereof, Tenant's right of
possession shall not be disturbed provided (a) Tenant is not then,
and is not in the future, in default under this Lease and (b)
Tenant attorns to such title holder. Tenant herein covenants and
agrees that upon a mortgage foreclosure or a foreclosure under a
deed of trust it will attorn to any mortgagee, trustee, assignee or
any purchaser at the foreclosure sale as its Landlord and this
Lease shall continue in full force and effect as a direct Lease
between Tenant herein and such party upon all terms, conditions and
agreements set forth in this Lease.
The subordination of this Lease to any mortgage or deed of
trust now or hereafter placed upon the Premises shall be automatic
and self-operative, and no further instrument of subordination
shall be necessary. Without limiting such automatic and self-
operative subordinations, however, Tenant herein shall, on demand,
at anytime or times, execute, acknowledge and deliver to Landlord,
or any grantee or assignee of Landlord, any and all instruments
that may be necessary or proper to evidence the subordination of
this Lease and all rights hereunder to the lien of any such
mortgage or deed of trust. If Tenant shall fail at any time to
execute, acknowledge and deliver any such subordination instrument
within five (5) days after demand, Landlord, or any grantee or
assignee of Landlord, in addition to any other remedies available
to it in consequence thereof, may execute, acknowledge and deliver
the same as the attorney-in-fact of Tenant and in Tenant's name,
place and stead, and Tenant hereby irrevocably makes, constitutes
and appoints Landlord, its successors and assigns, such attorney-
in-fact for that purpose.
29. END OF TERM. Upon the expiration or other termination
of the term of this Lease, Tenant shall quit and surrender to
Landlord the Premises, broom clean, in good order and condition,
ordinary wear and tear excepted, and Tenant shall remove all its
property. All property permitted or required to be removed by
Tenant at the end of the term which remains in the Premises after
Tenant's removal shall be deemed abandoned and may at the election
of the Landlord, either be retained as Landlord's property or may
be removed from the Premises by Landlord at Tenant's expense.
Tenant's obligation to observe or perform this covenant shall
survive the expiration or other termination of this Lease.
30. HOLDING OVER. Tenant shall not hold over beyond the
expiration or sooner termination of the term of this Lease. If,
nevertheless, there be any holding over by Tenant, such shall give
rise to a tenancy at the sufferance of the Landlord. Tenant agrees
to indemnify and save Landlord harmless against all costs, claims,
loss or liability resulting from delay by Tenant in so surrendering
the Premises, including, without limitation, any claims made by any
succeeding Tenant founded on such delay. The parties recognize and
agree that the damage to Landlord resulting form any failure by
Tenant to timely surrender possession of the Premises as aforesaid
will be extremely substantial, will exceed the amount of the
monthly rental theretofore payable hereunder, and will be
impossible to accurately measure. Tenant therefore agrees that if
possession of the Premises is not surrendered to Landlord within 24
hours after the date of expiration or sooner termination of this
Lease, then Tenant shall pay to Landlord for each month and for
each portion of any month during which Tenant holds over in the
Premises after the expiration or sooner termination of this Lease,
a sum equal to two times the aggregate of that portion of the Rent,
both Fixed Minimum and Percentage, which was payable under this
Lease during the last month of the term hereof. Nothing herein
contained shall be deemed to permit Tenant to retain possession of
the Premises after the expiration or sooner termination of this
Lease. This provision shall survive the termination of this Lease.
31. MISCELLANEOUS:
(a) Authority: The persons who have executed this Lease
represent and warrant that they are duly authorized to execute this
Lease in their individual or representative capacity as indicated.
(b) Review of Documents: The parties hereto represent
that they have read and understand the terms of this Lease, and
that they have sought legal counsel to the extent deemed necessary
in order to protect their respective interests.
(c) Time: Time is of the essence of this Lease.
(d) Construction: The words "Landlord" and "Tenant"
shall mean respectively all parties Landlord and Tenant, regardless
of number, the word "he" shall be synonymous with "she", "it" and
"they", the word "his" shall be synonymous with "her", "its", and
"their", and words in the singular shall be held to include the
plural when the context requires.
(e) Broker: Tenant shall not be responsible for the
payment of any real estate broker's or finder's fees, if any,
pertaining to this Lease.
(f) No Agency Created: Tenant shall have no authority,
express or implied, to act as agent of Landlord or any of its
affiliates for any purpose. Tenant is, and shall remain, an
independent contractor responsible for all obligations and
liabilities of, and for all losses or damage to, the JIFFY LUBE
SERVICE CENTER to be operated by Tenant including any personal
property, equipment, fixtures or real property connected therewith
and for all claims or demands based upon damage or destruction of
property or based upon injury, illness or death of any person or
persons, directly or indirectly, resulting from the operation of
said JIFFY LUBE SERVICE CENTER.
(g) Force Majeure: Whenever a period of time is provided
in this Lease for either party to do or perform any act or thing,
except the payment of monies, neither party shall be liable or
responsible for any delays due to strikes, lockouts, casualties,
acts of God, war, governmental regulation or control or other
causes beyond the reasonable control of the parties, and in any
event, said time period for the performance of an obligation
hereunder shall be extended for the amount of time of the delay.
This clause shall not, however, apply to nor result in any
extension of the term of this Lease.
(h) Paragraph Headings: Paragraph headings of this Lease
are for convenience only and are not to be construed as part of
this Lease and shall not be construed as defining or limiting in
any way the scope or intent of the provisions hereof.
(i) Invalidity of a Provision: If any term or provision
of this Lease shall to any extent be held invalid or unenforceable,
the remaining terms and provisions of this Lease shall be valid and
be enforced to the fullest extent permitted by law. However, in
the event that any material term of the Lease shall be stricken or
declared invalid, Landlord reserves the right to terminate this
Lease at its sole option.
(j) Law Governing: The terms and provisions of the
Lease shall be interpreted in accordance with and governed by the
laws of the State of Pennsylvania without regard to principles of
conflicts of law.
(k) Entire Agreement: This Lease, shall be deemed to
include the entire agreement between the parties hereto and it is
agreed that neither Landlord nor anyone acting on its behalf has
made any statement, promise, or agreement or taken upon itself any
engagement whatsoever, whether verbally or in writing, in conflict
with the terms of this Lease, or that in any way modifies, varies,
alters, enlarges, or invalidates any of the provisions hereof, or
extends the term of this Lease, and that no obligations of the
Landlord shall be implied in addition to the obligations herein
expressed. This agreement cannot be changed orally, but only by an
agreement in writing signed by Landlord and Tenant.
(l) Parties Bound: The terms of this Lease shall extend
to and be binding upon the administrators, executors,
representatives, heirs, assigns and successors of the parties to
this instrument.
(m) Notices: All notices to or demands upon the Landlord
or Tenant desired or required to be given under any of the
provisions hereof shall be in writing. Any notices or demands from
the Landlord to the Tenant shall be deemed to have been duly and
sufficiently given if a copy thereof has been mailed by United
States registered or certified mail, return receipt requested, in
an envelope properly stamped and addressed to Tenant at the address
set forth on the first page hereof, and a copy simultaneously
mailed to the Guarantor, JIFFY LUBE INTERNATIONAL, INC. at 7008
Security Blvd., Baltimore, Maryland 21207. Any notices or demands
from the Tenant to the Landlord shall be deemed to have been duly
and sufficiently given if mailed by United States registered or
certified mail, return receipt requested, in an envelope properly
stamped and addressed to the Landlord at the address set forth on
the first page hereof. Either party, by notice, may change the
address to which notice shall be sent, but all notices mailed to
the Tenant at the address of the Premises shall be deemed
sufficient.
(o) Recordation: It is the intention of the parties
hereto not to record this Lease. However, should recordation of
this Lease be required by applicable law, or any other reason,
Tenant and Landlord agree to do so. Additionally, if required by
applicable law or any other reason, each party at the request of
the other shall execute and acknowledge, so that the same may be
recorded, a Short Form Lease or Memorandum of Lease, indicating the
Lease term, as well as any other terms necessary for recording.
Tenant shall pay all of the costs and expenses of such recordation,
including but not limited to any and all recordation taxes,
transfer taxes, recordation fees and notary fees.
(p) Maximum Interest: No provision of this Lease shall
require the payment or permit the collection of interest in excess
of the maximum permitted by applicable law. If any excess of
interest is herein or otherwise provided for, or shall result or be
held to result, the provisions of this paragraph shall govern and
the Tenant or any guarantor of this Lease shall not be obligated to
pay the amount of such interest which is in excess of the maximum
amount permitted by applicable law.
(q) Release of Liability: Except as is otherwise
provided for in Paragraph 2 of this Lease, Landlord and Landlord's
agents and employees shall not be liable for, and Tenant waives all
claims for, loss or damage to Tenant's business or loss of profits
or damage to persons or property sustained by Tenant or any person
claiming through Tenant resulting from any accident or occupance in
or upon the Demised Premises, or any other part of the Center,
including, but not limited to, claims for damage resulting from:
(i) any equipment or appurtenances becoming out of repair; (ii) any
defect in or failure of plumbing, heating or air conditioning
equipment, electric wiring or the installation thereof, gas, water,
railings or walks; (iii) broken glass; (iv) the backing up of any
sewer pipe or downspout; (v) the bursting, leaking or running of
any tank, tub, washstand, water closet, waste pipe, drain or any
other pipe or tank in, upon or about the Demised Premises, or any
other building or buildings in the Center; (vi) water, snow, or ice
being upon or coming through the roof, stairs, doorways, show
windows, walks or any other place upon or near the Demised
Premises, or otherwise; (vii) the falling of any fixture, plaster,
tile or stucco; and (viii) any act of owners of adjacent or
contiguous property; (ix) loss of profits. Tenant shall have the
benefit of all warranties accruing to the Landlord by reason of
construction of the Demised Premises.
(r) Execution of Financing or Security Agreements
Prohibited: Except for the financing of Tenant's equipment as is
set forth in Exhibit "D", Tenant agrees not to enter into, execute
or deliver any financing agreement or security agreement that can
be considered as a priority to any mortgage or deed of trust
pertaining to the Demised Premises and, in the event Tenant does so
execute or deliver such financing agreement or security agreement,
such action on the part of Tenant shall be considered a breach of
the terms and conditions of this Lease entitling Landlord to such
remedies as are provided for herein, including, but not limited to,
termination of this Lease. Landlord agrees, upon request, to
execute a waiver in favor of Tenant's equipment lender in a form
reasonably acceptable to Landlord.
(s) Transfer of Landlord's Interest: In the event of
any transfer or transfers of Landlord's interest in the Premises,
the transferor shall be automatically relieved of any and all
obligations on the part of Landlord accruing from and after the
date of such transfer, provided that (i) the interest of the
transferor, as Landlord, in any funds then in the hands of Landlord
in which Tenant has an interest shall be turned over, subject to
such interest, to the then transferee; and (ii) notice of such
sale, transfer or Lease shall be delivered to Tenant as required by
law.
(t) Mortgagee Protection: Tenant agrees to give any
mortgagee(s), by certified or registered mail, a copy of any Notice
of Default served upon the Landlord, provided that prior to such
notice, Tenant has been notified, in writing of the address of such
mortgagee(s). Tenant further agrees that if Landlord shall have
failed to cure such default within the time provided for in this
Lease, then the mortgagee(s) shall have an additional thirty (30)
days within which to cure such default or if such default cannot be
cured within that time, then such additional time as may be
necessary if within such thirty (30) days, any mortgagee has
commenced and is diligently pursuing the remedies necessary to cure
such default, (including, but not limited to, commencement of
foreclosure proceedings, if necessary, to effect such cure) in
which event this Lease shall not be terminated while such remedies
are being so diligently pursued.
(u) Landlord's Mortgagee's Approval of this Lease: If
Landlord's mortgagee will approve this Lease only upon the basis of
modification of the terms and provisions of this Lease, other than
those provisions relating to the size and location of the Demised
Premises, the amount of rent and charges payable hereunder and the
use for which Tenant is permitted to operate the Demised Premises,
Landlord shall have the right to cancel this Lease if Tenant
refuses to approve in writing any such modifications within thirty
(30) days after Landlord's request therefor, which request may not
be made later than forty-five (45) days after the delivery of
possession of the Demised Premises to Tenant. If such right to
cancel is exercised, this Lease shall thereafter be null and void,
and neither party shall have any liability to the other by reason
of such cancellation.
(v) Conduct of Business by Tenant: Tenant will occupy
the Premises pursuant to the terms of this Lease and thereafter,
except when and to the extent that the Premises are untenantable by
reason of damage or fire or other casualty, continuously operate
and conduct in 100% of the Premises during each hour of the entire
lease term when Tenant is required under this Lease to be open for
business the business permitted under Section 8 hereof, in the name
herein set forth, with a full staff and full stock of merchandise.
(w) Liability of Landlord: If landlord shall fail to
perform any covenant, term or condition of this Lease upon
Landlord's part to be performed, and if as a consequence of such
default Tenant shall recover a money judgment against Landlord,
such judgment shall be satisfied only out of the proceeds of sale
received upon execution of such judgment and levied thereon against
the right, title and interest of Landlord in Landlord's tract and
out of rents or other income from such property receivable by
Landlord, or out of the consideration received by Landlord from the
sale or other disposition of all or any part of Landlord's right,
title and in Landlord's tract, and Landlord shall not be liable for
any deficiency.
IN WITNESS WHEREOF, the parties have hereunto set their hands and
seals the day and year first above written.
WITNESS: LANDLORD:
__________________________ /s/ Lewis J. Stowe, III
Lewis J. Stowe, III
TENANT:
JIFFY LUBE OF PENNSYLVANIA, INC.
ATTEST:
_______________________ By:_________________________________
(Corporate Seal)
<PAGE>
EXIBIT 10 (t)
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (the "Assignment") is
made as of the 21st day of January, 1997 between GERMANTOWN
ASSOCIATES LIMITED PARTNERSHIP, a Delaware limited partnership
("Assignor"), and GERMANTOWN ASSOCIATES, INC. ("Assignee"), an
Illinois corporation.
Background:
A. Pursuant to a certain Agreement of Sale dated on even
date herewith, between Assignor and Assignee (the "Agreement"),
Assignor is selling to Assignee, who is buying from Assignor, that
certain real property, together with all buildings and improvements
located thereon, located at 12-14 West Germantown Pike, East
Norriton, County of Montgomery, Pennsylvania (the "Premises"). All
terms not otherwise defined herein shall have the same meanings as
in the Agreement.
B. In connection with said sale and purchase, Assignor
desires to assign and set over to Assignee all of Assignor's right,
title and interest in and to : (i) any and all licenses, permits,
certificates, warranties or similar documents relating to the
Premises (collectively, the "Contracts and Agreements"); (ii) the
Leases relating to the Premises, a schedule of which Leases is
attached hereto as Exhibit A (collectively referred to as the
"Leases"), including, without limitation, all of the Assignor's
right, title and interest in and to any rents therefrom; and (iii)
all other intangible property constituting part of the Premises
(the "Intangible Property").
NOW, THEREFORE, intending to be legally bound hereby, in
consideration of the conveyance of the Premises to Assignee and the
Purchase Price paid therefor, the parties hereto agree as follows:
1. Assignment. Assignor hereby grants, sells,
transfers, conveys and assigns and sets over unto Assignee, which
Assignee accepts from Assignor, effective from and after the date
hereof, all of Assignor's right, title and interest in and to the
Contracts and Agreements, the Leases and the Intangible Property,
in "as is where is" condition and without recourse, except as
provided in Section 2 herein.
2. No Representation or Warranty. Assignee hereby
acknowledges that Assignor makes no representation, guaranty or
warranty with respect to this Assignment or the Contracts and
Agreements, Leases or Intangible Property except as follows: (a)
Assignor has all necessary power and authority to execute and
deliver this Assignment; and (b) Assignor has done no act to
encumber or otherwise assign or transfer the Contracts and
Agreements, the Leases or Intangible Property.
3. Assumption by Buyer. Assignee does hereby
acknowledge receipt of the Contracts and Agreements, the Leases and
the Intangible Property, and hereby agrees to perform all of the
duties and satisfy all of the obligations of Assignor from and
after the date hereof.
4. Counterparts. This Assignment may be executed in
two or more counterparts, each of which shall be deemed and
original, but all of which together shall constitute one and the
same instrument.
5. Heirs/Successors. This Assignment shall inure to
the benefit of and be binding upon the respective representatives,
successors and assigns of the parties hereto.
6. Governing Law. This Assignment shall be construed
and enforced in accordance with the laws of the Commonwealth of
Pennsylvania.
7. Indemnification. Assignor shall defend, protect,
indemnify and save harmless Assignee from and against any and all
liabilities, suits, actions, losses, claims, damages, reasonable
costs and expenses, including without limitation reasonable counsel
fees, suffered or incurred by Assignee resulting from any failure
by Assignor to observe or perform any of its agreements or
obligations hereunder, or under the Contracts and Agreements,
Leases and Intangible Property prior to the date hereof during the
period of Assignor's ownership of the Premises. Assignee shall
defend, protect, indemnify and save harmless Assignor from and
against any and all liabilities, suits, actions, losses, claims,
damages, reasonable costs and expenses, including without
limitation reasonable counsel fees, suffered or incurred by
Assignor resulting from any failure by Assignee to observe or
perform any of its agreements or obligations hereunder, or under
the Contracts and Agreements, Leases and Intangible Property on or
after the date hereof.
IN WITNESS WHEREOF, and intending to be legally bound
hereby, the undersigned have duly executed this Assignment of
Assumption Agreement as of the date and year first above written.
ASSIGNOR:
WITNESS: GERMANTOWN ASSOCIATES LIMITED
PARTNERSHIP, a Delaware limited
partnership
By: Germantown Realty Corp., its
General Partner
_____________ By: /s/ Theodore Sannella
Name: Theodore Sannella
Its: Vice President
ASSIGNEE:
ATTEST: GERMANTOWN ASSOCIATES, INC., an
Illinois corporation
____________ By: /s/ James L. Brault
Its: Vice President
<PAGE>
EXHIBIT "A"
SCHEDULE OF LEASES
1. Lease dated September 25, 1986, by and between Lewis J. Stowe,
III, and The Firestone Tire & Rubber Company, now known as
Bridgestone/Firestone, Inc., as amended.
2. Lease dated June 11, 1986, by and between Lewis J. Stowe, III,
and Jiffy Lube of Pennsylvania, Inc., as amended.
<PAGE>
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration
Statement No. 333-03899 of Brauvin Net Lease V, Inc. on Form S-3 of
our report dated February 10, 1997 (February 20, 1997 as to Note 5)
appearing in the Annual Report on Form 10-KSB for the year ended
December 31, 1996 as originally filed March 31, 1997.
/s/DELOITTE & TOUCHE LLP
Chicago, Illinois
June 19, 1997
<PAGE>
