Exhibit 10(z)
GROUND LEASE
This Lease is entered into as of the 25th day of March, 1994, between PHCG
INVESTMENTS ("Landlord"), a Texas general partnership, whose address is c/o
Pappas Restaurant Group, 642 Yale, Houston, Texas 77007, and LUBY'S CAFETERIAS,
INC. ("Tenant"), a Delaware corporation, whose address is 2211 Northeast Loop
410, P. O. Box 33069, San Antonio, Texas 78265-3069.
1. Landlord's Tract. Landlord represents that it owns, free and clear of
mortgage liens, a parcel of land (the "Landlord's Tract") located in the City of
Dallas, Dallas County, Texas, containing 1.5717 acres, described as Tract A in
the property description attached hereto as Exhibit "A," which is made a part
hereof.
2. City Tract. Landlord represents that it owns, free and clear of
mortgage liens, a valid and subsisting leasehold estate in a parcel of land (the
"City Tract") owned by the City of Dallas and located adjacent to Landlord's
Tract, containing 0.6106 acre, described as Tract B in the property description
attached hereto as Exhibit "A."
3. City Lease. Landlord's leasehold estate in the City Tract exists under
and by virtue of Lease Agreement dated November 10, 1982, between the City of
Dallas, as Lessor, and Oaklawn Place, Ltd., as Lessee, recorded in Volume 82225,
page 1953, Deed Records of Dallas County, Texas, as amended by (i) First
Amendment dated April 23, 1984, recorded in Volume 84088, page 4336, Deed
Records of Dallas County, Texas, (ii) Second Amendment dated January 10, 1985,
recorded in Volume 85039, page 1688, Deed Records of Dallas County, Texas, (iii)
Third Amendment dated July 30, 1985, recorded in Volume 88181, page 1583, Deed
Records of Dallas County, Texas, and (iv) Fourth Amendment dated June 1, 1988,
recorded in Volume 88181, page 1575, Deed Records of Dallas County, Texas. Said
Lease Agreement, as so amended, is referred to hereinafter as the "City Lease."
Landlord represents that the City Lease is in full force and effect and that
Landlord owns all rights of the Lessee under the City Lease.
4. Leased Premises and Reserved Parking Area. Landlord hereby leases and
lets exclusively to Tenant, and Tenant hereby leases from Landlord, upon and
subject to the provisions hereof, the following lands (the "Leased Premises"):
(a) all of Landlord's Tract; and
(b) all of the City Tract save and except an area reserved for
exclusive use by the City of Dallas for parking 14 automobiles (the
"Reserved Parking Area").
The Leased Premises and the Reserved Parking Area are shown on the drawing
attached hereto as Exhibit "B," which is made a part hereof.
5. Sublease. Notwithstanding anything to the contrary contained herein, it
is understood and agreed that, with respect to that portion of the City Tract
included within the Leased Premises, this Lease is a sublease and is subject to
all the terms and provisions of the City Lease. During the term of this Lease,
the City Lease shall not be amended or terminated without the prior written
consent of Tenant, except as hereinafter expressly provided. During the term of
this Lease, Tenant at its own expense shall comply with the provisions of the
City Lease and shall perform and fulfill the duties and obligations of the
Lessee thereunder.
6. Amendment of the City Lease. Landlord at its expense shall use
reasonable efforts to cause the City Lease to be amended as set forth in Exhibit
"C" attached hereto, which is made a part hereof. If, within 90 days after the
date of this Lease, the City Lease has not been amended as set forth in Exhibit
"C" by a recordable instrument duly authorized by the City Council of the City
of Dallas, Tenant may, as its sole and exclusive remedy, terminate this Lease by
written notice to Landlord given within 100 days after the date of this Lease.
If such termination notice is timely given, this Lease shall then terminate and
neither party shall have any further obligations hereunder.
7. Feasibility Study. Tenant shall have a period of 60 days from the date
of this Lease to conduct a feasibility study and to determine, at Tenant's
expense, that the following conditions (the "Conditions") are satisfied:
(a) that the Leased Premises are appropriately zoned and platted to
permit the construction and operation thereon of a typical
"Luby's" cafeteria (with signage and other customary facilities)
in accordance with Tenant's standard criteria and that all
building permits, curb cut permits, signage permits, and other
licenses and approvals of governmental authorities necessary for
such construction and operation are readily obtainable by Tenant
without expense other than normal fees and charges which Tenant
does not consider excessive;
(b) that soil conditions and contour elevations of the Leased Premises
are reasonably satisfactory for purposes of the contemplated
construction and operation of a cafeteria on the premises without
the expenditure of site development costs which Tenant considers
excessive;
(c) that there are no hazardous or toxic substances or pollutants in
significant quantities present in the soil of the Leased Premises;
(d) that no part of the surface of the Leased Premises lies within the
100-year flood plain;
(e) that Reagan Street, Cedar Springs Road and Oak Lawn Avenue in the
vicinity of the Leased Premises are dedicated public streets
maintained by public authority;
(f) that a water line for fire protection is located in the proximity
of the Leased Premises, that public fire hydrants connected to such
water line are installed at locations sufficiently near the Leased
Premises to meet the requirements of municipal codes and
ordinances, and that such water line is adequate to meet Tenant's
fire sprinkler system requirements;
(g) that there are available, at the perimeter of the Leased Premises,
public mains or public conduits providing electricity, telephone,
natural gas, water and sanitary sewer services adequate and
suitable for Tenant's intended use of the Leased Premises to which
Tenant may make connection within a reasonable time without charge
other than normal connection fees; and
(h) that governmental authorities will permit drainage of the Leased
Premises without the construction of drainage facilities by Buyer
at a cost which Buyer considers excessive.
8. Unsatisfied Feasibility Conditions. If Tenant determines after
conducting the feasibility study that the Conditions are not satisfied, Tenant
shall by written notice, given within 60 days after the date of this Lease,
inform Landlord of any Conditions, whether one or more, which are not
satisfied. Unless Landlord and Tenant shall in writing agree otherwise,
Landlord shall have 30 days from and after the date of Tenant's notice to
Landlord within which to satisfy the unsatisfied Conditions described in
Tenant's notice, but Landlord shall have no obligation to do so. If all of
such Conditions are not satisfied by the end of such 30 day period, Tenant may,
as its sole and exclusive remedy, terminate this Lease by written notice given
to Landlord within 10 days after expiration of such 30-day period. If such
termination is timely given, this Lease shall then terminate and neither party
shall have any further obligations hereunder.
9. Tenant's Plans. Within 60 days after the date of this Lease, Tenant
shall submit to Landlord a set of plans (the "Plans") for the cafeteria building
(the "Cafeteria") and other improvements to be constructed by Tenant on the
Leased Premises, consisting of a site plan, exterior elevations of the
Cafeteria, a description of exterior building materials and colors for the
Cafeteria, and a description of exterior signs to be located on the Leased
Premises. If within 30 days after Landlord's receipt of the Plans, Landlord
does not deliver written approval of the Plans to Tenant, either party may
terminate this Lease by written notice given to the other within 10 days after
the expiration of said 30-day period, in which event this Lease shall terminate
and neither party shall have any further obligations hereunder. Landlord and
Tenant shall act in good faith in an effort to cause the Plans to be approved
within the time above provided.
10. Survey. Within 30 days after the date of this Lease, Landlord at its
expense shall provide to Tenant a current boundary and topographical survey of
the Leased Premises describing the Leased Premises by metes and bounds and
designating site contours at one-foot intervals. Such survey shall be prepared
and certified by a licensed public surveyor and shall locate the Leased Premises
by a correct metes and bounds description (with iron pins set to mark all
corners) and shall show all easements affecting the Leased Premises and all
utilities located on the Leased Premises and in the adjacent streets. Such
survey shall contain a certification of the surveyor indicating whether any part
of the Leased Premises lies within the 100-year flood plain. If such survey
reveals any dimension of the Leased Premises to be materially different from the
dimensions shown in Exhibit "A" hereto, or if such survey reveals the existence
of any easement or other matter which may interfere with Tenant's use of the
Leased Premises, Tenant may, as its sole and exclusive remedy, terminate this
Lease by written notice to Landlord given within 30 days after receipt of such
survey, in which event this Lease shall terminate and neither party shall have
any further obligations hereunder.
11. Short-Form Lease. Promptly after the City Lease has been amended
pursuant to Section 6 and the survey has been provided pursuant to Section 10,
Landlord and Tenant shall execute and deliver to each other counterparts of a
recordable Short-Form Lease containing a summary of the essential terms of this
Lease and describing the Leased Premises by metes and bounds in accordance with
said survey. The Short-Form Lease shall be recorded promptly at Tenant's
expense.
12. Title. Within 30 days after the Short-Form Lease referred to in Section
11 is filed in the Office of the County Clerk of Dallas County, Texas, Tenant at
its expense shall cause a national title insurance company to issue a leasehold
title policy commitment covering the Leased Premises obligating the title
company to issue a leasehold title insurance policy to Tenant at Tenant's
expense insuring title to Tenant's leasehold estate in the Leased Premises. If
such commitment reveals any title exception or title matter which is
objectionable to Tenant, Tenant shall give Landlord prompt written notice of
Tenant's objections. Landlord may, but shall not be obligated to, cure such
objections. If the objections are not cured to Tenant's satisfaction or waived
by Tenant in writing within 30 days after written notice thereof is given to
Landlord, either party may terminate this Lease by written notice to the other
given within 10 days after the expiration of said 30-day period, in which event
this Lease shall terminate and neither party shall have any further obligations
hereunder.
13. Date of Possession. Tenant shall take possession of the Leased Premises
for purposes of this Lease when all of the following shall have occurred: (i)
the City Lease has been amended as provided in Section 6, (ii) Tenant's Plans
have been approved by Landlord as provided in Section 9, (iii) the survey has
been furnished as provided in Section 10, and (iv) the leasehold title insurance
policy referred to in Section 12 has been issued. The date on which the last of
such matters occurs shall be the "Date of Possession." If, for any reason
whatsoever, the Date of Possession has not occurred within 90 days after the
date of this Lease, either party may terminate this Lease by written notice to
the other, in which event this Lease shall terminate and neither party shall
have any further obligations hereunder.
14. Tenant's Work and Opening. Tenant at its expense shall construct the
Cafeteria and related improvements on the Leased Premises (referred to as
"Tenant's Work") in accordance with the approved Plans, subject to such
modifications as may be required by municipal authorities in connection with the
issuance of the necessary building permits. Subject to force majeure, as
hereinafter defined, Tenant shall cause Tenant's Work to be completed and the
Cafeteria to be opened to the public for business within nine months after the
Date of Possession. Tenant shall have no authority, express or implied, to
create or place any lien or encumbrance of any kind or nature whatsoever upon,
or in any manner to bind, the interest of Landlord in the Leased Premises.
Tenant shall pay or cause to be paid all sums legally due and payable by it on
account of any labor performed or materials furnished in connection with any
work performed on the Leased Premises by or on behalf of Tenant.
15. Primary Term. The term of this Lease shall commence on a date,
hereincalled the "Commencement Date", which is the earlier of (i) the expiration
of six months after the Date of Possession or (ii) the date on which the
Cafeteria is first opened to the public for business. The initial term of this
Lease (the "Primary Term") shall be a period of 20 years (plus the partial month
in which the Commencement Date occurs, if the Commencement Date is not on the
first day of a month), beginning on the Commencement Date.
16. Renewal Terms. Tenant is hereby granted options to extend the term of
this Lease beyond the expiration of the Primary Term for four additional periods
of five years each (the "Renewal Terms"), the first of which is to commence upon
the expiration of the Primary Term. Such options may be exercised only in
sequence. Each such option may be exercised only by written notice given to
Landlord at least six months prior to the beginning of the particular Renewal
Term to which the notice relates, but no such notice may be given at any time
when Tenant is in default under this Lease. All of the provisions of this Lease
applicable during the Primary Term shall be applicable during the Renewal Terms,
except that (i) rentals during the Renewal Terms shall be as hereinafter
provided and (ii) the Renewal Terms in the aggregate shall not exceed 20 years.
References herein to the "Lease Term" or the "term of this Lease" shall include
the Primary Term and any applicable Renewal Terms.
17. Rentals. (a) During the Lease Term, Tenant shall pay to Landlord as
rentals hereunder the following annual amounts, payable in monthly installments
in advance, without notice or demand, on the first day of each calendar month:
Lease Years Annual Amount Monthly Rental
1 thru 5 $ 80,000.00 $ 6,666.67
6 thru 10 85,000.00 7,083.33
11 thru 15 90,000.00 7,500.00
16 thru 20 95,000.00 7,916.67
21 thru 25 109,250.00 9,104.17
26 thru 30 125,637.50 10,469.79
31 thru 35 144,483.13 12,040.26
36 thru 40 166,155.59 13,846.30
(b) All rentals and other amounts required to be paid to Landlord shall
be paid at the notice address set forth in this Lease or at such
other place as Landlord may from time to time designate in
writing. Tenant shall pay all such amounts when due and payable
without prior demand therefor and without any deduction or setoff.
(c) If the Lease Term commences on a date other than the first day of a
calendar month, Tenant shall pay on such date a rental for the
partial month prorated for the number of days in such month
included in the Lease Term.
18. Use of Leased Premises. Tenant shall have the right to use the Leased
Premises solely for the operation of a cafeteria of the type operated by Tenant
at other locations in Texas and for no other purpose whatsoever. Tenant's
business operations on the Leased Premises shall be conducted only under the
trade name "Luby's" or such other trade name as is being used at the time by a
majority of Tenant's other cafeteria units in Texas. In using and occupying the
Leased Premises, Tenant shall conform to good business practice and shall comply
with all applicable laws, rules and regulations of governmental authorities.
19. Maintenance of the Leased Premises. During the Lease Term, Tenant shall
maintain the Leased Premises, the improvements and landscaping thereon and the
utility lines and other facilities located thereon in good condition and repair
at Tenant's expense, subject to the provisions hereof relating to damage by fire
or other casualty. If Tenant, after having been given 30 days' written notice,
refuses or neglects to perform any such maintenance or repair, Landlord shall
have the right to perform the maintenance or repair for the account of Tenant,
and in such event Tenant shall reimburse Landlord for the reasonable costs so
incurred, promptly upon receipt of a bill therefor.
20. Utilities. Tenant shall pay for all utility services furnished to the
Leased Premises, including utility deposits, connection fees, meter fees and
monthly charges.
21. Property Taxes. During the Lease Term, Tenant shall pay when due and
before becoming delinquent all property (ad valorem) taxes levied upon or
assessed against the Leased Premises and the improvements located thereon.
Tenant may at its expense contest the validity of any such taxes but only after
providing Landlord with an adequate bond or other assurances of payment
acceptable to Landlord. If only a portion of a tax year is included within the
Lease Term, Tenant shall pay taxes only for that portion of the tax year
included within the Lease Term.
22. Tenant's Insurance. (a) During the Lease Term, Tenant at its expense
shall maintain (i) fire and extended coverage insurance on the improvements
located on the Leased Premises and on Tenant's trade fixtures, equipment and
personal property located on the Leased Premises with limits of not less than
80% of their full replacement cost, less a deductible not to exceed $100,000,
and (ii) comprehensive general public liability insurance with respect to the
Leased Premises with limits for each occurrence of not less than $2,000,000 for
personal injury or death and $500,000 for property damage. All such insurance
shall name Landlord as an additional insured and shall require at least 10 days'
notice to Landlord of any reduction, cancellation or termination of such
insurance. Tenant shall furnish Landlord with certificates of such insurance
upon request.
(b) Tenant shall also comply during the term of this Lease with the
provisions of Article VII of the City Lease relating to insurance
and indemnity.
23. Waiver. Landlord and Tenant hereby waive and release any rights each
may have against the other for any loss or damage to the Leased Premises or to
any building located on the Leased Premises or to the contents of any such
building caused by fire or any other hazard or peril covered by fire and
extended coverage or all-risk insurance, to the extent such loss or damage is
covered by insurance; and such waiver and release shall be effective even if the
loss or damage is caused by the party released or by anyone for whom such party
is responsible. Landlord and Tenant, on behalf of their respective insurers
insuring the property of either against any such loss or damage, hereby waive
any right of subrogation that any such insurer may have against Landlord or
Tenant, as the case may be.
24. Tenant's Contractor's Insurance. Tenant shall require its General
Contractor performing work on the Leased Premises to maintain (i) comprehensive
general public liability insurance with respect to the Leased Premises with
limits for each occurrence of not less than $2,000,000 for personal injury or
death and $500,000 for property damage and (ii) workers' compensation insurance
as provided by law.
25. Tenant's Contractor's Operations. Tenant shall require its General
Contractor to keep the construction area and the Leased Premises in as clean and
neat condition as possible during construction. Tenant shall require its
General Contractor to furnish payment and performance bonds with respect to the
work to be done on the Leased Premises on behalf of Tenant. Tenant shall
require its General Contractor to locate its construction storage and staging
area on the Leased Premises.
26. Tenant's Signs. Tenant shall be permitted to maintain exterior signs
throughout the Lease Term in accordance with the following provisions:
(a) Tenant shall be entitled to maintain building signs on the
Cafeteria in accordance with Tenant's approved Plans, subject to
applicable laws, codes and governmental regulations;
(b) Tenant shall be entitled to maintain "food-to-go" signs on selected
parking spaces located on the Leased Premises in accordance with
Tenant's approved Plans, subject to applicable laws, codes and
governmental regulations;
(c) Tenant shall be entitled to maintain a free-standing sign on the
Leased Premises in accordance with Tenant's approved Plans, subject
to applicable laws, codes and governmental regulations;
(d) Tenant at its expense shall obtain all necessary permits of
governmental authorities for the erection and maintaining of
Tenant's signs and shall comply with all applicable laws, codes and
regulations of governmental authorities applicable to such signage;
(e) Tenant at its expense shall provide and install all equipment
required for the illumination of Tenant's signs and shall pay for
all electricity used for sign illumination; and
(f) Tenant at its expense shall maintain Tenant's signs in attractive
condition and good repair throughout the Lease Term.
27. Casualty Damage. If the improvements constructed on the Leased Premises
are damaged by fire or other casualty, Tenant shall proceed with reasonable
diligence, and at its cost and expense, to rebuild and repair such improvements
to the same or similar condition as that which existed prior to the casualty;
and for such purpose Tenant shall be entitled to utilize the proceeds of the
insurance maintained by Tenant. Notwithstanding the foregoing, if such
improvements are damaged to the extent of more than 25% of the replacement cost
thereof and if the damage occurs during the last three years of the Lease Term
(as then in effect), Tenant may terminate this Lease by written notice to
Landlord given within 30 days after the damage occurs, in which case the
proceeds from insurance maintained by Tenant on the improvements located on the
Leased Premises shall be assigned by Tenant to Landlord to the extent necessary
to cover Landlord's expense of removing debris and restoring the Leased Premises
to the condition which existed prior to construction of Tenant's improvements.
If the casualty, repairing or rebuilding renders the Leased Premises
untenantable, in whole or in part, a proportionate abatement of rentals shall be
allowed from the date when the damage occurred until substantial completion of
the repairs or rebuilding, provided Tenant diligently pursues to completion the
repairs or rebuilding.
28. Condemnation.
(a) If any material part of the Leased Premises is taken for public or
quasi-public use under any governmental law, ordinance or
regulation or by right of eminent domain, or if Tenant's rights of
ingress and egress are materially restricted or denied as a result
of any taking for public or quasi-public use under any governmental
law, ordinance or regulation or by right of eminent domain, Tenant
may terminate this Lease by written notice to the Landlord, in
which event this Lease shall terminate as of the date that
possession of the part so taken is surrendered to the condemning
authority and neither party shall have any further obligation
hereunder. If this Lease is terminated as a result of any such
taking, the award or compensation for such taking shall be
apportioned as follows: (i) Tenant shall be entitled to an amount
equal to the unamortized investment of Tenant in the leasehold
improvements on the Leased Premises, based upon twenty-year
straight-line depreciation, and (ii) the balance shall belong to
Landlord.
(b) If any part of the Leased Premises is taken for public or quasi-
public use under any governmental law, ordinance or regulation or
by right of eminent domain and Tenant does not exercise its right
to terminate this Lease as provided in the preceding paragraph,
this Lease shall continue in force and effect with respect to that
portion of the Leased Premises not taken; rentals hereunder shall
thereafter be reduced in the proportion that the area of the land
taken bears to the total land area of the Leased Premises; and the
entire award or compensation for such taking shall belong
exclusively to Landlord.
(c) As used in this Section 28, the phrase "material part of the Leased
Premises" shall mean a portion of the Leased Premises the loss of
which would materially and adversely affect Tenant's cafeteria
operations on the Leased Premises.
(d) Notwithstanding the foregoing, the provisions of Article XIII of
the City Lease shall apply to any condemnation or other taking of
all or any part of the City Tract.
29. Mechanic's Liens. Tenant shall use its best efforts to prevent the
creation of any lien against the Leased Premises on account of labor or
materials furnished in connection with any construction, maintenance,
repairs or alterations. If any such lien is filed against the Leased
Premises, Tenant shall cause such lien to be released within 60 days
after actual notice of the filing thereof or shall furnish to Landlord a
bond or other security reasonably satisfactory to Landlord, conditioned
to indemnify Landlord against the foreclosure of such lien.
30. Force Majeure. Notwithstanding anything elsewhere herein contained, it
is agreed that in the event either party shall be delayed or hindered in or
prevented from the performance of any act required hereunder by reason of
strikes, lockouts, inability to procure labor or materials, failure of power,
restrictive governmental laws or regulations, riots, insurrection, war, fire or
other casualty or other cause beyond the reasonable control of the party delayed
in performing work or doing acts required under the terms of this Lease, then
performance of such act shall be excused for the period of the delay, and the
period for the performance of any such act shall be extended for a period
equivalent to the period of such delay. The provisions of this Section shall
not (a) operate to excuse Tenant from prompt payment of rentals or other
payments required under this Lease or (b) be applicable to delays resulting from
Tenant's financial distress or its inability to obtain financing. The causes
described in this Section are referred to elsewhere in this Lease as "force
majeure."
31. Default by Tenant. Tenant may be declared in default hereunder by
Landlord if
(a) Tenant fails to pay when due any payment of rental or other sum of
money payable to Landlord hereunder and such failure continues
for more than 10 days after written notice from Landlord to Tenant;
(b) It becomes necessary for Landlord to give (and Landlord does give)
more than two notices of non-payment to Tenant pursuant to clause
(a) above in any period of 12 consecutive months; or
(c) Tenant fails to perform or observe any covenant or condition (other
than for the payment of rental or other sum of money to Landlord)
which Tenant is required to perform or observe hereunder and such
failure continues for 30 days after written notice from Landlord to
Tenant specifying the nature of such failure (unless the failure is
of such nature that it cannot reasonably be cured within 30 days,
in which case Tenant shall not be in default if Tenant commences to
cure within the 30-day period and thereafter diligently pursues the
cure to completion).
In addition, Landlord may declare Tenant in default if (i) Tenant is adjudicated
bankrupt or insolvent, (ii) Tenant makes a general assignment for the benefit of
creditors, (iii) a receiver is appointed for a substantial portion of Tenant's
assets or (iv) Tenant's interest in the Leased Premises is sold under
attachment, execution or similar legal process. If Landlord declares Tenant in
default, Landlord shall have the right and option to pursue any and all remedies
provided by law or in this Lease. All rights and remedies herein provided shall
be cumulative and shall not exclude any other rights or remedies. Such rights
and remedies may be exercised and enforced concurrently or whenever or as often
as the occasion therefor arises. If Tenant is declared in default, Landlord
shall have the right to re-enter and take possession of the Leased Premises, to
remove all persons and property from the Leased Premises and to store such
property at Tenant's expense, all without notice or resort to legal process and
without being deemed guilty of trespass or becoming liable for any loss or
damage occasioned thereby. If Tenant is declared in default and Landlord does
not elect to terminate this Lease, Landlord shall have the right to correct the
default and to recover the reasonable cost thereof from Tenant, which cost
Tenant agrees to pay to Landlord upon written demand. If Landlord takes
possession of the Leased Premises without terminating this Lease, Landlord shall
use good faith and best efforts to relet the same on reasonable terms, with
Tenant remaining liable to pay rentals hereunder for the remainder of the term
of this Lease, less the net amount realized from such reletting. Should the sum
realized from such reletting be less than the rentals, Tenant shall pay such
deficiency each month upon demand therefor. No act of Landlord shall be deemed
an act terminating this Lease or declaring the term of this Lease ended unless a
written notice is served upon Tenant by Landlord expressly setting forth therein
that Landlord elects to terminate this Lease or to declare the term ended, in
which event Tenant shall thereby be released from any liabilities hereunder.
32. Legal Expenses. If either party hereto resorts to legal action against
the other to protect or enforce any right hereunder, the party prevailing in
such action shall be entitled to recover its attorneys' fees, court costs and
other expenses relating to such action from the other party.
33. Peaceable Possession. So long as Tenant is not in default hereunder,
Tenant shall peaceably and quietly hold and enjoy during the Lease Term the
Leased Premises and all rights granted hereunder without interruption, subject
to the terms and conditions of this Lease.
34. Termination. Tenant shall vacate the Leased Premises on or before the
last day of the term of this Lease (or any Renewal Lease), leaving such premises
in a good, clean and satisfactory condition, unless termination results from
fire or other casualty. All improvements located on the Leased Premises at the
expiration or termination of this Lease shall become the property of Landlord.
Tenant shall have the right at such time to remove its personal property, trade
fixtures, restaurant equipment, coolers, compressors, heating equipment, air
conditioning equipment and signs, but Tenant shall repair any damage to
improvements caused by such removal.
35. Holding Over. In the event Tenant remains in possession of the Leased
Premises after the expiration of the Lease Term with Landlord's consent, Tenant
shall be deemed to be occupying the Leased Premises as a tenant from month to
month, at the rents herein specified, subject to all conditions, provisions and
obligations of this Lease, insofar as the same are applicable to a month-to-
month tenancy. In the event Tenant remains in possession of the Leased Premises
after the expiration of the Lease Term without Landlord's consent, Tenant shall
be deemed to be occupying the Leased Premises as a tenant at sufferance, at 150%
of the rents herein specified, subject to all conditions, provisions and
obligations of this Lease, insofar as the same are applicable to a tenant at
sufferance.
36. Assignment and Subletting. Tenant covenants and agrees not to assign
this Lease or to sublease the whole or any part of the Leased Premises to other
than a parent, subsidiary or affiliated company (i.e., an entity having the same
parent company as Tenant), or to permit any other persons to occupy same,
without the written consent of Landlord, which consent will not be unreasonably
withheld. Landlord's consent to any assignment or subletting shall not
constitute a waiver of the necessity for such consent to any subsequent
assignment or subletting. The acceptance of rent from any other person shall
not be deemed to be a waiver of any of the provisions of this Lease or to be a
consent to the assignment of this Lease or subletting of the Leased Premises.
Any assignee of Tenant shall take possession of the Leased Premises in
accordance with the terms, conditions, obligations and rights of this Lease.
Any transfer of an ownership interest in Tenant by merger, consolidation or sale
of stock shall not constitute an assignment for the purpose of this Lease and
shall not require the consent of Landlord, provided the surviving entity
specifically assumes Tenant's obligations under this Lease in writing. No
assignment, sublease, or occupancy of the Leased Premises shall affect or
diminish Tenant's liability hereunder.
37. Late Payment. If Tenant shall fail to pay to Landlord when due any
installment of rental or other sum of money payable hereunder, the past-due
amount shall bear interest at the maximum legal rate permitted by law (not in
excess of 18% per annum) from the date due until paid.
38. Brokers. Landlord and Tenant represent to each other that no real
estate agent or broker has been engaged or involved in connection with this
Lease except that Landlord agrees to pay, upon the opening of the Cafeteria on
the Leased Premises, a commission of $35,000.00 to Scott R. Steenson, a
commission of $35,000.00 to Chris Cosby, and a commission of $35,000.00 to
Thomas Mattingly, which commissions shall be paid only if and when the Cafeteria
is opened to the public for business.
39. Notices. Any notice or demand required or permitted to be given herein
shall be in writing and shall be deemed delivered when actually received, or
when deposited in the United States mails, certified or registered mail, return
receipt requested, postage prepaid, addressed to the parties as follows:
Landlord: PHCG Investments
c/o Pappas Restaurant Group
642 Yale
Houston, Texas 77007
Tenant: Luby's Cafeterias, Inc.
2211 Northeast Loop 410
P. O. Box 33069
San Antonio, Texas 78265-3069
Attention: Real Estate Department
Either party may change its address for notice at any time or from time to time
by notification in writing delivered to the other party.
40. Miscellaneous. (a) This Lease contains the entire agreement of the
parties and may not be amended, modified, released or discharged, in whole or in
part, except by an instrument in writing signed by the parties.
(b) The captions contained in this Lease are for convenience and
reference only, and shall not be held to explain, modify, amplify
or aid in the interpretations, construction or meanings of the
provisions of this Lease to which they relate.
(c) This Lease shall be governed by and construed in accordance with
the laws of the state where the Leased Premises are located. If
any provision of this Lease shall to any extent be invalid or
unenforceable, the remainder of this Lease or the application of
such provision or any portion thereof to any person or
circumstances shall not be affected thereby, and each valid
provision or portion thereof shall be enforceable to the fullest
extent permitted by law.
(d) Nothing contained in this Lease shall be construed to make the
parties partners or joint venturers or to render either party
liable for the debts or obligations of the other, except as
expressly provided in this Lease.
(e) Subject to the provisions of this Lease, the covenants, conditions
and agreements contained herein shall bind and inure to the benefit
of Landlord and Tenant and their respective successors and assigns.
(f) No waiver by either party of any default or breach of any term,
condition, or covenant of this Lease shall be deemed to be a waiver
of any other breach of any other term, condition, or covenant
contained herein.
Executed in counterparts as of the date first above written.
PHCG INVESTMENTS
By: /s/Pete H. Pappas
_____________________
Name: Pete H. Pappas
Title: General Partner
LUBY'S CAFETERIAS, INC.
By: /s/John A. Finch
_____________________
John A. Finch,
Vice President
LEASE AMENDMENT
This Lease Amendment is entered into as of July 6, 1994, between PHCG
INVESTMENTS ("Landlord"), a Texas general partnership, and LUBY'S CAFETERIAS,
INC. ("Tenant"), a Delaware corporation, witnesseth:
WHEREAS, a Ground Lease (the "Lease") dated March 25, 1994, was entered
into between Landlord and Tenant covering certain land located in the City of
Dallas, Dallas County, Texas (the "Leased Premises"); and
WHEREAS, the parties desire to amend the Lease as hereinafter set forth;
NOW, THEREFORE, Landlord and Tenant hereby amend the Lease as follows:
A. There is hereby added to the Lease a new Section 41 reading in its
entirety as follows:
41. Platting. (a) It is understood that the City of Dallas (the "City")
will not issue a building permit for construction of Tenant's improvements on
the Leased Premises until the Leased Premises have been platted in accordance
with the City's platting ordinances. Tenant at its expense shall cause to be
prepared and filed with the City an application for platting the Leased
Premises. Landlord agrees to execute such documents as may be required to
initiate and to consummate the platting process, but the expense involved shall
be borne by Tenant.
(b) If the City imposes preliminary platting conditions which are
unacceptable to Tenant, Tenant may, as its sole and exclusive
remedy, terminate this Lease by written notice given to Landlord
within 15 days after receipt by Tenant of written notification from
the City specifying the preliminary platting conditions. If such
notice is not given to Landlord within the 15-day period, such
conditions shall be deemed acceptable to Tenant.
(c) If Tenant does not terminate this Lease pursuant to subsection (b)
above, Tenant shall proceed diligently at its expense to comply
with the preliminary platting conditions and to obtain final
platting approval by the City.
(d) Engineering fees and filing fees paid by Tenant in connection with
the platting process not exceeding $1,000.00 in the aggregate may
be offset and deducted from the first rentals payable by Tenant
under this Lease.
B. Section 6 of the Lease is hereby amended by adding thereto the
following: Tenant shall pay $1,000.00 to the City of Dallas as the
required consideration for amending the City Lease. Such amount may be
offset and deducted from the first rentals payable by Tenant under the
Lease.
C. Section 13 of the Lease is hereby amended so as to read in its entirety
as follows:
13. Date of Possession. Tenant shall take possession of the Leased Premises
for purposes of this Lease when all of the following shall have occurred: (i)
the City Lease has been amended as provided in Section 6, (ii) Tenant's Plans
have been approved by Landlord as provided in Section 9, (iii) the survey has
been furnished as provided in Section 10, (iv) the leasehold title insurance
policy referred to in Section 12 has been issued, and (v) preliminary platting
conditions acceptable to Tenant have been received by Tenant as provided in
Section 41. The date on which the last of such matters occurs shall be the
"Date of Possession." If, for any reason whatsoever, the Date of Possession has
not occurred by August 31, 1994, either party may terminate this Lease by
written notice to the other, in which event this Lease shall terminate and
neither party shall have any further obligations hereunder.
D. The Lease, as hereby amended, shall continue in force and effect
according to its terms.
Executed in counterparts as of the date first above written.
LUBY'S CAFETERIAS, INC. PHCG INVESTMENTS
By: /s/John A. Finch By: /s/Pete H. Pappas
___________________ ____________________
John A. Finch Pete H. Pappas
Vice President General Partner