EXHIBIT 4-B
LEASE
- ------
In consideration of the rents and covenants set forth below,
Landlord (as hereinafter defined) hereby leases to Tenant
(as hereinafter defined), and Tenant hereby leases from
Landlord, the Property (as hereinafter defined), upon the
following terms and conditions:
ARTICLE 11
FUNDAMENTAL LEASE PROVISIONS
1.1 Definitions. The provisions in this Article shall be
referred to in this Lease as the "Fundamental Lease
Provisions". Unless otherwise defined herein, capitalized
terms used in this Lease shall have the meanings listed
in the Fundamental Lease Provisions.
Commencement Date: Closing_Date
Landlord: Borrower
4220 Edison Lakes Parkway Mishawaka,
Indiana 46545
FAX: (219) 243-4377
Tenant Opsub
4220 Edison
Lakes Parkway
Mishawaka,
Indiana 46545
FAX: (219) 243-4377
Tenant's EID No.: Opsub_Tax_ID
Guarantor: Quality Dining, Inc., an Indiana corporation
Property: That certain real property, together with all improvements
and equipment located thereon, commonly known as the
FranchiseType located at Premises_Street , Premises_City,
Premises_State Premises_Zip , and more particularly
described in Exhibit A attached hereto
Term Term, commencing on the Commencement Date
Minimum Monthly
Rent: $__________________, subject to proration and
adjustment as provided in Article 2
Lender: Lender
Franchisor: Fran_chisor
Franchise
Agreement: The Franchise Agreement
between Fran_chisor and
Tenant with respect to the Property
Permitted Use: A FranchiseType restaurant
1.2 Intent of Parties. Landlord
and Tenant acknowledge and agree
that this Lease is being
executed and delivered
contemporaneously with the
execution and delivery by Landlord
of the Mortgage (as defined in the
Note, as defined below), granting
to Lender a first priority lien
on the Landlord's fee or
leasehold interest in the Property, which
Mortgage secures Landlord's obligations
under that certain Promissory Note
of even date herewith in the
original principal amount of
Loan_Amt ("Note"). Tenant
further agrees that as a condition
to Lender agreeing to make a
loan and other financial accommodations
and extensions of credit to Landlord,
and to induce Lender to enter into said
financing arrangements, Lender is
relying upon Tenant's execution of
this Lease and performance
of all terms and conditions
herein. Tenant acknowledges
receipt of a fully executed copy
of the Mortgage.
ARTICLE 22
TERM AND RENT
2.1 Term2.1 Term.
The Term of this Lease shall be as
set forth in the Fundamental Lease
Provisions and shall be
hereinafter referred to as the
"Lease Term."
2.2 Minimum Monthly Rent2.2 Minimum Monthly Rent.
For the use and occupancy of the
Property, Tenant shall pay
Landlord the Minimum Monthly
Rent, in advance, commencing on
the Commencement Date and
continuing on the first day of
each calendar month thereafter
during the Lease Term, without
any offset or deduction. Should the
Lease Term commence on a day other
than the first day of a calendar
month, then the rental for such
first fractional month
shall be computed on a daily basis for
the period from the Commencement Date
to the end of such calendar month
at an amount equal to 1/30th of
the Minimum Monthly Rent for each
day. Should the Lease Term end on
a day other than the last day of a
calendar month, then the rental for
such fractional month
shall be computed on a daily basis
at an amount equal to 1/30th of
the Minimum Monthly Rent for each
day. Tenant shall pay Landlord
the Minimum Monthly Rent in lawful
money of the United States at
the address for Landlord
set forth in the Fundamental
Lease Provisions, or to such other
persons or at such other places as
Landlord may designate in writing
to Tenant.
2.3 Impositions2.3 Impositions.
In addition to the Minimum Monthly
Rent, Tenant shall pay to the
parties respectively entitled
thereto all impositions, insurance
premiums, Taxes (as defined in
Article 4), operating charges,
maintenance charges, construction
costs, accounting and legal fees,
and any other charges, costs and
expenses which arise or may be
contemplated under any
provision of this Lease during
the Lease Term (collectively, the
"Impositions"). Tenant shall
furnish to Landlord, promptly
after payment of any Taxes or
insurance premiums, and, with
respect to any other Impositions,
promptly upon request of Landlord,
official receipts or other
satisfactory proof evidencing payment of such
Impositions. Upon Tenant's failure to pay
such Impositions on two (2) or
more occasions during the Lease
Term, Landlord shall have the
option to require Tenant to
deposit with Landlord (i) funds
sufficient for the
payment of the current Impositions
required to be paid by Tenant
hereunder, and (b) onetwelfth of
the current annual or
annualized Impositions, as the
case may be (or those of the
preceding years if the current
amounts thereof have not been
fixed), in advance and on the
same day upon which the Minimum
Monthly Rent is due.
2.4 Late Charge2.4 Late Charge.
If any installment of the Monthly
Minimum Rent, any Imposition or
any other payment provided for
under this Lease which is payable
by Tenant is not received by
Landlord by the date when due,
Tenant shall immediately pay
Landlord as a late charge an amount
equal to the lesser of (y) 5% of
the amount of such payment or (z)
the maximum amount of late
charges permitted by law (the "Late
Charge"). Landlord and Tenant agree
that the Late Charge represents a
fair and reasonable estimate of the
costs that Landlord will incur by
reason of any such late payment
by Tenant. Acceptance of the
Late Charge by Landlord shall not
constitute a waiver of Tenant's
default with respect to the
overdue amount, nor prevent
Landlord from exercising any
other rights and remedies
available to Landlord under this
Lease on account of such overdue
amount, unless such Late Charge is
accompanied by the amount of such
overdue payment.
2.5 Net Lease2.5 Net Lease.
This Lease is what is commonly
called a "triple net lease," it being
understood that Landlord shall
receive the Minimum Monthly Rent
free and clear of any and all
Taxes, other Impositions, liens,
charges, or expenses of
any nature whatsoever incurred
in connection with the ownership
and operation of the Property.
ARTICLE 33
USE OF THE PROPERTY
3.1 Use3.1 Use.
Tenant shall use the Property
solely for the Permitted Use. Tenant may
not use the Property for any other
purpose without obtaining the
prior written consent of
Landlord, which consent shall not
be unreasonably withheld.
3.2 Condition of Property3.2 Condition of Premises.
Tenant accepts the Property in
its "as is" condition. Tenant acknowledges
that Landlord makes no warranty of
any kind with respect to the
Property.
3.3 Compliance With Law3.3 Compliance With Law.
3.3.1 Tenant shall, at
Tenant's sole expense, comply in
all material respects with all
applicable laws, ordinances,
orders, rules and regulations of
any governmental authorities and
with any directive of any public
officer which shall impose any
violation, order or duty upon
Landlord or Tenant with respect to
the Property or the use or
occupation thereof or signage
thereon, including, without
limitation, any governmental law or
statute, rule, regulation,
ordinance, code, policy or rule of
common law now or hereafter in
effect relating to
the environment, health or safety.
3.3.2 Tenant shall not use or
permit the Property to be used
in any manner which will result in
waste or the creation of a
nuisance, and Tenant shall maintain
the Property free of any
objectionable noises, odors, or
disturbances.
3.4 Environmental Compliance3.4 Environmental Compliance.
3.4.1 Tenant shall, at its sole
cost and expense at all times
during the Lease Term, comply in
all respects with the Environmental
Laws (as defined below) in its use
and operation of the Property.
3.4.2 Tenant shall not use the
Property for the purpose of storing
Hazardous Materials (as defined below)
except in full compliance with the
Environmental Laws and other
applicable laws, and shall not
cause the release of any Hazardous
Material.
3.4.3 Tenant shall notify
Landlord promptly and in reasonable
detail in the event that Tenant
becomes aware of or suspects (i)
the presence of any Hazardous
Material on the Property (other
than any Permitted Hazardous
Materials, as defined below), or
(ii) a violation of the
Environmental Laws on the Property.
3.4.4 If Tenant uses or permits the
Property to be used so as to
subject Tenant, Landlord or any
occupant of the Property to a
claim of violation of the Environmental
Laws (unless contested in good
faith by appropriate proceedings),
Tenant shall, at its sole cost and
expense, immediately cease or
cause cessation of such use or
operations and shall remedy and
fully cure any conditions arising
therefrom.
3.4.5 At its sole cost and
expense, Tenant shall (i)
immediately pay, when due, the cost
of compliance with the
Environmental Laws within the
Property, and (ii) keep the
Property free of any liens imposed
pursuant to the Environmental Laws.
Tenant shall, at all times, use,
handle and dispose of any Permitted
Hazardous Material in a
commercially reasonable manner and
in compliance with the
Environmental Laws and applicable
industry standards. Tenant shall
cooperate with Landlord in any
program between Landlord and any
governmental entity for proper
disposal and/or recovery of any
Permitted Hazardous Material.
3.4.6 Tenant shall indemnify,
save and hold Landlord harmless
from and against any claim,
liability, loss, damage or
expense (including, without
limitation, reasonable attorneys'
fees and disbursements) arising out
of any violation of the
covenants of Tenant contained in
this Section by Tenant, or out of
any violation of the Environmental
Laws by Tenant, its owners,
employees, agents, contractors,
customers, guests and invitees,
which indemnity obligation shall
survive the expiration or
termination of this Lease.
3.4.7 In the event that Tenant
fails to comply with any of the
foregoing requirements of this
Section, after the expiration of
the cure period permitted under the
Environmental Laws, if any,
Landlord may, but shall not be
obligated to (i) elect that such
failure constitutes a default under
this Lease; and/or (ii) take any
and all actions, at Tenant's sole
cost and expense, that Landlord
deems necessary or desirable to
cure any such noncompliance.
Tenant shall reimburse Landlord for any costs
incurred by Landlord in exercising
its options under this subsection
within 5 days after receipt of a
bill therefor.
3.4.8 The provisions of this
Section shall survive the
expiration or termination of the
Lease Term. Capitalized terms used in this
Section and not otherwise defined
herein shall have the following
meanings:
"Hazardous Materials" means any of
the following as defined by the
Environmental Laws: solid wastes;
medical or nuclear waste or
materials; toxic or hazardous
substances; natural gas, liquified
natural gas or synthetic fuel
gas; petroleum products or
derivatives, wastes or
contaminants (including, without limitation,
polychlorinated biphenyls); paint
containing lead; ureaformaldehyde
foam insulation; asbestos
(including, without limitation,
fibers and friable asbestos);
explosives, and discharges of
sewage or effluent.
"Environmental Laws" means all
requirements of environmental,
ecological, health, or industrial
hygiene laws or regulations or
rules of common law related to
the Property, including all
requirements imposed by any law,
rule, order, or regulation of any
federal, state, or local
executive, legislative,
judicial, regulatory, or
administrative agency, board, or
authority, which relate to (i)
noise; (ii) pollution or protection
of the air, surface water, ground
water, or land; (iii) solid,
gaseous, or liquid waste
generation, treatment, storage,
disposal, or transportation; (iv)
exposure to Hazardous Materials; or
(v) regulation of the manufacture,
processing, distribution and
commerce, use, or storage of
Hazardous Materials.
"Permitted Hazardous Material"
means any Hazardous Material which
is necessary and commercially
reasonable for the provision of
any good or service related to
the Permitted Use.
3.5 Permits and Licenses3.5 Permits and Licenses.
Tenant shall be solely responsible to
apply for and secure any building permit or
permission of any duly constituted
authority for the purpose of
doing any of the things which
Tenant is required or permitted to
do under the provisions of this
Lease.
3.6 Franchise Agreement3.6
Franchise Agreement. Tenant is a
franchisee in good standing with
Franchisor and is not in default
under the Franchise Agreement
relating to the Property. Tenant
shall keep the Franchise Agreement
relating to the Permitted Use in full
force and effect. Tenant shall promptly
provide Landlord with a copy of (i)
any notice of termination of the
Franchise Agreement, or (ii) any
notice of the existence of any
breach which, with notice or the
passage of time or both, would
entitle Franchisor to terminate
the Franchise Agreement. Tenant
shall not pledge or encumber any
asset (tangible or intangible),
other than the Excluded Collateral
(as defined in the Mortgage),
located at the Property; provided,
however, this provision shall not
prohibit Tenant from collaterally
assigning its interest in this
Lease (subject to paragraph 10.1
hereof) or in the Franchise
Agreement to Chase Bank of Texas,
National Association, as
Administrative Agent or another
senior lender or from entering
into intercreditor agreements from
time to time with any such
senior lender substantially in the
form of the Consent to
Collateral Assignment dated
September 11, 1998 with Brinker
International, Inc. or the
Intercreditor Agreement dated on
or about the date hereof with
Burger King Corporation, all of
which Tenant is permitted to do
provided that such senior lender
shall simultaneously enter into an
intercreditor agreement with
Lender in substantially the same
form as the Intercreditor
Agreement of even date herewith
by and among the Lender, Chase
Bank of Texas, National
Association, as Administrative
Agent, and certain other parties
("Chase Agreement").
3.7 Liquor License. Tenant shall
keep any license, permit or
similar approval ("Permits")
relating to the sale of liquor,
beer or wine on the Property in
connection with the Permitted Use
in full force and effect. Tenant
shall promptly provide Landlord
with a copy of (i) any notice of
termination of any Permit, or (ii)
any notice of the existence of any
breach which, with notice or the
passage of time or both, would
entitle any applicable governing
body to terminate or suspend any
such Permit or to restrict
Tenant's ability to sell liquor,
beer or wine on the Property.
Tenant shall not pledge or encumber
its rights under the Permits.
3.8 Liens and Encumbrances.
Except as otherwise expressly
permitted herein, Tenant shall not
pledge or encumber any asset
(tangible or intangible)
located at the Property.
Notwithstanding the foregoing,
this section shall not be
construed to prohibit Tenant from
granting a security interest in
inventory located at the Property
nor from (i) replacing any of the
existing furniture, fixtures and
equipment ("FF&E") with FF&E that
is leased nor from granting a
purchase money security interest
to finance the acquisition of such
replacement FF&E, or (ii) from
continuing to maintain any
presently existing FF&E located
at the Property which is leased.
ARTICLE 44
TAXES AND UTILITIES
4.1 Payment of Taxes4.1 Payment of Taxes.
Tenant shall pay the Taxes
(as defined in the following
Section) applicable to the Property
during the Lease Term. Landlord
shall provide Tenant with copies
of any tax bills applicable to the
Property promptly after receipt of
such bills. All such payments
shall be made at least 10 days
prior to the delinquency date of
such payment. Tenant shall
promptly furnish Landlord with
satisfactory evidence that such
Taxes have been paid. If any such
Taxes paid by Tenant shall cover
any period of time prior to or
after the expiration of the Lease
Term, Landlord shall reimburse
Tenant to the extent required. If
Tenant shall fail to pay any such
Taxes, Landlord shall have the
right (but not the obligation) to
pay the same, in which case Tenant
shall repay such amount plus any
penalties and interest resulting
therefrom to Landlord within 5
days after receipt of a bill
therefor.
4.2 Definition of "Taxes"4.2 Definition of "Taxes".
As used herein, the term "Taxes" shall include:
4.2.1 any form of real estate tax
or assessment, ad valorem tax or
gross receipts tax, imposed by
any authority having the direct
or indirect power to tax, including
any city, county, state, or
federal government, or any school,
agricultural, sanitary, fire,
street, drainage, or other
improvement district thereof, on,
against or with respect to the
Property, this Lease, any legal or
equitable interest of Landlord or
any superior landlord in the
Property or in the real property of
which the Property are a part,
Landlord's right to rent or other
income therefrom, and Landlord's
business of leasing the Property;
4.2.2 any tax, fee, levy,
assessment, penalty, interest or
other charge (i) in substitution
of, partially or totally, any
tax, fee, levy, assessment, or
charge hereinabove included within
this definition of Taxes, or (ii)
any tax or increase in any tax
which is imposed as a result of a
transfer, either partial or total,
of Landlord's interest in the
Property to Tenant, or (iii) which is
imposed by reason of this
transaction, any modifications or
changes hereto, or any transfers
hereof; and
4.2.3 all inspection fees,
taxes, bonds, permits,
certificates, assessments and
sales, use, property or other taxes,
fees or tolls of any nature
whatsoever (together with any
related interest or penalties) now
or hereafter imposed against
Landlord or Tenant by any
federal, state, county or local
governmental authority upon or
with respect to the Property or
the use thereof or upon the
possession, leasing, use, operation
or other disposition thereof or
upon the rents, receipts or
earnings arising therefrom or upon
or with respect to this Lease; and
4.2.4 all taxes assessed
against and levied upon trade
fixtures, furnishings, equipment,
and all other personal property
of Tenant contained in the Property
or elsewhere, which Tenant shall
cause to be separately assessed and
billed directly to Tenant.
Tenant shall pay when due or reimburse
and indemnify and hold
Landlord harmless from and
against any Taxes. Notwithstanding the
foregoing, the term "Taxes" shall not include any
general income taxes, inheritance
taxes, and estate taxes imposed
upon Landlord.
4.3 Tenant's Right to Contest Taxes4.3 Tenant's Right to Contest Taxes.
4.3.1 Tenant shall have the
right, at its sole cost and
expense, to contest the amount or
validity, in whole or in part, of any
Taxes by appropriate proceedings
diligently conducted in good faith,
but no such contest shall be
carried on or maintained by
Tenant after the time limit for the
payment of any Taxes unless Tenant
shall (i) pay the amount involved
under protest; (ii) procure and
maintain a stay of all proceedings
to enforce any collection of any
Taxes, together with all penalties,
interest, costs and expenses, by a
deposit of a sufficient sum of
money, or by such undertaking, as
may be required or permitted by law
to accomplish such stay; or (iii)
deposit with Landlord, as security
for the performance by Tenant
of its obligations hereunder with
respect to such Taxes, 150% of
such contested amount or such
other reasonable security as may be
demanded by Landlord to insure
payment of such contested Taxes
and all penalties, interest, costs
and expenses which may accrue
during the period of the contest.
Upon the termination of any such
proceedings, Tenant shall pay the
amount of such Taxes or part
thereof, as finally determined in
such proceedings, together with any
costs, fees (including all
reasonable attorneys' fees and
expenses), penalties or other
liabilities in connection
therewith; provided, however, that
if Tenant has deposited cash or
cash equivalents with Landlord as
security under clause (iii) above,
then, so long as no default
exists under this Lease,
Landlord shall arrange to pay
such Taxes (or part thereof) together
with the applicable costs, fees and
liabilities as described above
out of such cash or cash
equivalents and return any unused
balance, if any, to Tenant.
Otherwise, Landlord shall return
to Tenant all amounts, if any,
held by or on behalf of Landlord
which were deposited by Tenant in
accordance with such clause (iii).
4.3.2 Tenant shall have the
right, at its sole cost and
expense, to seek a reduction in the
valuation of the Property as
assessed for tax purposes and to
prosecute any action or
proceeding in connection therewith.
Provided Tenant is not in
default hereunder, Tenant shall be
authorized to retain any tax
refund of any tax paid by Tenant.
4.3.3 Landlord agrees that whenever Landlord's cooperation is
required in any proceeding brought by Tenant to contest any tax,
Landlord will reasonably cooperate therein, provided same shall not
entail any cost, liability or expense to Landlord.
Tenant shall pay, indemnify and save Landlord harmless of and
from, any and all liabilities, losses, judgments, decrees, costs
and expenses (including all reasonable attorneys' fees and
expenses) in connection with any such contest and shall, promptly
after the final settlement, fully pay and discharge the amounts
which shall be levied, assessed, charged or imposed or be
determined to be payable therein or in connection therewith,
and Tenant shall perform and observe all acts and obligations,
the performance of which shall be ordered or decreed as a
result thereof. No such contest shall subject Landlord to the
risk of any civil liability or the risk of any criminal
liability, and Tenant shall give such reasonable indemnity
or security to Landlord as may reasonably be demanded by
Landlord to insure compliance with the foregoing provisions of
this Section.
4.4 Payment of Utilities4.4 Payment of Utilities. Tenant
shall pay to the utility companies or other parties entitled to
payment the cost of all water, heat, air conditioning, gas,
electricity, telephone, and other utilities and services provided
to or for the Property, including, without limitation, connection
fees and taxes thereon. In the case of any utilities or services
which are not separately metered and billed directly to Tenant,
but are metered jointly with other property, Tenant shall pay to
the parties entitled thereto, a pro rata share based on Tenant's
usage of such utilities and services.
4.5 Interruption in Utility Service4.5 Interruption in
Utility Service. Landlord shall not be liable in damages or
otherwise for any failure or interruption of any utility or other
service being furnished to the Property, and no such failure or
interruption shall entitle Tenant to any abatement of, set off or reduction
in the amounts payable to Landlord hereunder or otherwise
entitle Tenant to terminate this Lease.
ARTICLE 55
INSURANCE AND INDEMNIFICATION
5.1 Tenant's Insurance5.1 Tenant's Insurance. From and
after taking possession of the Property, Tenant shall carry and
maintain, at its sole cost and expense, the following types and
amounts of insurance:
Insurance Type Amount ofCoverage Risks Covered
- -------------- ----------------- -----------
Commercial General Liability $1,000,000 per bodily injury,
occurrence and property damage and
$2,000,000 in the contractual liability
aggregate
Property Damage full replacement "all risk", including
value sprinkler damage
Business not less than 6 loss of earnings by at
Interruption installments of least the perils of
Minimum Monthly Rent fire and lightning,
extended coverage,
vandalism, malicious
mischief and sprinkler
leakage
Worker's as required by law
compensation
Flood Insurance to the extent of damage caused by
current coverage flooding
5.2 Policy Form5.2 Policy Form.
5.2.1 Tenant shall obtain all
policies of insurance required by
Section 5.1 from insurance
companies having an A.M. Best
rating of A- or better which are
qualified to do business in the
jurisdiction where the Property
are situated. All such policies
shall be issued in the names of
Landlord and Tenant, and shall
name Lender as additional insured.
In addition, all such policies
providing coverage for physical
damage include loss payee and
mortgagee endorsement in favor of
Landlord and Lender, respectively
and as applicable. The Tenant
shall cause copies of such
policies of insurance or
originally executed certificates
thereof to be delivered to Landlord
prior to Landlord's execution of
this Lease, and not less than 30
days prior to any renewal
thereof. Landlord shall cause
copies of all such policies of
insurance or originally executed
certificates thereof, together
with any and all renewals thereof,
to be delivered to Lender no less
than 10 days prior to the effective
date thereof. As often as any such
policy shall expire or terminate,
Tenant shall procure and maintain
renewal or additional policies with
like terms. None of such
policies shall contain any co-insurance
requirements and all such policies
shall provide for written notice
to Landlord and Lender, not less
than 10 days prior to any
modification, cancellation, lapse,
or reduction in the amounts of
insurance, and shall further
provide that any loss otherwise
payable thereunder shall be payable
notwithstanding any act or
negligence of Landlord or
Tenant which might, absent such
provision, result in a forfeiture
of all or part of the payment of
such loss. All general liability,
property damage, and other casualty
policies shall be written on an
occurrence basis as primary
policies, not contributing with or
in excess of coverage which
Landlord may carry.
5.2.2 Tenant's obligations to
carry the insurance provided for
above may be brought within the
coverage of an "umbrella" policy
or policies of insurance carried
and maintained by Tenant;
provided, however, that such policy
or policies shall (i) have limits
of not less than $5,000,000, (ii)
name Landlord and Lender as
additional insureds as their
interests may appear, and (iii)
provide that the coverage afforded
Landlord will not be reduced or
diminished by reason of the use
of such blanket policies.
Tenant agrees to permit Landlord and Lender at
all reasonable times to inspect any
policies of insurance of Tenant
which Tenant has not delivered to Landlord.
5.3 Subrogation Waiver5.3 Subrogation Waiver.
Landlord (for itself and its insurer) hereby
waives any rights, including rights
of subrogation, and Tenant (for
itself and its insurer) hereby
waives any rights, including rights
of subrogation, each may have
against the other on account of any
loss or damage occasioned to
Landlord or Tenant, as the case may
be, to their respective property,
the Property or its contents that
are caused by or result from
risks insured against under any
insurance policies carried by the
parties hereto and in force at the
time of any such damage. The
foregoing waivers of subrogation
shall be operative only so long as
available in the jurisdiction where
the Property are located and so
long as no policy of insurance is
invalidated thereby.
5.4 Payment of Insurance5.4 Payment of Insurance.
In the event that Tenant shall fail to obtain
the insurance policies required
hereunder or to pay the premiums
due for the insurance policies
required hereby, Landlord shall
have the right, but not the
obligation, to pay the same in
which case Tenant shall repay such
amount plus any penalties or
additional amounts resulting
therefrom to Landlord within 5 days after
receipt of a bill therefor.
5.5 Insurance Use Restrictions5.5 Insurance Use
Restrictions. Tenant shall not
carry any stock or goods or do
anything in, on, or about the
Property which will substantially
increase the insurance rates upon
the building of which the
Property are a part.
5.6 Indemnification 5.6 Indemnification.
Tenant shall indemnify Landlord for, defend
Landlord against, and save
Landlord harmless from, any
liability, loss, cost, injury,
damage or other expense or risk
whatsoever that may occur or be
claimed by or with respect to any
person(s) or property on or about
the Property and resulting directly
or indirectly from:
(a)the use, misuse, occupancy,
possession or disuse of the
Property by Tenant or other persons
claiming through or under Tenant,
or their respective agents,
employees, licensees, invitees,
guests or other such persons;
(b) the condition of the Property;
(c) any work or thing done in
respect of construction of, in or
to the Property or any part of the
improvements now or hereafter
constructed on the Property
(other than work by Landlord);
(d) any use, possession,
occupation, operation, maintenance
or management of the Property or
any part hereof;
(e)any failure to, or to properly,
use, possess, occupy, operate,
maintain or manage the Property or
any part thereof;
(f) the condition, including
environmental conditions, of the
Property or any part thereof;
(g) any negligence on the part of
Tenant or any of its agents,
contractors, servants, employees,
licensees or invitees;
(h) any accident, injury or damage
to any person or property
occurring in, on or about the
Property or any part thereof
including any sidewalk adjacent
thereto; or
(i)any failure on the part of
Tenant to perform or comply with
any of the covenants, agreements,
terms or conditions contained in
this Lease on its part to be
performed or complied with.
ARTICLE 66
MAINTENANCE AND REPAIRS
6.1 Tenant's Obligations6.1 Tenant's Obligations.
Tenant shall, at its sole cost and
expense, maintain in good repair,
order, and serviceable condition
the Property and every part
thereof, including, without
limitation, all structural
elements of; all plumbing,
ventilation, heating, air
conditioning, and electrical
systems and equipment in, on, or
exclusively serving, the Property;
and all windows, doors,
storefronts, plate glass, interior
walls, and ceilings which are part
of the Property. Tenant
shall not make any claim or
demand upon or bring any action
against Landlord for any loss,
cost, injury, damage or other
expense caused by any failure or
defect, structural or
nonstructural, of the Property or
any part thereof.
6.2 Landlord's Obligations6.2 Landlord's Obligations.
Landlord shall have no obligation to repair
and maintain the Property, nor
any improvements or equipment
thereon, whether interior or
exterior, structural or
nonstructural, ordinary or
extraordinary. Tenant expressly
waives the benefit of any
statute or law now or hereafter in
effect which would otherwise
afford Tenant the right to
terminate this Lease because of
Landlord's failure to keep the
Property in good order, condition,
and repair, or the right to repair
and offset the cost related
thereto against rent.
6.3 Landlord's Rights6.3 Landlord's Rights.
If Tenant refuses or neglects to make repairs
or maintain the Property, or any
part thereof, in a manner
reasonably satisfactory to
Landlord, without prejudice to any
other remedy Landlord may have
hereunder, upon giving Tenant 10
days prior written notice,
Landlord shall have the right to
enter the Property and perform
such maintenance or make such
repairs on behalf of and for the
account of Tenant. In the event
Landlord so elects, Tenant shall
pay the cost of such repairs,
maintenance, or replacements within
5 days following receipt of a
bill therefor. Tenant agrees to
permit Landlord or its agent to
enter the Property, upon
reasonable notice by Landlord,
during normal business hours for
the purpose of inspecting the
Property.
ARTICLE 77
ALTERATIONS
7.1 Consent to Alterations7.1 Consent to Alterations.
Tenant may, at its sole cost and
expense, make alterations,
replacements, additions, changes,
and improvements (collectively
referred to in this Article as
"Alterations") to the Property as
it may find necessary or convenient for
its purposes; provided, that if the
cost of such Alterations
is in excess of $100,000 (i) Tenant
shall be required to obtain the
prior written consent of Landlord,
which consent shall not be
unreasonably withheld, delayed or
conditioned, and (ii) such
Alterations shall be made in
accordance with reasonable plans
and specifications and cost
estimates prepared by Tenant and
approved in writing in advance by
Landlord, which approval shall not
be unreasonably withheld, delayed
or conditioned. In addition, if
the applicable building codes
require the submission of
architectural plans, Tenant shall
provide Landlord copies of all
architectural plans and specifications relating
to any such Alteration.
7.2 Removal of Alterations7.2 Removal of Alterations.
All Alterations, except for trade
dress or items containing
trademarks or other proprietary
marks, made on the Property shall
become the property of Landlord at
the expiration or termination of
the Lease Term and shall be
surrendered with the Property.
7.3 Alterations Required by Law7.3 Alterations Required by Law.
Tenant shall, at its sole cost and
expense, make any Alteration,
structural or otherwise, to or on
the Property, or any part
thereof, which may be necessary or
required by reason of any law,
rule, regulation, or order
promulgated by competent
government authority.
7.4 General Conditions
Relating to Alterations7.4 General
Conditions Relating to Alterations.
Any Alteration shall be subject to
the following conditions:
7.4.1 No Alteration shall be
undertaken until Tenant shall have
procured and paid for all required
permits and authorizations of all
municipal departments and
governmental subdivisions having
jurisdiction.
7.4.2 Any Alteration involving
an estimated cost of more than
$100,000 or where the applicable
building codes require the
submission of architectural plans
shall be conducted under the
supervision of a licensed architect
or engineer selected by Tenant
and satisfactory to Landlord, and
shall be made in accordance with detailed
plans and specifications and
cost estimates prepared by such
architect or engineer and approved
in writing in advance by Landlord.
7.4.3 Any Alteration shall be
made promptly and in a good
workmanlike manner, by properly
qualified and licensed personnel,
and in compliance with all
applicable permits and
authorizations and building and
zoning laws and all laws, and in
accordance with the orders, rules
and regulations of the Board of
Fire Insurance Underwriters and
any other body hereafter exercising similar
functions having or asserting
jurisdiction over the Property.
7.4.4 No Alteration shall tie-
in or connect the Property or
any improvements thereon with any
property outside the Property
without the prior written consent
of Landlord, which consent shall
not be unreasonably withheld.
7.4.5 No Alteration shall
reduce the value of the Property
or impair the structural
integrity of any building
comprising a part of the Property.
7.5 Liens7.5 Liens.
In connection with Alterations,
Tenant shall do all things
necessary to prevent the filing of
any liens or encumbrances against the
Property, or any part thereof, or
upon any interest of Landlord or
any mortgagee or beneficiary under
a deed of trust or any ground or
underlying lessor in any portion
of the Property. Notwithstanding
the foregoing, Tenant shall have
the right and ability to contest
any such lien and no Event of
Default hereunder shall be deemed
to have occurred so long as
Tenant is contesting such lien in
good faith and by appropriate
proceedings and has effectively
stayed enforcement of such lien.
ARTICLE 88
CASUALTY
8.1 Casualty8.1 Casualty.
Subject to the terms of any underlying
ground lease, as modified or
affected by any landlord consent
and waiver obtained with respect to
the Property, Tenant acknowledges
and agree that upon payment of
any casualty insurance proceeds
relating to the Property, the
proceeds shall be applied as
provided in the Mortgage, and the
Lease shall remain in full force
and effect.
ARTICLE 99
EMINENT DOMAIN
9.1 Condemnation9.1 Condemnation.
Subject to the terms
of any underlying ground lease,
as modified or affected by any
landlord consent and waiver
obtained with respect to the
Property, Tenant acknowledges and
agrees that upon payment of any
condemnation proceeds relating to
the Property, the proceeds shall
be applied as provided in the
Mortgage, and the Lease shall
remain in full force and effect.
ARTICLE 1010
ASSIGNMENT
10.1 No Assignment10.1 No Assignment.
Tenant shall not assign this Lease or Tenant's
interest in and to the Property.
Any attempted assignment shall be
void, and shall constitute a
default by Tenant under this
Lease. For purposes of this
Article, the terms "assign" and
"assignment" shall include any
act attempting to, or document
purporting to, assign, transfer,
sublet, enter into license or
concession agreements for, change
ownership of, mortgage or
hypothecate this Lease or
Tenant's interest in and to the
Property or any part thereof.
Notwithstanding the foregoing,
Tenant may enter into a collateral
assignment or other agreement
regarding this Lease or Tenant's
interest hereunder with Chase
Bank of Texas, National Association, as Agent;
provided, that any such
collateral assignment or other
agreement (i) has been approved in
writing by Lender in
its reasonable discretion, (ii) is
expressly subordinate to Lender pursuant to
and in accordance with the terms
and conditions of the Chase
Agreement, and (iii) shall not
at any time be recorded, nor
shall a memorandum thereof at any
time be recorded, so long as the
Note has not been paid in full,
without the prior written consent
of Lender.
10.2 Sale or Transfer10.2 Sale or Transfer.
Tenant and Landlord shall be, directly
or indirectly, wholly owned by Guarantor until
the earlier of (i) the expiration
of this Lease, or (ii)
consummation of a Transfer Event
in accordance with Section 10.3
below.
10.3 Transfer Event.
Except as provided below, Tenant shall not
consummate a Transfer Event without
the prior written consent of
Landlord and Lender (the
"Transaction Consent"). As used
herein, "Transfer Event" means (i)
the sale or transfer of all or
substantially all of the assets of
Tenant, (ii) a merger or
consolidation of Tenant into
another corporation or entity or
(iii) the sale or transfer of
fifty percent (50%) or more of
Tenant's stock.
10.3.1. "Transfer Event" shall
not include any sale, transfer, merger,
consolidation or other event or circumstance
if, after consummation thereof,
Tenant and Landlord are wholly
owned, directly or indirectly,
by Guarantor.
10.3.2. The Transaction Consent
shall not be required if all of the
following conditions (the
"Transfer Requirements") are met:
(i) the Property shall be used only
as it was used prior to such
Transfer Event; (ii) the combined
net worth of Tenant, the acquiring
corporation (or entity) or
surviving corporation (or entity)
(as the case may be) of such
Transfer Event (the "Transferee"),
the Guarantor (unless the Guarantor
has been or will be released from
its Guaranty of this Lease upon
consummation of the Transfer Event
in accordance with Section 10.3.3 below) and any
other substitute or additional guarantors of this
Lease, if any, immediately after
the Transfer Event is not less
than Fifty Million Dollars
($50,000,000) determined on a pro
forma basis assuming consummation
of the Transfer Event; (iii) the
Transferee shall guarantee this
Lease and all other leases
between Tenant and Landlord; (iv)
the Transfer Event shall not
result in a withdrawal,
downgrade, or qualification in
the rating of any securities
issued in connection with any
securitization involving the Note
or the Loan Documents (as defined
in the Mortgage) as confirmed in
writing by an appropriate
rating agency reasonably
acceptable to the Lender, (v) the Transferee and
Landlord shall be, directly or
indirectly, under common ownership
immediately upon consummation of
the Transfer Event,(vi) Tenant
shall have provided written
notice of the Transfer Event to
Landlord and Lender not less than
sixty (60) days prior to the
consummation of the Transfer Event
which notice shall be accompanied
by such documentation and
information reasonably necessary to
facilitate Landlord and Lender's
determination that the Transfer
Requirements have been satisfied
(and Tenant shall furnish such
supplemental informationand
documentation reasonably requested
by Landlord and Lender), and (vii)
Tenant agrees to pay for all
reasonable costs and expenses
(including attorney's fees) in
connection with Landlord and
Lender's review of the proposed
Transfer Event (including the
cost, if any, of confirmation by
the rating agency).
10.3.3 If all the requirements
of Section 10.3.2 above are
satisfied and if the minimum net
worth requirement specified in
clause (ii) thereof is satisfied
without reference to Guarantor's net worth,
then Guarantor shall be released
from its obligations under the
Guaranty with respect to this
Lease upon consummation of the
Transfer Event.
10.4 Further Assurances.
Landlord, Tenant, Lender and
Guarantor agree to execute and
deliver, without additional
consideration, any and all
documents, amendments,
confirmations and agreements
reasonably necessary to effectuate
the intent of Section 10.3 above.
ARTICLE 1111
DEFAULT; REMEDIES
11.1 Default11.1 Default.
The occurrence of any one or more of
the following events shall
constitute an Event of Default by
Tenant under this Lease:
11.1.1 The failure of Tenant to
operate the Property with the
Permitted Use; provided,
that the foregoing does not apply
to a period of time not to exceed
the lesser of (i) six (6) months,
and (ii) any shorter time permitted
by the terms of any underlying
lease agreement, during which the
Property may be closed due to
fire or other casualty, or
condemnation, so long as all other
terms of this Lease are satisfied.
11.1.2 The failure by Tenant to
make any payment of Minimum
Monthly Rent, Impositions or any
other payment required to be made
by Tenant hereunder, where such
failure shall continue (i) for a
period of 15 days at any time when
Landlord and Tenant are affiliated
entities, or (ii) for a period of
five (5) days after written notice
at any time when Landlord and
Tenant are not affiliated entities.
11.1.3 Except as otherwise
provided in this Lease, the
failure by Tenant to observe or
perform any of the nonmonetary
covenants, conditions, or
provisions of this Lease to be
observed or performed by
Tenant, where such failure shall
continue for a period of 30 days
after written notice thereof from
Landlord to Tenant; provided,
however, that if the nature of
Tenant's noncompliance is such
that more than 30 days are
reasonably required for its cure,
then Tenant shall not be deemed to
be in default if Tenant commences
such cure within said 30-day period
and thereafter diligently
prosecutes such cure to completion and the final
determination thereof.
11.1.4 The admission by Tenant or any Guarantor of its
inability to pay debts as they mature.
11.1.5 Institution by or
against Tenant or any Guarantor
of any bankruptcy, insolvency,
reorganization, receivership or other similar
proceeding involving the creditors
of Tenant or any Guarantor, which,
if instituted against Tenant or
any Guarantor is not dismissed
within 60 days after the commencement thereof;
11.1.6 The issuance or filing
of any judgment, attachment,
levy, or garnishment against
Tenant or all or substantially
all of the assets of Tenant in
excess of $250,000 which is not
covered by insurance, the issuance
or filing of any judgment,
attachment, levy, or garnishment
against any guarantor or all
or substantially all of the assets
of any guarantor in excess of
$500,000 which is not covered by
insurance, or the issuance or
filing of any judgment,
attachment, levy, or garnishment
against the Property in excess of
$100,000 which is not covered
by insurance, unless any such
judgment, attachment, levy or
garnishment is dismissed or
enforcement is effectively stayed
within sixty (60) days or such longer
period, if any, permitted by the
local rules of the applicable
jurisdiction for such dismissal or
stay.
11.1.7 Dissolution,
termination of existence,
insolvency, business failure or
assignment for the benefit of
creditors of or by Tenant or any
Guarantor.
11.1.8 Any statement,
representation or information made
or furnished by or on behalf of
Tenant or any Guarantor to
Landlord in connection with or to
induce Landlord to enter into this
Lease shall prove to be materially
false or misleading when made or
furnished.
11.1.9 The default, breach or
insolvency of any Guarantor beyond
any applicable notice and/or grace
period under the instrument
evidencing its guaranty.
11.1.10 The occurrence of any Event of Default under the
Mortgage.
11.2 Remedies11.2 Remedies.
Upon the occurrence of an Event
of Default by Tenant pursuant to
the foregoing Section or otherwise
under this Lease, Landlord may at
any time thereafter, with or
without notice or demand and
without limiting Landlord in the
exercise of any right or remedy
which Landlord may have by reason
of such Event of Default:
11.2.1 Terminate Tenant's right
to possession of the Property by
any lawful means, in which case
this Lease and the term hereof
shall terminate and Tenant
shall immediately surrender
possession of the Property to
Landlord.
11.2.2 Landlord shall be
entitled to recover from Tenant
all damages incurred by Landlord
by reason of Tenant's default.
Tenant acknowledges that this Lease
and the terms and conditions
contained herein were a material
inducement and condition to
Lender making the loan and
other financial accommodations and
extensions of credit to Landlord
pursuant to the Note and the
Mortgage and Landlord shall be
subject to acceleration of the
Note and to the payment of a
Prepayment Premium (as defined in the Note)
upon, among other things, the occurrence of
an Event of Default under this
Lease during the first ten (10)
years of the Lease Term. Tenant
further agrees that damages
incurred by Landlord for purposes
of this Section 11.2.1 shall
include, without limitation, all
obligations of Landlord to Lender
under the Note and Mortgage, including
but not limited to the Prepayment Premium.
11.2.3 Landlord shall be
entitled to recover from Tenant an amount
equal to the positive difference
between:
(a) the sum of (without
duplication) (x) the present value
of all future payments of Minimum
Monthly Rent due or to become due
under this Lease discounted at the
non-default Stated Rate accruing
under the Note, plus (y) all
payments of Minimum Monthly Rent
then past due under this Lease,
together with all other amounts (if
any) then due and owing under this
Lease, plus (z) the Prepayment
Premium (if any) then due under the
Note; and
(b) the sum of (without
duplication) (i) the present value
of the then fair market rental
value of the Property discounted
at the non-default Stated Rate
accruing under the Note, plus (ii)
in the event that Lender has
acquired Landlord's interest in
the Property, the then fair
market value of the Property.
11.2.4 Maintain Tenant's right
to possession of the Property by
any lawful means, in which case
this Lease and the term hereof
shall continue in effect whether or
not Tenant shall have vacated or
abandoned the Property. In such
event Landlord shall be entitled
to enforce all of Landlord's
rights and remedies under the
Lease, including the right to
recover the rent as it becomes due
hereunder.
11.2.5 Pursue any other remedy now
or hereafter available to Landlord
under the laws or judicial
decisions of the jurisdiction where
the Property are located.
11.3 Cumulative Remedies11.3
Cumulative Remedies. No remedy or
election hereunder shall be deemed
exclusive but shall, wherever
possible but without duplication,
be cumulative with all other
remedies provided in this Section
or otherwise available at law or in
equity.
ARTICLE 1212
REPRESENTATIONS AND WARRANTIES;
FINANCIAL REPORTING
12.1 Representations and Warranties12.1 Representations and Warranties.
To induce Landlord to enter into this Lease, Tenant
represents and warrants to Landlord
as follows:
12.1.1 This Lease is an enforceable
obligation of Tenant.
12.1.2 Tenant is not a foreign
corporation, foreign partnership,
foreign trust or foreign estate (as
such terms are defined in the
Internal Revenue Code of 1986, as
amended) and the regulations
promulgated thereunder).
12.1.3 The financial statements of
Tenant and any Guarantor provided
to Landlord delivered to Landlord
are true and correct in all
material respects, have been
prepared in accordance with
generally accepted accounting
principles, and fairly present
the respective financial
conditions of the subjects
thereof as of the respective
dates thereof. No materially
adverse change has occurred in
the financial conditions reflected therein since
the respective dates thereof.
12.1.4 There are no actions, suits
or proceedings pending, or to
the best of Tenant's knowledge,
threatened, against or affecting
it or the Property or any Guarantor
which, if adversely determined,
would materially impair the ability
of Tenant or Guarantor to
satisfy their obligations under
or relating to this Lease.
12.1.5 Tenant is not in default
under any obligation for the
payment of borrowed money, for the
deferred purchase price of
property or for the payment of any
rent under any lease agreement,
which, either individually or in
the aggregate, would adversely
affect the financial condition of
Tenant, or the ability of Tenant
to perform its obligations
hereunder, or comply with the terms
of this Lease.
12.1.6 Tenant has all required
certificates of occupancy, building
permits, certificates of
environmental impact approval, all
zoning, building, safety, fire and
health approvals and all permits
and licenses required by any
governmental authority and
necessary or advisable to operate,
occupy or use the Property for
the Permitted Use, all of which are
unexpired and to the extent
assignable, are hereby collaterally
assigned to Landlord.
12.2 Financial Statements12.2
Financial Statements. Tenant has
furnished certain financial
statements to Lender, which
statements completely and
accurately present the financial condition
of Tenant on the dates thereof.
There has been no material
adverse change in business,
property or condition of Tenant
since the date of such financial
statements. Tenant is not
insolvent within the meaning of
Section 548(a)(2)(B) of the
United States Bankruptcy Code or
any other federal or state law
using or defining such term, and
will not be rendered insolvent by
the transactions contemplated by
this Lease. Tenant hereby
covenants and agrees to deliver
to Landlord within the time
periods stated its financial
statements and other financial
information necessary to enable
Landlord to comply with all
financial reporting obligations
set forth in the Mortgage.
Without limiting the foregoing,
Tenant acknowledges that pursuant
to the Mortgage, Landlord is
required to maintain a minimum
Fixed Charge Coverage Ratio (as
defined in the Mortgage), and
Tenant agrees to provide Landlord
with all information necessary to
enable Landlord to calculate and
report its Fixed Charge Coverage
Ratio.
ARTICLE 13
OPTION TO PURCHASE
Intentionally Omitted.
ARTICLE 1414
BANKRUPTCY OR INSOLVENCY
14.1 Liquidation14.1 Liquidation.
In the event that Tenant shall become a debtor
under Chapter 7 of the Bankruptcy
Reform Act of 1978, as amended
(the "Bankruptcy Code"), and
Tenant's trustee or Tenant shall
elect to assume this Lease for the
purpose of assigning the same or
otherwise, such election and
assignment may be made only if the
provisions of this Section are
satisfied. If Tenant or Tenant's
trustee shall fail to assume this
Lease within 60 days after the
entry of an order for relief, this
Lease shall be deemed to have been
rejected. Immediately thereupon,
Landlord shall be entitled to
possession of the Property without further
obligation to Tenant or Tenant's
trustee and this Lease, upon the
election of Landlord, shall
terminate, but Landlord's right to
be compensated for damages shall
survive, whether or not this Lease
shall be terminated.
14.2 Reorganization14.2 Reorganization.
In the event that a voluntary petition for
reorganization is filed by Tenant,
or an involuntary petition is filed
against Tenant under Chapter 11 of
the Bankruptcy Code, or in the
event of the entry of an order for
relief under Chapter 7 in a case
which is then transferred to
Chapter 11, Tenant's trustee or
Tenant, as debtor-in-possession,
must elect to assume this Lease
within 60 days from the date of
the filing of the petition under
Chapter 11 or the transfer
thereto, or Tenant's trustee or the
debtor-in-possession shall be
deemed to have rejected this
Lease. Immediately thereupon,
Landlord shall be entitled to
possession of the Property without
further obligation to Tenant or
Tenant's trustee, and this Lease,
upon the election of Landlord,
shall terminate. Landlord's right
to be compensated for damages,
shall survive, whether or not this
Lease shall be terminated.
14.3 Conditions to Assumption14.3 Conditions to Assumption.
No election by Tenant's trustee or
the debtor-in-possession to assume
this Lease, whether under Chapter 7
or Chapter 11, shall be effective
unless each of the following conditions
has been satisfied:
14.3.1 Tenant's trustee or the
debtor-inpossession has cured all
defaults under this Lease, or has
provided Landlord with evidence
satisfactory to Landlord that it
will cure all defaults capable of
being cured by the payment of money
within 10 days from the date of
such assumption and that it will
cure all other defaults under
this Lease which are capable of
being cured by the performance of
any act within 30 days after the
date of such assumption.
14.3.2 Tenant's trustee or the
debtor-inpossession has
compensated, or has provided
Landlord with evidence
satisfactory to Landlord that,
within 10 days from the date of such
assumption, it will compensate
Landlord for any actual
pecuniary loss incurred by Landlord
arising from the default of
Tenant, Tenant's trustee, or
the debtor-in-possession as
indicated in any statement of
actual pecuniary loss sent by
Landlord to Tenant's trustee or the
debtorin-possession.
14.3.3 Such assumption will
not breach or cause a default
under any provision of any
other lease, mortgage, financing
agreement or other agreement by
which Landlord is bound, relating
to the Property.
14.3.4 Tenant's trustee or the
debtor-inpossession shall (i)
provide Landlord with "Assurance",
as defined below, of the future
performance of each of the
obligations under this Lease of
Tenant, Tenant's trustee or the
debtor-in-possession, and (ii) in
addition to any other security
deposits held by Landlord,
deposit with Landlord, as
security for the timely payment
of Minimum Monthly Rent and for the
performance of all other
obligations of Tenant under this
Lease, an amount equal to 3 monthly
installments of Minimum Monthly
Rent (in the amount then
payable), and (iii) pay in advance
to Landlord on the date each
installment of Minimum Monthly Rent
is due and payable, onetwelfth of
Tenant's annual obligations for
Impositions to be made by Tenant
pursuant to this Lease. The
obligations imposed upon Tenant's
trustee or the debtor-in-
possession by this subsection shall
continue with respect to Tenant or any
assignee of this Lease, after the
conclusion of proceedings under
the Bankruptcy Code.
For purposes of the foregoing
subsection, the term "Assurance" shall mean
no less than:
(1) Tenant's trustee or the
debtor-inpossession has and will
continue to have sufficient
unencumbered assets after the
payment of all secured
obligations and administrative
expenses to assure Landlord that
sufficient funds will be available
to fulfill the obligations of Tenant under this
Lease; and
(2) To secure to Landlord the
obligations of Tenant, Tenant's
trustee or the debtor-inpossession
and to assure the ability of
Tenant, Tenant's trustee or the
debtorinpossession to cure the
defaults under this Lease,
monetary and/or nonmonetary,
there shall have been (A)
sufficient cash deposited with
Landlord, or (B) the bankruptcy
court shall have entered an order
segregating sufficient cash
payable to Landlord, and/or (C)
Tenant's trustee or
the debtor-in-possession shall have
granted to Landlord a valid and
perfected first lien and security
interest and/or mortgage in
property of Tenant, Tenant's
trustee or the debtor-in-
possession, acceptable as to value
and kind to Landlord.
14.4 Conditions to Assignment14.4 Conditions to Assignment.
If Tenant's trustee or the debtor-in-
possession has assumed this Lease
pursuant to the terms and
provisions of this Section for the
purpose of assigning (or elects to
assign) this Lease, this Lease
may be so assigned only if the
proposed assignee has provided adequate
assurance of future performance of
all of the terms, covenants and
conditions of this Lease to be
performed by Tenant. As used in
this subsection "adequate assurance
of future performance" shall mean
at least that clauses (2)(B) and
(2)(C) of the above definition of
"Assurance", and each of the
following conditions, has been
satisfied:
14.4.1 the proposed assignee has
furnished Landlord with a current
financial statement audited by a
certified public accountant
determined in accordance with
generally accepted accounting
principles consistently applied
indicating a credit rating, net
worth and working capital in
amounts which Landlord reasonably
determines to be sufficient to
assure the future performance of
such assignee of Tenant's
obligations under this Lease, but
in no event indicating a net worth
less than the net worth of Tenant
and any guarantors of this Lease,
on the date of execution hereof;
14.4.2 such assignment will not
breach or cause a default under
any provision of any other lease, mortgage,
financing agreement or other
agreement by which Landlord is
bound, relating to the Property;
and
14.4.3 the proposed assignment
will not release or impair any
guaranty of all or any portion of
this Lease.
14.5 Reasonable Charges14.5
Reasonable Charges. When,
pursuant to the Bankruptcy Code,
Tenant's trustee or the debtorin
possession shall be obligated to
pay reasonable use and occupancy
charges for the use of the
Property, such charges shall not
be less than the Minimum Monthly
Rent and all additional amounts
payable by Tenant under this Lease
and shall be paid at the times
and when due as though such
charges were Minimum Monthly Rent
and such additional payments.
ARTICLE 1515
GENERAL PROVISIONS
15.1 Quiet Enjoyment15.1 Quiet
Enjoyment. Subject to the terms
and conditions of this Lease,
Tenant shall have the quiet and
peaceful possession of the
Property.
15.2 Definition of Rent15.2 Definition of Rent.
All monetary obligations of Tenant to Landlord
under the terms of this Lease,
including, without limitation, the
Taxes, insurance premiums and other
Impositions payable hereunder shall
be deemed to be "rent".
15.3 Subordination15.3 Subordination.
This Lease shall be subordinate to any superior lease,
mortgage, deed of trust, or any
other hypothecation or security now
existing or hereafter placed upon
the Property and to any and all
advances made on the security
thereof and to all renewals,
modifications, consolidations,
replacements, and extensions
thereof and Tenant hereby
agrees, upon request by Landlord,
to execute and deliver to Landlord
and its lender(s) a subordination,
non-disturbance and attornment
agreement in a commercially
reasonable form prescribed
by such lender(s) with respect to
any such superior lease, mortgage,
deed of trust, hypothecation, or
security. Landlord and Tenant
further agree that: (i) in the
event of the occurrence of an Event
of Default under this Lease, Lender
shall have the right to terminate
this Lease; (ii) neither Landlord
nor Tenant shall cause or
permit any recordation in any
public records of this Lease or any
memorandum of lease related
thereto; (iii) neither Landlord nor
Tenant shall enter into or be
entitled to any nondisturbance
agreement from Lender with respect
to this Lease; and (iv) upon the
occurrence of an Event of Default
under this Lease, Tenant upon
request of Lender, and at
Lender's expense, shall take
commercially reasonable efforts to
cause the restaurant located at
the Property to be operated
pursuant to the terms of this
Lease, unless this Lease is
terminated by Lender pursuant to
clause (i) of this Paragraph.
15.4 Surrender of Property15.4 Surrender of Premises.
Except for changes resulting from eminent
domain proceedings, at the
expiration or sooner termination of
the Lease Term, Tenant shall
surrender the Property in the
same condition as the Property
were in upon delivery of possession
thereto under this Lease,
reasonable wear and tear excepted,
and shall surrender all keys for
the Property to Landlord at the
place then fixed for the payment of
rent and shall inform Landlord of
all combinations on locks, safes
and vaults, if any, in the
Property. Tenant shall at such
time remove all of Tenant's
moveable equipment, machinery,
trade fixtures and other personal
property, as well as any
alterations or improvements, if
requested to do so by Landlord,
and shall repair any damage to the
Property caused thereby, and any
or all of such property not so
removed shall, at Landlord's
option, and to the extent permitted
by applicable law, become the
exclusive property of Landlord or
be disposed of by Landlord, at
Tenant's sole cost and expense,
without further notice to or
demand upon Tenant. In the event
Tenant shall fail to pay the cost
of any such repair, Landlord may do
so and Tenant shall reimburse
Landlord for the amount thereof
within 5 days after receipt of a
bill therefor. If Tenant shall so
surrender the Property, Tenant
shall indemnify Landlord against
loss or liability resulting from
the delay by Tenant in so
surrendering the Property
including, without limitation, any
claims made by any
succeeding occupant founded on
such delay. Tenant's obligation to
observe or perform this covenant
shall survive the expiration or
other termination of the Lease
Term.
15.5 Estoppel Certificates15.5 Estoppel Certificates.
Each party (each a "Responding Party") shall
at any time upon not less than 10
days' prior written notice from the
other party (each a "Requesting
Party") execute, acknowledge, and
deliver to the Requesting Party a
statement in a form prescribed by
Landlord certifying and
acknowledging the following: (i)
that this Lease represents the
entire agreement between Landlord
and Tenant, and is unmodified and
in full force and effect (or, if
modified, stating the nature of
such modification and certifying
that this Lease, as so modified,
is in full force and effect) and
the date to which the Minimum
Monthly Rent and other charges are
paid in advance, if any; and (ii)
that there are not, to the
Responding Party's knowledge, any
uncured defaults on the part of
the Requesting Party, or specifying
such defaults if any are claimed.
Any such statement may be
conclusively relied upon by any
prospective purchaser or
encumbrancer of the Property or of
the business of the Requesting
Party.
15.6 Severability15.6 Severability.
The invalidity of any provision of
this Lease as determined by a court
of competent jurisdiction shall in
no way affect the validity of any
other provision hereof.
15.7 Entire Agreement15.7
Entire Agreement. This Lease
constitutes the entire agreement
between Landlord and Tenant and
supersedes all prior agreements
between them with respect to the
Property, whether written or oral.
15.8 Notices15.8 Notices.
Any notice required or permitted
to be given hereunder shall be in
writing and may be given by
facsimile, personal delivery,
certified mail, return receipt
requested or by nationally
recognized overnight courier
service delivered to Tenant or to Landlord,
as the case may be, at the FAX
numbers or addresses for each set
forth in the Fundamental Lease
Provisions. Either party may by
notice to the other specify a
different FAX number or address
for notice purposes. A copy of
all notices required or permitted
to be given to Landlord hereunder
shall be concurrently transmitted
to such party or parties at such
addresses as Landlord may from time
to time hereafter designate by
notice to Tenant.
15.9 Waivers15.9 Waivers.
No waiver by Landlord of any
provision hereof shall be deemed a
waiver of any other provision
hereof or of any subsequent default
by Tenant of the same of any other
provision. Landlord's consent to,
or approval of, any act shall not
be deemed to render unnecessary
the obtaining of Landlord's
consent to or approval of any
subsequent act by Tenant. The
acceptance of rent hereunder by
Landlord shall not be a waiver
of any preceding default by Tenant
hereunder, other than the failure
of Tenant to pay the particular
rent so accepted, regardless of
Landlord's knowledge of such
preceding default at the time of
acceptance of such rent.
15.10 Intentionally Omitted 15.10 Intentionally Omitted.
15.11 Holding Over15.11 Holding Over.
If Tenant remains in possession of the
Property or any part thereof after the
expiration or termination of the Lease Term,
such occupancy shall be a tenancy
from monthto-month upon all the
provisions of this Lease
pertaining to the obligations of
Tenant and Tenant shall thereby
waive its rights of notice to quit.
The monthly rent due during such
hold-over period shall be equal to
150% of the Minimum Monthly Rent
then in effect, and Tenant shall
continue to be obligated to pay all
Impositions and other amounts
required to be paid by the terms of
this Lease.
15.12 Choice of Law15.12 Choice of Law.
The laws of the jurisdiction in which the Property
are located shall govern the validity, performance, and
enforcement of this Lease.
15.13 Attorneys' Fees15.13 Attorneys' Fees.
Should either party institute any action or
proceeding to enforce any
provision hereof or for a
declaration of such party's rights
or obligations hereunder, the
prevailing party shall be entitled
to receive from the losing party
such amounts as the court may adjudge to be
reasonable attorneys' fees and
expenses for services rendered to
the party prevailing in any such
action or proceeding, and such
fees shall be deemed to have
accrued upon the commencement of
such action or proceeding and
shall be enforceable whether or
not such action or proceeding is prosecuted to
judgment.
15.14 Waiver of Jury Trial15.14 Waiver of Jury Trial.
LANDLORD AND TENANT EACH HEREBY WAIVE ALL
RIGHT TO A TRIAL BY JURY IN ANY CLAIM, ACTION,
PROCEEDING OR COUNTERCLAIM BY
EITHER LANDLORD OR TENANT
AGAINST THE OTHER ON ANY
MATTERS ARISING OUT OF OR IN ANY
WAY CONNECTED WITH THIS LEASE,
THE RELATIONSHIP OF LANDLORD AND
TENANT AND/OR TENANT'S USE OR
OCCUPANCY OF THE PROPERTY.
15.15 Liability of Landlord15.15 Liability of Landlord.
In the event of any sale or other
transfer of Landlord's interest in
the Property, Landlord shall be
relieved of all liabilities and
obligations of Landlord hereunder
arising after the date of such
transfer. Notwithstanding
anything contained herein to the
contrary, Landlord shall have no
personal liability in respect of
any of the terms, covenants,
conditions or provisions of this
Lease, and in the event of a
breach or default by Landlord of
any of its obligations under this
Lease, Tenant and any persons
claiming by, through or under
Tenant shall look solely to the
equity of the Landlord in the
Property for the satisfaction of
Tenant's and/or such persons'
remedies and claims for damages.
15.16 No Merger15.16 No Merger.
There shall be no merger of this
Lease, or the leasehold estate
created by this Lease, with any
other estate or interest in the
Property, or any part thereof, by
reason of the fact that the same
person, firm, corporation or other
entity may acquire or own or hold,
directly or indirectly, (i) this
Lease or the leasehold estate
created by this Lease, or any
interest in this Lease or in
any such leasehold estate, and
(ii) any such other estate or
interest in the Property or any
part thereof; and no such merger
shall occur unless and until all
persons, corporations,
firms and other entities having
an interest (including a security
interest) in (1) this Lease or the
leasehold estate created by this
Lease; and (2) any such other
estate or interest in the Property,
or any part thereof, shall join in
a written instrument effecting
such merger and shall duly record
the same.
15.17 Interpretation15.17 Interpretation.
The captions by which the
Articles and Sections of this Lease
are identified are for convenience
only and shall have no effect
upon the interpretation of this
Lease. Whenever the context so
requires, singular numbers shall
include the plural, the plural
shall refer to the singular, the
neuter gender shall include the
masculine and feminine genders, and
the terms "Landlord" and "Tenant"
and "person" shall include
corporations, limited liability
companies, partnerships,
associations, other legal
entities, and individuals.
15.18 Relationship of the Parties15.18 Relationship of the Parties.
Nothing in this Lease shall create
a partnership, joint venture,
employment relationship, borrower
and lender relationship, or any
other relationship between
Landlord and Tenant, other than
the relationship of landlord and
tenant.
15.19 Successors15.19 Successors.
This Lease shall be binding upon and
inure to the benefit of the parties
hereto and their respective
personal and legal representatives,
heirs, successors, and assigns.
15.20 Modifications15.20 Modifications.
This Lease may not be altered,
amended, changed, waived,
terminated, or modified in any
manner except by a written
instrument executed by Landlord and
Tenant.
15.21 Brokerage Fees15.21 Brokerage Fees.
Landlord and Tenant each represent
and warrant that they have not
employed a broker in connection
with the execution of this Lease.
Landlord and Tenant shall each
indemnify and hold the other
harmless from and against any
claim or claims for brokerage
or other commissions arising
from such party having employed a
broker contrary to its
representation in this Section.
15.22 Waiver of Redemption15.22 Waiver of Redemption.
To the extent permitted by law, Tenant
hereby waives any and all rights
of redemption with respect to this
Lease. Tenant hereby waives any
rights it may have to any notice to
cure or vacate or to quit
provided by any current or future
law; provided that the foregoing
shall not be deemed to waive any
notice expressly provided in this
Lease.
15.23 Not Binding Until Executed15.23 Not Binding Until Executed.
This Lease does not constitute an "offer" and is
not binding until fully executed and delivered
by Landlord.
15.24 Counterparts15.24 Counterparts.
This Lease may be executed in one
or more counterparts, each of which
shall be an original, and all of
which together shall constitute one
and the same instrument.
IN WITNESS WHEREOF, Landlord and
Tenant have executed this Lease as
of the date first set forth above.
LANDLORD: TENANT:
BORROWER, OPSUB,
Borrower_Entity Opsub_Entity
By: INDEPENDENT_MEMBER,
Independent_Member_Entity
Its: Managing Member
- ---------------------------- -----------------------
JOHN C. FIRTH JOHN C.FIRTH
Executive Vice President and Executive Vice
Secretary President
EXHIBIT AA
DESCRIPTION OF PROPERTY
[LEGAL DESCRIPTION]
LEASE
BETWEEN
BORROWER
AND
OPSUB
TABLE OF CONTENTS
PAGE
ARTICLE 1 FUNDAMENTAL LEASE PROVISIONS 1
1.1 Definitions 1
1.2 Intent of Parties 1
ARTICLE 2 TERM AND RENT 2
2.1 Term 2
2.2 Minimum Monthly Rent 2
2.3 Impositions 2
2.4 Late Charge 2
2.5 Net Lease 2
ARTICLE 3 USE OF THE PROPERTY 2
3.1 Use 2
3.2 Condition of Property 2
3.3 Compliance With Law 2
3.4 Environmental Compliance 3
3.5 Permits and Licenses 4
3.6 Franchise Agreement 4
3.7 Liquor License 4
3.8 Liens and Encumbrances 4
ARTICLE 4 TAXES AND UTILITIES 5
4.1 Payment of Taxes 5
4.2 Definition of "Taxes" 5
4.3 Tenant's Right to Contest Taxes 5
4.4 Payment of Utilities 6
4.5Interruption in Utility Service 6
ARTICLE 5 INSURANCE AND INDEMNIFICATION 6
5.1 Tenant's Insurance 6
5.2 Policy Form 7
5.3 Subrogation Waiver 7
5.4 Payment of Insurance 7
5.5 Insurance Use Restrictions 7
5.6 Indemnification 7
ARTICLE 6 MAINTENANCE AND REPAIRS 8
6.1 Tenant's Obligations 8
6.2 Landlord's Obligations 8
6.3 Landlord's Rights 8
ARTICLE 7 ALTERATIONS 9
7.1 Consent to Alterations 9
7.2 Removal of Alterations 9
7.3 Alterations Required by Law 9
7.4 General Conditions Relating to Alterations 9
7.5 Liens 9
ARTICLE 8 CASUALTY 10
8.1 Casualty 10
ARTICLE 9 EMINENT DOMAIN 10
9.1 Condemnation 10
ARTICLE 10 ASSIGNMENT 10
10.1 No Assignment 10
10.2 Sale or Transfer 10
10.3 Transfer Event 10
10.4 Further Assurance 11
ARTICLE 11 DEFAULT; REMEDIES 11
11.1 Default 11
11.2 Remedies 12
11.3 Cumulative Remedies 12
ARTICLE 12 REPRESENTATIONS AND
WARRANTIES; FINANCIAL REPORTING 13
12.1 Representations and Warranties 13
12.2 Financial Statements 13
ARTICLE 13 OPTION TO PURCHASE [Intentionally Omitted] 13
ARTICLE 14 BANKRUPTCY OR INSOLVENCY 14
14.1 Liquidation 14
14.2 Reorganization 14
14.3 Conditions to Assumption 14
14.4 Conditions to Assignment 15
14.5 Reasonable Charges 15
ARTICLE 15 GENERAL PROVISIONS 15
15.1 Quiet Enjoyment 15
15.2 Definition of Rent 15
15.3 Subordination 15
15.4 Surrender of Property 16
15.5 Estoppel Certificates 16
15.6 Severability 16
15.7 Entire Agreement 16
15.8 Notices 16
15.9 Waivers 16
15.10 Recording [Intentionally Omitted] 16
15.11 Holding Over 17
15.12 Choice of Law 17
15.13 Attorneys' Fees 17
15.14 Waiver of Jury Trial 17
15.15 Liability of Landlord 17
15.16 No Merger 17
15.17 Interpretation 17
15.18 Relationship of the Parties 17
15.19 Successors 17
15.20 Modifications 17
15.21 Brokerage Fees 18
15.22 Waiver of Redemption 18
15.23 Not Binding Until Executed 18
15.24 Counterparts 18
EXHIBIT A DESCRIPTION OF PROPERTY A-1