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Exhibit 10.4
LANDLORD CONSENT AND AMENDMENT TO LEASE
THIS LANDLORD CONSENT AND AMENDMENT TO LEASE ("Consent") is made and
entered into as of the ____ day of _____________, 1996, by and among PLAZA
INTERNATIONAL ("Landlord"), and JERRY'S FAMOUS DELI, INC., a California
corporation ("JFD").
RECITALS
A. Sol Zide ("Lessee") is the lessee pursuant to that certain Lease --
Shopping Center Form (the "Lease"), dated as of August 31, 1993, as amended by
that certain Consent to Lease, dated ______________ ___, 1996 (the "Amendment"),
by and between Landlord and Lessee, pursuant to which Lessee leased from
Landlord commercial space commonly known as 21857 and 21845 Ventura Boulevard,
Woodland Hills, California (the "Original Premises"), as such Original Premises
are more particularly described in the Lease.
B. Pursuant to the Amendment, effective upon completion of the Sale
Transaction (as defined below), the Lease will be amended to include the
premises known as 21853 Ventura Boulevard, Woodland Hills, California (the
"Additional Premises"). The Additional Premises and the Original Premises
together consist of approximately 8,600 square feet and are sometimes
collectively referred to herein as the "Premises."
C. Lessee currently owns and operates a restaurant known as "Solley's"
on the Original Premises (the "Acquired Restaurant").
D. JFD is in the business of owning and operating 24-hour restaurants
("JFD Restaurants") under the name "Jerry's Famous Deli."
E. JFD and Lessee propose to enter into an Asset Purchase Agreement
(the "Asset Purchase Agreement") pursuant to which the Lessee will sell and
assign to JFD, and JFD will purchase from Lessee, the Acquired Restaurant,
including all of Lessee's right, title and interest in and to the Lease.
F. As a condition to the consummation of transactions contemplated by
the Asset Purchase Agreement (the "Sale
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Transaction"), JFD has requested and Landlord has agreed, to consent to the Sale
Transaction (including the assignment of the Lease to JFD) and, effective upon
consummation of the Sale Transaction, to modify the Lease in accordance with the
terms set forth below.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Consent to Assignment of Lease. Landlord hereby acknowledges and
consents to the assignment of the Lease to JFD by Lessee in connection with the
Sale Transaction.
2. Certifications of Landlord. Landlord hereby agrees and certifies to
JFD that:
a. No adjustment in percentage rental shall be made as a result
of JFD obtaining a full or partial liquor license for the Original Premises or
Additional Premises.
b. Complete copies of the Lease and all amendments, modifications
and supplements thereto are attached hereto and the Lease, as so amended,
modified and supplemented, is in full force and effect, and represents the
entire agreement between Lessee and Landlord with respect to the Premises. Other
than the Amendment, there are no amendments, modifications or supplements to the
Lease, whether oral or written, except as attached hereto.
c. Landlord has received no written notice of any default under
the Lease by Landlord, and (to Landlord's knowledge) Lessee has not assigned,
transferred or hypothecated the Lease or any interest therein or subleased all
or any portion of the Premises. Neither the Sale Transaction, the execution and
performance of this Consent, nor the operation of the Premises, or any portion
of the Premises, by JFD as contemplated by this Consent and the Lease violates
any Landlord covenants or other conditions imposed on Landlord pursuant to the
terms of any lease or other
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agreement to which Landlord is a party.
d. Landlord has not received any notification from any federal,
state, or local governmental authority having jurisdiction over the Premises
asserting that any such violation exists.
3. Use of Premises. Landlord is familiar with the style, operations and
menus (a copy of which current menu is attached hereto and incorporated herein
as Exhibit A) of JFD Restaurants. Upon consummation of the Sale Transaction,
Landlord consents to the operation of the Premises (including the Additional
Premises) as a JFD Restaurant which shall include dining on-site as well as
catering, take-out and delivery services.
4. Alterations and Signage.
a. Subject to Landlord's approval of specific
construction/renovation plans to be provided by JFD, which approval shall not be
unreasonably withheld, and compliance by JFD with all applicable laws, rules and
regulations relating to such construction/renovation, Landlord hereby consents
to all construction and renovations to the Premises as JFD deems necessary or
appropriate for the Premises (including the Additional Premises) to be converted
into and operated as a JFD Restaurant. Such construction and alterations shall
include, without limitation, use and bordering (by means of railing, plants
and/or awning) of the public sidewalk adjoining the Premises on Ventura
Boulevard as an outdoor dining patio. Landlord agrees that no additional rent
will be payable to Landlord by JFD with respect to any such outdoor dining
patio.
b. Subject to Landlord's approval of specific signage plans to be
provided by JFD, which approval shall not be unreasonably withheld, Landlord
hereby consents to the installation of new signage on the Premises, including,
without limitation, the installation of new signage on the roof and front and
back entrances to the Premises as well as the installation of new awnings,
exterior signs, window and/or door signs, exterior lighting, restaurant seating
and/or decorations. Landlord further agrees that JFD shall have the right to
change its signage, without the consent of Landlord, in the event of a change in
the name of the restaurant operated on the Premises; provided, however, that
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(i) such signage shall comply with all applicable laws, rules and regulations
and shall be no more prominent than the JFD Restaurant signage previously
approved by Landlord, and (ii) such signage shall not block the existing primary
sign for the shopping center of which the Premises are a part.
c. Notwithstanding anything to the contrary contained in the
Lease, Landlord acknowledges and agrees that JFD shall have the right to make
(i) any and all non-structural renovations and alterations to the interior of
the Premises deemed by JFD to be necessary or appropriate for it to operate its
business, and (ii) any power, sewer, mechanical and HVAC connections deemed by
JFD to be necessary or appropriate for it to operate its business; provided,
however, that (i) all such renovations, alterations and connections shall be
made in compliance with all applicable laws and regulations and shall not result
in any mechanics' or other liens on the Premises, and (ii) no such renovations,
alterations or connections shall disturb the structural integrity or exterior
motif of the shopping center of which the Premises are a part. In addition, JFD
agrees that any and all roof openings and penetrations shall be waterproofed at
JFD's cost and expense pursuant to Landlord's reasonable specifications. Any and
all additional equipment placed by JFD on the roof shall be placed, at JFD's
costs and expense, in a safe location on wood platforms (2"x 6" studs with 1/2"
plywood minimum) in accordance with Landlord's reasonable specifications
d. Landlord shall reasonably cooperate with JFD (which
cooperation shall include, without limitation, execution of any and all
applications, requests, consents, correspondence or other documents) in
connection with (i) any and all efforts by JFD to obtain all permits, licenses
and any approvals required to commence and complete the construction and
renovations referenced in subsections 4 a., b. and c. above, including, without
limitation, the bordering and use of the public sidewalk as an outdoor dining
patio, and (ii) any and all efforts by JFD to obtain a liquor license for the
premises or to acquire the rights to any existing liquor license for the
premises; provided, however, that any such construction and renovations shall
comply with all applicable laws, rules and regulations.
5. Hours of Business; Payment of Certain Additional Utility Costs.
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a. Landlord hereby acknowledges and agrees that the business
hours for the JFD Restaurant to be operated on the Premises are anticipated to
be 24 hours a day, 7 days a week. Landlord shall reasonably cooperate with JFD
(which cooperation shall include, without limitation, execution of any and all
applications, requests, consents, correspondence or other documents) in
connection with any and all efforts by JFD to obtain a conditional use permit
and/or any other permits as are required or deemed by JFD to be reasonably
necessary in order to operate the Premises on a 24 hour a day, 7 days a week
basis.
b. Notwithstanding anything to the contrary contained in the
Lease or this Consent, JFD shall reimburse Landlord for the additional utility
costs, if any, incurred by Landlord as a result of the provision of exterior
lighting resulting from the operation of the Premises on a 24 hour a day basis.
The measurement of the additional charge shall be a percentage of the total
utility charge based on the additional wattage used at the applicable electric
meter after JFD takes occupancy of the premises compared to the same period in
the prior year measured as follows. The amount of such charge to JFD (the
"Additional Utility Charge") shall equal the total utility costs incurred by the
Landlord during a given billing period with respect to the exterior lighting for
the Premises as measured by readings from (and corresponding bills for) the "F
Building" utility meter during such period; multiplied by a fraction (the
"Fraction"). The numerator of the Fraction is the difference between (i) the "F
Building" meter aggregate bills during the one year period commencing on the
first day of the first utility billing period for the meter after which JFD
begins operating a JFD Restaurant on the premises (the "Commencement Date"), and
(ii) the denominator of the Fraction shall be the "F Building" meter aggregate
bills during the same one year period prior to the first day of the month in
which the Sale Transaction is completed. The Additional Utility Charge for the
first year following the Commencement Date shall be payable by JFD within 30
days following the date on which Landlord provides written description of the
initial calculation of the Additional Utility Charge for such year and copies of
the F Building meter bills; thereafter, the Additional Utility Charge shall be
payable by JFD periodically (but not more often than monthly) within thirty (30)
days after receipt from the Landlord of a copy of the applicable utility bills.
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c. Notwithstanding anything to the contrary in this Section 5,
Landlord acknowledges and consents to the closure of the Premises, in the sole
discretion of JFD, for (i) Yom Kippur and other traditional Jewish holidays as
well as for any holidays recognized by the State of California or federal
government for their respective employees, and/or (ii) a period of up to 90 days
in connection with the alterations of the Premises discussed in Section 4 of
this Consent. The provisions of the second paragraph of Article 25 of the Lease
shall not apply to any closure of the Premises pursuant to this Section 5 c.
6. Damage and Destruction of Premises. Article 19 of the Lease is
hereby amended to provide that in the event that Landlord fails to complete any
structural repairs to the Premises which materially interfere with JFD's use of
the Premises within ninety (90) days of the earlier of the date of JFD's notice
of the need for such repairs or the commencement of such repairs, JFD shall have
the right but not the obligation to make the structural repairs without the
consent of the Landlord and offset the costs of such repairs against payment due
from JFD to Landlord under the Lease.
7. Real Estate Taxes. Real estate taxes shall be paid as provided in
Article 5 of the Lease, currently at a rate of $1,015.00 per month inclusive of
the Additional Premises; provided, however, that JFD shall be responsible for
paying any increase in real estate taxes resulting directly from tenant
improvements made by JFD.
8. Landlord Covenant. Landlord agrees for itself, its agents,
successors and assigns that during the term or any extended term of the Lease,
it will not, to the extent permissible under applicable law, permit lease or
allow any portion of the shopping center of which the Premises are a part to be
used (either by itself or by any other tenant, directly or indirectly) for a
delicatessen-style restaurant. Should any valid federal, state or local law or
formal determination of any administrative agency of competent jurisdiction
affect this covenant, the covenant shall be automatically conformed to the law
and otherwise this covenant and the other provisions of the Lease shall continue
in full force and effect.
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9. JFD Covenant. Notwithstanding anything to the contrary contained in
Article 29 of the Lease, nothing in such Article 29 shall be deemed to preclude
JFD from acquiring one or more stores or businesses located within the shopping
center of which the Premises are a part.
10. Miscellaneous Payments. Landlord and JFD hereby agree that an
assignment fee of $53,387.64 required by Article 43 (first numbered paragraph)
of the Lease shall be paid by Lessee out of escrow simultaneously with the
closing of the Sale Transaction from the sale price otherwise payable to Lessee.
11. Effectiveness of Lease Consents. Any amendments to the terms and
provisions of the Lease provided for in this Consent shall be effective only
upon assignment of the Lease to JFD in connection with the Sale Transaction.
12. Assignment. Notwithstanding anything to the contrary contained in
this Consent or the Lease, JFD may, in its sole discretion, assign any or all of
its rights, duties and obligations pursuant to this Consent or the Lease to any
entity wholly or partially-owned, directly or indirectly by JFD. Except as
specifically provided herein, this Consent may not be assigned or transferred by
any party hereto without the express written consent of the remaining parties,
which consent shall not be unreasonably withheld; provided, however, that
nothing herein shall be deemed to restrict the ability of Landlord to assign the
Lease in connection with a sale of the property underlying the Premises.
13. Confidentiality. Landlord acknowledges that (i) the existence and
terms of this Consent, the Amendment and the Sale Transaction are confidential
and neither Landlord nor Lessee shall issue any press release or make any public
announcement or other public disclosure relating to the subject matter of this
Consent, the Amendment or the Sale Transaction without the prior written consent
of JFD, and (ii) JFD shall have the right, without the consent of Landlord or
Lessee and in any manner that JFD deems necessary or appropriate, to disclose
the existence and terms of this Consent, the Amendment and the Sale Transaction
in order to satisfy its disclosure obligations as a public corporation.
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14. Further Assurances. In addition to the obligations required to be
performed under the Lease, as amended hereby, Landlord and JFD shall perform
such other acts, and shall execute, acknowledge and/or deliver such other
instruments, documents and other materials, as may be reasonably required in
order to accomplish the intent and purposes of the Lease, as hereby amended.
15. Authority. Landlord represents and warrants to JFD that it has the
due power and authority to enter into this Consent and to be bound by the terms
hereof.
16. Binding Effect. This Consent shall be binding upon and inure to the
benefit of Landlord and JFD and their respective successors and assigns.
17. Attorneys' Fees. Should any party initiate a legal proceeding
against any other party, including an arbitration, then the prevailing party
shall be entitled to receive reasonable attorneys' fees and costs incurred in
connection with such legal proceeding as determined by the court or arbitrator,
as the case may be.
18. Counterparts. This Consent may be executed in any number of
counterparts, each of which shall be an original, but all of which shall
constitute one and the same instrument.
19. No Other Consent. Except as modified by this Consent, the
provisions of the Lease shall remain unaffected and in full force and effect. To
the extent that any terms or provisions of this Consent are inconsistent with
any terms or provisions of the Lease, the terms and provisions of this Consent
shall control.
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IN WITNESS WHEREOF, this Consent is executed as of the day and year
aforesaid.
LANDLORD: PLAZA INTERNATIONAL
By:_____________________________
Name:
Title:
JFD: JERRY'S FAMOUS DELI, INC.
By:_______________________________
Name:
Title:
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EXHIBIT A
JFD Menu
See menu of "Jerry's Famous Deli" restaurants attached hereto and
incorporated herein by this reference.