Texas-Dallas-Corporate Headquarters Lease - General Electric Capital Business Asset Funding Corp. and Dave & Buster's inc.
================================================================================
LEASE AGREEMENT
By and Between
GENERAL ELECTRIC CAPITAL BUSINESS
ASSET FUNDING CORPORATION,
a Delaware corporation
(As Landlord)
AND
DAVE & BUSTER'S, INC.,
a Missouri corporation
(As Tenant)
October 18, 2001
Corporate Headquarters/Warehouse
Dallas, Texas
<PAGE>
TABLE OF CONTENTS
<Table>
<Caption>
Page
----
<S> <C>
1. Demise of Premises.........................................................1
2. Certain Definitions........................................................1
3. Title and Condition........................................................4
4. Use of Leased Premises; Quiet Enjoyment....................................6
5. Term.......................................................................6
6. Rent.......................................................................7
7. Net Lease; Non-Terminability...............................................8
8. Payment of Impositions; Compliance with Legal Requirements and Insurance
Requirements...............................................................9
9. Liens; Recording and Title................................................10
10. Indemnification...........................................................10
11. Maintenance and Repairs...................................................11
12. Alterations...............................................................12
13. Condemnation..............................................................13
14. Insurance.................................................................15
15. Restoration...............................................................19
16. Subordination to Financing................................................20
17. Assignment or Subleasing..................................................21
18. Permitted Contests........................................................22
19. Conditional Limitations; Default Provisions...............................24
20. Additional Rights of Landlord and Tenant..................................26
21. Notices...................................................................27
</Table>
i
<PAGE>
<Table>
<S> <C>
22. Estoppel Certificates.....................................................29
23. Surrender and Holding Over................................................29
24. No Merger of Title........................................................30
25. Definition of Landlord....................................................30
26. Hazardous Substances......................................................31
27. Entry by Landlord.........................................................32
28. No Usury..................................................................32
29. Separability..............................................................32
30. Miscellaneous.............................................................33
31. Additional Rent...........................................................33
32. Financial Statements......................................................34
</Table>
ii
<PAGE>
LEASE AGREEMENT
THIS LEASE AGREEMENT (this "LEASE") made as of the 18th day of October
2001, by and between GENERAL ELECTRIC CAPITAL BUSINESS ASSET FUNDING
CORPORATION, a Delaware corporation, having an office at 10900 NE 4th Street,
Suite 500, Bellevue, WA 98004 ("LANDLORD"), and DAVE & BUSTER'S, INC., a
Missouri corporation, having its principal office at 2481 Manana Drive, Dallas,
Texas 75220 ("TENANT").
In consideration of the rents and provisions herein stipulated to be
paid and performed, Landlord and Tenant, intending to be legally bound, hereby
covenant and agree as follows:
1. Demise of Premises. Landlord hereby demises and leases to Tenant and
Tenant hereby takes and leases from Landlord for the term and upon the
provisions hereinafter specified the following described property (the "LEASED
PREMISES"): (i) the lot or parcel of land described on Exhibit A attached hereto
and made a part hereof, together with the easements, rights, and appurtenances
hereunto belonging or appertaining ("LAND"); (ii) the buildings, structures, and
other improvements on the Land (collectively, the "IMPROVEMENTS"); and (iii) the
machinery and equipment which is attached to the Improvements in such a manner
as to become fixtures under applicable law, together with all additions and
accessions thereto, substitutions therefor and replacements thereof permitted by
this Lease (collectively, the "EQUIPMENT"), excepting therefrom the Trade
Fixtures (as hereinafter defined).
2. Certain Definitions.
"ADDITIONAL RENT" shall mean Additional Rent as defined in
Paragraph 31.
"ADJOINING PROPERTY" shall mean all sidewalks, curbs, gores,
and vault spaces adjoining the Leased Premises.
"ALTERATION" or "ALTERATIONS" shall mean any or all changes,
additions (whether or not adjacent to or abutting any then existing buildings),
expansions (whether or not adjacent to or abutting any then existing buildings),
improvements, reconstructions, removals, or replacements of any of the
Improvements or Equipment, both interior or exterior, and ordinary and
extraordinary.
"BASIC RENT" shall mean Basic Rent as defined in Paragraph 6.
"BASIC RENT PAYMENT DATES" shall mean the Basic Rent Payment
Dates as defined in Paragraph 6.
"COMMENCEMENT DATE" shall mean the Commencement Date as
defined in Paragraph 5.
1
<PAGE>
"CONDEMNATION" shall mean a Taking and/or a Requisition.
"DEFAULT RATE" shall mean the Default Rate as defined in
Paragraph 19(b)(iv).
"EQUIPMENT" shall mean the Equipment as defined in Paragraph
1.
"EVENT OF DEFAULT" shall mean an Event of Default as defined
in Paragraph 19(a).
"FINANCIAL STATEMENTS" shall mean, for so long as Tenant is a
publicly traded company, Form 10 Q for quarterly reports, and Form 10K for
annual reports. If the Tenant is no longer publicly traded, quarterly reports
shall be unaudited and annual reports shall be audited, and each shall be in
accordance with generally accepted accounting principles, consistently applied.
"IMPOSITIONS" shall mean the Impositions as defined in
Paragraph 8.
"IMPROVEMENTS" shall mean the Improvements as defined in
Paragraph 1.
"INSURANCE REQUIREMENT" or "INSURANCE REQUIREMENTS" shall
mean, as the case may be, any one or more of the terms of each insurance policy
required to be carried by Tenant under this Lease and the requirements of the
issuer of such policy, and whenever Tenant shall be engaged in making any
Alteration or Alterations, repairs or construction work of any kind
(collectively, "WORK"), the term "INSURANCE REQUIREMENT" or "INSURANCE
REQUIREMENTS" shall be deemed to include a requirement that Tenant obtain or
cause its contractor to obtain completed value builder's risk insurance when the
estimated cost of the Work in any one instance exceeds the sum of One Hundred
Thousand Dollars ($100,000.00) and that Tenant or its contractor shall obtain
worker's compensation insurance or other adequate insurance coverage covering
all persons employed in connection with the Work, whether by Tenant, its
contractors or subcontractors and with respect to whom death or bodily injury
claims could be asserted against Landlord.
"LAND" shall mean the Land as defined in Paragraph 1.
"LAW" shall mean any constitution, statute, or rule of law.
"LEASED PREMISES" shall mean the Leased Premises as defined in
Paragraph 1.
"LEGAL REQUIREMENT" or "LEGAL REQUIREMENTS" shall mean, as the
case may be, any one or more of all present and future laws, codes, ordinances,
orders, judgments, decrees, injunctions, rules, regulations and requirements,
even if unforeseen or extraordinary, of every duly constituted governmental
authority or agency (but excluding those which by their terms are not applicable
to and do not impose any obligation on Tenant, Landlord, or the Leased Premises)
and all covenants, restrictions and conditions now of record which may be
applicable to Tenant,
2
<PAGE>
Landlord (with respect to the Leased Premises) or to all or any part of or
interest in the Leased Premises, or to the use, manner of use, occupancy,
possession, operation, maintenance, alteration, repair or reconstruction of the
Leased Premises, even if compliance therewith (i) necessitates structural
changes or improvements (including changes required to comply with the
"Americans with Disabilities Act of 1990") or results in interference with the
use or enjoyment of the Leased Premises or (ii) requires Tenant to carry
insurance other than as required by the provisions of this Lease.
"LENDER" shall mean an entity identified as such in writing to
Tenant which makes a Loan to Landlord, secured by a Mortgage and evidenced by a
Note or which is the holder of the Mortgage and Note as a result of an
assignment thereof.
"LOAN" shall mean a loan made by a Lender to Landlord secured
by a Mortgage and evidenced by a Note.
"MORTGAGE" shall mean a first priority mortgage or similar
security instrument hereafter executed covering the Leased Premises from
Landlord to Lender.
"NET AWARD" shall mean the entire award payable to Landlord by
reason of a Condemnation, less any reasonable expenses incurred by Landlord in
collecting such award.
"NET PROCEEDS" shall mean the entire proceeds of any insurance
required under clauses (i), (iv), (v) or (vi) of Paragraph 14(a), less any
actual and reasonable expenses incurred by Landlord in collecting such proceeds.
"NOTE" or "NOTES" shall mean a Promissory Note or Notes
hereafter executed from Landlord to Lender, which Note or Notes will be secured
by a Mortgage and an assignment of leases and rents.
"PERMITTED ENCUMBRANCES" shall mean those covenants,
restrictions, reservations, liens, conditions, encroachments, easements, and
other matters of title that affect the Leased Premises as of the date of
Landlord's acquisition thereof, excepting, however, any such matters arising
from the acts of Landlord (such as liens arising as a result of judgments
against Landlord).
"REPLACED EQUIPMENT" or "REPLACEMENT EQUIPMENT" shall mean the
Replaced Equipment and Replacement Equipment, respectively, as defined in
Paragraph 11(d).
"REQUISITION" shall mean any temporary condemnation or
confiscation of the use or occupancy of the Leased Premises by any governmental
authority, civil or military, whether pursuant to an agreement with such
governmental authority in settlement of or under threat of any such requisition
or confiscation, or otherwise.
3
<PAGE>
"RESTORATION" shall mean the Restoration as defined in
Paragraph 13(c)(i).
"STATE" shall mean the State of Texas.
"TAKING" shall mean any taking of the Leased Premises in or by
condemnation or other eminent domain proceedings pursuant to any law, general or
special, or by reason of any agreement with any condemner in settlement of or
under threat of any such condemnation or other eminent domain proceedings or by
any other means, or any de facto condemnation.
"TERM" shall mean the Term as defined in Paragraph 5.
"TERMINATION DATE" shall mean the Termination Date as defined
in Paragraph 13(b)(i)(A).
"TRADE FIXTURES" shall mean all fixtures, equipment and other
items of personal property (whether or not attached to the Improvements) which
are owned by Tenant and used in the operation of the business conducted on the
Leased Premises.
3. Title and Condition.
a. The Leased Premises are demised and let subject to (i) the
Permitted Encumbrances, (ii) all Legal Requirements and Insurance Requirements,
including any existing violation of any thereof, and (iii) the condition of the
Leased Premises as of the commencement of the Term without representation or
warranty by Landlord; it being understood and agreed, however, that the recital
of the Permitted Encumbrances herein shall not be construed as a revival of any
thereof which for any reason may have expired.
b. LANDLORD LEASES AND WILL LEASE AND TENANT TAKES AND WILL
TAKE THE LEASED PREMISES "AS IS", AND TENANT ACKNOWLEDGES THAT LANDLORD (WHETHER
ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT MADE AND WILL NOT
MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY WARRANTY OR REPRESENTATION,
EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES, INCLUDING ANY
WARRANTY OR REPRESENTATION AS TO ITS FITNESS FOR USE OR PURPOSE, DESIGN OR
CONDITION FOR ANY PARTICULAR USE OR PURPOSE, AS TO THE QUALITY OF THE MATERIAL
OR WORKMANSHIP THEREIN, LATENT OR PATENT, AS TO LANDLORD'S TITLE THERETO, OR AS
TO VALUE, COMPLIANCE WITH SPECIFICATIONS, LOCATION, USE, CONDITION,
MERCHANTABILITY, QUALITY, DESCRIPTION, DURABILITY OR OPERATION, IT BEING AGREED
THAT ALL RISKS INCIDENT THERETO ARE TO BE BORNE BY TENANT. Tenant acknowledges
that the Leased Premises are of its selection and that the Leased Premises have
been inspected by Tenant and are satisfactory to it. In the event of any defect
or deficiency in any of the Leased Premises of any nature, whether patent or
latent, Landlord shall not have any responsibility or liability with respect
thereto or for any incidental or consequential damages
4
<PAGE>
(including strict liability in tort). The provisions of this Paragraph 3 (b)
have been negotiated, and the foregoing provisions are intended to be a complete
exclusion and negation of any warranties by Landlord, express or implied, with
respect to any of the Leased Premises, arising pursuant to the Uniform
Commercial Code as adopted by the State or any other law or regulation now or
hereafter in effect or otherwise.
c. Landlord hereby assigns, without recourse or warranty
whatsoever, to Tenant, all warranties, guaranties, and indemnities, express or
implied, and similar rights which Landlord may have, if any, against any
architect, manufacturer, seller, engineer, contractor, subcontractor, supplier,
or builder with respect to any of the Leased Premises, including, but not
limited to, any rights and remedies existing under contract or pursuant to the
Uniform Commercial Code as adopted by the State (collectively, the
"GUARANTIES"). Such assignment shall remain in effect until the termination of
this Lease. Landlord shall also retain the right to enforce any Guaranties
assigned in the name of Tenant upon the occurrence of an Event of Default.
Landlord hereby agrees to execute and deliver at Tenant's expense such further
documents, including powers of attorney, as Tenant may reasonably request in
order that Tenant may have the full benefit of the assignment effected or
intended to be effected by this Paragraph 3(d). Upon the termination of this
Lease, the Guaranties shall automatically revert to Landlord. The foregoing
provision of reversion shall be self-operative and no further instrument of
reassignment shall be required. In confirmation of such reassignment Tenant
shall execute and deliver promptly any certificate or other instrument which
Landlord may reasonably request. Any monies collected by Tenant under any of the
Guaranties after the occurrence of and during the continuation of an Event of
Default shall be held in trust by Tenant and promptly paid over to Landlord;
said monies will then be used by Landlord to cure (to the extent sufficient) any
Event of Default for which the payment is applicable.
d. Landlord agrees to enter into, at Tenant's expense, such
easements, covenants, waivers, approvals or restrictions for utilities, parking
or other matters as desirable for operation of the Leased Premises or properties
adjacent thereto (collectively, "EASEMENTS") as reasonably requested by Tenant,
subject to Lender's and Landlord's approval of the form thereof, not to be
unreasonably withheld or delayed; provided, however, that no such Easement shall
result in any diminution in the value or utility of the Leased Premises for its
Use (as hereinafter defined), and further provided that no such Easement shall
render the use of the Leased Premises dependent upon any other property or
condition the use of the Leased Premises upon the use of any other property,
each of which Tenant shall certify to Landlord and Lender in writing delivered
with Tenant's request with respect to such Easement. Tenant's request shall also
include Tenant's written undertaking acknowledging that Tenant shall remain
liable hereunder as principal and not merely as a surety or guarantor
notwithstanding the establishment of any Easement.
e. Tenant agrees that Tenant is obligated to and shall perform
all obligations of the owner of the Leased Premises under and pay all expenses
which the owner of the Leased Premises may be required to pay in accordance with
any reciprocal easement agreement or any other agreement or document of record
now (if expressly consented to in writing by Tenant) or in the future affecting
the Leased Premises (herein referred to collectively as the "REA"), and that
Tenant shall comply with all of the terms and conditions of any REA during the
Term of this
5
<PAGE>
Lease. Tenant further covenants and agrees to indemnify, defend, and hold
harmless Landlord and Lender against any claim, loss, or damage suffered by
Landlord or Lender by reason of Tenant's failure to perform any obligations or
pay any expenses as required under any REA or comply with the terms and
conditions of any REA as hereinabove provided during the Term of this Lease.
4. Use of Leased Premises; Quiet Enjoyment.
a. Tenant may use the Leased Premises for a world headquarters
(office) and warehouse use (the "USE"), or any lawful use that does not violate
the terms of any REA. In no event shall the Leased Premises be used for any
purpose that would violate any Permitted Encumbrance or any covenants,
restrictions, or agreements hereafter created by or consented to by Tenant
applicable to the Leased Premises. Tenant agrees that with respect to the
Permitted Encumbrances and any covenants, restrictions, or agreements hereafter
created by or consented to by Tenant, Tenant shall observe, perform and comply
with and carry out the provisions thereof required therein to be observed and
performed by Landlord.
b. Subject to Tenant's rights under Paragraph 18 hereof,
Tenant shall not permit any unlawful occupation, business, or trade to be
conducted on the Leased Premises or any use to be made thereof contrary to
applicable Legal Requirements or Insurance Requirements. Subject to Tenant's
rights under Paragraph 18, Tenant shall not use, occupy, or permit any of the
Leased Premises to be used or occupied, nor do or permit anything to be done in
or on any of the Leased Premises, in a manner which would (i) make void or
voidable any insurance which Tenant is required hereunder to maintain then in
force with respect to any of the Leased Premises, (ii) affect the ability of
Tenant to obtain any insurance which Tenant is required to furnish hereunder, or
(iii) cause any injury or damage to any of the Improvements unless pursuant to
Alterations permitted under Paragraph 12 hereof.
c. Subject to all of the provisions of this Lease, so long as
no Event of Default exists hereunder, Landlord covenants to do no act to disturb
the peaceful and quiet occupation and enjoyment of the Leased Premises by
Tenant.
5. Term.
a. Subject to the provisions hereof Tenant shall have and hold
the Leased Premises for an initial term commencing on October 18, 2001 (the
"COMMENCEMENT DATE"), and ending October 31, 2021 (the "EXPIRATION DATE") (such
initial term, together with any Renewal Term, hereinafter defined, which comes
into effect as hereinafter provided, is herein called the "TERM").
b. Provided this Lease shall not have been terminated pursuant
to the provisions of Paragraphs 13(b) or 19, Tenant shall have the option to
renew this Lease for four (4) consecutive five (5) year periods (collectively,
the "RENEWAL TERMS" and individually, a "RENEWAL TERM"). Tenant shall give the
Landlord written notice ("RENEWAL TERM NOTICE") of
6
<PAGE>
its intent to renew the Lease at least one (1) year prior to the Expiration Date
or the expiration date of the first Renewal Term, as applicable. Each Renewal
Term shall be subject to all of the provisions of this Lease, and all such
provisions shall continue in full force and effect, except that the Basic Rent
for each Renewal Term shall be the amounts determined in accordance with the
schedule set forth in Exhibit B attached hereto and made a part hereof. If
Tenant shall fail to timely give a Renewal Term Notice, then all options with
regard to subsequent Renewal Terms shall expire and be null and void, but only
after Landlord delivers to Tenant a written notice of failure to deliver the
Renewal Term Notice, and ten (10) days from the date of the written notice in
which Tenant may cure the failure. Notwithstanding the foregoing, if Tenant has
failed to deliver a Renewal Term Notice, and Landlord fails to send Tenant a
notice of its failure to deliver a Renewal Term Notice, all options with regard
to subsequent Renewal Terms shall expire and be null and void, without any
further action required of Landlord, on the date that is eleven (11) months
prior to the Expiration Date, or the expiration date of the applicable Renewal
Term.
6. Rent.
a. Tenant shall pay to Landlord (or to Lender, if directed by
Landlord), as minimum annual rent for the Leased Premises during the Term, the
amounts set forth in Exhibit B attached hereto ("BASIC RENT"), commencing on the
Commencement Date for the succeeding, prorated month, and continuing regularly
on the first (1st) calendar day of each month thereafter during the Term, in
advance (the said days being called the "BASIC RENT PAYMENT Dates"), and shall
pay the same at Landlord's address set forth below, or at such other place as
Landlord from time to time may designate to Tenant in writing, in funds which at
the time of such payment shall be legal tender for the payment of public or
private debts in the United States of America and if required by Lender by wire
transfer in immediately available federal funds to such account in such bank as
Lender shall designate, from time to time.
b. Tenant shall pay and discharge before the imposition of any
fine, lien, interest or penalty may be added thereto for late payment thereof,
as Additional Rent, all other amounts and obligations which Tenant assumes or
agrees to pay or discharge pursuant to this Lease, together with every fine,
penalty, interest and cost which may be added by the party to whom such payment
is due for nonpayment or late payment thereof. In the event of any failure by
Tenant to pay or discharge any of the foregoing, Landlord shall have all rights,
powers and remedies provided herein, by law or otherwise, in the event of
nonpayment of Basic Rent.
c. If any installment of Basic Rent is not paid within ten
(10) days after written notice is given by Landlord or Lender (or Lender's
servicer or other designee of Lender) to Tenant that the same is overdue, Tenant
shall pay to Landlord or Lender, as the case may be, on demand, as Additional
Rent, a late charge equal to five percent (5%) (the "LATE CHARGE") on such
overdue installment of Basic Rent, but in no event more than the maximum amount
allowed by law.
d. Landlord and Tenant agree that this Lease is a true lease
and does not represent a financing arrangement. Each party shall reflect the
transactions represented by this
7
<PAGE>
Lease in all applicable books, records, and reports (including, without
limitation, income tax filings) in a manner consistent with "true lease"
treatment rather than "financing" treatment.
7. Net Lease; Non-Terminability.
a. This is a net Lease and Basic Rent, Additional Rent, and
all other sums payable hereunder by Tenant shall be paid, except as otherwise
expressly set forth in this Lease, without notice, demand, setoff, counterclaim,
recoupment, abatement, suspension, deferment, diminution, deduction, reduction,
or defense.
b. Except as otherwise expressly provided in this Lease, this
Lease shall not terminate and Tenant shall not have any right to terminate this
Lease during the Term. Except as otherwise expressly provided in this Lease,
Tenant shall not be entitled to any setoff, counterclaim, recoupment, abatement,
suspension, deferment, diminution, deduction, reduction, or defense of or to
Basic Rent, Additional Rent, or any other sums payable under this Lease; and
except as otherwise expressly provided in this Lease, and the obligations of
Tenant under this Lease shall not be affected by any interference with Tenant's
use of any of the Leased Premises for any reason, including but not limited to
the following: (i) any damage to or destruction of any of the Leased Premises by
any cause whatsoever, (ii) any Condemnation, (iii) the prohibition, limitation,
or restriction of Tenant's use of any of the Leased Premises, (iv) any eviction
by paramount title or otherwise, (v) Tenant's acquisition of ownership of any of
the Leased Premises other than pursuant to an express provision of this Lease,
(vi) any default on the part of Landlord under this Lease or under any other
agreement, (vii) any latent or other defect in, or any theft or loss of any of
the Leased Premises, (viii) the breach of any warranty of any seller or
manufacturer of any of the Equipment, (ix) any violation of Paragraph 4(c) by
Landlord, or (x) any other cause, whether similar or dissimilar to the
foregoing, any present or future Law to the contrary notwithstanding. It is the
intention of the parties hereto that the obligations of Tenant under this Lease
shall be separate and independent covenants and agreements, and that Basic Rent,
Additional Rent, and all other sums payable by Tenant hereunder shall continue
to be payable in all events (or, in lieu thereof, Tenant shall pay amounts equal
thereto), and that the obligations of Tenant under this Lease shall continue
unaffected, unless this Lease shall have been terminated pursuant to an express
provision of this Lease.
c. Tenant agrees that it shall remain obligated under this
Lease in accordance with its provisions and that, except as otherwise expressly
provided herein, it shall not take any action to terminate, rescind or avoid
this Lease, notwithstanding (i) the bankruptcy, insolvency, reorganization,
composition, readjustment, liquidation, dissolution, winding-up or other
proceeding affecting Landlord, (ii) the exercise of any remedy, including
foreclosure, under the Mortgage, or (iii) any action with respect to this Lease
(including the disaffirmance hereof) which may be taken by Landlord under the
Federal Bankruptcy Code or by any trustee, receiver or liquidator of Landlord or
by any court under the Federal Bankruptcy Code or otherwise.
d. This Lease is the absolute and unconditional obligation of
Tenant. Tenant waives all rights which are not expressly stated in this Lease
but which may now or hereafter otherwise be conferred by Law to the extent
permitted by applicable law (i) to quit, terminate or
8
<PAGE>
surrender this Lease or any of the Leased Premises, (ii) to any setoff,
counterclaim, recoupment, abatement, suspension, deferment, diminution,
deduction, reduction or defense of or to Basic Rent, Additional Rent or any
other sums payable under this Lease, except as otherwise expressly provided in
this Lease, and (iii) for any statutory lien or offset right against Landlord or
its property.
8. Payment of Impositions; Compliance with Legal Requirements and
Insurance Requirements.
a. i) Subject to the provisions of Paragraph 18 hereof
relating to contests, Tenant shall, before interest or penalties are due
thereon, pay and discharge (all of the following being herein collectively
called the "IMPOSITIONS"): all taxes of every kind and nature (including real,
ad valorem, personal property) on or with respect to the Leased Premises; all
charges and/or taxes for any easement or agreement maintained for the benefit of
the Leased Premises; all general and special assessments, levies, permits,
inspection and license fees on or with respect to the Leased Premises; all water
and sewer rents and other utility charges on or with respect to the Leased
Premises; and all other public charges and/or taxes whether of a like or
different nature, even if unforeseen or extraordinary, imposed or assessed upon
or with respect to the Leased Premises, prior to or during the Term, against
Landlord, Tenant, or any of the Leased Premises as a result of or arising in
respect of the ownership, occupancy, leasing, use, maintenance, operation,
management, repair, or possession thereof, or any activity conducted on the
Leased Premises, or the Basic Rent or Additional Rent, including without
limitation, any gross income tax, sales tax, occupancy tax or excise tax levied
by any governmental body on or with respect to such Basic Rent or Additional
Rent. If received by Landlord, Landlord shall promptly deliver to Tenant any
bill or invoice with respect to any Imposition.
ii) Nothing herein shall obligate Tenant to pay, and the
term "IMPOSITIONS" shall exclude, federal, state or local (A) transfer taxes as
the result of a conveyance by (or suffered by) Landlord, (B) franchise, capital
stock or similar taxes if any, of Landlord, (C) income, excess profits or other
taxes, if any, of Landlord, determined on the basis of or measured by its net
income, or (D) any estate, inheritance, succession, gift, capital levy or
similar taxes, unless the taxes referred to in clauses (B) and (C) above are in
lieu of or a substitute for any other tax or assessment upon or with respect to
any of the Leased Premises which, if such other tax or assessment were in effect
at the commencement of the Term, would be payable by Tenant. In the event that
any assessment against any of the Leased Premises may be paid in installments,
Tenant shall have the option to pay such assessment in installments; and in such
event, Tenant shall be liable only for those installments which become due and
payable during the Term. Tenant shall prepare and file all tax reports required
by governmental authorities which relate to the Impositions. Tenant shall
deliver to Landlord and to Lender, within twenty (20) days after Landlord's
written request therefor, copies of all settlements and notices pertaining to
the Impositions which may be issued by any governmental authority and receipts
for payments of all Impositions made during each calendar year of the Term.
b. Subject to the provisions of Paragraph 18 hereof, Tenant
shall promptly comply with and conform to all of the Legal Requirements and
Insurance Requirements.
9
<PAGE>
9. Liens; Recording and Title.
a. Subject to the provisions of Paragraph 18 hereof, Tenant
shall not, directly or indirectly, create or permit to be created or to remain,
and shall promptly discharge, any lien on the Leased Premises, on the Basic
Rent, Additional Rent or on any other sums payable by Tenant under this Lease,
other than the Mortgage, the Permitted Encumbrances and any mortgage, lien,
encumbrance or other charge created by or resulting from any act or omission by
Landlord or those claiming by, through or under Landlord (except Tenant). Notice
is hereby given that Landlord shall not be liable for any labor, services, or
materials furnished or to be furnished to Tenant, or to anyone holding any of
the Leased Premises through or under Tenant, and that no mechanic's or other
liens for any such labor, services or materials shall attach to or affect the
interest of Landlord in and to any of the Leased Premises.
b. Each of Landlord and Tenant shall execute, acknowledge and
deliver to the other a written Memorandum of this Lease to be recorded in the
appropriate land records of the jurisdiction in which the Leased Premises is
located, in order to give public notice and protect the validity of this Lease.
In the event of any discrepancy between the provisions of said recorded
Memorandum of this Lease and the provisions of this Lease, the provisions of
this Lease shall prevail.
c. Nothing in this Lease and no action or inaction by Landlord
shall be deemed or construed to mean that Landlord has granted to Tenant any
right, power or permission to do any act or to make any agreement which may
create, give rise to, or be the foundation for, any right, title, interest, or
lien in or upon the estate of Landlord in any of the Leased Premises.
10. Indemnification.
a. TENANT AGREES TO DEFEND, PAY, PROTECT, INDEMNIFY, SAVE AND
HOLD HARMLESS LANDLORD FROM AND AGAINST ANY AND ALL LIABILITIES, LOSSES,
DAMAGES, PENALTIES, COSTS, EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES AND
EXPENSES), CAUSES OF ACTION, SUITS, CLAIMS, DEMANDS, OR JUDGMENTS OF ANY NATURE
WHATSOEVER, HOWSOEVER CAUSED (EXCEPT BY GROSS NEGLIGENCE OR WILLFUL ACTS OF
LANDLORD), ARISING FROM THE LEASED PREMISES OR THE USE, NON-USE, OCCUPANCY,
CONDITION, DESIGN, CONSTRUCTION, MAINTENANCE, REPAIR, OR REBUILDING OF THE
LEASED PREMISES, AND ANY INJURY TO OR DEATH OF ANY PERSON OR PERSONS OR ANY LOSS
OF OR DAMAGE TO ANY PROPERTY, REAL OR PERSONAL, IN ANY MANNER ARISING THEREFROM
CONNECTED THEREWITH OR OCCURRING THEREON, WHETHER OR NOT LANDLORD HAS OR SHOULD
HAVE KNOWLEDGE OR NOTICE OF THE DEFECT OR CONDITIONS, IF ANY, CAUSING OR
CONTRIBUTING TO SAID INJURY, DEATH, LOSS, DAMAGE OR OTHER CLAIM; EXCEPT TO THE
EXTENT THAT ANY SUCH LIABILITY, LOSS, DAMAGE, PENALTY, COST, EXPENSE, CAUSE OF
ACTION, SUIT, CLAIM, DEMAND OR JUDGMENT IS THE RESULT OF THE GROSS NEGLIGENCE OF
LANDLORD OR THE INTENTIONAL WRONGFUL ACT OF LANDLORD. IN CASE ANY ACTION OR
PROCEEDING IS BROUGHT AGAINST LANDLORD BY REASON OF ANY SUCH CLAIM AGAINST WHICH
TENANT HAS AGREED TO DEFEND, PAY, PROTECT, INDEMNIFY, SAVE AND HOLD HARMLESS
PURSUANT TO THE PRECEDING SENTENCE, TENANT COVENANTS UPON NOTICE FROM LANDLORD
TO RESIST OR DEFEND LANDLORD IN SUCH ACTION, WITH THE EXPENSES OF SUCH DEFENSE
PAID BY TENANT, AND LANDLORD
10
<PAGE>
WILL COOPERATE AND ASSIST IN THE DEFENSE OF SUCH ACTION OR PROCEEDING IF
REASONABLY REQUESTED SO TO DO BY TENANT.
b. The obligations of Tenant under this Paragraph 10 shall
survive for one year after the expiration or any termination of this Lease.
11. Maintenance and Repairs.
a. Except for any Alterations that Tenant is permitted to make
pursuant to this Lease, Tenant shall at all times, including any Requisition
period, put, keep, and maintain the Leased Premises (including, without
limitation, the roof, landscaping, walls, footings, foundations, and structural
components of the Leased Premises) and the Equipment in the same condition and
order of repair as exists as of the date of this Lease, except for ordinary wear
and tear, and shall promptly make all repairs and replacements of every kind and
nature, whether foreseen or unforeseen, which may be required to be made upon or
in connection with the Leased Premises in order to keep and maintain the Leased
Premises in the order and condition required by this Paragraph 11 (a). Tenant
shall do or cause others to do all shoring of the Leased Premises or of
foundations and walls of the Improvements and every other act necessary or
appropriate for preservation and safety thereof, by reason of or in connection
with any excavation or other building operation upon any of the Leased Premises,
whether or not Landlord shall, by reason of any Legal Requirements or Insurance
Requirements, be required to take such action or be liable for failure to do so.
Landlord shall not be required to make any repair, whether foreseen or
unforeseen, or to maintain any of the Leased Premises or Adjoining Property in
any way, and Tenant hereby expressly waives the right to make repairs at the
expense of the Landlord, which right may be provided for in any Law now or
hereafter in effect. Nothing in the preceding sentence shall be deemed to
preclude Tenant from being entitled to insurance proceeds or condemnation awards
for Restoration pursuant to Paragraphs 13(c) and 14(g) of this Lease. Tenant
shall, in all events, make all repairs for which it is responsible hereunder
promptly, and all repairs shall be in a good, proper and workmanlike manner.
b. In the event that any Improvement shall (i) violate any
Legal Requirements or Insurance Requirements, or (ii) encroach on any adjoining
property, and as a result of such violation or encroachment enforcement action
is threatened or commenced against Tenant or with respect to the Leased
Premises, then Tenant, at the request of Landlord, shall either (i) obtain valid
and effective waivers or settlements of all claims, liabilities and damages
resulting from each such violation, whether the same shall affect Landlord,
Tenant or both, or (ii) take such action as shall be necessary to remove such
violation, including, if necessary, any Alteration. Any such repair or
Alteration shall be made in conformity with the provisions of Paragraph 12 of
this Lease.
c. If Tenant shall be in default under any of the provisions
of this Paragraph 11, Landlord may after thirty (30) days written notice given
to Tenant and failure of Tenant to commence to cure during said period, but
without notice in the event of an emergency, do whatever is necessary to cure
such default as may be appropriate under the circumstances for the account of
and at the expense of Tenant. In the event of an emergency Landlord shall notify
11
<PAGE>
Tenant of the situation by phone or other available communication. All
reasonable sums so paid by Landlord and all reasonable costs and expenses
(including, without limitation, attorneys' fees and expenses) so incurred,
together with interest thereon at the Default Rate from the date of payment or
incurring the expense, shall constitute Additional Rent payable by Tenant under
this Lease and shall be paid by Tenant to Landlord on demand.
d. Tenant shall from time to time replace with other
operational equipment or parts (the "REPLACEMENT EQUIPMENT") any of the
Equipment (the "REPLACED EQUIPMENT") which shall have become worn out or
unusable for the purpose for which it is intended, been taken by a Condemnation
as provided in Paragraph 13, or been lost, stolen, damaged or destroyed as
provided in Paragraph 14. Tenant shall repair at its sole cost and expense all
damage to the Leased Premises caused by the removal of Equipment or Replaced
Equipment or other personal property of Tenant or the installation of
Replacement Equipment. All Replacement Equipment shall become the property of
Landlord, shall be free and clear of all liens and rights of others and shall
become a part of the Equipment as if originally demised herein.
e. Landlord shall have no obligations for repairs,
replacements, or maintenance of the Leased Premises.
12. Alterations.
a. Tenant shall not make Alterations which would (after the
completion thereof) impair the structural integrity of the Leased Premises,
without Landlord's written consent. Tenant may make any other Alterations
without the prior written consent of the Landlord provided such Alterations
comply with all of the provisions of the following paragraph.
b. In the event that Landlord gives its prior written consent
to any Alterations, or if such consent is not required, Tenant agrees that in
connection with any Alteration: (i) the fair market value of the Leased Premises
shall not be lessened in any material respect after the completion of any such
Alteration, or its structural integrity impaired; (ii) the Alteration and any
Alteration theretofore made or thereafter to be made shall not in the aggregate
reduce the gross floor area of the Improvements; (iii) all such Alterations
shall be performed in a good and workmanlike manner, and shall be expeditiously
completed in compliance with all Legal Requirements; (iv) all work done in
connection with any such Alteration shall comply with all Insurance
Requirements; (v) Tenant shall promptly pay all costs and expenses of any such
Alteration, and shall (subject to the provisions of Paragraph 18 hereof)
discharge all liens filed against any of the Leased Premises arising out of the
same; (vi) Tenant shall procure and pay for all permits and licenses required in
connection with any such Alteration; (vii) all such Alterations shall be the
property of Landlord and shall be subject to this Lease; and (viii) all
Alterations shall be made (in the case of any Alteration the estimated cost of
which in any one instance exceeds Two Hundred Fifty Thousand Dollars
($250,000.00)) under the supervision of an architect or engineer and, in
accordance with plans and specifications which shall be submitted to Landlord
(for informational purposes only) prior to the commencement of the Alterations.
12
<PAGE>
13. Condemnation.
a. Tenant, promptly after obtaining knowledge of the
institution of any proceeding for Condemnation, shall notify Landlord thereof
and Landlord shall be entitled to participate in any Condemnation proceeding.
Landlord, promptly after obtaining knowledge of the institution of any
proceeding for Condemnation, shall notify Tenant thereof and Tenant shall have
the right to participate in such proceedings. Subject to the provisions of this
Paragraph 13 and Paragraph 15, Tenant hereby irrevocably assigns to Lender or to
Landlord, in that order, any award or payment in respect of any Condemnation of
Landlord's interest in the Leased Premises, except that (except as hereinafter
provided) nothing in this Lease shall be deemed to assign to Landlord or Lender
any award relating to the value of the leasehold interest created by this Lease
or any award or payment on account of the Trade Fixtures, moving expenses and
out-of-pocket expenses incidental to the move, if available, to the extent
Tenant shall have a right to make a separate claim therefor against the
condemner, it being agreed, however, that Tenant shall in no event be entitled
to any payment that reduces the award to which Landlord is or would be entitled
for the condemnation of Landlord's interest in the Leased Premises.
Notwithstanding the foregoing, Tenant shall be entitled to any award or payment
on account of Tenant's leasehold interest under this Lease only in the event of
a Condemnation described in Paragraph 13(b)(i)(A) and then only to the extent
that when such award, added to all other awards to which Tenant is entitled
hereunder, is subtracted from the entire award in respect to all interests in
the Leased Premises, the remainder exceeds the amount set forth on Exhibit C
attached hereto and made a part hereof.
b. (i) (A) If (I) the entire Leased Premises or (II) at least
ten percent (10%) of the applicable Land or the building constructed on the Land
or any means of ingress, egress, or access to the Leased Premises, the loss of
which even after Restoration would, in Tenant's reasonable business judgment, be
substantially and materially adverse to the business operations of Tenant at the
Leased Premises, shall be subject of a Taking by a duly constituted authority or
agency having jurisdiction, then Tenant shall, not later than ninety (90) days
after a Taking has occurred, serve notice ("TENANT'S TERMINATION NOTICE") upon
Landlord of Tenant's intention to terminate this Lease on any Basic Rent Payment
Date specified in such Tenant's Termination Notice, which date (the "TERMINATION
DATE") shall be no sooner than the first Basic Rent Payment Date occurring at
least thirty (30) days after the date of such Tenant's Termination Notice.
(B) In the event that during the Initial Term or during
the first twenty-four (24) months of the first Renewal Term Tenant
shall serve a Tenant's Termination Notice upon Landlord, Tenant shall,
as part of such Tenant's Termination Notice offer (which offer may be
rejected by Landlord only with Lender's consent as set forth below in
Paragraph 13(b)(i)(E) if the Leased Premises are then subject to a
Mortgage) to purchase the Leased Premises and the award (or if no part
of the Leased Premises shall remain, the entire award) for the
applicable price (the "PURCHASE PRICE") computed in accordance with the
schedule annexed hereto and marked Exhibit C plus all other amounts
which may have accrued and be owing to Lender or Landlord under this
Lease (the "ADDITIONS TO PURCHASE PRICE").
13
<PAGE>
(C) If Landlord and Lender shall elect to reject
Tenant's offer to purchase, Landlord shall give notice thereof to
Tenant within thirty (30) days after the giving of Tenant's Termination
Notice. Should said notices of Landlord and Lender rejecting Tenant's
offer to purchase not be served within said period of thirty (30) days,
then and in that event, the said offer shall be deemed accepted.
(D) Should an offer to purchase be rejected by Landlord
and Lender, this Lease shall be terminated as above provided and the
entire award made in the Condemnation proceeding with respect to the
Leased Premises shall be paid to Lender or to Landlord in that order.
(E) Landlord's notice to reject Tenant's offer to
purchase shall be void and of no effect unless accompanied by the
written notice of Lender (if the Leased Premises are then subject to a
Mortgage) to the effect that Lender also elects to reject Tenant's
offer to purchase. Alternatively, if Lender elects to accept Tenant's
offer to purchase by written notice to Tenant and Landlord delivered in
accordance herewith, then, notwithstanding any notice by Landlord to
the contrary, Tenant's offer to purchase shall be deemed accepted for
all purposes hereof.
(ii) In the event that Landlord and Lender shall accept or be
deemed to have accepted Tenant's offer to purchase, title shall close
and the Purchase Price and Additions to Purchase Price shall be paid as
hereinafter provided and in such event Tenant shall be entitled to and
shall receive any and all awards with respect to the Leased Premises
then or thereafter made in the Condemnation proceeding and Landlord
shall assign (or in case of any award previously made, deliver to
Tenant on the Closing Date) such award as may be made with respect to
the Leased Premises. In the event Landlord and Lender shall accept
Tenant's offer to purchase with respect to the Leased Premises, or be
deemed to have accepted such Tenant's offer, title shall close thirty
(30) days after the Termination Date hereinbefore defined (the "CLOSING
DATE"), at noon at the local office of Landlord's counsel, or at such
other time and place as the parties hereto may agree upon, this Lease
shall be automatically extended to and including the Closing Date (or,
if applicable, the extended Closing Date hereinafter described) and
Tenant shall pay the Purchase Price and Additions to Purchase Price by
transferring immediately available funds to such account or accounts
and in such bank or banks as Lender or Landlord, in that order, shall
designate, upon delivery to Tenant of a special warranty deed (or local
equivalent) conveying Leased Premises and all other required documents
including an assignment of any award in connection with the taking of
the Leased Premises. The special warranty deed (or local equivalent)
shall convey title, free from encumbrances other than (A) Permitted
Encumbrances, (B) liens or encumbrances created or suffered by Tenant
or arising by reason of the failure of Tenant to observe or perform any
of the terms, covenants or agreements herein provided to be observed
and performed by Tenant, (C) any installments of Impositions then
affecting the Leased Premises, and (D) this Lease. The Purchase Price
and Additions to Purchase Price payable as hereinabove provided shall
be charged or credited, as the case may be, on the Closing Date, to
reflect adjustments of Basic Rent paid or payable to and including the
Closing Date, apportioned as of the Closing Date. Tenant shall pay all
conveyance, transfer, sales and like taxes
14
<PAGE>
required in connection with the purchase, regardless of who is required
to pay such taxes under State or local law or custom (and Tenant shall
also pay to Landlord any amount necessary to yield to Landlord a net
amount equal to the entire Purchase Price and Additions to Purchase
Price if as a matter of the Law of the State or locality such tax
cannot be paid directly by Tenant).
(iii) In the event that after the first twenty-four (24)
months of the first Renewal Term, Tenant shall serve a Tenant's
Termination Notice upon Landlord, this Lease and the Term hereof shall
terminate on the Termination Date specified in the Termination Notice;
and in such event the entire award to the made in the Condemnation
proceeding shall be paid to Lender or to Landlord, in that order.
c. i) In the event of a Condemnation of any part of the Leased
Premises which does not result in a Termination of this Lease, subject to the
requirements of Paragraph 15, the Net Award of such Condemnation shall be
retained by Landlord subject to the provisions of (c)(ii) below; and promptly
after such Condemnation, Tenant shall commence and diligently continue to
restore the Leased Premises as nearly as possible to its value, condition and
character immediately prior to such Condemnation, in accordance with the
provisions of this Lease, including but not limited to the provisions of
Paragraphs 11 (a), 12 and 15 (such restoration following a Condemnation and
restoration following a casualty is, as the context shall require, herein called
a "Restoration").
ii) Upon the payment to Landlord of the Net Award of a Taking
which falls within the provisions of this Paragraph 13(c), Landlord and Lender
shall, to the extent received, make that portion of the Net Award equal to the
cost of Restoration (the "RESTORATION AWARD") available to Tenant for
Restoration, in accordance with the provisions of Paragraph 15, and promptly
after completion of the Restoration, the balance of the Net Award shall be paid
to Tenant. During a Restoration, all Basic Rent, Additional Rent, and other sums
payable hereunder shall continue unabated and unreduced.
iii) In the event of a Requisition of the Leased Premises,
Landlord shall apply the Net Award of such Requisition, to the extent available,
to the installments of Basic Rent, Additional Rent or other sums payable by
Tenant hereunder thereafter payable and Tenant shall pay any balance remaining
thereafter. Upon the expiration of the Term, any portion of such Net Award which
shall not have been previously credited to Tenant on account of the Basic Rent
and Additional Rent shall be retained by Landlord.
d. Except with respect to an award or payment to which Tenant is
entitled pursuant to the provisions of Paragraph 13(a), 13(b) and 13(c), no
agreement with any condemner in settlement of or under threat of any
Condemnation shall be made by either Landlord or Tenant without the written
consent of the other, and of Lender, if the Leased Premises are then subject to
a Mortgage, which consent shall not be unreasonably withheld or delayed.
14. Insurance.
15
<PAGE>
a. Tenant shall maintain at its sole cost and expense the
following insurance on the Leased Premises:
i) Insurance against loss or damage to the Improvements and
Equipment under a fire and broad form of all risk extended coverage insurance
policy (which shall include flood insurance if the Leased Premises is located
within a flood hazard area and which shall include earthquake insurance if the
Leased Premises is located in an area where earthquake insurance is customarily
maintained for similar commercial properties). Such insurance shall be in
amounts sufficient to prevent Landlord or Tenant from becoming a co-insurer
under the applicable policies, and in any event in amounts not less than the
full replacement cost of the Improvements and Equipment (excluding footings and
foundations and other parts of the Improvements which are not insurable) as
determined from time to time at Lender's request but not more frequently than
once in any 12-month period, by agreement of Landlord, Lender, and Tenant, or if
not so agreed, at Tenant's expense, by the insurer or insurers or by an
appraiser approved by Landlord. Such insurance policies may contain reasonable
exclusions and deductible amounts.
ii) Commercial general liability insurance (including
contractual indemnity) against claims for bodily injury, death or property
damage occurring on, in or about the Leased Premises, which insurance shall be
written on a so-called "Occurrence Basis," and shall provide minimum protection
with a combined single limit in an amount not less than Two Million Dollars
($2,000,000.00) (or in such increased limits from time to time to reflect
declines in the purchasing power of the dollar as Landlord may reasonably
request) and excess liability coverage of Ten Million Dollars ($10,000,000.00).
iii) Worker's compensation insurance covering all persons
employed by Tenant on the Leased Premises in connection with any work done on or
about any of the Leased Premises for which claims for death or bodily injury
could be asserted against Landlord, Tenant or the Leased Premises.
iv) During periods of war or national emergency, war risk
insurance in an amount not less than the actual replacement cost of the
Improvements and Equipment (excluding footings and foundations and other parts
of the Improvements which are not insurable), when and to the extent obtainable
from the United States Government or an agency thereof at reasonable cost.
v) Insurance against loss or damage from explosion of any
steam or pressure boilers or similar apparatus located in or about the
Improvements in an amount not less than the actual replacement cost of the
Improvements and Equipment (excluding footings and foundations and other parts
of the Improvements which are not insurable).
vi) Business interruption insurance in an amount equal to at
least one (1) year's Basic Rent.
16
<PAGE>
vii) Such additional and/or other insurance with respect to
the Improvements located on the Leased Premises and in such amounts as at the
time is customarily carried by prudent owners or tenants with respect to
improvements similar in character, location and use and occupancy to the
Improvements located on the Leased Premises.
b. The insurance required by Paragraph 14(a) shall be written by
companies having a claims paying ability rating by Standard & Poors of not less
than A, and all such companies shall be authorized to do an insurance business
in the State, or otherwise agreed to by Landlord and Lender. The insurance
policies (i) shall be in amounts sufficient at all times to satisfy any
coinsurance requirements thereof, and (ii) shall (except for the worker's
compensation insurance referred to in Paragraph 14(a)(iii) hereof) name
Landlord, and Tenant and any Lender as additional insured parties or loss payee
(as appropriate), as their respective interests may appear. If said insurance or
any part thereof shall expire, be withdrawn, become void by breach of any
condition thereof by Tenant or become void or unsafe by reason of the failure or
impairment of the capital of any insurer, Tenant shall immediately obtain new or
additional insurance reasonably satisfactory to Landlord and Lender.
c. Each insurance policy referred to in clauses (i), (iv), (v),
(and (vi) if requested by Lender) of Paragraph 14(a), shall contain standard
non-contributory mortgagee clauses in favor of any Lender which holds a Mortgage
on the Leased Premises. Each policy shall provide that it may not be canceled
except after thirty (30) days prior notice to Landlord and any Lender. Each
policy shall also provide that any losses otherwise payable thereunder shall be
payable notwithstanding (i) any act or omission of Landlord or Tenant which
might, absent such provision, result in a forfeiture of all or a part of such
insurance payment, or (ii) the occupation or use of any of the Leased Premises
for purposes more hazardous than permitted by the provisions of such policy.
d. Tenant shall pay as they become due all premiums for the
insurance required by this Paragraph 14, shall renew or replace each policy, and
shall deliver to Landlord, and Lender, a certificate or other evidence
(reasonably satisfactory to Lender and Landlord) of the existing policy and such
renewal or replacement policy at least thirty (30) days prior to the Expiration
Date (as hereinafter defined) of each policy. Each such policy shall provide
that it shall not expire until the Landlord and the Lender shall receive a
notice from the insurer to the effect that a policy will expire on a date (the
"EXPIRATION DATE") which shall be thirty (30) days following the date of the
receipt by Landlord and Lender of such notice. In the event of Tenant's failure
to comply with any of the foregoing requirements of this Paragraph 14 within
five (5) business days of the giving of written notice by Landlord to Tenant,
Landlord shall be entitled to procure such insurance. Any sums expended by
Landlord in procuring such insurance shall be Additional Rent and shall be
repaid by Tenant, together with interest thereon at the Default Rate, from the
time of payment by Landlord until fully paid by Tenant immediately upon written
demand therefor by Landlord.
e. Anything in this Paragraph 14 to the contrary notwithstanding,
any insurance which Tenant is required to obtain pursuant to Paragraph 14(a) may
be carried under a "blanket" policy or policies covering other properties or
liabilities of Tenant, provided that such
17
<PAGE>
"blanket" policy or policies otherwise comply with the provisions of this
Paragraph 14. In the event any such insurance is carried under a blanket policy,
Tenant shall deliver to Landlord and Lender evidence of the issuance and
effectiveness of the policy, the amount and character of the coverage with
respect to the Leased Premises and the presence in the policy of provisions of
the character required in the above sections of this Paragraph 14.
f. In the event of any casualty loss exceeding $100,000.00,
Tenant shall give Landlord immediate notice thereof. Tenant shall adjust,
collect and compromise any and all claims, with the consent of Lender and
Landlord, not to be unreasonably withheld or delayed, and Landlord and Lender
shall have the right to join with Tenant therein. If the estimated cost of
Restoration or repair shall be One Hundred Thousand Dollars ($100,000.00) or
less, all proceeds of any insurance required under clauses (i), (iv), and (v)
(and (vi) and (vii) if requested by Lender) of Paragraph 14(a) hereof shall be
payable to Tenant, provided that Tenant (or the guarantor of the Tenant's
obligations under this Lease) at such time shall have a tangible net worth of
not less than One Hundred Million Dollars ($100,000,000.00) as determined in
accordance with generally accepted accounting principles, consistently applied,
and in all other events to a Trustee which shall be a federally insured bank or
other financial institution, selected by Landlord and Tenant and reasonably
satisfactory to Lender (the "Trustee"). If the Leased Premises shall be covered
by a Mortgage, Lender, if it so desires, shall be the Trustee. Each insurer is
hereby authorized and directed to make payment under said policies directly to
such Trustee instead of to Landlord and Tenant jointly; and Tenant and Landlord
each hereby appoints such Trustee as its attorney-in-fact to endorse any draft
therefor for the purposes set forth in this Lease after approval by Tenant of
such Trustee, if Trustee is other than Lender. Except as stated in Paragraph
14(g) below, in the event of any casualty (whether or not insured against)
resulting in damage to the Leased Premises or any part thereof, the Term shall
nevertheless continue and there shall be no abatement or reduction of Basic
Rent, Additional Rent or any other sums payable by Tenant hereunder. The Net
Proceeds of such insurance payment shall be retained by the Trustee and,
promptly after such casualty, Tenant, as required in Paragraphs 11 (a) and 12,
shall commence and diligently continue to perform the Restoration to the Leased
Premises. Upon payment to the Trustee of such Net Proceeds, the Trustee shall,
to the extent available, make the Net Proceeds available to Tenant for
Restoration, in accordance with the provisions of Paragraph 15. Tenant shall,
whether or not the Net Proceeds are sufficient for the purpose, promptly repair
or replace the Improvements and Equipment in accordance with the provisions of
Paragraph 11 (a) and the Net Proceeds of such loss shall thereupon be payable to
Tenant, subject to the provisions of Paragraph 15 hereof. In the event that any
damage or destruction shall occur at such time as Tenant shall not have
maintained third-party insurance in accordance with Paragraph 14(a)(i),(iv),(v),
(vi) or (vii), Tenant shall pay to the Trustee the amount of the proceeds that
would have been payable had such insurance program been in effect (the "TENANT
INSURANCE PAYMENT").
g. Notwithstanding anything to the contrary contained herein, if
all or substantially all of the Leased Premises are damaged or destroyed by fire
or other casualty which, in the Tenant's good faith and reasonable judgment
renders the Leased Premises unsuitable for Restoration to allow continued use
and occupancy by the Tenant, then Tenant may elect to terminate the Lease, but
only if such election is made within ninety (90) days of the casualty. If Tenant
timely elects to terminate the Lease, then (i) if during the initial term, the
18
<PAGE>
Tenant shall make a rejectable offer to purchase the Leased Premises following
the same procedures outlined in Paragraph 13(b) of this Lease, and (ii) if
during any Renewal Term, the Lease shall terminate, and Tenant shall assign all
insurance proceeds to the Landlord.
15. Restoration. Net Proceeds, Restoration Award and Tenant Insurance
Payment (the aggregate of which being herein defined as the "RESTORATION FUND")
shall be disbursed by the Trustee in accordance with the following conditions:
a. If the cost of Restoration will exceed $250,000.00, prior to
commencement of the Restoration, the architects, general contractor(s), and
plans and specifications for the Restoration shall be approved by Landlord,
which approval shall not be unreasonably withheld or delayed; and which approval
shall be granted to the extent that the plans and specifications depict a
Restoration which is substantially similar to the Improvements and Equipment
which existed prior to the occurrence of the Casualty or Taking, whichever is
applicable.
b. At the time of any disbursement, no Event of Default shall
exist and no mechanics' or materialmen's liens shall have been filed and remain
undischarged or unbonded, subject to the provisions of Paragraph 18 hereof.
c. Disbursements shall be made from time to time in an amount not
exceeding the hard and soft cost of the work and costs incurred since the last
disbursement upon receipt of (1) satisfactory evidence, including architects'
certificates of the stage of completion, of the estimated cost of completion and
of performance of the work to date in a good and workmanlike manner in
accordance with the contracts, plans and specifications, (2) conditional (based
upon payment) releases of liens, and (3) other reasonable evidence of cost and
payment so that Landlord can verify that the amounts disbursed from time to time
are represented by work that is completed in place or delivered to the site and
free and clear of mechanics' lien claims.
d. Each request for disbursement shall be accompanied by a
certificate of Tenant describing the work, materials or other costs or expenses,
for which payment is requested, stating the cost incurred in connection
therewith and stating that Tenant has not previously received payment for such
work or expense and the certificate to be delivered by Tenant upon completion of
the work shall, in addition, state that the work has been substantially
completed and complies with the applicable requirements of this Lease.
e. The Trustee may retain ten percent (10%) of the Restoration
Fund until the Restoration is substantially complete.
f. The Restoration Fund shall be kept in a separate
interest-bearing federally insured account by the Trustee or by Lender.
19
<PAGE>
g. At all times the undisbursed balance of the Restoration Fund
held by Trustee plus any funds contributed thereto by Tenant shall be not less
than the cost of completing the Restoration, free and clear of all liens.
h. In addition, prior to commencement of Restoration and at any
time during Restoration, if the estimated cost of Restoration, as reasonably
determined by Landlord, exceeds the amount of the Net Proceeds, the Restoration
Award and Tenant Insurance Payment available for such Restoration, the amount of
such excess shall be paid by Tenant to the Trustee to be added to the
Restoration Fund or Tenant shall fund at its own expense the costs of such
Restoration until the remaining Restoration Fund is sufficient for the
completion of the Restoration. Any sum in the Restoration Fund which remains in
the Restoration Fund upon the completion of Restoration shall be paid to Tenant.
For purposes of determining the source of funds with respect to the disposition
of funds remaining after the completion of Restoration, the Net Proceeds or the
Restoration Award shall be deemed to be disbursed prior to any amount added by
Tenant.
16. Subordination to Financing.
a. i) Subject to the provisions of Paragraph 16 (a)(ii), and
subject to the execution and timely delivery to Tenant by Lender of an
instrument in accordance with Paragraph 16(d), Tenant agrees that this Lease
shall at all times be subject and subordinate to the lien of any Mortgage, and
Tenant agrees, upon demand, without cost, to execute instruments as may be
required to further effectuate or confirm such subordination.
ii) Except as expressly provided in this Lease by reason of
the occurrence of an Event of Default, Tenant's tenancy and Tenant's rights
under this Lease shall not be disturbed, terminated, or otherwise adversely
affected, nor shall this Lease be affected, by any default under any Mortgage,
and in the event of a foreclosure or other enforcement of any Mortgage, or sale
in lieu thereof, the purchaser at such foreclosure sale shall be bound to Tenant
for the Term of this Lease and any Renewal Term, the rights of Tenant under this
Lease shall expressly survive, and this Lease shall in all respects continue in
full force and effect so long as no Event of Default has occurred and is
continuing. Tenant shall not be named as a party defendant in any such
foreclosure suit, except as may be required by law. Any Mortgage to which this
Lease is now or hereafter subordinate shall provide, in effect, that during the
time this Lease is in force insurance proceeds and Restoration Award shall be
permitted to be used for Restoration in accordance with the provisions of this
Lease.
b. Notwithstanding the provisions of Paragraph 16(a), the holder
of any Mortgage to which this Lease is subject and subordinate shall have the
right, at its sole option, at any time, to subordinate and subject the Mortgage,
in whole or in part, to this Lease by recording a unilateral declaration to such
effect, provided that such holder shall have agreed that during the time this
Lease is in force, insurance proceeds and Restoration Award shall be permitted
to be used for restoration in accordance with the provisions of this Lease.
20
<PAGE>
c. At any time prior to the expiration of the Term, Tenant
agrees, at the election and upon demand of any owner of the Leased Premises, or
of a Lender who has granted non-disturbance to Tenant pursuant to Paragraph
16(a) above, to attorn, from time to time, to any such owner or Lender, upon the
terms and conditions of this Lease, for the remainder of the Term. The
provisions of this Paragraph 16(c) shall inure to the benefit of any such owner
or Lender, shall apply notwithstanding that, as a matter of law, this Lease may
terminate upon the foreclosure of the Mortgage, shall be self-operative upon any
such demand, and no further instrument shall be required to give effect to said
provisions.
d. Each of Tenant, any owner and Lender, however, upon demand of
the other, hereby agrees to execute, from time to time, instruments in
confirmation of the foregoing provisions of Paragraphs 16(a) and 16(c),
reasonably satisfactory to the requesting party acknowledging such
subordination, non-disturbance and attornment as are provided in such
subsections and setting forth the terms and conditions of its tenancy.
e. Each of Tenant, Landlord and Lender agrees that, if requested
by any of the others, each shall, without charge, enter into a Subordination,
Non-Disturbance and Attornment Agreement reasonably requested by Lender,
provided such agreement contains provisions relating to non-disturbance in
accordance with the provisions of subparagraph (a), and Tenant hereby agrees for
the benefit of Lender that Tenant will not, (i) without in each case the prior
written consent of Lender, which shall not be unreasonably withheld, conditioned
or delayed, amend or modify the Lease (provided, however, Lender, in Lender's
sole discretion may withhold or condition its consent to any amendment or
modification which would or could (A) alter in any way the amount or time for
payment of any Basic Rent, Additional Rent or other sum payable hereunder, (B)
alter in any way the absolute and unconditional nature of Tenant's obligations
hereunder or materially diminish any such obligations, (C) result in any
termination hereof prior to the end of the initial term, or (D) otherwise, in
Lender's reasonable judgment, affect the rights or obligations of Landlord or
Tenant hereunder), or enter into any agreement with Landlord so to do, (ii)
without the prior written consent of Lender which may be withheld in Lender's
sole discretion, cancel or surrender or seek to cancel or surrender this Lease
or the Term hereof, or enter into any agreement with Landlord to do so (the
parties agreeing that the foregoing shall not be construed to affect the rights
or obligations of Tenant, Landlord or Lender with respect to any termination
permitted under the express terms hereof in connection with an offer to purchase
the Leased Premises following certain events of condemnation as provided in
Section 13 hereof), or (iii) pay any installment of Basic Rent more than one (1)
month in advance of the due date thereof or otherwise than in the manner
provided for in this Lease.
17. Assignment or Subleasing.
a. Notwithstanding anything contained in this Lease to the
contrary, Tenant may not assign its interest in this Lease without the prior
written consent of Landlord, which may be withheld in the sole and absolute
discretion of Landlord, unless such assignment is to a successor-by-merger or
related or affiliated entity. Tenant may not sublease the Demised Premises, in
whole or in part, without the prior written consent of Landlord, which may be
withheld in Landlord's sole and absolute discretion.
21
<PAGE>
b. Each sublease of the Leased Premises or any part thereof shall
be subject and subordinate to the provisions of this Lease. No assignment or
sublease shall affect or reduce any of the obligations of Tenant hereunder, and
all such obligations shall continue in full force and effect as obligations of a
principal and not as obligations of a guarantor, as if no assignment or sublease
had been made. Notwithstanding any assignment or subletting Tenant shall
continue to remain liable and responsible for the payment of the Basic Rent and
Additional Rent and the performance of all its other obligations under this
Lease. No assignment or sublease shall impose any obligations on Landlord under
this Lease except as otherwise provided in this Lease. Tenant agrees that in the
case of an assignment of the Lease, Tenant shall, within fifteen (15) days after
the execution and delivery of any such assignment, deliver to Landlord (i) a
duplicate original of such assignment in recordable form and (ii) an agreement
executed and acknowledged by the assignee in recordable form wherein the
assignee shall agree to assume and agree to observe and perform all of the terms
and provisions of this Lease on the part of the Tenant to be observed and
performed from and after the date of such assignment. In the case of a sublease,
Tenant shall, within fifteen (15) days after the execution and delivery of such
sublease, deliver to Landlord a duplicate original of such sublease.
c. Upon the occurrence of an Event of Default under this Lease,
Landlord shall have the right to collect and enjoy all rents and other sums of
money payable under any sublease of any of the Leased Premises, and Tenant
hereby irrevocably and unconditionally assigns such rents and money to Landlord,
which assignment may be exercised upon and after (but not before) the occurrence
of an Event of Default.
18. Permitted Contests.
a. After prior written notice to Landlord, Tenant shall not be
required to (i) pay any Imposition, (ii) comply with any Legal Requirement,
(iii) discharge or remove any lien referred to in Paragraphs 9 or 12, or (iv)
take any action with respect to any violation referred to in Paragraph 11 (b),
so long as Tenant shall contest, in good faith and at its expense, the
existence, the amount or the validity thereof, the amount of the damages caused
thereby, or the extent of its or Landlord's liability therefor, by appropriate
proceedings which shall operate during the pendency thereof to prevent (A) the
collection of, or other realization upon, the Imposition or lien so contested,
(B) the sale, forfeiture or loss of any of the Leased Premises, any Basic Rent
or any Additional Rent to satisfy the same or to pay any damages caused by the
violation of any such Legal Requirement or by any such violation, (C) any
interference with the use or occupancy of any of the Leased Premises, (D) any
interference with the payment of any Basic Rent or any Additional Rent, and (E)
the cancellation of any fire or other insurance policy.
b. In no event shall Tenant pursue any contest with respect to
any Imposition, Legal Requirement, lien, or violation, referred to above in such
manner that exposes Landlord or Lender to (i) criminal liability, penalty or
sanction, (ii) any civil liability, penalty or sanction for which Tenant has not
made provisions reasonably acceptable to Landlord and Lender or (iii) defeasance
of its interest the Leased Premises.
22
<PAGE>
c. Tenant agrees that each such contest shall be promptly and
diligently prosecuted to a final conclusion, except that Tenant shall, have the
right to attempt to settle or compromise such contest through negotiations.
Tenant shall pay and save Lender and Landlord harmless against any and all
losses, judgments, decrees and costs (including all attorneys' fees and
expenses) in connection with any such contest and shall, promptly after the
final determination of such contest, 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, together with all penalties, fines,
interest, costs and expenses thereof or in connection therewith, and perform all
acts the performance of which shall be ordered or decreed as a result thereof.
23
<PAGE>
19. Conditional Limitations; Default Provisions.
a. The occurrence of any one or more of the following events (any
such event being specified herein as a "failure" or "default") shall constitute
an Event of Default under this Lease: (i) a failure by Tenant to make
(regardless of the pendency of any bankruptcy, reorganization, receivership,
insolvency or other proceedings, in law, in equity or before any administrative
tribunal which had or might have the effect of preventing Tenant from complying
with the provisions of this Lease): (x) any payment of Basic Rent which
continues unremedied for a period of five (5) business days after written notice
in accordance with Paragraph 21 below ("NONPAYMENT NOTICE") thereof given to
Tenant by Landlord or Lender or Lender's designee, or (y) any payment of
Additional Rent or other sum herein required to be paid by Tenant which
continues unremedied for a period of ten (10) business days after a Nonpayment
Notice is given to Tenant by Landlord or Lender or Lender's designee; (ii)
failure by Tenant to perform and observe, or a violation or breach of, any other
provision in this Lease and such default shall continue for a period of thirty
(30) business days after written notice thereof is given by Landlord or Lender
or Lender's designee to Tenant or if such default is of such a nature that it
cannot reasonably be cured within such period of thirty (30) business days, such
period shall be extended for such longer time as is reasonably necessary
provided that Tenant has commenced to cure such default within said period of
thirty (30) business days and is actively, diligently and in good faith
proceeding with continuity to remedy such default; (iii) Tenant or any guarantor
of Tenant's obligations hereunder shall (A) voluntarily be adjudicated a
bankrupt or insolvent, (B) or voluntarily consent to the appointment of a
receiver or trustee for itself or for any of the Leased Premises, (C)
voluntarily file a petition seeking relief under the bankruptcy or other similar
laws of the United States, any state or any jurisdiction, or (D) voluntarily
file a general assignment for the benefit of creditors; (iv) a court shall enter
an order, judgment or decree appointing, with the voluntary consent of Tenant or
any guarantor of Tenant's obligations hereunder, a receiver or trustee for
Tenant or any guarantor of Tenant's obligations hereunder or for the Leased
Premises or approving a petition filed against Tenant or any guarantor of
Tenant's obligations hereunder which seeks relief under the bankruptcy or other
similar laws of the United States or any State, and such order, judgment or
decree shall remain in force, undischarged or unstayed, ninety (90) business
days after it is entered; (v) Tenant or any guarantor of Tenant's obligations
hereunder shall in any insolvency proceedings be liquidated or dissolved or
shall voluntarily commence proceedings towards its liquidation or dissolution;
or (vi) the estate or interest of Tenant in the Leased Premises shall be levied
upon or attached in any proceeding and such estate or interest is about to be
sold or transferred or such process shall not be vacated or discharged within
ninety (90) business days after such levy or attachment. Notwithstanding
anything to the contrary contained in this Section 19(a), it shall be an
immediate Event of Default without demand, notice, or opportunity to cure, if
Tenant fails to maintain any of the Insurance required by Section 14 of this
Lease.
b. If any Event of Default shall have occurred, Landlord shall
have the right at its option, then or at any time thereafter, to do any one or
more of the following without demand upon or notice to Tenant:
24
<PAGE>
i) Landlord may give Tenant notice (following the occurrence
of an Event of Default) of Landlord's intention to terminate this Lease on a
date specified in such notice (which date shall be no sooner than thirty (30)
days after the date of the notice). Upon the date therein specified, unless the
Event of Default for which the termination is effected has been cured by Tenant,
the Term and the estate hereby granted and all rights of Tenant hereunder shall
expire and terminate as if such date were the date hereinabove fixed for the
expiration of the Term, but Tenant shall remain liable for all its obligations
hereunder through the date hereinabove fixed for the expiration of the Term,
including its liability for Basic Rent and Additional Rent as hereinafter
provided.
ii) Landlord may, whether or not the Term of this Lease shall
have been terminated pursuant to clause (i) above give Tenant notice (following
the occurrence of an Event of Default) to surrender the Leased Premises to
Landlord on a date specified in such notice (which date shall be no sooner than
thirty (30) days after the date of the notice), at which time Tenant shall
surrender and deliver possession of the Leased Premises to Landlord unless the
Event of Default for which the termination is effected has been cured by Tenant.
Upon or at any time after taking possession of the Leased Premises, Landlord may
remove any persons or property therefrom. Landlord shall be under no liability
for or by reason of any such entry, repossession or removal. No such entry or
repossession shall be construed as an election by Landlord to terminate this
Lease unless Landlord gives a written notice of such intention to Tenant
pursuant to clause (i) above.
iii) After repossession of any of the Leased Premises pursuant
to clause (ii) above, whether or not this Lease shall have been terminated
pursuant to clause (i) above, Landlord may relet the Leased Premises or any part
thereof to such tenant or tenants for such term or terms (which may be greater
or less than the period which would otherwise have constituted the balance of
the Term) for such rent, on such conditions (which may include concessions or
free rent) and for such uses as Landlord, in its reasonable discretion, may
determine; and Landlord shall collect and receive any rents payable by reason of
such reletting. The rents received on such reletting shall be applied (A) first
to the reasonable and actual expenses of such reletting and collection,
including without limitation necessary renovation and alterations of the Leased
Premises (but not including tenant improvement or construction allowances),
reasonable and actual attorneys' fees and any reasonable and actual real estate
commissions paid, and (B) thereafter toward payment of all sums due or to become
due Landlord hereunder. If a sufficient amount to pay such expenses and sums
shall not be realized or secured, then Tenant shall pay Landlord any such
deficiency monthly, and Landlord may bring an action therefor as such monthly
deficiency shall arise. Landlord shall not, in any event, be required to pay
Tenant any sums received by Landlord on a reletting of the Leased Premises in
excess of the rent provided in this Lease, but such excess shall reduce any
accrued present or future obligations of Tenant hereunder. Landlord's re-entry
and reletting of the Leased Premises without termination of this Lease shall not
preclude Landlord from subsequently terminating this Lease as set forth above.
Tenant agrees to pay Landlord, as Additional Rent, immediately upon demand, all
reasonable expenses incurred by Landlord in obtaining possession, in performing
repairs or maintenance in preparation for reletting any of the Leased Premises,
including fees and commissions of attorneys, architects, agents and brokers.
25
<PAGE>
iv) If Tenant shall fail to make payment of any installment of
Basic Rent or any Additional Rent after the date when each such payment is due
(after expiration of any applicable notice and cure periods), Tenant shall pay
to Landlord, a sum equal to two (2%) percent per annum above the then current
Prime Rate, as hereinafter defined, of the amount unpaid (the "DEFAULT RATE")
computed from the date such payment of Basic Rent or Additional Rent was due to
and including the date of payment. The term "PRIME RATE" shall mean the prime
rate of interest published in the Wall Street Journal or its successor, from
time to time.
v) Landlord may exercise any other right or remedy now or
hereafter existing by law or in equity, other than the right to accelerate rent.
c. In the event of any expiration or termination of this Lease or
repossession of any of the Leased Premises by reason of the occurrence of an
Event of Default, Tenant shall pay to Landlord Basic Rent, Additional Rent and
all other sums required to be paid by Tenant to and including the date of such
expiration, termination or repossession and, thereafter, Tenant shall, until the
end of what would have been the Term in the absence of such expiration,
termination or repossession, and whether or not any of the Leased Premises shall
have been relet, be liable to Landlord for and shall pay to Landlord as
liquidated and agreed current damages: (1) Basic Rent, Additional Rent, and all
other sums which would be payable under this Lease by Tenant in the absence of
such expiration, termination or repossession, less (ii) the net proceeds, if
any, of any reletting pursuant to paragraph 19(b)(iii), after deducting from
such proceeds all of Landlord's reasonable expenses in connection with such
reletting (including all reasonable repossession costs, brokerage commissions,
legal expenses, attorneys' fees, employees' expenses, costs of Alteration and
expenses of preparation for reletting). Tenant hereby agrees to be and remain
liable for all sums aforesaid and Landlord may recover such damages from Tenant
and institute and maintain successive actions or legal proceedings against
Tenant for the recovery of such damages. Nothing herein contained shall be
deemed to require Landlord to wait to begin such action or other legal
proceedings until the date when the Term would have expired by limitation had
there been no such Event of Default.
20. Additional Rights of Landlord and Tenant.
a. No right or remedy conferred upon or reserved to Landlord in
this Lease is intended to be exclusive of any other right or remedy; and each
and every right and remedy shall be cumulative and in addition to any other
right or remedy contained in this Lease. No delay or failure by Landlord or
Tenant to enforce its rights under this Lease shall be construed as a waiver,
modification or relinquishment thereof. In addition to the other remedies
provided in this Lease, Landlord and Tenant shall be entitled, to the extent
permitted by applicable law, to injunctive relief in case of the violation or
attempted or threatened violation of any of the provisions of this Lease, or to
specific performance of any of the provisions of this Lease.
b. Tenant hereby waives and surrenders for itself and all those
claiming under it, including creditors of all kinds, any right and privilege
which it or any of them may have under any present or future law to redeem any
of the Leased Premises or to have a
26
<PAGE>
continuance of this Lease after termination of this Lease or of Tenant's right
of occupancy or possession pursuant to any court order or any provision hereof.
c. Landlord hereby waives any right to distrain or levy upon
Trade Fixtures or any property of Tenant and any Landlord's lien or similar lien
upon Trade Fixtures and any other property of Tenant regardless of whether such
lien is created or otherwise. Landlord agrees at the request of Tenant, to
execute a waiver of any Landlord's or similar lien for the benefit of any
present or future holder of a security interest in or lessor of any of Trade
Fixtures or any other personal property of Tenant.
d. Landlord acknowledges and agrees in the future to acknowledge
(in a written form reasonably satisfactory to Tenant) to such persons and
entities at such times and for such purposes as Tenant may reasonably request
that the Trade Fixtures are Tenant's property and not part of the Improvements
(regardless of whether or to what extent such Trade Fixtures are affixed to the
Improvements) or otherwise subject to the terms of this Lease.
e. Each of Tenant and Landlord (herein called "PAYING PARTY")
agrees to pay to the other party (herein called "DEMANDING PARTY") any and all
reasonable costs and expenses incurred by the Demanding Party in connection with
any litigation or other action instituted by the Demanding Party to enforce the
obligations of the Paying Party under this Lease, to the extent that the
Demanding Party has prevailed in any such litigation or other action. Any amount
payable by Tenant to Landlord pursuant to this Paragraph 20(e) shall be due and
payable by Tenant to Landlord as Additional Rent. No sum payable by Landlord to
Tenant under this subparagraph will be payable or recoverable from any sums
pledged or assigned (or intended to have been pledged or assigned) by Landlord
to Lender, Tenant's right to recover such sums from Landlord being subordinate
to the rights of Lender, such sums only being recoverable after payment to
Lender in full of the Loan as constituted on the date hereof.
21. Notices. All notices, demands, requests, consents, approvals,
offers, statements and other instruments or communications required or permitted
to be given pursuant to the provisions of this Lease (collectively "Notice" or
"NOTICES") shall be in writing and shall be deemed to have been given for all
purposes (i) three (3) days after having been sent by United States mail, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to the other party at its address as stated below, or (ii) one (1) day
after having been sent by Federal Express, United Parcel or other nationally
recognized overnight, air courier service.
To the Addresses stated below:
If to Landlord:
General Electric Capital Business Asset Funding Corporation
10900 NE 4th Street, Suite 500
Bellevue, Washington 98004
Attn: Patrick J. Pearson
27
<PAGE>
With a copy to:
Dechert Price & Rhoads
Ten Post Office Square South
Boston, Massachusetts 02109
Attn: Lewis A. Burleigh
28
<PAGE>
If to Tenant:
Dave & Buster's, Inc.
2481 Manana Drive
Dallas, Texas 75220
Attn: Legal Department
With a copy to:
Kane, Russell, Coleman & Logan, P.C.
3700 Thanksgiving Tower
1601 Elm Street
Dallas, Texas 75201
Attn: Scott A. Dyche
If any Lender shall have advised Tenant by Notice in the manner aforesaid that
it is the holder of a Mortgage and states in said Notice its address for the
receipt of Notices, then simultaneously with the giving of any Notice by Tenant
to Landlord, Tenant shall send a copy of such Notice to Lender in the manner
aforesaid. For the purposes of this Paragraph 21, any party may substitute its
address by giving fifteen (15) days' notice to the other party in the manner
provided above. Any Notice may be given on behalf of any party by its counsel.
22. Estoppel Certificates. Landlord and Tenant shall at any time and
from time to time, upon not less than twenty (20) days' prior written request by
the other, execute, acknowledge and deliver to the other a statement in writing,
certifying (i) that this Lease is unmodified and in full effect (or, if there
have been modifications, that this Lease is in full effect as modified, setting
forth such modifications), (ii) the dates to which Basic Rent, payable hereunder
has been paid, (iii) that to the knowledge of the signer of such certificate no
default or Event of Default by either Landlord or Tenant has occurred and is
continuing hereunder, (iv) the remaining Term hereof, (v) with respect to a
certificate signed on behalf of Tenant, that to the knowledge of the signer of
such certificate, there are no proceedings pending or threatened against Tenant
before or by any court or administrative agency which if adversely decided would
materially and adversely affect the financial condition and operations of Tenant
or if any such proceedings are pending or threatened to said signer's knowledge,
specifying and describing the same, and (vi) such other matters as may
reasonably be requested by the party requesting the certificate. It is intended
that any such statements may be relied upon by Landlord, Tenant, Lender, the
recipient of such statements or their assignees or by any prospective purchaser,
assignee or subtenant of the Leased Premises.
23. Surrender and Holding Over.
a. Upon the expiration or earlier termination of this Lease,
Tenant shall peaceably leave and surrender the Leased Premises (except as to any
portion thereof with respect to which this Lease has previously terminated) to
Landlord. Tenant shall remove from the Leased Premises on or prior to such
expiration or earlier termination the Trade Fixtures and
29
<PAGE>
personal property which is owned by Tenant or third parties other than Landlord,
and Tenant at its expense shall, on or prior to such expiration or earlier
Termination, repair any damage caused by such removal. Trade Fixtures and
personal property not so removed at the end of the Term or within thirty (30)
days after the earlier termination of the Term for any reason whatsoever shall
become the property of Landlord, and Landlord may thereafter cause such property
to be removed from the Leased Premises. The cost of removing and disposing of
such property and repairing any damage to any of the Leased Premises caused by
such removal shall be borne by Tenant. Landlord shall not in any manner or to
any extent be obligated to reimburse Tenant for any property which becomes the
property of Landlord as a result of such expiration or earlier termination.
b. Any holding over by Tenant of the Leased Premises after the
expiration or earlier termination of the Term of this Lease or any extensions
thereof, with the consent of Landlord, shall operate and be construed as tenancy
from month to month only, at one hundred twenty-five percent (125%) of the Basic
Rent reserved herein and upon the same terms and conditions as contained in this
Lease. Notwithstanding the foregoing, any holding over without Landlord's
consent shall entitle Landlord, in addition to collecting Basic Rent at a rate
of one hundred twenty-five percent (125 %) thereof, to exercise all rights and
remedies provided by law or in equity, including the remedies of Paragraph
19(b).
24. No Merger of Title. There shall be no merger of this Lease nor of
the leasehold estate created by this Lease with the fee estate in or ownership
of any of the Leased Premises by reason of the fact that the same person,
corporation, firm or other entity may acquire or hold or own, directly or
indirectly, (a) this Lease or the leasehold estate created by this Lease or an
interest in this Lease or in such leasehold estate and (b) the fee estate or
ownership of any of the Leased Premises or any interest in such fee estate or
ownership. No such merger shall occur unless and until all persons,
corporations, firms and other entities having any interest in (i) this Lease or
the leasehold estate created by this Lease and (ii) the fee estate in or
ownership of the Leased Premises or any part thereof sought to be merged shall
join in a written instrument effecting such merger and shall duly record the
same.
25. Definition of Landlord.
a. Except as provided in Section 12(d) and anything contained
herein to the contrary notwithstanding, any claim based on or in respect of any
liability of Landlord under this Lease shall be enforced only against the
Landlord's interest in the Leased Premises and shall not be enforced against the
Landlord individually or personally (except to the extent that it is necessary
to name Landlord as a defendant in an action for equitable relief).
b. The term "LANDLORD" as used in this Lease so far as covenants
or obligations on the part of Landlord are concerned, shall be limited to mean
and include only the owner or owners of the Leased Premises or holder of the
Mortgage in possession at the time in question of the Leased Premises and in the
event of any transfer or transfers of the title of the Leased Premises, the
Landlord herein named (and in case of any subsequent transfers or conveyances,
the then grantor) shall be automatically freed and relieved from and after the
date
30
<PAGE>
of such transfer and conveyance of all personal liability as respects the
performance of any covenants or obligations on the part of Landlord contained in
this Lease thereafter to be performed.
26. Hazardous Substances.
a. Tenant agrees that it will not on, about, or under the Leased
Premises, make, release, treat, store or dispose of any "hazardous substances"
as that term is defined in the Comprehensive Environmental Response,
Compensation and Liability Act, and the rules and regulations promulgated
pursuant thereto, as from time to time amended, 42 U.S.C. Section 9601 et seq.
(the "ACT"); but the foregoing shall not prevent the use of any hazardous
substances in accordance with applicable laws and regulations. Tenant represents
and warrants that it will at all times comply with the Act and any other
federal, state or local laws, rules or regulations governing "Hazardous
Materials". "HAZARDOUS MATERIALS" as used herein shall mean all chemicals,
petroleum, crude oil or any fraction thereof, hydrocarbons, polychlorinated
biphenyls (PCBs), asbestos, asbestos containing materials and/or products, urea
formaldehyde, or any substances which are classified as "hazardous" or "toxic"
under the Act; hazardous waste as defined under the Solid Waste Disposal Act, as
amended 42 U.S.C. Section 6901; air pollutants regulated under the Clean Air
Act, as amended, 42 U.S.C. Section 7401, et seq.; pollutants as defined under
the Clean Water Act, as amended, 33 U.S.C. Section 1251, et seq., any pesticide
as defined by Federal Insecticide, Fungicide, and Rodenticide Act, as amended, 7
U.S.C. Section 136, et seq., any hazardous chemical substance or mixture or
imminently hazardous substance or mixture regulated by the Toxic Substances
Control Act, as amended, 15 U.S.C. Section 2601, et Seq., any substance listed
in the United States Department of Transportation Table at 45 CFR 172.101; any
chemicals included in regulations promulgated under the above listed statutes;
any explosives, radioactive material, and any chemical or other substance
regulated by federal, state or local statutes similar to the federal statutes
listed above and regulations promulgated under such federal, state or local
statutes.
b. To the extent required by the Act and/or any federal, state or
local laws, rules or regulations governing Hazardous Materials, Tenant shall
remove any hazardous substances (as defined in the Act) and Hazardous Materials
(as defined above) whether now or hereafter existing on the Leased Premises. In
addition to, and without limiting Paragraph 10 of this Lease Tenant shall and
hereby does agree to defend, indemnify and hold Lender and Landlord, their
officers, directors, shareholders, partners, beneficial owners, members and
employees, harmless from and against any and all causes of actions, suits,
demands or judgments of any nature whatsoever, losses, damages, penalties,
expenses, fees, claims, costs (including response and remedial costs), and
liabilities, including, but not limited to, reasonable attorneys' fees and costs
of litigation, arising out of or in any manner connected with (i) the violation
of any applicable federal, state or local environmental law with respect to the
Leased Premises or Tenant's or any other person's or entity's prior ownership of
the Leased Premises; (ii) the "release" or "threatened release" of or failure to
remove, as required by this Paragraph 26, "hazardous substances" (as defined in
the Act) and Hazardous Materials (as defined above) at or from the Leased
Premises or any portion or portions thereof, including any past or current
release and any release or threatened release during the initial term and any
extension or Renewal Term
31
<PAGE>
whether or not arising out of or in any manner connected with Tenant's occupancy
of the Leased Premises during the initial Term or Renewal Term.
c. The Tenant agrees that it will not install any underground
storage tank at the Leased Premises without specific, prior written approval
from the Landlord. The Tenant agrees that it will not store combustible or
flammable materials on the Leased Premises in violation of the Act or any other
federal, state or local laws, rules or regulations governing Hazardous
Materials.
27. Entry by Landlord. Landlord and its authorized representatives
shall have the right upon reasonable notice (which shall be not less than two
(2) business days except in the case of emergency) to enter the Leased Premises
at all reasonable business hours (and at all other times in the event of an
emergency): (a) for the purpose of inspecting the same or for the purpose of
doing any work under Paragraph 11 (c), and may take all such action thereon as
may be necessary or appropriate for any such purpose (but nothing contained in
this Lease or otherwise shall create or imply any duty upon the part of Landlord
to make any such inspection or do any such work), and (b) for the purpose of
showing the Leased Premises to prospective purchasers and mortgagees and, at any
time within six (6) months prior to the expiration of the Term of this Lease for
the purpose of showing the same to prospective tenants. No such entry shall
constitute an eviction of Tenant but any such entry shall be done by Landlord in
such reasonable manner as to minimize any disruption of Tenant's business
operation.
28. No Usury. The intention of the parties being to conform strictly to
the applicable usury laws, whenever any provision herein provides for payment by
Tenant to Landlord of interest at a rate in excess of the legal rate permitted
to be charged, such rate herein provided to be paid shall be deemed reduced to
such legal rate.
29. Separability.
Each and every covenant and agreement contained in this Lease is, and shall
be construed to be, a separate and independent covenant and agreement, and the
breach of an such covenant or agreement by Landlord shall not discharge or
relieve Tenant from its obligation to perform the same. If any term or provision
of this Lease or the application thereof to any provision of this Lease or the
application thereof to any person or circumstances shall to any extent be
invalid and unenforceable, the remainder of this Lease, or the application of
such term or provision to persons or circumstances other than those as to which
it is invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Lease shall be valid and shall be enforced to the extent
permitted by law.
32
<PAGE>
30. Miscellaneous.
a. The paragraph headings in this Lease are used only for
convenience in finding the subject matters and are not part of this Lease or to
be used in determining the intent of the parties or otherwise interpreting this
Lease.
b. As used in this Lease the singular shall include the plural as
the context requires and the following words and phrases shall have the
following meanings: (i) "including," shall mean "including but not limited to";
(ii) "provisions" shall mean "provisions, terms, agreements, covenants and/or
conditions"; (iii) "lien" shall mean "lien, charge, encumbrance, title retention
agreement, pledge, security interest, mortgage and/or deed of trust"; and (iv)
"obligation" shall mean "obligation, duty, agreement, liability, covenant or
condition".
c. Any act which Landlord is permitted to perform under this
Lease may be performed at any time and from time to time by Landlord or any
person or entity designated by Landlord. Any act which Tenant is required to
perform under this Lease shall be performed at Tenant's sole cost and expense.
d. This Lease may be modified, amended, discharged or waived only
by an agreement in writing signed by the party against whom enforcement of any
such modification, amendment, discharge or waiver is sought, and consented to in
writing by Lender.
e. The covenants of this Lease shall run with the Land and bind
Tenant, the successors and assigns of Tenant and all present and subsequent
encumbrances and subtenants of any of the Leased Premises, and shall inure to
the benefit of and bind Landlord, its successors and assigns.
f. This Lease will be simultaneously executed in several
counterparts, each of which when so executed and delivered shall constitute an
original, fully enforceable counterpart for all purposes.
g. This Lease shall be governed by and construed according to the
laws of the State.
h. Wherever the consent or approval of Landlord is required
hereunder, Landlord agrees that it will not unreasonably withhold or delay such
consent or approval, unless otherwise expressly stated herein.
31. Additional Rent. The term "ADDITIONAL RENT" as used herein includes
all amounts, costs, expenses, liabilities and obligations (including but not
limited to Tenant's obligation to pay any Net Awards or Purchase Price
hereunder) which Tenant is required to pay pursuant to the terms of this Lease
other than Basic Rent.
33
<PAGE>
32. Financial Statements. Tenant shall provide to Landlord, on a
quarterly and annual basis, the Financial Statements. Tenant shall deliver such
Financial Statements as soon as is commercially reasonable following the end of
each fiscal quarter and fiscal year.
IN WITNESS WHEREOF, Landlord and Tenant have caused this instrument to
be executed under seal as of the day and year first above written.
(REMAINDER OF THIS PAGE INTENTIONALLY BLANK)
34
<PAGE>
LANDLORD:
GENERAL ELECTRIC CAPITAL
BUSINESS ASSET FUNDING
CORPORATION,
a Delaware corporation
By: /s/ Linda K. Bracken
--------------------------------
Name: Linda K. Bracken
------------------------------
Title: Vice President
-----------------------------
TENANT:
DAVE & BUSTER'S, INC.,
a Missouri corporation
By: /s/ Chas Michel
--------------------------------
Name: Chas Michel
------------------------------
Title: Chief Financial Officer
-----------------------------
35
<PAGE>
EXHIBIT A
LEGAL DESCRIPTION OF THE LAND
BEING Lot 3, in Block G/6509, of DAVE AND BUSTER'S HQ ADDITION, an Addition to
City of Dallas, Dallas County, Texas, according to the Map thereof recorded in
Volume 97207, Page 4416, of the Map Records of Dallas County, Texas, being more
particularly described as follows:
BEING a tract of land situated in the JOHN L. HUNT SURVEY, ABSTRACT NO. 588,
Dallas County, Texas and being a portion of City of Dallas Block G/6509 and
being all of Lot 3, Block G/6509 of DAVE & BUSTER'S HQ. ADDITION, an addition to
the City of Dallas according to the plat as recorded in Volume 97207, Page 4416
of the Deed Records of Dallas County, Texas (DRDCT) and being more particularly
described as follows:
BEGINNING at a 5/8 inch iron rod set in the northerly right-of-way line of
MANANA DRIVE (a 60' right-of-way) and the southwesterly corner of a tract of
land described in a deed to The Moss Venturing, Inc., as recorded in Volume
2001068, Page 5185 (DRDCT), said iron rod also being located North 89 degrees 01
minute 36 seconds West along the northerly right-of-way line of said MANANA
DRIVE, a distance of 134.01 feet from its intersection with the westerly
right-of-way line of ELECTRONIC LANE (60' right-of-way);
THENCE along the northerly right-of-way line of said MANANA DRIVE, North 89
degrees 01 minute 36 seconds West, a distance of 475.00 feet to a 5/8 inch iron
rod found for corner;
THENCE departing the northerly right-of-way line of said MANANA DRIVE, North 00
degrees 15 minutes 35 seconds East, a distance of 490.33 feet to a 5/8 inch iron
rod set in the southerly line of a tract of land described in a deed to AAI
INVESTMENTS, INC. as recorded in Volume 95249, Page 2972 (DRDCT);
THENCE South 89 degrees 19 minutes 29 seconds East, a distance of 478.39 feet to
a 5/8 inch iron rod set in the southerly line of a tract of land described as
Tract II in a deed to EBE REALTY, INC. as recorded in Volume 89245, Page 4411
(DRDCT), said iron rod also being the northwesterly corner of a tract of land
described in a deed to RE-MMC, L.L.C. as recorded in Volume 98207, Page 4657
(DRDCT);
THENCE South 00 degrees 39 minutes 24 seconds West, a distance of 492.79 feet to
the POINT OF BEGINNING;
CONTAINING within these metes and bounds 5.379 acres or 234,314 square feet of
land more or less.
36
<PAGE>
EXHIBIT B
Primary Initial Term: Twenty (20) years
Number of Consecutive Renewal Terms: Four (4) (subject to Paragraph 5c)
Duration of each Renewal Term: Five (5) years
1. Basic Rent from the Commencement Date through the first anniversary
of the Commencement Date shall be $896,000 annually, payable in monthly
installments of $74,666.67 each.
2. Base Rent shall increase annually on each anniversary of the
Commencement Date by 1.35%, through and including any Renewal Terms.
37
<PAGE>
EXHIBIT C
Casualty and Condemnation Purchase Price
$7,790,000
38