ASSIGNMENT AND ASSUMPTION OF LEASE
THIS ASSIGNMENT AND ASSUMPTION OF LEASE (this "Assignment") is
made and entered into effective as of this 6th day of October,
2008, by and between Xxxx Companies US, Inc., a Minnesota
corporation ("Assignor"), and AEI Income & Growth Fund XXII
Limited Partnership as to an undivided 33% interest, AEI
Income & Growth Fund 24 LLC as to an undivided 34% interest,
and AEI Income & Growth Fund 27 LLC as to an undivided 33%
interest, as tenants in common (each individually and all such
tenants in common are collectively referred to herein as
"Assignee").
RECITALS:
A. Assignor and Assignee are parties to that certain
Purchase and Sale Agreement dated August 7, 2008, as it may
have been amended (the "Agreement"), pursuant to which
Assignee is acquiring from Assignor the real property and
improvements, located on property more particularly described
on EXHIBIT A attached hereto and incorporated herein by this
reference.
B. Pursuant to the terms of the Agreement, Assignor desires
to sell, assign, convey, transfer and set over to Assignee and
Assignee desires to assume all of Assignor's interest in that
certain Lease dated February 27, 2007 (the "Lease"), by and
between Assignor and Best Buy Stores, L.P., a Virginia limited
partnership (the "Tenant"), including all rents prepaid for
any period subsequent to the date of this Assignment, subject
to the terms and conditions set forth below.
C. Assignor is the Landlord under the Lease with full right
and title to assign the Lease and the Rent to Assignee as
provided herein.
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by
the parties, Assignor and Assignee hereby agree as follows:
1 Assignor hereby irrevocably and unconditionally
sells, assigns, conveys, transfers and sets over unto
Assignee, its heirs, successors and assigns as of the date
hereof (the "Effective Date"), all of Assignor's right, title
and interest in, to and under: (i) the Lease, together with
any and all guaranties thereof, if any, and (ii) any and all
rents prepaid as of the Effective Date, held by Assignor in
connection with the Lease (the "Rent").
2. Assignee hereby irrevocably and unconditionally
assumes, and shall be fully liable for, all of Assignor's
obligations under the Lease on or after the Effective Date.
Assignor shall indemnify and hold Assignee harmless from any
and all liabilities, claims, obligations, losses and expenses,
including reasonable attorneys' fees arising as a result of
Assignor's failure to fulfill the landlord's duties and
obligations accruing under the Lease prior to the Effective
Date. Assignee shall indemnify and hold Assignor harmless
from any and all liabilities, claims, obligations, losses and
expenses, including reasonable attorney's fees, arising as a
result of Assignee's failure to fulfill the landlord's duties
and obligations accruing under the Lease on or after the
Effective Date. Assignee shall be entitled to receive all
income accruing from the Lease from and after said Effective
Date. Assignor shall be entitled to receive all income
accruing from the Lease prior to the Effective Date.
3. Assignor shall direct the tenant and any successor
tenant under the Lease to pay to Assignee the Rent and all
other monetary obligations due or to become due under the
Lease for the period beginning on the Effective Date.
Assignee shall promptly pay to Assignor all Rent received that
is attributable to periods prior to the Effective Date.
4. This Assignment shall be governed by and construed
in accordance with the laws of the state in which the Property
is located.
5. All rights and obligations of Assignee and Assignor
hereunder shall be binding upon and inure to the benefit of
Assignor, Assignee and the heirs, successors and assigns of
each such party.
6. This Assignment may be executed in any number of
counterparts, each of which shall be effective only upon
delivery and thereafter shall be deemed an original, and all
of which shall be taken to be one and the same instrument, for
the same effect as if all parties hereto had signed the same
signature page. Any signature page of this Assignment may be
detached from any counterpart of this Assignment without
impairing the legal effect of any signatures thereon and may
be attached to another counterpart of this Agreement identical
in form hereto but having attached to it one or more
additional signature pages.
7. Whenever the context so requires in this Assignment,
all words used in the singular shall be construed to have been
used in the plural (and vice versa), each gender shall be
construed to include any other genders, and the word "person"
shall be construed to include a natural person, a corporation,
a firm, a partnership, a joint venture, a trust, an estate or
any other entity.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK;
SIGNATURES APPEAR ON FOLLOWING PAGES]
IN WITNESS WHEREOF, Assignor and Assignee have executed
this Assignment effective as of the day and year first above
written.
ASSIGNOR: Xxxx Companies US, Inc.,
a Minnesota corporation
By: /s/ Xxxxxx X Xxxxxx
Name: Xxxxxx X Xxxxxx
Its: Vice President
ASSIGNEE: AEI Income & Growth Fund XXII Limited
Partnership
By: AEI Fund Management XXI, Inc.
By:/s/ Xxxxxxx X Xxxxx
Xxxxxxx X. Xxxxx,Secretary/Treasurer
AEI Income & Growth Fund 24
Limited Partnership
By: AEI Fund Management XXI, Inc.
By: /s/ Xxxxxxx X Xxxxx
Xxxxxxx X. Xxxxx,Secretary/Treasurer
AEI Income & Growth Fund 27
Limited Partnership
By: AEI Fund Management XXI,Inc.
By: /s/ Xxxxxxx X Xxxxx
Xxxxxxx X. Xxxxx,Secretary/Treasurer
ACKNOWLEDGEMENTS
STATE OF MINNESOTA )
) ss.
CITY/COUNTY OF HENNEPIN )
I, the undersigned, a Notary Public in and for the County
and State aforesaid, DO HEREBY CERTIFY, that the above named
Xxxxxx X Xxxxxx of Xxxx Companies US, Inc., personally known
to me to be the same person whose name is subscribed to the
foregoing instrument as such Vice President, appeared before
me this day in person and acknowledged that he signed and
delivered the said instrument as his own free and voluntary
act and as the free and voluntary act of the corporation for
the uses and purposes therein set forth.
Given under my hand and Notary Seal, this 2 day of
October, 2008.
/s/ Xxxx X Xxxxxxxxx
Notary Public
[notary seal]
STATE OF MINNESOTA )
) ss.
CITY/COUNTY OF XXXXXX )
The forgoing instrument was acknowledged before me this 2
day of October, 2008, by Xxxxxxx X. Xxxxx, as
Secretary/Treasurer of AEI Fund Management XXI, Inc., the
corporate general partner of AEI Income & Growth Fund XXII
Limited Partnership, on behalf of said partnership.
WITNESS my hand and official seal.
/s/ Josann Xxxxx Xxxxxxx
Notary Public
[Notarial Seal]
STATE OF MINNESOTA )
) ss.
CITY/COUNTY OF XXXXXX )
The forgoing instrument was acknowledged before me 2 day
of October, 2008, by Xxxxxxx X. Xxxxx, as Secretary/Treasurer
of AEI Fund Management XXI, Inc., the Managing Member of AEI
Income & Growth Fund 24 LLC, on behalf of said limited
liability company.
WITNESS my hand and official seal.
/s/ Josann Xxxxx Xxxxxxx
Notary Public
[Notarial Seal]
STATE OF MINNESOTA )
) ss.
CITY/COUNTY OF XXXXXX )
The forgoing instrument was acknowledged before me this 2
day of October, 2008, by Xxxxxxx X. Xxxxx, as
Secretary/Treasurer of AEI Fund Management XXI, Inc., the
Managing Member of AEI Income & Growth Fund 27 LLC, on behalf
of said limited liability company.
WITNESS my hand and official seal.
/s/ Josann Xxxxx Xxxxxxx
Notary Public
[Notarial Seal]
EXHIBIT A TO ASSIGNMENT AND ASSUMPTION OF LEASE
Legal Description
LOT 2 OF CERTIFIED SURVEY MAP NUMBER 4170, A DIVISION OF XXX 0
XX XXXXXXXXX XXXXXX XXX XX. 0000, RECORDED AUGUST 22, 2008 IN
THE OFFICE OF THE REGISTER OF DEEDS FOR WALWORTH COUNTY,
WISCONSIN IN VOLUME 26, PAGE 193, AS DOCUMENT NO. 744108,
BEING PART OF THE SOUTHEAST QUARTER OF THE SOUTHWEST QUARTER
AND THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER OF SECTION
30, TOWN 2 NORTH, RANGE 18 EAST, IN XXX XXXX XX XXXX XXXXXX,
XXXXXXXX XXXXXX, XXXXXXXXX.
FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE ("Amendment") is made and
entered into this
day of, 2007, by and between XXXX COMPANIES US, INC., a Xxxxx
xxxx corporation
("Landlord"), and BEST BUY STORES, L.P., a Virginia limited
partnership ("Tenant").
RECITALS:
A. Landlord and Tenant are parties to that certain Lease
dated February 27, 2007 ("Original Lease") for the premises
described therein located at Xxxxxx Xxxxxxx Xxxxxxxx Xxxxxx,
Xxxx Xxxxxx, Xxxxxxxxx ("Shopping Center").
B. Pursuant to the Lease, Landlord endeavored to obtain the
approval of the Village of Lake Geneva, Wisconsin ("Village")
to Tenant's proposed signage attached as Exhibit D-1 to the
Original Lease.
C. Landlord has obtained the approval of the Village to the
Tenant building signage and the Shopping Center pylon signage
depicted on Schedule I attached hereto and made a part hereof.
D. The parties desire to incorporate their understandings
and agreements relative to the Tenant building signage and
Shopping Center pylon signage in this Amendment (the Original
Lease, as amended by this Amendment, is hereinafter referred
to as the "Lease").
IN CONSIDERATION of the mutual covenants and agreements
herein and in the Lease contained, the parties hereby agree as
follows:
1. Signage. Notwithstanding anything to the contrary set
forth in Section 12 of the Original Lease or in Exhibits D or
D-1 attached thereto, the Village-approved and Landlord-
approved Tenant building signage and Shopping Center pylon
signage depicted on Schedule I hereto shall be the Tenant
building signage and Shopping Center pylon signage for all
purposes under the Lease and shall satisfy the requirements of
Section 12 of the Original Lease. The Original Lease is hereby
amended by substituting Exhibit D-1 to the Original Lease with
Schedule I attached to this Amendment.
2. Premises. The Premises contain 30,296 square feet of
Rentable Area as certified in accordance with BOMA standards
3. Lease Term. In accordance with the terms and conditions
of Article 3 in the Original Lease, the Commencement Date
shall be March 6, 2008 and shall expire on January 31, 2019.
4. Fixed Rent. Fixed Rent shall be amended as follows:
Lease Yr. Monthly Annual Per Sq.Ft.
1-5 $36,607.67 $439,292 $14.50
6-10 $37,870.00 $454,440 $15.00
Opt. 1 (11-15) $39,132.33 $469,588 $15.50
Opt. 2 (16-20) $40,394.67 $484,736 $16.00
Opt. 3 (21-25) $41,657.00 $499,884 $16.50
Opt. 4 (26-30) $42,919.33 $515,032 $17.00
5. Reaffirmation. Except as expressly provided herein, the
Original Lease shall remain in full force and effect in
accordance with its terms.
IN WITNESS WHEREOF, Landlord and Tenant have executed
this Amendment as of the date and year first above written.
LANDLORD: TENANT:
XXXX COMPANIES US, INC., a Minnesota BEST BUY STORES, L.P.,
corporation a Virginia limited partnership
By: By:
Name: Name:
Its: Its:
LEASE
by and between
XXXX COMPANIES US, INC.
a Minnesota corporation/
("Landlord")
and
BEST BUY STORES, LP.,
a Virginia limited partnership
("Tenant")
for improved real property at
Geneva Commons Shopping Center
Lake Geneva, WI
TABLE OF CONTENTS
Article Page
I. FUNDAMENTAL LEASE TERMS. 1
1. THE PREMISES. 2
2. TITLE AND QUIET POSSESSION. 3
3. LEASE TERM. 4
4. OPTION TO EXTEND. 4
5. COMPLETION AND DELIVERY OF THE PREMISES AND SHOPPING
CENTER; CONTINGENCY 5
6. RIGHT OF PRIOR ENTRY. 9
7. RENT. 10
8. CONFORMITY WITH LAW; OPERATIONS. 10
9. UTILITIES FOR THE PREMISES. 11
10. REPAIRS 11
11. ACCESS BY LANDLORD. 12
12. TENANT'S FIXTURES AND SIGNS. 13
13. ALTERATIONS TO THE PREMISES; SATELLITE EQUIPMENT 14
14. SURRENDER OF THE PREMISES 14
15. HOLDING OVER 15
16. DEFAULT; DISPUTES. 15
18. QUIET ENJOYMENT. 17
19. DAMAGE BY FIRE OR CASUALTY. 18
20. WAIVER OF SUBROGATION. 19
21. EMINENT DOMAIN. 19
22. INSURANCE. 19
23. SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT. 20
24. TRANSFER OF INTEREST. 21
25. REAL ESTATE TAXES. 22
26. RIGHT OF PROTEST. 23
27. COMMON AREAS. 23
28. ALTERATIONS TO SHOPPING CENTER. 26
29. INTENTIONALLY DELETED 27
30. EXCLUSIVITY AND USE. 27
31. HAZARDOUS SUBSTANCES. 28
32. ESTOPPEL CERTIFICATE. 30
33. PARKING. 30
34. ATTORNEY'S FEES. 30
35. BROKERAGE. 31
36. NOTICES. 31
37. MISCELLANEOUS. 31
II. EXHIBITS. 33
EXHIBITS
A. LEGAL DESCRIPTION OF SHOPPING CENTER
B. SITE PLAN
C. PERMITTED TITLE EXCEPTIONS (TITLE COMMITMENT/POLICY)
D. CONSTRUCTION PLANS AND SPECIFICATIONS AND ELEVATIONS D-1
PYLON AND/OR MONUMENT SIGNS
E. SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
F. COMMON AREA SPECIFICATIONS
G. MEMORANDUM OF LEASE
H. PROHIBITED USES
Best Buy #
LEASE
THIS LEASE ("Lease") is made and entered into as of the 27th of
February , 2007, by and between XXXX COMPANIES US, INC., a
Minnesota corporation/ ("Landlord"), and BEST BUY STORES, L.P.,
a Virginia limited partnership ("Tenant").
WITNESSETH:
In consideration of the rents reserved and the covenants and
conditions set forth herein, Landlord and Tenant agree as
follows:
I. FUNDAMENTAL LEASE TERMS.
A. Parties.
Landlord:Xxxx Companies US, Inc.
Tenant: Best Buy Stores, L.P.
B. Premises (Article 1).
Approximately thirty thousand one hundred sixty-two
(30,162) square feet of building area with dimensions
of not less than 186-0 of frontage and 158-8 of depth
located in Geneva Commons, Lake Geneva, WI.
C. Term (Articles 3 and 4).
Ten (10) Lease Years, with four (4), five (5) Lease
Year options to extend.
D. Fixed Rent (Article 7).
Lease Yr. Monthly Annual Per sq.
ft.
1-5 $36,445.75 $437,349 $14.50
6-10 $37,702.50 $452,430 $15.00
Opt. 1 (11-15) $38,959.25 $467,511 $15.50
Opt. 2 (16-20) $40,216.00 $482,592 $16.00
Opt. 3 (21-25) $41,472.75 $497,673 $16.50
Opt. 4 (26-30) $42,729.50 $512,754 $17.00
E. Construction (Article 5).
Landlord to complete construction on or before
February 15, 2008 (the "Delivery Date").
F. Addresses (Article 36).
(i) If to Landlord:
Xxxx Companies US, Inc.
00 Xxxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attention: Properties Group
Federal Tax Identification Number: 000000000
and to:
Xxxx Companies US, Inc.
00 Xxxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Federal Tax Identification
Number: 000000000 Attention:
Xxxx Xxxxxxxxx
with a copy to:
Xxxx, Xxxxxx & Xxxxxxxxx, UP
Xxx Xxxxx XxXxxxx
Xxxxxx Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx Xxxxxx, Esq.
(ii) If to Tenant:
Best Buy Stores,
L.P. 0000 Xxxx
Xxxxxx Xxxxx
Xxxxxxxxx, XX
00000
Attention: Legal Department - Real Estate
Federal Tax Identification Number: 00-0000000
with a copy to:
Robins, Kaplan, Xxxxxx &
Xxxxxx L.L.P. 0000 XxXxxxx
Xxxxx
000 XxXxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxxxxxx, Esq.
G Potential Conflict.
In the event that any of the terms or provisions set
forth in any portion of the Fundamental Lease Terms
set forth above shall conflict with any of the terms
or provisions of the balance of the Lease, the
applicable Fundamental Lease Term shall control.
1. THE PREMISES.
2
Subject to the terms and conditions of this Lease, Landlord
leases to Tenant and Tenant rents from Landlord the premises
situated in the City of Lake Geneva, County of Walworth, State
of Wisconsin, and known and described as follows:
The premises and improvements and appurtenances
constructed and to be constructed thereto (the
"Premises") located in the Geneva Commons Shopping
Center (the "Shopping Center"). The legal description
of the Shopping Center is attached hereto as Exhibit A
and made a part hereof, and the Shopping Center is
outlined in red on the site plan attached hereto as
Exhibit B and made a part hereof, provided that in the
event of any conflict between Exhibit A and Exhibit B,
Exhibit B shall control. The Shopping Center includes
the real property owned by Target. As used in this
Lease, the term "Landlord's Property" describes the
land parcels in the Shopping Center that Landlord
holds in fee simple title or controls under a lease,
plus all other real property interests that Landlord
has in or over land within the Shopping Center, (such
as easements and access rights); but specifically
excluding the square footage of land in the Shopping
Center owned by Target. The Premises contain
approximately thirty thousand, one hundred sixty two
(30,162) square feet of building area with dimensions
of not less than 186"0" of frontage and 158'-6" of
depth and are cross-hatched on the site plan attached
hereto as Exhibit B, exclusive of square footage
applicable, if any, to a loading dock appendage to
Premises resulting from the design of the Shopping
Center.
2. TITLE AND QUIET POSSESSION.
Landlord hereby represents, covenants and warrants to Tenant
that it has full right and authority to enter into this Lease in
accordance with the terms hereof and that it has and will
maintain throughout the Lease Term (subject to Landlord's
transfer rights in accordance with this Lease) good title in fee
simple to the Landlord's Property including the Premises free
and clear of all liens and encumbrances except as stated in the
current title commitment or policy issued from a national title
company attached hereto as Exhibit C and made a part hereof (the
"Permitted Exceptions"). If so requested by Tenant from time to
time during the term of this Lease, Landlord shall furnish
Tenant with evidence of Landlord's title to the Premises. Such
title may be evidenced by a copy of a policy of title insurance
issued by a title insurance company licensed to do business in
the state in which the Premises are located, which policy shall
contain no exceptions to Landlord's interest in the Premises
superior to this Lease other than the Permitted Exceptions and
mortgages or deeds of trust if in accordance with the provisions
of Article 23 of this Lease.
Tenant agrees and acknowledges that (a) Landlord intends to
subject or has subjected the Shopping Center, the Premises and
other property to the terms and conditions of a reciprocal
easement agreement ("REA") with Target, Inc. governing the use,
operation, maintenance, repair, design and construction of such
property and providing for, among other things, the imposition
of certain covenants, conditions, restrictions and easements,
and (b) notwithstanding the later execution and recordation of
the REA, this Lease and Tenant's interest in and to the Premises
is and shall be
3
subject and subordinate to the Declaration; provided, however,
in the event of any conflict between the express provisions of
this Lease and the provisions of the REA that would cause a
material reduction of Tenant's rights hereunder or a material
increase in Tenant's obligations hereunder, the provisions of
this Lease shall prevail and control. Subject to the provisions
of this Article, the REA shall be a Permitted Exception.
Landlord shall provide Tenant a complimentary copy or a near
execution copy of the REA for its review.
3. LEASE TERM.
The term of this Lease (the "Lease Term") shall be for a period
of ten (10) "Lease Years," as that term is hereinafter defined.
The Lease Term shall commence on the date (the "Commencement
Date") which is the earlier of: (i) the Possession Date, as that
term is hereinafter defined, or (ii) the date Tenant opens for
business to the public at the Premises. The Lease Term shall
expire on the last day of the tenth (10th) consecutive "Lease
Year," unless sooner terminated or extended as provided herein.
The "Possession Date" as used herein means the ninetieth (90th)
day Landlord delivers the Premises and Tenant or Tenant's
architect certifies in writing that the Premises are in the
condition described in Article 5 hereof and available for
occupancy by Tenant; provided, however, that if any delivery and
certification shall be given between October 1 of any year and
January 5 of the subsequent year, the Possession Date shall be,
at Tenant's option, effective on January 5 of such subsequent
year and the ninety (90) day period shall begin to run from such
date; and provided further that the ninety (90) day period shall
be extended by the number of days of delay resulting from
strikes, casualties, Tenant's inability to secure necessary
licenses or permits or any other cause beyond Tenant's control;
provided that Tenant uses commercially reasonable efforts to
mitigate such delay and notifies Landlord, in writing, at the
inception of the delay; provided further that in no event shall
the Possession Date be deemed to have occurred prior to the
Delivery Date unless Tenant shall agree to the same in writing.
The term "Lease Year" as used herein shall mean a period of
twelve (12) consecutive full calendar months (except for the
first Lease Year, which may be longer). The first Lease Year
shall commence on the Commencement Date. The first Lease Year
shall expire at midnight on the second January 31 following the
Commencement Date. Succeeding Lease Years shall each commence on
the first (1st) day following the end of the preceding Lease
Year. After the Commencement Date and within ten (10) business
days after request from the other party, the parties shall
jointly execute a statement specifying the Commencement Date of
this Lease.
4. OPTION TO EXTEND.
Tenant is hereby given the right to extend the Lease Term for
four (4) additional periods of five (5) Lease Years per period,
upon the same terms and conditions as provided in the initial
Lease Term. Tenant shall exercise the right granted in the
foregoing sentence by notifying Landlord in writing of its
intention to exercise its option to extend the Lease Term at
least one hundred eighty (180) days prior to the date of
commencement of each such extension term, and thereupon this
Lease shall be so extended without any further document or act.
If Tenant fails to notify Landlord of its exercise of any
extension option hereunder as hereinabove provided, its
option(s)
4
to extend shall nevertheless remain in full force and effect for
a period of thirty (30) days after Tenant's receipt of
subsequent written notice from Landlord setting forth the
expiration date of the Lease and advising Tenant that notice of
extension has not been received. In the event the Lease Term is
extended pursuant to this Article, the definition of "Lease
Term" as used in this Lease shall include any and all such
extension term(s).
5. COMPLETION AND DELIVERY OF THE PREMISES AND SHOPPING CENTER;
CONTINGENCY.
This Lease is contingent upon Landlord obtaining approval from
the municipality for a Best Buy building containing
approximately 30,162 square feet. Landlord agrees to promptly
seek municipal approval for a 30,162 square foot Best Buy
building after the Lease is fully executed, if not sooner. If
Landlord is unable to obtain municipal approval for a 30,162
square foot building within sixty (60) days after the Lease is
fully executed, Landlord shall notify Tenant; and unless Tenant
advises Landlord within seven (7) days after Landlord's
notification that it would accept a 20,000 square foot building,
(in which case Landlord and Tenant shall amend this Lease to
provide for a 20,000 square foot building and adjust the Rent
accordingly) Landlord may terminate this Lease. For a period of
one year following Landlord's termination of the Lease as a
result of this contingency, if Landlord is subsequently able to
obtain municipal approval for a 30,000 square foot building or
larger at or in the vicinity where the Premises under this Lease
are located, Landlord will notify Tenant and Tenant shall have
twenty (20) days from such Landlord notice to advise Landlord if
it would agree to reinstate the Lease. If Tenant so agrees,
Landlord and Tenant shall reinstate the Lease on all of the same
terms and conditions, except with respect to the Delivery Date
and outside dates (as described in Article 5) for Landlord to
commence and complete Landlord's Work, which Delivery Date and
outside dates Landlord and Tenant shall discuss and resolve, in
good faith. Notwithstanding anything to the contrary stated
elsewhere in this Lease, it is mutually understood and agreed
that if Landlord terminates the Lease in accordance with the
provisions of this paragraph, it has no obligation to continue
to seek or pursue municipal approval for a 30,000 square foot or
larger building.
Landlord agrees, at its sole cost and expense, to substantially
complete the work described on Exhibit D at the times
hereinafter and therein set forth (collectively, "Landlord's
Work"), time being of the essence: (i) on or before the Delivery
Date to construct the Premises as provided in this Article,
including completion of Tenant's truck dock provided, however,
that to the extent Exhibit D specifies that any portions of
Landlord's Work are to be completed before or after the Delivery
Date, such portions of Landlord's Work shall be completed in
accordance with the dates specified in Exhibit D, it being
understood, for example, that all permanent utilities (including
but not limited to, water, storm sewer, sanitary sewer, fire
protection water, electrical, gas, and telephone service) shall
be completed in satisfactory working condition with all
necessary permits no later than three weeks prior to the
Delivery Date including work required to be completed by
Landlord under Article 9, (ii) on or before the Delivery Date,
construct the signage required to be provided by Landlord under
Article 12, hereof including but not limited to any pylon and/or
monument sign(s) and to construct and complete the construction
of all other "Common Area" (as hereinafter defined) elements
servicing the Premises, including, but not limited to, all
access and egress roads located on and serving the Shopping
Center (including, but not limited to, the access and egress
roads providing access and egress from Xxxxxxx 00 and the
5
frontage road along Highway 12), landscaping, parking lot
lighting, site drainage, concrete curbs and sidewalks,
driveways, utilities, and a finished and fully-improved parking
lot. Landlord shall construct the parking lot and loading dock
area for the Premises as shown in arid on Exhibits B and D to
this Lease.
Landlord shall with sole responsibility for all related hard and
soft costs or expenses (it being understood that no portion of
the costs of Landlord's Work shall be passed through to Tenant
under Article 27 or otherwise) provide or cause to be provided
all reasonably necessary insurance (including without limitation
builder's risk insurance and worker's compensation insurance),
materials, and (c) labor necessary to complete Landlord's Work ,
and to deliver possession thereof to Tenant on the Delivery Date
or other applicable date specified in Exhibit D in broom clean
and : (i) free and clear of Hazardous Substances as defined in
Article 31 (ii) free and clear of liens and encumbrances, except
for Permitted Exceptions, (iii) in compliance with all
applicable building, health, safety, fire, environmental and
zoning codes, and all other laws, codes, ordinances, rules and
regulations of federal and state and local governmental agencies
properly exercising jurisdiction over the Shopping Center (all
of the foregoing collectively defined hereinafter as "Laws"),
and (iv) at least a temporary (if not permanent) certificate of
occupancy, and such other permits or approvals as will enable
Tenant by the Delivery Date to commence fixturing and
merchandising the Premises, and thereafter at Tenant's option to
open the Premises to the public for business it being understood
that Tenant shall be responsible for obtaining any permits
specifically necessary for Tenant's fixturing of the Premises or
training its employees therein but that Landlord shall obtain
such permits/approvals by the Delivery Date that are not
specific to Tenant's fixturing of the Premises, or training of
its employees therein but are required of Tenant to lawfully
perform the activities set forth in said clause (iv). Landlord
shall obtain a permanent certificate of occupancy once Landlord
and Tenant have fully performed their respective obligations
relating to construction and fixturing of the Premises or
training of employees.
All heating, ventilating and air-conditioning equipment
servicing the Premises will be new. Landlord hereby warrants and
represents that at the Delivery Date, the structure, roof, roof
membrane, heating, ventilating, air-conditioning, lighting,
electrical, plumbing, sewer and other systems and fixtures
serving the Premises will be in good condition and working
order, and there will be utilities available (in the quantities
or at the capacities as per Exhibit D attached hereto. Landlord
shall, at its own expense, apply and pay for all hookups, taps,
and connections of any and all utilities used on the Premises
(including but not limited to gas, water, electricity,
telephone, etc.), and Landlord shall pay any and all fees
(including so-called "impact" fees or their equivalent) and
expenses associated therewith. Landlord further agrees that it
shall be required to utilize Tenant's vendors and/or material
suppliers as per Exhibit D attached hereto in connection with
the construction of the Premises so long as such vendors and
material suppliers used by Landlord are competitive in price
with respect to their services and materials. Landlord agrees to
provide fire protection as specified in Exhibit D.. Landlord,
shall be in conformance with NFPA-13, NFPA-25, and local
governmental jurisdiction, and provide clear height for space of
not less than the following so as to accommodate sixteen foot
(16') "high pile" flammable stock as is customary for Tenant's
business: twenty-three feet (23') to roof deck; twenty (20') to
the underside of steel beams.
6
Landlord shall have obtained all necessary approvals by parties
to the REA, if necessary, with respect to Tenant's storefront
elevation, including its blue wedge dimension prior to the date
Landlord's Work commences.
Landlord further warrants and represents that: (i) the general
paving in the parking areas of the Shopping Center shall be
designed for a design load of five (5) tons per axle and ten
(10) year design with a minimum cross-section of a 6" compacted
gravel base, with 3" bituminous surface or 5" concrete over 6"
granular base (unless the site specific soils/geotechnical
report, which report shall be dated within sixty (60) days of
the commencement of Landlord's Work and provided by Landlord to
Tenant at Landlord's sole cost and expense, requires a more
stringent design, which stringent design must be approved by
Tenant in writing), and (ii) all truck access drives maneuvering
and exit areas shall have a nine (9) ton, ten (10) year minimum
design and are designed for easy access by 72'-0" semi-trucks.
Landlord shall install Metal Halide parking lot lighting to
provide 2.36 foot candles per square foot, averaged over entire
lot with an average to minimum uniformity ratio of .6-to-2.36
minimum, and agrees the entrance to the parking lot and the area
around the entrance to Tenant's building shall be at seven (7)
foot candles minimum. Landlord further agrees the bases for any
light posts shall be three (3) foot diameter concrete columns,
with a 2'-6" height for pole protection. Landlord shall enforce,
or at Tenant's option, assign to Tenant all warranties and
guaranties given to Landlord by any contractor or subcontractor
involved in the construction of the Premises, which shall
include, at a minimum as to new construction or materials or
equipment, warranties of at least one (1) year, except for the
roof which shall be a fifteen (15) year warranty, and agrees
herewith to indemnify, defend and hold Tenant harmless with
respect to either any lien(s) against the Premises or claim(s)
asserted against Tenant that arises out of or relates to the
performance of Landlord's Work.
Landlord shall contract with Tenant's prototype electrical,
mechanical and fire protection engineers for the production of
their respective construction documents and shall submit
construction documents (provided their fees or charges for same
are competitive) and specifications for all of Landlord's Work
(the "Construction Documents") to Tenant for Tenant's review,
such submitted Construction Documents to be in accordance with
the plans and specifications attached hereto as Exhibit D.
Tenant shall have twenty (20) days to review and return comments
to Landlord on the Construction Documents. Landlord shall revise
the Construction Documents in accordance with Tenant's comments
to the extent Tenant's comments are consistent with Exhibit D.
In the event of any conflict between the Construction Documents
and Tenant's comments, Tenant's comments shall control if
consistent with Exhibit D. Notwithstanding the submittal of the
Construction Documents to Tenant for Tenant's review, and any
requests for changes made by Tenant, Landlord shall be solely
responsible for ensuring that the Construction Documents conform
to the more stringent requirement of either Tenant's plans and
specifications attached hereto as Exhibit D or local
governmental rules, orders or regulations. In the event that
Landlord incurs additional costs as a result of design, material
or construction requirements imposed upon Tenant by Landlord
and/or any governmental entity that exceed Tenant's plans and
specifications attached hereto as Exhibit D, Landlord shall be
responsible for any and all such costs associated with said
additional requirements.
Immediately prior to the Delivery Date, Tenant may inspect the
common areas and especially the parking areas and driveways
supporting the Premises for wear and potholes or unfinished
7
surfaces. Landlord shall make such repairs and re-stripe as
necessary prior to the Possession Date.
At any time prior to the Delivery Date, Tenant shall have the
right to make interior non-structural store plan modifications
and fixturing changes ("Permitted Modification") to the plans
and specifications attached hereto as Exhibit D. Every Permitted
Modification shall be reduced to writing and mutually
acknowledged by Landlord and Tenant, and shall establish the
cost or expense to complete same, if any, and any extension of
the Delivery Date necessitated by such Permitted Modification. A
Permitted Modification shall not constitute grounds for an
extension of the Delivery Date unless so indicated. Landlord
shall provide to Tenant a monthly written accounting of the
Permitted Modifications specifically delineating both (i) any
delays in Landlord's construction schedule directly attributable
to the Permitted Modifications and (ii) any change in the total
cost of the project directly attributable to the Permitted
Modifications. In the event that all Permitted Modifications,
when viewed together, increase the total cost of the
construction beyond the total cost required for the project
pursuant to the plans and specifications attached as Exhibit D,
Tenant will pay such increased cost within thirty (30) days
after the later of (i) the Delivery Date or (ii) Tenant's
receipt of a final accounting related to the Permitted
Modifications. In the event that all Permitted Modifications
when viewed together decrease the total cost of the construction
beyond the total cost required for the project pursuant to the
plans and specifications attached as Exhibit D, Landlord will
pay the difference to Tenant (or at Tenant's option, Tenant may
deduct the amount due from Landlord from the initial payment(s)
of Rent (defined in Article 7) due under this Lease) within
thirty (30) days after the later of (i) the Possession Date or
(ii) Tenant's receipt of a final accounting related to the
Permitted Modifications.
As used herein, the terms "substantial completion" and/or
"substantially complete" shall be defined as the date when all
construction as indicated on Exhibit D attached hereto,
including change order work, is one hundred percent (100%)
complete. Notwithstanding the foregoing definition of
substantial completion, to the extent that Exhibit D specifies
that any portions of Landlord's Work are to be completed before
or after the Delivery Date, such portions of Landlord's Work
shall be completed according to the dates specified in Exhibit
D. Moreover, the foregoing definition of substantial completion
shall be exclusive of immaterial "punch list" work, required
hereunder that neither delays Tenant's fixturing, merchandising,
or opening for business to the public from the Premises nor
requires Tenant to incur any additional costs in connection with
the same; provided, however, that all punch list items shall be
100% completed within seven (7) days after the same is scheduled
to be completed under this Article 5. Notwithstanding that
Tenant and Landlord may agree that all or any portion of the
Landlord's Work is substantially completed subject to certain
punch list items, in the event that any item of Landlord's Work
is not completed within seven (7) days after the same is
scheduled to be completed under this Article 5, the same shall
not be deemed a punch list item and the relevant portion of
Landlord's Work shall not be deemed substantially completed
until said item is completed. Tenant's receipt of deliveries or
its commencement of fixture installation and/or store
merchandising and/or its store opening does not necessarily
constitute substantial completion or admittance to substantial
completion.
8
In completing Landlord's Work, Landlord agrees to complete the
performance of same in accordance with the provisions of Article
28 of this Lease regarding interference with the business
operations of Tenant after the Possession Date. Subject to force
majeure as defined in this Lease, if any portion of the
Landlord's Work is not substantially completed on or before the
date specified in this Lease for the completion of the same, for
any reason whatsoever, then Landlord shall pay Tenant on demand,
as agreed upon and liquidated damages, Seven Thousand Five
Hundred Dollars ($7,500.00) per day for each day beyond such
date that Landlord's Work is not substantially completed.
Landlord and Tenant agree that the above amount is a reasonable
estimate of the damages Tenant would sustain if the substantial
completion of Landlord's Work is delayed, and that it is not and
shall not be construed as a penalty. Tenant may, at Tenant's
option, deduct the amount due from Landlord under this paragraph
from the Rent payment(s) otherwise due hereunder. Tenant's
taking possession of the Premises and/or opening for business to
the public at the Premises shall not constitute a waiver of
Tenant's right to receive such amount or a waiver of any
construction defects. In addition, if Landlord's Work is not
commenced by October 1, 2007, or if Landlord's Work is not
substantially completed by April 1, 2008, Tenant shall have the
right to cancel this Lease at any time thereafter by forwarding
written notice to Landlord at any time on or before Tenant
receiving notice of commencement or completion of Landlord's
Work, as the case may be.
For the purposes of this Article, "commencement" of Landlord's
Work shall mean: the installation of all required utilities to
within five feet (5') of the specified connection points, and
construction of all footings and foundations and acquisition of
all required permits and approvals.
In addition to the foregoing rights, if Tenant shall, in the
exercise of its reasonable judgment, determine that Landlord's
Work will not be completed by the date specified in this Lease
for the completion of the same, or that deficiencies exist
therein which must be immediately corrected, Tenant shall have
no obligation to, but at any time may, upon five (5) days' prior
written notice to Landlord, elect to complete Landlord's Work or
correct deficiencies therein at Landlord's cost and expense,
unless Landlord shall within said five (5) day period and to the
reasonable satisfaction of Tenant, either correct the situation
giving rise to Tenant's determination or commence, and
diligently pursue, a course of action which will permit the
timely completion of Landlord's Work or correction of the
deficiency therein. Tenant shall be permitted to offset against
Rent otherwise due under this Lease an amount equal to (i)
liquidated damages as above provided and/or (ii) costs or
expenses incurred by Tenant if Tenant elects to complete
uncompleted or deficient items of Landlord's Work, with interest
upon the remaining balance of any such liquidated damages or
completion costs at a rate equal to the lesser of (a) the Prime
Rate or "Reference Rate" then being published in the Wall Street
Journal, plus four percent (4%) per annum, or (b) the highest
rate per annum permitted by law (the "Interest Rate") until the
amount of such liquidated damages or completion costs, plus
interest, is recouped in full. Time is of the essence with
respect to the dates contained in this Article.
6. RIGHT OF PRIOR ENTRY.
At any time prior to the Delivery Date, Tenant shall have the
right to enter the Premises for the purposes of measuring the
Premises and installing therein Tenant's fixtures, equipment and
9
merchandise, provided that such operations do not interfere with
Landlord's timely completion of Landlord's Work. The Delivery
Date shall be extended if and to the extent Tenant's entry
directly causes a delay in completion of Landlord's Work. In any
event, Tenant shall be entitled to enter upon the Premises if
the Delivery Date but not the Possession Date shall have
occurred, it being understood that in such event Landlord shall
not be entitled to claim any delay due to Tenant in connection
with the completion of Landlord's Work. Any entry by Tenant for
the purpose of measuring the Premises or of installing its
fixtures and equipment shall not be deemed acceptance of the
Premises by Tenant.
7. RENT.
Tenant hereby covenants and agrees to pay Landlord as monthly
fixed rent for the Premises during the Lease Term the sums set
forth in Article ID hereof. Such monthly fixed rent and other
charges otherwise payable hereunder (collectively "Rent") shall
be payable in advance and without demand on the first day of
every calendar month commencing on the Commencement Date and
thereafter during the Lease Term. Rent shall be prorated for any
partial month at the beginning or end of the Lease Term. Tenant
shall pay Rent to Landlord at the address provided for Landlord
in Article I.F hereof, unless otherwise notified in writing by
Landlord.
If the leasable area of the Premises, determined as hereinafter
provided, is in fact less than the estimated leasable area set
forth in the description of the Premises in Article 1, the fixed
rent and other charges otherwise payable hereunder shall be
proportionately adjusted to reflect the actual leasable area of
Tenant's building within the Premises. In determining the
leasable area of the Premises, measurements shall be from the
center of all common walls and the outside of all exterior walls
of Tenant's building thereon.
8. CONFORMITY WITH LAW; OPERATIONS.
Tenant will use and occupy the Premises and appurtenances in a
careful, safe and proper manner, and shall comply with the
lawful requirements of the proper public authorities regarding
the conduct of Tenant's business. Landlord agrees and
acknowledges that Tenant shall have no obligation to open for
business and/or operate its business at the Premises, except as
determined by Tenant in its sole and absolute discretion.
However, if Tenant fails to open for business in the Premises
fully-stocked and staffed as a typical "Best Buy" store within
one hundred eighty (180) days of the Commencement Date (subject
to the provision of Section 37.15) or Tenant fails to operate
its business in the Premises for one hundred eighty (180)
consecutive days or more (temporary closures due to force
majeure conditions, fire or other casualty or remodeling in the
Premises not to exceed 60 consecutive days excepted) Landlord
shall have the right (but not the obligation) to terminate this
Lease by giving written notice (Termination Notice") to Tenant,
which termination shall become effective on the last day of the
first full month following Tenant's receipt of the Termination
Notice. In the event of a termination under this Article 8, the
parties hereto shall be released from all further liability or
obligations under this Lease, provided that any obligations
which, by their terms, expressly survive the termination or
expiration of this Lease shall remain in full force and effect
in accordance with their terms. The foregoing notwithstanding,
Landlord shall reimburse Tenant for its unamortized costs of
Tenant's Work and its non-movable fixtures, using the ten year
Lease Term as the amortization period. Tenant
10
will not permit the Premises to be used for any unlawful
purpose. Landlord hereby warrants that, at time of delivery of
the Premises to Tenant, the Premises will be in conformance with
all applicable Laws, and at all times throughout the Lease Term,
the Common Areas of the Shopping Center will be in conformance
with all applicable Laws.
9. UTILITIES FOR THE PREMISES.
Tenant shall pay when due all bills for gas, water, electricity
and other utilities used on the Premises on and after the
Commencement Date and through and including the date of
expiration of this Lease or the earlier termination hereof. No
later than the date specified for the delivery of utilities
under Article 5, Landlord, at its own expense, shall (a) apply
for and install separate meters for all utilities used in the
Premises, to the extent required under Exhibit D hereto, and (b)
apply and pay for all hookups, taps, and connections of any and
all utilities used on the Premises (including but not limited to
gas, water, electricity, telephone, etc. and any and all fees
(including so-called "impact" fees or their equivalent) and
expenses associated therewith).
10. REPAIRS.
Tenant agrees that except as otherwise provided in this Article,
it will perform all necessary nonstructural interior repairs to
the Premises, including repair or replacement of damaged or
broken doors and windows and routine maintenance of the heating,
ventilating, air-conditioning systems ("HVAC"), plumbing, gas,
electrical and similar systems which are located in and service
exclusively the Premises. Tenant shall service and maintain the
HVAC by retaining a qualified contractor under a service
agreement with a minimum of four (4) inspection and maintenance
visits per year. Tenant further agrees that it will keep and
maintain the interior of the Premises in a clean and sanitary
condition. Tenant shall not be required to make any repairs
which are the responsibility of Landlord pursuant to this
Article or elsewhere under this Lease.
Subject to the provisions and authority afforded Landlord under
Article 27 herein, Landlord, at its sole cost and expense, shall
make all structural repairs to the Premises, whether interior or
exterior, keep the Premises watertight, and shall repair,
replace and maintain in good condition the exterior of the
Premises including without limitation the roof, roof membranes,
walls (including the removal of efflorescence, if any),
foundations, gutters, parking and drive areas, fire sprinkler
system, utility lines from the point of connection to the
Premises to the main line, and downspouts. Landlord shall make
all necessary replacements of obsolete or unrepairable HVAC,
plumbing, gas, electrical and other similar systems (and
components thereof) which service all or any part of the
Premises, and shall make any repairs to the Premises
necessitated by any neglect, fault or default of Landlord, its
agents, employees or contractors. Further, Landlord shall
indemnify, defend and hold Tenant harmless from all actual loss,
damage, costs, expenses or claims (exclusive of consequential,
special or punitive damages, including, without limitation, lost
profits) arising or resulting from Landlord's failure to fulfill
its repair obligations under this Lease.
in performing its obligations under this Article or elsewhere
under this Lease, Landlord shall use commercially reasonable
efforts not to unreasonably interfere with Tenant's normal
business operations. If Landlord fails to undertake and complete
to Tenant's reasonable satisfaction the
11
repairs required under this Article or elsewhere under this
Lease within thirty (30) days after written notice from Tenant
(provided, however, that Landlord shall not be deemed in default
if such repair cannot be completed within such thirty (30) day
period and Landlord commences curing such default within such
thirty (30) day period and thereafter diligently pursues such
cure to completion within a reasonable time not to exceed sixty
(60) days), then upon five (5) days' prior written notice,
Tenant shall have the right to make such repairs on behalf of
Landlord and to deduct the cost thereof, plus ten percent (10%)
of such cost to cover its overhead and administrative costs,
from the Rent otherwise payable hereunder.
Anything in this Lease to the contrary notwithstanding, Landlord
agrees that in the event of an emergency which necessitates
immediate maintenance, repair or replacement of items which are
otherwise required by this Lease to be maintained, repaired or
replaced by Landlord, and Tenant is unable to contact Landlord
and advise it of such emergency condition Tenant may at its
option proceed forthwith to make such repairs and pay the cost
thereof. Landlord agrees to reimburse Tenant for the cost of
such repairs, within thirty (30) days of written demand. If
Landlord does not so reimburse Tenant, then Tenant may deduct
such amount from the Rent otherwise payable hereunder.
If at any time during the Lease Term any governmental agency or
other authority with jurisdiction over the Premises requires
modifications or repairs of the Premises that are attributable
to Tenant's particular use of or operations within the Premises,
all such modifications or repairs shall be at Tenant's sole cost
and expense. If during the Lease Term any governmental agency or
other authority with jurisdiction over the Premises requires
modifications or repairs of the Premises that are attributable
to buildings or structures similar to the one occupied by
Tenant, or apply generally to retail businesses or operations
(as compared with Tenant's particular business operation), then
all such modifications or repairs shall be at Landlord's sole
cost and expense. If Landlord does not make such modifications
or repairs, then Tenant may make such modifications or repairs
upon five (5) days' written prior written notice and deduct the
amount expended therefor, plus ten percent (10%) of such amount
for its overhead and administrative costs, from the Rent
otherwise payable hereunder,
Notwithstanding anything in this Lease to the contrary, in the
event of any failure of Landlord to comply with the provisions
of this Article or elsewhere in this Lease, and such failure
materially and substantially interferes with Tenant's ability to
conduct its regular and customary business in the Premises or
materially and substantially impedes or materially and
substantially impairs ingress to or egress from the Premises or
the visibility of Tenant's storefront or blue wedge or use of
the Common Areas for more than forty-eight (48) hours, Tenant
may elect to terminate this Lease upon thirty (30) days' prior
written notice to Landlord unless, prior to the expiration of
such period, Landlord has cured such default and/or Tenant shall
have the right to proportionately xxxxx Rent under this Lease
during such period of impairment in the amount which is greater
of (i) the corresponding time during which Tenant is deprived
due to Landlord's failure to comply with the provisions of this
Article or those elsewhere in this Lease or (ii) an amount equal
to the decrease in sales, if any, during such period of
impairment over sales for the equivalent period of the prior
year.
11. ACCESS BY LANDLORD.
12
Landlord shall have access to the Premises at all reasonable
times upon twenty-four (24) hours' notice (written, electronic
or verbal) for the purpose of examining or making any repairs
thereto that Landlord is required to make under this Lease or
which are necessary for safety or maintenance purposes. In the
event of an emergency, Landlord shall not be required to give
Tenant twenty-four (24) hours' written notice, but shall use
reasonable efforts to notify Tenant and its security company
prior to entry.
12. TENANT'S FIXTURES AND SIGNS.
Tenant, at its sole cost and expense, may install and operate
its standard interior and exterior electric and other signs,
machinery and other mechanical equipment in and on the Premises,
subject to applicable Law. Tenant shall have the right, at its
sole cost and expense, to install its standard prototype signage
on the sides and rear of the building as shown on Exhibit D,
subject to applicable Law.
Landlord shall, in accordance with Exhibit D, construct Tenant's
standard storefront structure. Tenant at Tenant's sole cost and
expense, shall install signage in accordance with Exhibit D,
Tenant's standard yellow and black ticket sign tilted five (5)
degrees. Tenant may also install and maintain in the Premises
such pipes, conduits and ventilating ducts as are required or
desirable for the business conducted by Tenant therein. Tenant
shall at all times have the right to remove all signs, fixtures,
machinery, equipment, appurtenances or other property heretofore
or hereafter furnished or installed by Tenant, provided it
repairs any damage caused thereby, it being expressly understood
and agreed by the parties that said property shall not become
part of the Premises but shall at all times be and remain the
property of Tenant and as such shall not be subject to any
landlord's lien or other creditor's remedy otherwise available
to Landlord.
On or before the Delivery Date, Landlord shall, at its sole cost
and expense, obtain all requisite approvals for and construct a
Shopping Center pylon sign in the location shown on Exhibit B,
for Tenant's installation on each side of such signs, its sign
panels as shown on Exhibit D. Landlord agrees that each side of
the pylon shall permit a minimum of 24 square feet for Tenant's
pylon sign panel, which will be in the location and contain the
dimensions shown on Exhibit D. Landlord agrees the structure for
said Shopping Center pylon sign shall be designed so as to
permit Tenant to affix the appropriate double-sided sign panel
to the pylon structure without on-site fabrication of fastenings
or a method thereof. In addition to the foregoing and not in
substitution therefor, (a) if Landlord shall construct any
additional pylon or free-standing sign(s) for the Shopping
Center, or (b) should Target obtain its own pylon or
freestanding sign or receive its own pylon sign or free-standing
sign from Landlord, or obtain approval from Landlord for its own
pylon sign where Landlord's approval was necessary or required,
and (c) with respect to (a) and (b), so long as any required
municipal and/or Target approvals are obtained, then. Tenant
shall be entitled to locate a sign panel on such additional
pylon or freestanding sign(s) at a location commensurate with
the size of the Premises in relation to the size of other
tenants with sign panels on such pylon or free-standing sign(s).
Tenant shall have the right (subject to applicable Law and the
REA) to designate its colors and sign face for its panel on any
pylon or free-standing sign to which Tenant is allowed space or
13
Tenant's storefront signage and structure. Further, it is
expressly agreed between Landlord and Tenant that Landlord shall
be solely responsible, at Landlord's sole cost and expense, on
or before the Delivery Date, for obtaining any and all permits
and approvals required and/or necessary to construct pylon and
storefront sign structures and to allow Tenant's signage as
specified in this Lease; but Tenant shall be responsible for
obtaining signage permits required to insert or install its sign
panels on pylon and storefront sign structures as specified in
this Lease.
Landlord shall have no right to (i) place or maintain any signs
of any type, other than those of Tenant, on the Premises,
including the exterior walls and roof thereof, or (ii) permit
any person or entity, other than a retail tenant of the Shopping
Center, to place or maintain any signage of any type in the
Shopping Center, other than directional signage or signage
required by applicable Laws.
13. ALTERATIONS TO THE PREMISES; SATELLITE EQUIPMENT.
At any time after the initial construction of the building
improvements on the Premises, Tenant at its own cost and expense
and without Landlord's consent may make changes, alterations,
additions and improvements to the Premises, provided it first
obtains Landlord's consent (which consent shall not be
unreasonably withheld) before making any changes to the
structure of the building itself. If Tenant does not receive
written objections from Landlord within ten (10) days after
submission to Landlord of a written request for consent,
Landlord shall be deemed to have consented to all items
requested therein. If so requested by Tenant, Landlord shall
cooperate in securing necessary permits and other government
authorizations for Tenant's changes and alterations, at no cost
to Landlord.
Landlord represents, warrants, covenants and agrees that at any
time following the Delivery Date, and during the Lease Term
Tenant shall have the right, at its expense, to install a
satellite communications and receiving dish and related sled,
and any other related materials, equipment or components
thereof, including, but not limited to, any cabling or wiring
through the Premises (collectively, the "Satellite Equipment")
on the roof of the Premises, or on the roof of the building in
which the Premises are located. Landlord shall not prevent,
hinder, impair or interfere with Tenant's installation,
maintenance or use of the Satellite Equipment, provided that
Landlord shall not be responsible for the acts or omissions of
third parties. In addition, Tenant shall be entitled to
continuing access to perform any installation, maintenance,
repairs and replacements of the Satellite Equipment that Tenant
deems necessary, in Tenant's sole and absolute discretion,
provided that Tenant's entry onto the roof, or the installation,
maintenance, operation or repair of the 'Satellite Equipment
thereon, shall not invalidate Landlord's roof warranty. Further,
Landlord agrees and acknowledges that the foregoing are material
inducements to Tenant to enter into this Lease.
14. SURRENDER OF THE PREMISES.
Tenant will deliver and surrender possession of the Premises to
Landlord upon the expiration of this Lease or its earlier
termination, in condition and repair equal to the condition and
repair thereof at the commencement of said term, loss by fire,
ordinary wear and tear and decay,
14
casualty, neglect or fault or default of Landlord, and taking by
eminent domain excepted. Landlord expressly waives any statutory
or other lien or security interest in Tenant's property.
15. HOLDING OVER
If Tenant continues its occupancy of the Premises after the
expiration of the Lease Term or any renewal or extension thereof
(or any earlier termination provided or permitted by this Lease)
either with or without the consent of Landlord, such tenancy
shall be month-to-month only, and not year-to-year or based on
any other interval of time. Such continued occupancy shall not
defeat Landlord's right to possession of the Premises, and the
month-to-month tenancy provided for herein may be canceled at
the end of any calendar month upon not less than thirty (30)
days' prior written notice from Landlord to Tenant. Except for
provisions relating to Lease Term or any renewal or extension
thereof, all covenants, provisions, obligations and conditions
of this Lease shall remain in full force and effect during such
month-to-month tenancy, provided that Tenant shall pay 125% of
monthly fixed rent at the rate in effect for the immediately
preceding Lease Year plus all Additional Rent due under this
Lease. In the event of any such month-tomonth tenancy, Tenant
shall be bound by all of the terms and conditions of this
Lease..
16. DEFAULT; DISPUTES.
16.1 Tenant Default. In the event that any of the following
(hereinafter referred to as an "Event of Default") shall occur:
(a) Tenant shall at any time be in default of the payment of
Rent, and Tenant shall fail to remedy such default within ten
business (10) days after receipt of written notice of such
default from Landlord; or
(b) Tenant shall at any time be in default of the performance
of any of its obligations under this Lease other than payment of
Rent, and Tenant shall fail to remedy such default within thirty
(30) days after receipt of written notice of such default from
Landlord, provided, however, that Tenant shall not be deemed in
default if such default cannot be cured within such thirty (30)
day period and Tenant commences curing such default within such
thirty (30) day period and thereafter diligently pursues such
cure to completion within sixty (60) days after the date of
Landlord's notice, if reasonably possible under the
circumstances; or
(c) Tenant shall be adjudged a bankrupt or make an assignment
for the benefit of creditors; or
(d) a receiver of any property of Tenant in or upon the
Premises shall be appointed in any action, suit or proceeding by
or against Tenant and not removed within ninety (90) days after
appointment,
then, upon the occurrence of such event and the termination of
the applicable notice period hereinabove provided without cure,
Landlord may without further notice or demand enter into the
Premises and take full and absolute possession thereof, without
such reentry causing a
15
forfeiture of the Rent to be paid or the covenants to be
performed by Tenant hereunder for the full term of this Lease,
and upon such reentry Landlord may lease or sublease the
Premises for such Rent as Landlord may reasonably obtain,
crediting Tenant with the Rent so obtained after deducting the
costs Landlord reasonably incurs by such reentry, leasing or
subleasing; or in the alternative, Landlord in its sole
discretion may terminate this Lease at any time and reenter and
take full and absolute possession of the Premises, releasing
Tenant from further obligation hereunder and free from any
further right or claim by Tenant. Notwithstanding the foregoing,
Tenant shall remain liable for all obligations under this Lease
which accrued prior to the date of termination of this Lease.
Landlord hereby waives any statutory or other Landlord lien on
Tenant's personal property.
Notwithstanding the foregoing, following two (2) substantially
similar Tenant Defaults under this Lease within a twelve (12)
month period, Landlord shall, upon the occurrence of any third
(3rd) such default, have the right to exercise any or all
remedies therefor under this Lease without, however, the
obligation to provide notice thereof, or any opportunity to
cure, to Tenant.
16.2 Landlord Default. A "Landlord Default" shall be deemed
to exist if (i) Landlord defaults in the performance of any of
its monetary obligations under this Lease and fails to cure such
default within ten (10) business days of Landlord's receipt of
written notice of such default or (ii) Landlord defaults in the
performance of any of its non-monetary obligations under this
Lease and fails to cure such default, or to commence and
diligently pursue the completion thereof, within thirty (30)
days of Landlord's receipt of written notice of such default,
provided, however, that Landlord shall not be deemed in default
if such default cannot be cured within such thirty (30) day
period and Landlord commences curing such default within such
thirty (30) day period and thereafter diligently pursues such
cure to completion in no more than 60 days from the date of
Tenant's original notice, if reasonably possible under the
circumstances. Subject to remedies for Landlord Default, if any,
set forth in other Articles of this Lease and in addition to any
other remedies available in law or in equity, if a Landlord
Default shall exist, Tenant may proceed to cure such default
which has not been cured following written notice of default and
expiration of the cure period stated above in this Article 16.2,
and offset against the Rents, the costs and expenses incurred by
Tenant to cure said default, together with an administrative
charge equal to ten percent (10%) of the amount of said costs
and expenses; or if such default which has not been cured
following written notice of default and expiration of the cure
period stated above in this Article 16.2 materially and
substantially interferes with Tenant's ability to conduct its
regular and customary business in the Premises, or materially
and substantially impedes or materially and substantially
impairs ingress to or egress from the Premises or the visibility
of Tenant's storefront or blue wedge, then upon an additional
fifteen (15) days' prior written notice to Landlord, terminate
this Lease unless Landlord shall cure the subject default within
said additional fifteen (15) day period or, where the nature of
the default is such that it cannot be cured within said fifteen
(15) day period, cure is commenced and is being diligently
pursued to completion.
16.3 Disputes. In the event of a bona fide dispute between
Landlord and Tenant arising under Articles 10, 22, 25 or 27 of
this Lease or with respect to the Lease (specifically excluding
any dispute where the monetary amount in question is expressly
provided for under this Lease including, without limitation,
fixed rent or liquidated damages either party ("Disputing
16
Party") shall have the right, within the applicable notice
and cure period, to notify the other party in writing
("Dispute Notice") of the Disputing Party's desire to
dispute the propriety of the other party's claim of
default. In the event such dispute relates to the payment
of money the Dispute Notice shall be valid only if the
Disputing Party pays, within the applicable notice and cure
period, that portion of the sum due as to which the
Disputing Party does not take issue, limiting the dispute
to the net amount actually disputed. The Dispute Notice
shall be accompanied by a detailed statement of the basis
for the Disputing Party's claim. The time within which to
cure any claimed default as to which a proper Dispute
Notice has been delivered shall be extended to the date
which is ten (10) days after the earlier to occur of (i)
the resolution of the dispute by the parties or (ii) the
final determination of the forum permitted by this Lease.
It is expressly understood and agreed that Landlord shall
not be entitled to commence or maintain an unlawful
detainer or eviction proceeding in connection with any bona
fide dispute involving Tenant's obligations under
Article(s) 22, 25 and/or 27 of this Lease.
In the event of any bona fide dispute arising between
Tenant and Landlord under this Lease where the net amount
in issue is up to Twenty-five Thousand Dollars ($25,000.00)
as increased by three percent (3%) for each Lease Year
during the Lease Term, the parties each hereby waive their
right to file a civil action or proceeding in connection
with the same, it being agreed that upon demand by either
party, the parties shall resolve the dispute by referring
the same to a single arbitrator agreed upon by the parties.
The arbitration shall take place in Minneapolis, Minnesota
and be governed under the rules of the American Arbitration
Association and amendments thereto. Such arbitrator will
have access to such records of the parties as are
reasonably necessary and the decision of such arbitrator
will be final and binding upon the parties. The cost of the
arbitration will follow the award, unless otherwise
determined by the arbitrator.
17. NONWAIVER OF DEFAULT.
No acquiescence by either party in any breach of covenant
or default by the other party hereunder shall operate as a
waiver of the acquiescing party's rights with respect to
such breach or default or subsequently, to the same or any
other breach or default.
18. QUIET ENJOYMENT.
Landlord covenants and agrees that if Tenant shall perform
all covenants and agreements herein stipulated to be
performed on Tenant's part, then at all times during the
term of this Lease and any renewal or extension thereof
Tenant shall have the peaceable and quiet enjoyment and
possession of the Premises, without any manner of hindrance
from Landlord or any person claiming by, through or under
Landlord.
Landlord hereby represents, warrants and covenants to and
with Tenant that Landlord's execution of this Lease,
compliance with the terms hereof or occupation of the
Premises by Tenant will not conflict with, cause a breach
of or constitute a default under the terms of any agreement
or instrument to which Landlord is a party.
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A breach of this Article by Landlord shall entitle Tenant to all
available equitable relief as well as any and all remedies at
law.
19. DAMAGE BY FIRE OR CASUALTY.
If the Premises or the Common Areas of the Shopping Center are
destroyed or damaged by any cause and such destruction or damage
can reasonably be repaired within two hundred ten (210) days
after the happening of such destruction or damage, then Tenant
shall not be entitled to surrender possession of the Premises,
nor shall Tenant's liability to pay Rent under this Lease cease,
but in the event of such destruction or damage Landlord shall
complete such repairs within two hundred ten (210) days after
receipt of insurance proceeds on account of the occurrence of
such destruction or damage. If Tenant is deprived of the
occupancy of any portion of the Premises due to any such
destruction or damage the Rent shall proportionately xxxxx
corresponding to the time during which, and to the area of the
Premises of which, Tenant shall be deprived due to such
destruction or damage or the making of such repairs. No Rent
shall be payable during any period that Tenant is unable to
occupy the Premises and engage in its regular business at the
Premises. If Landlord fails to complete repairs within the two
hundred ten (210) days after receipt of insurance proceeds but
in no event more than three hundred (300) days from the
occurrence of the fire or other casualty, Tenant at its election
may terminate this Lease and quit the Premises upon written
notice to Landlord given prior to the completion of the
restoration.
If the destruction or damage of the Premises or the Common Areas
of the Shopping Center cannot reasonably be repaired within two
hundred ten (210) days after the occurrence of the fire or other
casualty, Landlord shall notify Tenant within thirty (30) days
after the happening of such destruction or damage whether or not
Landlord will repair or rebuild. If Landlord elects not to
repair or rebuild, this Lease shall be terminated. If Landlord
elects to repair or rebuild, Landlord shall specify the time
within which repairs or construction will be completed, and
Tenant shall have the option within thirty (30) days after the
receipt of such notice to elect either to terminate this Lease
and further liability hereunder, or to extend the term hereof by
a period of time equivalent to the period from the happening of
such destruction or damage until the Premises are restored to
their former condition. In the event Tenant elects to extend the
term of this Lease, Landlord shall restore the Premises to their
former condition within the time specified in the notice and
Tenant shall be entitled to an abatement of Rent and other
charges in the manner hereinabove set forth. If Landlord fails
to complete restoration of the Premises within the specified
time, then Tenant at its election may terminate this Lease and
quit the Premises upon written notice to Landlord given prior to
the completion of the restoration.
If the Premises or the Common Areas of the Shopping Center are
destroyed or damaged by any cause during the final two (2) Lease
Years of the Lease Term to the extent that such damage cannot
reasonably be repaired, or is not repaired by Landlord, within
ninety (90) days after the happening of such damage, Tenant
shall have the right to terminate this Lease effective as of the
date of such damage by delivering written notice of the same to
Landlord. Notwithstanding anything to the contrary herein,
Tenant shall not be required to restore its trade fixtures
and/or personal property in the Premises during the final Lease
Year of the Lease Term if the costs of
18
restoration exceed $50,000. If this Lease is terminated for any
reason pursuant to this Article, Landlord shall promptly refund
to Tenant any Rent or other unearned charges paid in advance.
20. WAIVER OF SUBROGATION.
Landlord and Tenant hereby waive all rights of subrogation which
either has or which may arise hereafter against the other for
any damage to the Premises or any other real or personal
property damage or loss of business by any cause whatsoever for
which either party may be reimbursed as a result of insurance
coverage for any loss suffered by it; provided, however, that
the foregoing waivers of subrogation do not invalidate any
policy of insurance of the parties hereto now or hereafter
issued, it being stipulated by the parties hereto that such
waiver shall not apply in any case which would result in the
invalidation of any such policy of insurance. Each party shall
notify the other if such party's insurance would be so
invalidated.
21. EMINENT DOMAIN.
If the entire Premises are at any time after execution of this
Lease taken by public or quasi-public use or condemned under
eminent domain, then this Lease shall terminate and expire
effective the date of such taking and any Rent paid in advance
and any unearned charges shall be refunded to Tenant by Landlord
on such date.
Tenant shall have the right to terminate this Lease and to
receive from Landlord an appropriate refund of Rent and/or other
unearned charges paid in advance if, as a result of eminent
domain proceedings or any other governmental or quasi-public
action any of the following events (each, a "Partial Taking")
shall occur: (i) a material portion of the Premises is taken
(ii) any or all of the Tenant Protected Parking Limits & Access
Area is taken. Should Tenant elect to remain in the Premises
after any partial taking, then Rent shall be reduced for the
remainder of the term thereafter in proportion to the building
area of the Premises taken, and reduced by an equitable amount
for any non-building area taken and Landlord shall promptly
repair and restore the Premises as nearly as possible to their
prior condition to the extent of condemnation awards paid. All
proceeds from a condemnation award shall be applied to the
extent necessary to satisfy Landlord's repair and restoration
obligation. Tenant shall not be entitled to damages for the
taking of its leasehold estate or the diminution of the value
thereof, provided, if Tenant has made any leasehold improvements
to the Premises or material alterations, structural changes or
repairs thereto at its own expenses, regardless of when made,
Tenant shall be entitled to separately claim an award with the
condemning authorities. In addition, Tenant shall be entitled to
claim an award for loss of business, damage to merchandise and
fixtures, removal and reinstallation costs and moving expense.
22. INSURANCE.
22.1 Tenant's Insurance. Tenant shall obtain and keep in force
at Tenant's expense for the term of this Lease commercial
general liability insurance covering the Premises with a
combined single limit of Two Million and No/100 Dollars
($2,000,000.00) for each occurrence (excluding coverage under so-
called "umbrella" or "excess liability" policies). Tenant shall
also maintain throughout the Lease Term umbrella or excess
liability coverage of at least ten million
19
($10,000,000.) dollars 538 Said insurance shall name Tenant as
named insured and Landlord as additional insured. Provided,
however, notwithstanding the foregoing, the insured Tenant
herein may self-insure all or any part of the insurance it is
required to carry hereunder and/or carry such insurance under a
"blanket" policy.
22.2 Landlord's Insurance. Landlord shall procure and maintain
throughout the entire term of this Lease a policy of All Risk
insurance in an amount not less than the full replacement cost
of the Landlord's Property (including the Premises) exclusive of
excavation, footings and foundations with a commercially
reasonable deductible, for which cost and expense Landlord shall
be solely responsible for. All insurance proceeds shall be
applied to the extent necessary to satisfy Landlord's repair and
restoration obligations under this Lease.
Landlord shall also procure and maintain throughout the entire
term of this Lease, a policy of comprehensive general liability
insurance coverage for casualties occurring on or about the
Common Areas. Said insurance shall have limits of liability of
not less than Two Million and No/100 Dollars ($2,000,000.00)
combined, single limit.
Tenant shall pay its proportionate share of Landlord's cost of
insurance as provided in this Article (exclusive of costs and
expenses of insurance for excavation, footings and foundations)
within thirty (30) days of receipt of documentation of cost
incurred (i.e. premium invoice and declaration page of the
policies) prorated in the manner described in Article 27. .
22.3 General. The insurance required under this Lease shall be
(a) issued by an insurance company authorized to do business in
the state in which the Premises are located, (b) have a rating
of no less than A- as published by A.M. Best Company, and (c)
provide for at least ten (10) days' written notice, by certified
mail to the other party before cancellation, termination or non-
renewal of such insurance. A certificate evidencing the coverage
required to be maintained by the applicable party shall be
delivered to the other party upon request.
23. SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT.
At the option of Landlord or any successor-in-interest to all or
part of Landlord's interest, this Lease shall be superior or
subordinate to the interest of Landlord, any such successor-in-
interest or to the lien of any mortgage upon the Premises or any
property of which the Premises form a part provided, however,
that the subordination of this Lease shall be made upon the
condition that in the event of the transfer of all or part of
Landlord's interest, whether by sale, foreclosure, or other
action taken under a mortgage, any such successor-in-interest
shall agree that this Lease and the rights of Tenant hereunder
shall not be disturbed but shall continue in full force and
effect so long as an Event of Default by Tenant is not then
continuing and the proceeds of any insurance recovery or
condemnation award shall be used for the purposes stated in this
Lease. The word "mortgage," as used herein, includes a mortgage,
deed of trust or other similar instrument and any modification,
extension, renewal or replacement thereof. Subject to the
foregoing, Tenant agrees to attorn to any such successor-in-
interest.
As to any mortgage existing as of the effective date of this
Lease, Landlord agrees to deliver to Tenant contemporaneously
with or within thirty days after the execution of this Lease,
and
20
Tenant agrees to thereafter promptly execute, a SNDA
substantially in the form attached hereto as Exhibit E. Landlord
shall be responsible for seeing that the balance of the SNDA is
fully executed and recorded. Tenant shall not be bound by the
terms and provisions of said SNDA until Tenant has received a
fully-executed and recorded copy of said SNDA. In addition to
the foregoing, Landlord agrees to, within thirty (30) days after
the execution of any future mortgage, deliver to Tenant, and
Tenant agrees to thereafter promptly execute, a SNDA
substantially in the form attached hereto as Exhibit E. Landlord
shall be responsible for seeing that the balance of the SNDA is
fully executed and recorded. .
24. TRANSFER OF INTEREST.
Landlord may at any time transfer its interest in this Lease and
underlying fee. In such event, Landlord shall provide Tenant
with a complete copy of the original instrument assigning
Landlord's interest in this Lease or a certified and conformed
copy of any deed conveying Landlord's fee interest in the
Premises and/or Landlord's Property, as applicable. Tenant shall
have the right at any time to assign this Lease or sublet all or
any part of the Premises without the consent of Landlord,
provided (a) Tenant is not in default beyond any applicable cure
period, (b) the assignment or subletting is for the same use
permitted in this Lease or another retail use that does not
duplicate or violate an existing use at the Shopping Center nor
violate any agreements of Landlord or the Operation and Easement
Agreement ("REA"), (c) the assignee or sublessee is an
experienced retail merchant operating at least four (4) other
similar retail stores or is a duly authorized franchisee of a
national retail franchise, (v) Tenant shall remain liable for
the full performance of all terms, covenants and conditions of
this Lease and(vi) that any such third party shall agree to be
bound by all the terms and provisions hereof.
The foregoing notwithstanding, Tenant shall have the right to
assign this Lease without the consent of Landlord to any entity
(i) controlled by Tenant, or (ii) controlling Tenant, or (iii)
controlled by the same entity who directly or indirectly
controls Tenant, or (iv) an entity acquiring the majority of
Tenant's stores in the state in which the Premises are located.
In the event of an assignment whereby Tenant was not, pursuant
to the terms hereof, released from its obligations and liability
hereunder and the occurrence of a default whereby Landlord
regains possession of the Premises, Tenant shall be entitled,
but not obligated, to retake possession of the Premises upon
written notice thereof to Landlord in which event this Lease
shall automatically be deemed reinstated as a lease between
Landlord and Tenant as if the assignment had never occurred,
without any obligation to operate a business therefrom, but with
all the other rights and obligations attendant thereto, and
under the same terms and conditions of this Lease, including any
amendments hereto which may have been made to effectuate an
assignment to or accommodate the defaulting assignee. Landlord
further agrees that, within thirty (30) days of Tenant's written
request, Landlord shall execute and obtain written consent of
its lender, if any, to a non-disturbance and attornment
agreement in form and content mutually acceptable to Landlord,
Tenant, Tenant's assignee or sublessee. Further, Landlord agrees
that, within thirty (30) days of Tenant's written request,
Landlord shall execute an estoppel certificate in favor of
Tenant and Tenant's assignee or sublessee, containing any
information as may be reasonably requested and reasonably agreed
to be provided; provided that, in fact, such facts are accurate
and ascertainable.
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25. REAL ESTATE TAXES.
Tenant shall pay to Landlord Tenant's proportionate share of
Landlord's actual out-of-pocket costs for the Taxes due and
payable with respect to Landlord's Property during the Lease
Term. Tenant's proportionate share of such Taxes shall be
computed by multiplying Taxes by a fraction, the numerator of
which is the number of leasable square feet in the Premises and
the denominator of which is the number of leasable square feet
in all buildings (including mezzanines and basement areas, and
areas outside of each building if used for outdoor sales,
storage or similar use by any tenant(s) of Landlord's Property)
of Landlord's Property (and any other buildings included within
the real estate tax parcel that also contains the Premises).
Tenant's proportionate share of Taxes shall not include any
management, administrative and/or overhead expenses, costs and
fees; and Tenant agrees that management, administrative and/or
overhead expenses, costs and fees do not apply to or include
contracts with consultants involved with Tax refunds or rebates,
as described in the third paragraph of this Article 25. The
foregoing notwithstanding, until such time as all of the
buildings (in addition to the building on the Premises) to be
constructed by Landlord on Lot 1 of Certified Survey Map No.
3977 (a division of Xxx 0 xx Xxxxxxxxx Xxxxxx Xxx Xx. 0000
recorded August 18, 2006 in Register of Deeds for Walworth
County, WI as Document No. 685693) have been constructed,
Tenant's proportionate share of Taxes per Lease Year shall not
exceed an amount equal to 68.4% of the Taxes billed to Landlord
with respect to Xxx 0 xx Xxxxxxxxx Xxxxxx Xxx Xx. 0000.
Tenant shall not be chargeable with nor obligated to pay (a) any
tax of any kind whatsoever which may be imposed on Landlord
independent of the Premises or on the Rents payable hereunder,
(b) any interest or penalties payable as a result of Landlord's
failure to pay any Taxes or assessments prior to delinquency, or
(c) any license fees or other fees required to be paid by
Landlord in connection with the operation of all or any part of
the Shopping Center including the Premises, As used in this
Article 25, Taxes "due and payable" during the Lease Term shall
mean installments of Taxes for which the last date for payment
without interest or penalty occurs during a calendar year that
falls in whole or in part during the Lease Term (regardless of
whether the Taxes due for such calendar year are attributed to
another calendar year), it being understood however, that all
Taxes payable by Tenant under this Lease shall be prorated for
any partial calendar year at the beginning or end of the Lease
Term based on the number of days in such calendar year that fall
within the Lease Term.
Subject to the following, Tenant shall have the right to
contest, in good faith, the validity or the amount of any Taxes
levied against the Premises by such appellate or other
proceedings as may be appropriate in the jurisdiction.
Notwithstanding the foregoing, Tenant shall only have the right
to contest Taxes if Landlord declines to contest the validity or
amount of such Taxes upon written request of Tenant. The non-
contesting party5shall cooperate with the contesting party in
its institution and prosecution of any such proceedings and will
execute and will provide any documents reasonably required
therefore. 589 The expense of such proceedings shall be borne by
Tenant and any 59 refunds or rebates secured shall belong to
Tenant, net of expenses. 591 If Landlord contracts with any
outside consultants or for such services for purposes of seeking
any refunds or rebates of the Taxes, such contracts will be
written on a contingency basis not to exceed, without Tenant's
prior consent, one-third (1/3) of the savings.
22
Notwithstanding anything to the contrary contained herein, the
definition of Taxes shall not include, and Tenant shall have no
obligation to pay, any special assessments levied, pending or
assessed prior to the Commencement Date or which relate to the
initial construction of the Shopping Center.
Tenant shall at all times be solely responsible for and shall
pay before delinquency all municipal, county, state or federal
taxes assessed or levied against any leasehold interest
hereunder or any personal property of any kind owned, installed
or used by Tenant. If at any time during the term of this Lease,
a tax or excise on Rents or other tax, however described, is
levied or assessed against Landlord on account of or measured
by, in whole or in part, the Rent expressly reserved hereunder
(excluding any income, corporate franchise, corporate, estate,
inheritance, succession, capital stock, corporate loan,
corporate bonus, transfer or profit tax of Landlord) as a
substitute, in whole or in part, for taxes assessed or imposed
on land and buildings, such tax or excise on Rents or other tax
shall be included as a part of the real property taxes covered
hereby, but only to the extent of the amount thereof which is
lawfully assessed or imposed as a direct result of Landlord's
ownership of this Lease or of the Rent accruing under this
Lease. If any real property tax or assessment levied against the
land, buildings or improvements covered hereby or the Rents
reserved therefrom shall be evidenced by improvement or other
bonds or in other form which may be paid in installments,
Landlord shall, if permitted, elect such installment payment
plan and only the amount paid in any Lease Year shall be
included in the taxes for that Lease Year for purposes of this
Article.
26. RIGHT OF PROTEST.
Tenant may contest any mechanics' or other liens imposed against
the Premises (provided Landlord agrees and acknowledges that
Tenant shall have no responsibility with respect to liens
arising from Landlord's Work or other construction, repair or
maintenance undertaken by or on behalf of Landlord under this
Lease), provided Tenant believes in good faith that such liens
are not proper, and further provided that Tenant furnishes
Landlord reasonable security to ensure payment and to prevent
any sale, foreclosure or forfeiture of the Premises by reason of
such nonpayment. Tenant shall furnish to Landlord such security
as Landlord may reasonably request pursuant to the foregoing
sentence within thirty (30) days of receiving a written request
therefor. Upon a final determination of the validity of such
lien or claim, Tenant shall promptly pay any judgment or decree
rendered against Tenant or Landlord, including without
limitation all costs and charges and attorney fees, and shall
cause such lien to be released of record, all without cost to
Landlord.
27. COMMON AREAS.
Landlord or the designated manager/operator under the REA will
maintain in good order, condition and repair (comparable to
other like-kind shopping centers in the trade area) all areas
used in common by all tenants and other occupants of the
Shopping Center, which shall include the parking areas,
landscaping, sidewalks, driveways, pylon sign(s), and other like
areas as required by the REA (the "Common Areas"), and Landlord
hereby grants to Tenant, its agents, employees and invitees, the
nonexclusive right to use the Common Areas in common with other
tenants and occupants of the Shopping Center. Landlord shall not
use or permit the Common
23
Areas located in the Tenant Protected Parking Limits & Access
Area to be used in any manner so as to substantially interfere
with or reduce (i) access to the Premises from the road(s)
immediately outside the Shopping Center or critical access
drives shown on the site plan, (ii) parking in the Tenant
Protected Parking Limits & Access Area or (iii) Tenant's
operation of its business from the Premises. In each calendar
year, Tenant shall pay Landlord, as additional Rent, its
proportionate share of Landlord's Operating Costs (as
hereinafter defined). Tenant's proportionate share of Landlord's
Operating Costs shall be computed by multiplying Landlord's
Operating Costs by a fraction, the numerator of which is the
number of leasable square feet in the Premises and the
denominator of which is the number of leasable square feet in
all buildings (including mezzanines and basement areas, and
areas outside of each building if used for outdoor sales,
storage or similar use by any tenant(s) or other occupant(s) of
the Shopping Center) of the Shopping Center (and any other
buildings included within the tax parcel). Upon request from
Tenant, Landlord shall provide current documentation of the
leasable square footage of the Shopping Center. The foregoing
notwithstanding, until such time as all of the buildings (in
addition to the building on the Premises) to be constructed by
Landlord on Lot 1 of Certified Survey Map No. 3977 (a division
of Xxx 0 xx Xxxxxxxxx Xxxxxx Xxx Xx. 0000 recorded August 18,
2006 in Register of Deeds for Walworth County, WI as Document
No. 685693) have been constructed, Tenant's contribution to
Landlord's Operating Costs per Lease Year shall not exceed an
amount equal to 68.4% of Landlord's Operating Costs incurred
with respect to maintaining the Common Areas of Xxx 0 xxx Xxx 0
xx Xxxxxxxxx Xxxxxx Xxx Xx. 0000.
As used herein, the term "Landlord's Operating Costs" shall mean
actual out-of-pocket expenses reasonably incurred by Landlord to
maintain the Common Areas in the manner per the REA. Landlord's
Operating Costs shall include, without limitation, all costs and
expenses incurred by Landlord in maintaining, repairing,
lighting, cleaning, and removing snow, ice and debris from the
Common Areas per the specifications as set forth in the REA, if
any, or in the absence of specifications under the REA, per
Exhibit F attached hereto. In addition, Tenant shall pay to
Landlord an administrative fee that shall not exceed five
percent (5%) of Tenant's proportionate share of the approved
common area maintenance expenses642excluding real estate taxes,
common area utilities and Landlord's insurance. Notwithstanding
the foregoing, the following shall, in all events, be excluded
from Landlord's Operating Costs: depreciation, principal,
interest and other charges on debt; the cost of capital
improvements (as defined by generally accepted accounting
principles); overhead; promotional and similar fees; expenses
that are not paid for by every other tenant or occupant of
Landlord's Property; costs of repaving or replacing all or any
part of the parking area ( other than patching and similar
periodic maintenance such as striping); costs of maintaining,
repairing and replacing the foundation, exterior walls, roof and
roof membrane, of the Shopping Center, including the Premises
(provided that roof repairs shall be included in Landlord's
Operating Costs); costs to remove any Hazardous Substance(s)
(unless caused by Tenant); maintenance performed on outparcels
or other adjacent tracts not maintained by Landlord and/or not
reserved to the benefit of the Shopping Center occupants;
maintenance, repairs or replacements to the Common Areas
necessitated by the negligent or wrongful act of Landlord or
made to correct any construction defect; amounts paid to
entities related to Landlord in excess of the cost of such
services from any competitive source; amounts reimbursable from
insurance proceeds or warranties; services, repairs and
maintenance performed within an occupant's exclusive space which
is not part of the Common Areas; improvements, repairs or
replacements of parking areas (other than patching and similar
minor periodic maintenance such
24
as striping); reserves for anticipated future expenses; charges
covered elsewhere in this Lease; or other maintenance expenses
not considered normal or customary under generally accepted
accounting principles or shopping center industry standards.
Tenant's proportionate share of the estimated costs and expenses
for each calendar year and partial calendar year shall be paid
in monthly installments on the first day of each calendar month,
as additional Rent. Notwithstanding anything to the contrary
herein, in no event shall the amount that Tenant is obligated to
pay for Landlord's Operating Costs in any calendar year exceed
one hundred and five percent (105%) of the total amount that
Tenant was obligated to pay for Landlord's Operating Costs for
the previous calendar year, excluding real estate taxes, costs
of snow removal and utilities. Landlord shall provide a budget
based upon the Landlord's Operating Costs for the preceding
calendar year (the "Budget"), or Landlord may, at its sole
option, xxxx such actual costs and expenses monthly in arrears
from time to time but not more than one (1) time per calendar
month. Because Landlord's Operating Costs for the period prior
to the Commencement Date are unknown, from the Commencement Date
through the end of the first calendar year, Tenant shall pay to
Landlord, in monthly installments on the first day of each
month, the sum of $5,655.37 per month, which sum shall be
applied toward Tenant's proportionate share of Landlord's
Operating Costs actually incurred by Landlord during the first
calendar year.
Within ninety (90) days after the end of each calendar year or
portion thereof, or as soon thereafter as reasonably
practicable, Landlord shall furnish Tenant with a detailed
written statement outlining the type and amount of expenses
incurred or income received by Landlord and Tenant's
proportionate share of such costs and expenses for such period.
Upon written request, Landlord shall furnish to Tenant
photostatic copies of all bills, invoices and other reasonable
documentation supporting such actual costs and evidence of
Landlord's payment thereof (the "Budget Reconciliation"). If the
total amount paid by Tenant under this Article for any calendar
year shall be less than the actual amount due from Tenant for
such year as shown on the Budget Reconciliation, Tenant shall
pay to Landlord the difference between the amount paid by Tenant
and the actual amount due, such deficiency to be paid within
thirty (30) days after the furnishing of each Budget
Reconciliation. If the total amount paid by Tenant hereunder for
any such calendar year shall exceed such actual amount due from
Tenant for such calendar year, the amount of the overpayment
shall be credited against the next installment of additional
Rent due hereunder. If Landlord shall fail to provide the Budget
Reconciliation Tenant shall have the right to suspend upon ten
(10) days' notice to Landlord, additional common area
maintenance payments pending Tenant's receipt of the Budget
Reconciliation.
Landlord shall keep or cause to be kept the books and records
applicable to such Landlord's Operating Costs, Landlord's
insurance costs under Article 22 and Taxes under Article 25 for
a period of not less than three (3) years following the date of
Tenant's receipt of any Budget Reconciliation, but, in the event
of any dispute, such books and records shall be retained until
the final determination of such dispute. Upon thirty (30) days'
prior written notice given to Landlord within three (3) years
after Tenant receives any Budget Reconciliation issued by
Landlord as set forth above, Tenant may cause an audit to be
made during Landlord's normal business hours at Landlord's
headquarters of Landlord's records relating to Landlord's
Operating Costs and other additional Rent for the period covered
by any such Budget Reconciliation. Tenant shall
25
promptly pay to Landlord any deficiency or Landlord shall
promptly refund to Tenant any overpayment. In the event that any
audit discloses an overpayment of Landlord's Operating Costs
and/or other additional Rent by Tenant of more than three
percent (3%), then, in addition, Landlord shall pay the
reasonable costs and expenses incurred by Tenant in conjunction
with performance of such audit. Notwithstanding anything to the
contrary herein, Landlord hereby waives the right and shall not
be entitled to make any claim for an adjustment to the Budget
Reconciliation for any undercharges and/or underpayments of
Landlord's Operating Cost or other additional Rent following the
lapse of the lesser of (i) two (2) calendar years after the
outside date provided above for Landlord's tendering of the
Budget Reconciliation to Tenant or (ii) one (1) calendar year
following the end of the Lease Term (or any earlier termination
provided or permitted by this Lease).
28. ALTERATIONS TO SHOPPING CENTER.
Except as may be required by applicable Law, Landlord will not
place or permit to be placed by any person or entity other than
Tenant, any building, wall, landscaping, fence or other
improvement or make any other alterations or changes to the
Tenant Protected Parking Limits & Access Area of the Shopping
Center other than improvements shown on Exhibit B as existing or
planned without Tenant's prior written approval, which approval
shall be granted, withheld or conditioned in Tenant's sole and
absolute discretion. In the event that Landlord shall acquire
control of real property immediately adjacent to the Shopping
Center, Landlord shall not without Tenant's prior written
approval, which approval shall be granted, withheld or
conditioned in Tenant's sole and absolute discretion, permit or
make changes that would materially interfere with ingress to or
egress from the Premises, materially alter vehicular traffic
paths or routes within the Shopping Center, or materially reduce
or restrict visibility of Tenant's storefront, blue wedge or
Tenant's signage7 or any of Tenant's rights under this Lease.
Subsequent to the Delivery Date, Landlord agrees to exercise
commercially reasonable efforts to minimize any interference
with the completion of the construction of the Premises, the
fixturing and merchandising thereof, and further agrees, from
and after the date Tenant opens for business to the public from
its Premises, (a) to limit all construction staging to the rear
of the Shopping Center; (b) to permit no construction of, or
scaffolding upon, the front of any building in the Shopping
Center between the dates of November 15 and January 1st of any
Lease Year, except in the event of an emergency; and (c) to have
any scaffolding within the Shopping Center removed within
seventy-two (72) hours of completion of the work for which it
was necessary. In the event Landlord shall fail to correct any
violation of this Article within three (3) business days from
its receipt of written notice thereof from Tenant, Tenant shall
be entitled to either liquidated damages of One Thousand and
No/100 Dollars ($1,000.00) per day for each day thereafter that
such condition remains a violation hereunder.
Landlord and Tenant agree that the Shopping Center shall not
contain any outparcel(s) except in the location(s) shown on the
site plan attached hereto as Exhibit B. Any building or
improvement to be constructed on such approved outparcel shall
be as follows:
(a) be a single-story structure of not more than fifteen
thousand (15,000) square feet of building area;
26
(b) be limited to twenty-eight feet (28') in height to the
highest point of any roof, wall, parapet, or screening or other
improvement; and
(c) and have a self-contained parking field in compliance with
all applicable Laws as if it were a free-standing site without
benefit of cross-parking rights as to the balance of the
Shopping Center.
29. INTENTIONALLY DELETED
30. EXCLUSIVITY AND USE.
Landlord represents, warrants and covenants to and with Tenant
that Tenant may lawfully use the Premises for sales, rental,
service (including installation, testing, repair, maintenance
and servicing of computer related items) and warehousing (and if
applicable, installation in motor vehicles) of the product
categories listed below, other products typically sold in the
majority of Tenant's stores, and thereafter for any lawful use
subject to the provisions of the Lease, the prohibited uses set
forth in Exhibit H, if any, and any future exclusives granted by
Landlord in the Shopping Center not in violation of the "Article
30 Restrictions", as defined in the Lease) and Landlord shall
not permit any person or entity other than Tenant732 (or
Tenant's parent company, affiliates, assignees, sublessees and
assigns) in space leased directly or indirectly from Landlord
within a radius of one (1) mile of the Shopping Center, to sell,
rent, service (including installation, testing, repair,
maintenance and servicing of computer related items) and/or
warehouse (and, if applicable, install in motor vehicles) the
following product categories (regardless of whether new, used or
refurbished): electronic equipment or appliances (including,
without limitation, televisions, stereos, radios and dvd or
video machines); major household appliances (including, without
limitation, refrigerators, freezers, stoves, microwave ovens,
dishwashers, washers and dryers); personal computers and
peripherals, computer software; digital, downloadable and
streamable entertainment; car radios, stereos, tape decks or
phones; entertainment software, including compact discs, music
videos, dvds and prerecorded tapes; accessories and connectors
for products sold by Tenant (including, without limitation,
cable connectors, surge protectors, cables, wires and
batteries); telephones, telecopy, facsimile and photocopy
machines; photographic cameras or equipment; office equipment,
supplies or office furniture; books and magazines; any
substitutes for or items which are a technological evolution of
the foregoing items; and/or any other related items carried in a
majority of Tenant's stores without Tenant's prior written
consent, which may be granted or withheld in Tenant's sole and
absolute discretion 738.
In addition to the foregoing, Tenant shall have the right to (a)
sell gourmet and other food items in support of and incidental
to the foregoing product categories, not to exceed 2,000 square
feet of floor area, and (b) use up to ten percent (10%) of the
Premises not to exceed 2,000 square feet of floor area for a non-
alcoholic beverage kiosk or bar, including seating area, with
food, snack and bakery items incidental thereto. "Landlord", for
purposes of this Article, shall be defined to include Landlord,
and (i) if Landlord is a corporation, its principal
shareholders; or (ii) if Landlord is a partnership, its partners
and any principal shareholders or partners of any partner which
is a corporation or shareholder; or (iii) if Landlord is a
trust, the beneficiaries of any such
27
trust, including the principal shareholders or partners of any
beneficiary which is a corporation or trust, all of whom shall
execute an agreement to be bound to this Article. The
restrictions set forth in this Article 30 are hereinafter
collectively referred to as the "Article 30 Restrictions".
The Article 30 Restrictions shall not be applicable to (i) a
Target retail store at the Shopping Center, (ii) a Xxxxxx &
Noble retail store, and a Borders retail store, provided Tenant
and such merchants execute a mutually acceptable letter
agreement to the extent such merchants have executed similar
letter agreements on previous occasions, (iii) any other tenant
or occupant of the Shopping Center so long as any other tenant's
or occupant' s display of products and/or services protected by
Tenant's exclusive does not exceed the lesser of 500 square feet
or five percent (5%) of its gross leasable area.
Landlord shall only be in violation of the Article 30
Restrictions if (i) Landlord after the date of February 28, 2007
enters into a lease or other agreement with a tenant or other
occupant expressly permitting it to engage in a business in
violation of the Article 30 Restrictions, or (ii) Landlord's
consent is required for any change to a permitted use, and after
the date of February 28, 2007, Landlord consents to change such
use to permit a use in violation of the Article 30 Restrictions,
or (iii) Landlord makes an initial sale of an outparcel in
violation of the Article 30 Restrictions. Landlord shall not be
in violation of the Article 30 Restrictions if a business has
been permitted to assume a lease or operate its business based
upon or as result of a bankruptcy, insolvency or similar action
or an action or order by a court.
Notwithstanding anything to the contrary that may be contained
in this Lease, in the event of a violation of this exclusivity
provision by Landlord, Tenant shall, in addition to any other
legal or equitable remedy, including specific performance, have
the automatic right upon ten (10) days written notice to
Landlord to: pay Rent in lieu of that provided for herein at the
rate of one-half (1/2) of the Rent otherwise payable under this
Lease until such time as Landlord cures any violation of this
exclusivity provision, whereupon Tenant's obligation to pay Rent
due under the Lease shall commence once again. It is
specifically understood and agreed between Landlord and Tenant
that Tenant shall have no obligation whatsoever to reimburse
Landlord for any Rent not paid by Tenant attributable to the
period of any Landlord's default under this Article 30. If a
violation of this Article 30 is not eliminated or corrected to
Tenant's satisfaction within 365 days of its occurrence, then
Tenant shall have the right to terminate this Lease upon thirty
(30) days' written notice, and unless Landlord eliminates the
violation within the thirty (30) day notice period, this Lease
shall terminate on the last day of the first full month
following expiration of the thirty day notice period. 754
31. HAZARDOUS SUBSTANCES.
(a) Environmental Assessment. Landlord has provided Tenant
a Phase I environmental assessment report dated May
31, 2006, prepared by ATC Associates, Inc., a
qualified environmental testing company indicating
that except as noted in the Report:
(i) The property described in Exhibit A (the
"Premises" for purposes of this
Article) is not listed in the United States
Environmental Protection
28
Agency's National Priorities List of Hazardous
Waste Sites, nor any other list, schedule, log,
inventory or record of any Hazardous Substance(s)
or hazardous waste sites, whether maintained by
the United States government or any state or
local agency;
(ii) A review of the history of ownership and uses has revealed
no evidence that the Premises has at any time been used for
the generating, transporting, treating, storage, manufacture,
emission of, disposal of, refining or handling asbestos,
polychlorinated biphenyls (PCB's), or any other dangerous,
toxic or hazardous pollutants, chemicals, wastes or
substances (each, a "Hazardous Substance") as defined in the
Federal Comprehensive Environmental Response Compensation and
Liability Act of 1980, as amended, or the Federal Resource
Conservation and Recovery Act of 1976, the Federal Water
Pollution Control Act, the Clean Air Act, any laws or
regulations relating to underground storage tanks, or any
other federal, state or local environmental laws,
statutes, regulations, requirements and ordinances;
(iii) In the opinion of the inspector, the Premises
represents a "low risk" of contamination;
(b) Warranty. Landlord hereby warrants and represents that
except as may be disclosed in the environmental assessment
report,: (a) the Premises has never been used by current or
previous owners or occupants to generate, transport, treat,
store, manufacture, emit, dispose of, refine or handle any
Hazardous substance(s), (b) the Premises does not contain any
underground storage tanks or any Hazardous Substance(s); (c)
Landlord has not received a summons, citation, directive, letter
or other communication, written or oral, from any state agency
or the U.S. Government concerning the Premises or any
intentional or unintentional action or omission on Landlord's
part as a result of the releasing, spilling, leaking, pumping,
pouring, emitting, emptying or dumping of any Hazardous
Substance(s) into waters or onto lands of the state in which the
Premises is located, or into water outside the jurisdiction of
the state in which the Premises is located, and the Premises is
not subject to any "superfund" type liens or claims by
governmental regulatory agencies or other third parties arising
from the release or threatened release of any Hazardous
Substance(s)s in, on or about the Premises; and (d) it has
furnished Tenant with copies of all environmental reports in its
possession or control as to the Premises.
(c) Indemnification. Landlord shall indemnify, defend and hold
Tenant harmless from and against any and all actual loss, cost,
liability, damage or expense (including without limitation
reasonable attorney's fees, investigation and court costs)
(excluding consequential, special or punitive damages), which
Tenant may incur, sustain or suffer or which may be asserted
against Tenant by reason of the presence of Hazardous Substances
prior to the Delivery Date or their introduction by Landlord any
cleanup or response costs, fines or penalties resulting from a
29
release or a threatened release of any materials
defined in paragraph (b) above; and any actual
personal injury, death, property, property damage,
business losses, or damage to the environment.
32. ESTOPPEL CERTIFICATE.
Landlord and Tenant agree within ten (10) business days after
request therefor by the other to execute in recordable form and
deliver a statement, in writing, certifying (a) that this Lease
is in full force and effect, (b) the Commencement Date of this
Lease, (c) that Rent is paid currently, (d) the amount of Rent,
if any, paid in advance, (e) that there are no uncured defaults
by Landlord or stating those claimed by Tenant, and (f) such
other information as may be reasonably requested and reasonably
agreed to be provided; provided that, in fact, such facts are
accurate and ascertainable.
33. PARKING.
Landlord covenants and agrees that the parking areas of the
Shopping Center shall at all times satisfy the following
criteria as to the ratio of parking spaces (measuring a minimum
of nine feet (9') by eighteen feet (18')) of:
(a) four and five tenths (4.5 cars per one thousand (1,000)
square feet of building retail area,
(b) parking spaces for restaurants will be as required under
the REA
Notwithstanding anything to the contrary that may be contained
in Article 16.2, if Landlord shall fail to comply with this
Article, after written notice and the expiration of a 60-day
cure period within which Landlord may satisfy the parking
requirements described above by providing replacement or
alternative parking Tenant shall, in addition to any other legal
or equitable remedy, including specific performance, have the
right upon ten (10) days written notice to Landlord to pay Rent
in lieu of that provided for herein at the rate of one-half
(1/2) of the Rent otherwise payable under this Lease until such
time as the above-specified parking ratio is maintained If such
failure to maintain the parking ratios required has not been
corrected or resolved to Tenant's satisfaction within 365 days
after its occurrence, then Tenant shall have the right to
terminate this Lease upon thirty (30) days' written notice, and
unless Landlord corrects the deficiency within the thirty (30)
day notice period, this Lease shall terminate on the last day of
the first full month following expiration of the thirty day
notice period.
34. ATTORNEY'S FEES.
In the event of a default, or an alleged or asserted default, in
the performance of any of the terms, covenants, agreements or
conditions contained in this Lease, and a suit is actually
filed, a final determination is made by a court of competent
jurisdiction, then the prevailing party shall be entitled to,
and the other party shall pay, all of the prevailing party's
costs and expenses, including reasonable attorneys' fees, which
were incurred in connection with the action. The determination
of the prevailing party will be made by the court.
Notwithstanding the above, the
30
plaintiff shall not be considered the prevailing party unless
the plaintiff prevails in a majority of its claims. If Landlord
is responsible for and fails to pay any such fees within ten
(10) days after demand, Tenant may deduct the amount of such
fees from the fixed rent and other charges otherwise due
hereunder.
35. BROKERAGE.
Landlord and Tenant hereby represent and warrant to each other
that (i) other than Xxx Parrot of CB Xxxxxxx Xxxxx representing
Landlord and Xxx Xxxxx of Mid America Real Estate representing
Tenant,(collectively the "Brokers") and the brokerage fees to be
paid to the Brokers pursuant to Landlord's separate agreement
with the Brokers (the "Brokers' Fees")790 each has not dealt
with any other brokers or agents and that there are no other
side letters, contracts or agreements relating to, or entitling
others to share or participate in, brokerage fees, commissions,
finder's fees or other similar charges, (ii) other than the
Brokers fees, no other brokerage fees, commissions, finder's
fees or other similar charges are owed to any persons, entities
or other parties in connection with this Lease, and (iii)
Brokers are the only brokers involved and the Brokers Fees are
the only brokerage fees due and payable in connection with this
Lease:
Landlord and Tenant each agree to defend, indemnify and hold the
other party harmless from any loss, claim, liability or
obligations with regard to any breach of the foregoing
representation or warranty by the indemnifying party thereto. In
the event that Landlord fails to pay the Brokers' Fees to the
Brokers, Tenant shall have the right, but not the obligation, to
pay the Brokers' Fees to the Brokers. In the event that Tenant
pays all or any portion of the Brokers' Fees, Landlord agrees
that Tenant shall have the right to offset against fixed rent
and other amounts payable under this Lease for the total amount
of the Brokers' Fees paid by Tenant, until the Broker's Fees and
interest are paid in full.
36. NOTICES.
Any notice or consent required to be given by or on behalf of
either party to the other shall be in writing and given by
mailing such notice or consent by either (i) one (1) business
day after sending by an overnight courier service, or (ii) two
(2) business days after sending by registered or certified mail,
return receipt requested, addressed to the other party as
indicated in Article I.F hereof, or at such other address in the
United States as may be specified from time to time in writing
by either party. Any notice or consent given hereunder by either
party shall be deemed effective when mailed as aforesaid, but
the time period in which to respond to any notice or consent
shall commence to run on the date on which such notice or
consent is actually received by the addressee. Refusal to accept
delivery shall be deemed receipt thereof.
37. MISCELLANEOUS.
37.1 Severability of Provisions. If any term or provision
of this Lease, or the application thereof to any person or
circumstance, shall to any extent be determined to be invalid or
unenforceable by a court of competent jurisdiction, then the
remainder of this Lease, or the application of such term or
provision to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected
thereby.
31
37.2 Memorandum of Lease. Neither party may record this
Lease. Upon execution of this Lease, however, Landlord and
Tenant shall join in the execution of a memorandum or so-called
"short form" of this Lease for the purposes of recordation
("Memorandum of Lease") substantially in the form attached
hereto as Exhibit G and made a part hereof. Landlord shall see
that an original Memorandum of Lease is recorded in the
appropriate real estate records office for the county in which
the Premises are located. Any fees required to be paid in order
to prepare or record such Memorandum of Lease shall be paid by
Landlord. In the event of any conflict between the provisions of
the Memorandum of Lease and the Lease, the Lease shall control.
37.3 Entire Agreement. This instrument shall merge all
undertakings between the parties hereto with respect to the
Premises and upon execution by both parties shall constitute the
entire lease agreement, unless thereafter modified by both
parties in writing. In the event Landlord shall execute this
Lease prior to Tenant, Tenant shall have ten (10) days to accept
the terms hereof and to execute this Lease, during which time
Landlord's execution shall constitute an irrevocable offer.
37.4 Relationship of the Parties. Nothing contained in this
Lease shall be deemed or construed by the parties hereto or by a
third party to create the relationship of principal and agent or
of partnership or of joint venture of any association whatsoever
between Landlord and Tenant, it being expressly understood and
agreed that neither the method or computation of Rent nor any
other provision contained herein, nor any act or acts of the
parties hereto, shall be deemed to create any relationship
between Landlord and Tenant other than_ the relationship of
lessor and tenant.
37.5 Importance of Each Covenant. Each covenant and
agreement on the part of one party hereto is understood and
agreed to constitute an essential part of the consideration for
each covenant and agreement on the part of the other party.
37.6 Headings. The headings of the Articles of this Lease
are for convenience of reference only and do not form a part
hereof, and they shall not be interpreted or construed to
modify, limit, or amplify the intent of such Articles.
37.7 Parties in Interest. Subject to the provisions of this
Lease relating to assignment, subleasing and other transfers of
the parties' interests, this Lease shall inure to the benefit of
and be binding upon the successors in interest and assigns of
the parties hereto.
37.8 Counterparts. This Lease may be executed in any number
of counterparts, each of which shall be deemed to be an
original, but all of which shall constitute one and the same
instrument.
37.9 Number and Gender. Words in the singular, plural,
masculine, feminine and neuter as used herein shall have the
meanings and be construed as required by the context in which
they are used herein.
32
37.10 Governing Law. This Lease shall be construed and
governed by the laws of the State in which the Premises are
located. Should any provisions be illegal or not
enforceable under the laws of the said State, it or they
shall be considered severable, and the Lease and its
conditions shall remain in force and be binding upon the
parties as though the said provisions had never been
included.
37.11 Prorations. Any prorations to be made under this
Lease shall be based on a 365 day year.
37.12 Confidentiality. The parties agree that the
terms and conditions of this Lease are to remain
confidential and may not be disclosed to any third party
without the other party's prior written consent except for
disclosures as shall be reasonably necessary in the conduct
of such party's business such as disclosures to such
party's attorneys, lenders and potential buyers and
disclosures as shall be necessary by applicable law.
37.13 Construction. Landlord and Tenant each agree
that this Lease was fully and mutually negotiated by the
parties such that this Lease and the provisions hereof
shall not be construed against either party based on such
party's drafting or alleged drafting of same.
37.14 Force Majeure . As used herein, the term "Force
Majeure" shall mean any prevention, delay or stoppage due
to tornado, earthquake, or hurricane, which shall excuse
the performance of such party for a period of time equal to
such prevention, delay or stoppage resulting from the
tornado, earthquake or hurricane. 825
37.15 Landlord's Liability. The liability of Landlord
to Tenant for any default by Landlord under the terms of
this Lease shall be limited to Tenant's actual direct, but
not consequential, special or punitive damages and shall be
recoverable only from the interest of Landlord in the
Shopping Center, and Landlord shall not be personally
liable for any deficiency. This Section shall not limit any
remedies which Tenant may have for Landlord's defaults
which do not involve the personal liability of Landlord
II. EXHIBITS.
Attached hereto and made a part of this Lease are Exhibits
A through H.
IN WITNESS WHEREOF, the parties hereto have executed this
Lease as of the date first above written.
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33
LANDLORD:
XXXX COMPANIES US, INC. a
Minnesota corporation
Date: 2/27, 2007 By: /s/ X X XxXxxx
Name: X. X. XxXxxx
Its: Executive Vice President
TENANT:
BEST BUY STORES, L.P., a Xxxxxxx limited
partnership
By: BBC Property Co., a Minnesota
corporation, its general partner
Date: 2/27, 2007 By: /s/ Xxx Xxxxx
Name Xxx Xxxxx
Its: Vice PResident Real Estate
EXHIBIT A
Legal Description of Shopping Center
PARCEL 1
Lots 1 and 3 of Certified Survey Map No. 3977, a division
of Xxx 0 xx Xxxxxxxxx Xxxxxx Xxx Xx. 0000, recorded August
18, 2006 in the office of the Register of Deeds for
Walworth County, as Document No. 685693, being part of the
Southeast 1/4 of the Southwest 1/4 and the Southwest 1/4
of the Southeast 1/4 of Section 30, Town 2 North, Range 18
East, in the City of Lake Geneva, Walworth County,
Wisconsin.
PARCEL 2:
Easement for the purpose of access as shown in an Access
Easement recorded on October 6, 2006 as Document No.690249.
PARCEL 3:
The easements and such other interests as are recognized
as real property interests under the laws of the State of
Wisconsin granted to the insured for the benefit of
PARCEL 1 created by that certain Operation and Easement
Agreement between Target Corporation and Xxxx Companies US,
Inc. dated October 5, 2006 and recorded October 6, 2006 as
Document No. 690251.
PARCEL 4
Easement for the purpose of constructing and maintaining a
retaining wall as shown in a Grading Easement recorded on
November 13, 2006 as Document No. 693552.
NOTE: The aforesaid easement is in the process of
being recorded. Recording information will be
forwarded upon confirmation of recording by the
Register of Deeds.
Tax Key No. ZA 399700001 and ZA 399700003
