1
MXF SFDOCS\88790 2 58794 0002 08/31/98
Bennigan's Unit No. 0525
Arcadia, CA
SUBLEASE
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THIS SUBLEASE ("Sublease") is made and entered into as of September 1,
1998, by and between STEAK AND ALE OF CALIFORNIA, INC., a Nevada corporation
(the "Sublessor"), and X.X.'S CHICAGO PIZZA & BREWERY, INC., a California
corporation (the "Subtenant"), with respect to the following facts:
RECITALS:
A. Under a certain Lease Agreement dated as of June 17, 1987 (the
"Lease"), a true, correct, complete and legible copy of which is attached
hereto as Exhibit A, Sublessor leased from ARCADIA GATEWAY CENTRE ASSOCIATES,
LTD., a California Limited Partnership ("Master Landlord"), certain improved
commercial real estate commonly known as 000 Xxxx Xxxxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxxxx 00000-0000 (the "Premises"). Initially capitalized terms not
otherwise defined herein shall have the meanings ascribed to such terms in the
Lease.
B. Sublessor desires to sublease the Premises to Subtenant and to
sell to Subtenant its leasehold interest (in the form of a sublease), property
improvements (which are not considered part of the leasehold), furniture
fixtures and equipment (collectively, "FF&E") and the Type 47 alcoholic
beverage license (the "LIQUOR LICENSE") relating to the Premises, and
Subtenant desires to sublease the Premises from Sublessor and to purchase from
Sublessor its leasehold interest (in the form of a sublease), FF&E and Liquor
License relating to the Premises, upon the terms and conditions set forth
herein.
NOW, THEREFORE, for and in consideration of the preceding Recitals, which
are intended by the parties to constitute a portion of this Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereby agree as follows:
1. SUBLEASE GRANT. Effective as of the "Commencement Date" (as defined in
Paragraph 4. below), Sublessor does hereby sublease the entire Premises to
Subtenant, and Subtenant does hereby sublease the Premises from Sublessor, for
the "Term" (as defined below in Paragraph 3) and upon the conditions
hereinafter set forth.
2. ESCROW. Not later than 10 days after the date of this Sublease, the
parties shall open an escrow with Commerce Escrow in Los Angeles, California
(the "ESCROW COMPANY") to facilitate the consummation of the Liquor License
transfer to Subtenant. Both parties shall cooperate in good faith to execute
and deliver to Escrow Company escrow instructions consistent with this
Sublease. Concurrently with the opening of the escrow with the Escrow
Company, Subtenant shall remit to Escrow Company the sum of $12,000 (the
"Purchase Price") to be applied against the "Purchase Price" (as hereinafter
defined). Each party shall bear one-half of the cost of the escrow. Not
later than five (5) days following (i) the approval of the California Alcohol
Beverage Commission (the "ABC") of the transfer of the Liquor License to
Subtenant, and (ii) the issuance by the California Employment Development
Department of a clean certificate showing no amounts due by Sublessor, (iii)
the issuance by the California Board of Equalization of a clean certificate
showing no amounts due by Sublessor, Escrow Company shall transfer the Liquor
License to Subtenant and remit the Purchase Price (less Sublessor's share of
Escrow Company's expenses) to Sublessor.
3. TERM AND POSSESSION. The term of this Sublease (the "TERM") will
commence on the "Commencement Date", and shall end on the date June 30, 2008
("EXPIRATION DATE"), or on such earlier date upon which the Term may expire or
be terminated pursuant to any of the conditions or limitations or other
provisions of the Lease, this Sublease or pursuant to applicable law. Nothing
contained herein shall obligate Sublessor to exercise any Term renewal options
granted in the Lease, and under no circumstances shall Sublessor have any
liability whatsoever under the Lease or this Sublease for any extension of the
Term based on the exercise of a renewal option by Subtenant. In the event
Subtenant and Master Landlord agree that Subtenant may lease the Premises
from and after the Expiration Date, then such renewal agreement shall be
deemed to be a novation of the Lease with Subtenant as the tenant thereunder,
and accordingly Sublessor shall have no further liability under the Lease.
Subtenant assumes all responsibility and liability for the right to and terms
of, the renewal option(s) and the exercise of such option(s).
4. COMMENCEMENT DATE. As used herein, the term "COMMENCEMENT DATE" shall
mean the date on which each of the following shall have occurred: (I) the
Master Landlord shall have approved this Sublease, the Subtenant and the
Subtenant's financial statements in accordance with the terms and requirements
of the Lease, (II) Subtenant shall have qualified for, at its own expense
using all necessary due diligence, a building permit from the City of Arcadia,
California, for the proposed renovations of the Premises (the "BUILDING
PERMIT") in accordance with plans and specifications approved by both Master
Landlord and Sublessor, and (III) Sublessor shall have tendered possession of
the Premises to Subtenant. Subtenant shall immediately notify Sublessor when
a Building Permit is ready to be issued to Subtenant for the Premises. If for
any reason the Commencement Date has not occurred on or before the 60th day
following the date of this Sublease, then, unless the parties have agreed in
writing prior thereto to extend the term of this Sublease, this Sublease shall
automatically terminate and be of no further force or effect, and all amounts
held in escrow pursuant to the escrow established under paragraph 2 above and
any documents deposited in escrow shall be returned to the party making such
deposit(s).
a. Prior to the Commencement Date, Subtenant and its contractors,
consultants and agents may visit the Premises by giving reasonable advance
notice to and coordinating such visits with, Xxxxxxxxxx X. Xxxxxxxx, the
Director of Real Estate for Sublessor. Subtenant hereby holds harmless and
indemnifies Sublessor from and against any and all claims, suits, actions and
mechanic's lien claims arising out of or in any way related to the entry by
Subtenant, its contractors , consultants or agents onto the Premises for any
purpose prior to the Commencement Date.
b. On the Commencement Date, Subtenant shall wire transfer to Sublessor an
amount equal to Sixty-Three Thousand Dollars ($63,000.00) in full payment for
the FF&E, and upon receipt of such funds, Sublessor shall deliver to Subtenant
a Xxxx of Sale for the FF&E in the form of Exhibit B attached hereto and
incorporated herein by this reference.
c. Commencing on the Commencement Date and continuing at all times
thereafter during the Term hereof, Subtenant shall pay to Sublessor all real
estate taxes and assessments assessed against the Premises, all insurance
charges, all common area costs relating to the Premises, and any other charges
and costs payable by Subtenant under the terms of the Lease (collectively, the
"EXPENSE PAYMENTS"). Such Expense Payments shall be made to Subtenant on the
first day of the calendar month following the Commencement Date and shall
continue on the first day of each month thereafter in arrears. If the
Commencement Date of the Term begins or ends on a day other than the first or
last day of a month, the Expense Payments (and Base Monthly Rent as provided
below) for the partial month shall be prorated at the rate of one-thirtieth
(l/30th) of the Base Monthly Rent for each day of such partial month. The
current Expense Payments are approximately $34,612.00 per year.
d. As used herein, the term "ADDITIONAL RENT" shall collectively mean any
payment obligation on the part of Subtenant to Sublessor, including without
limitation the Percentage Rent and any other such payment denominated as
"additional rent." All payments due hereunder to Sublessor herein reserved or
payable shall be paid to Sublessor at 0000 Xxxxxxxxxxxxx Xxxxxxx, Xxxxx, Xxxxx
00000, Attention: Lease Administrator, or at such other place as Sublessor may
designate from time to time in writing, in lawful money of the United States
of America.
e. Subtenant agrees to pay, as additional rent, all common area
maintenance, utilities and all other common area charges payable under the
Lease and when the same are due and payable. It is the expressed intention of
Sublessor and the Subtenant that Sublessor shall not have to pay or incur any
further amounts under the Lease and that Subtenant shall pay and perform all
of Sublessor's obligations thereunder.
5. BASE MONTHLY RENT AND PERCENTAGE RENT. As used herein, the term "RENT
COMMENCEMENT DATE" means the 91st day following the Commencement Date. On the
Rent Commencement Date, "Base Monthly Rent" and "Percentage Rent" shall
commence.
a. As used herein, "BASE MONTHLY RENT" means the following monthly and
annual base monthly rent:
Monthly Base Rental Annual Base Rental
--------------------- ------------------
Rent Commencement
Date - June 30, 2003 $9,950.00 $119,400.00
July 1, 2003 -
June 30, 2008 $11,535.00 $138,420.00
Accordingly, commencing on the first day of the calendar month which occurs
after the Rent Commencement Date and continuing on the first day of each month
thereafter, Subtenant shall pay to Sublessor, as base monthly rent, in
advance, without deduction, setoff, abatement, notice, or demand, the sums
shown above.
b. As used herein, "PERCENTAGE RENT" means the following for each calendar
period, prorated on a monthly basis for any period of less than a full
calendar year:
Percentage Rent
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Commencement Date
-June 30, 2003 3% in excess of $3,400,000.00 of "Gross Receipts" as
defined in the Lease.
July 1, 2003
-June 30, 2008 3% in excess of $3,600,000.00 of "Gross Receipts" as
defined in the Lease.
On a calendar quarterly basis, the Subtenant shall pay Percentage Rent to
Sublessor, as additional rent under this Sublease, in the amounts shown above
measured from the Commencement Date for each quarter-annual period thereafter
during the Term. The parties recognize that the formula for the payment of
Percentage Rent hereunder differs from the formula contained in the Lease.
The Percentage Rent shall be due and payable as provided in the Lease, except
that the Percentage Rent shall be paid solely to Sublessor. In addition to
the Master Landlord, Sublessor shall have all of the rights accorded to the
Master Landlord under the Lease and Subtenant shall have all of the
obligations of the Tenant thereunder, with respect to the Percentage Rent. In
addition, the Subtenant shall deliver to Sublessor all of the statements and
reports required to be maintained and provided by Sublessor under the Lease,
and Subtenant hereby grants its irrevocable continuing permission to Sublessor
to copy and deliver Subtenant's statements and reports to the Master Landlord.
6. PURCHASE OF PROPERTY IMPROVEMENTS AND FF&E. Subtenant hereby agrees to
purchase from Sublessor all of the FF&E currently located on the Premises,
except the following items:
EXCLUDED FROM PURCHASE:
1. All trademarked and proprietary items, including china.
2. The point of sale system, including all hardware and software.
3. Any liquor inventory.
a. The purchase of the Property Improvements shall occur on the
Commencement Date. The purchase price shall be $63,000 for the FF&E. THE
SALE OF SUCH FF&E SHALL BE MADE BY Sublessor to Subtenant ON AN "AS-IS,
WHERE-IS" BASIS WITHOUT RECOURSE OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED,
INCLUDING ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE OR OTHERWISE, ALL SUCH WARRANTIES BEING EXPRESSLY EXCLUDED.
On the Commencement Date, Sublessor shall deliver to Subtenant a xxxx of sale
for the FF&E.
b. The Subtenant acknowledges that the elements remaining within the
Premises from the standard Bennigan's artifact package must be used by the
Subtenant in a manner so as to "de-identify" the Premises from the distinctive
Bennigan's "look," "feel," "total image" and "trade dress."'
7. SALE OF ALCOHOLIC BEVERAGE LICENSE. Subject to the approval of the
California Alcohol Beverage Control (the "ABC"), Subtenant hereby agrees to
purchase from Sublessor the Type 47 Alcoholic beverage license for the
Premises (the "ALCOHOLIC BEVERAGE LICENSE") for a purchase price of
$12,000.00. Upon the execution and delivery of this Sublease, both Sublessor
and Subtenant agree to fully cooperate with each other and to promptly and
diligently all steps respectively required to be taken to effectuate the
transfer of the Liquor License, including the opening of an escrow with the
Escrow Company
8. LEASE PROVISIONS. Subtenant acknowledges that it has reviewed the
Lease and is familiar with the contents thereof, and that this Sublease is
subordinate and subject to the Lease. As between Sublessor and Subtenant,
Subtenant assumes and agrees to be primarily liable for the performance of all
of the obligations (affirmative, negative, monetary and/or non-monetary) which
are imposed upon Sublessor under the Lease, except to the extent that such
obligations have been expressly modified by this Sublease; provided, however,
that the obligation to pay Base Monthly Rent, Percentage Rent, additional
rent, operating costs and other amounts payable to the Master Landlord under
the Lease will be considered performed by the Subtenant to the extent and in
the amount Base Monthly Rent, Percentage Rent, additional rent, operating
costs and such other amounts payable under the Sublease are actually paid by
Subtenant to Sublessor in good funds in accordance with Sections 3 and 4 of
this Sublease.
a. Subtenant shall not commit or suffer any act or omission that will
violate or breach any provision of the Lease. If the Lease gives Sublessor
any right to terminate the Lease with respect to the Premises in the event of
the partial or total damage, destruction, or condemnation of the Premises or
the building in which the Premises are located, the exercise of such right
shall not constitute a default or breach hereunder. In no event shall
Sublessor be obligated to cure any default under the Lease caused by
Subtenant; provided, however, that Sublessor shall have the right in its sole
discretion, but not the obligation to effectuate any such cure without
inquiring in to the validity of the Master Landlord's demand or claims. In
the event Sublessor does so, then the amount so paid by Sublessor shall be due
and payable by Subtenant on demand of Sublessor and shall bear interest at the
Applicable Interest Rate" from the date expended by Sublessor until the date
repaid in full by Subtenant. As used herein the term "APPLICABLE INTEREST
RATE" means the rate per annum equal to the greater of (a) five percent (5%)
per annum plus the then federal discount rate on advances to member banks in
effect at the Federal Reserve Bank of San Francisco on the 25th day of the
month preceding the date of this Sublease, or (b) ten percent (10%). However,
in no event will the Applicable Interest Rate exceed the maximum interest rate
permitted by law that may be charged under these circumstances. The payment
of interest at the Applicable Interest Rate shall be considered as Additional
Rent hereunder.
9. MAINTENANCE AND REPAIRS.
a. This Sublease is intended to be a "triple net" sublease; and ,
therefore, as between Sublessor and the Subtenant, the Subtenant assumes and
agrees to perform, observe and comply with all of the obligations
(affirmative, negative, monetary and/or non-monetary) which are imposed upon
Sublessor under the Lease, except to the extent that such obligations have
been expressly modified by this Sublease.
b. Unless otherwise required to be maintained by the Master Landlord, the
Subtenant shall maintain in good order and operating condition and make all
necessary repairs to all improvements, fixtures and equipment comprising the
entire Premises, including the interior and exterior walls, the roof, the roof
membrane, the foundation, all mechanical and electrical equipment, HVAC
systems and equipment, and all other structural aspects of the Premises and
the parking areas attached thereto. Subtenant agrees to keep in effect an
HVAC maintenance contract during the entire Term which requires at least two
inspections during each Lease Year. Subtenant agrees to deliver a copy of
such maintenance contract upon request by Sublessor. THE SUBLEASE OF THE
PREMISES IS BEING MADE BY SUBLESSOR TO SUBTENANT ON AN "AS-IS, WHERE-IS" BASIS
WITHOUT RECOURSE OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING ANY
EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE OR OTHERWISE, ALL SUCH WARRANTIES BEING EXPRESSLY EXCLUDED. Sublessor
shall have no responsibility to make any repairs, improvements or capital
expenditures during the term of this Sublease. SUBTENANT HEREBY ASSUMES THE
RESPONSIBILITY FOR COMPLIANCE OF THE PREMISES WITH THE AMERICANS WITH
DISABILITIES ACT OF 1990 (42 United States Code Sections 12101-12213).
c. To the actual knowledge of Sublessor, Sublessor has not received any
notices from any governmental authority alleging any violation of any federal,
state or local ordinance, law or regulation, which violation, if any, has not
been fully cured.
d. Subtenant hereby assumes all continuing responsibility for repairs,
maintenance and upkeep (structural and non-structural) whether now or in the
future required by the Lease, any federal, state or local governmental
ordinance, law or regulation (including, as examples, compliance with ADA or
seismic retrofitting ordinances and regulations).
10. USE. The Premises will be used and occupied only for the operation
and maintenance of a full service sit-down restaurant serving food and
alcoholic beverages, all in accordance with applicable law and required
governmental permits. Under no circumstances shall the Premises be used for
any other purpose without the prior written consent of Sublessor (and Master
Landlord if required by the Lease), which, in the case of Sublessor, may be
given or withheld in its sole discretion.
11. ALTERATIONS. Subtenant shall not make any alteration improvement,
trade dress, signage, decoration, or installation (which includes any removal
or addition or partitions or walls, whether weight-bearing or not)
(hereinafter collectively called "ALTERATIONS"), including Alterations
required by federal, state or local governmental ordinances or regulations, in
or to the Premises, without in each instance obtaining the prior written
consent of the Master Landlord and Sublessor, which consent, in the case of
Sublessor shall not be unreasonably withheld. If any Alterations are made
without the Master Landlord's (when required) and Sublessor's prior written
consent, the Master Landlord or Sublessor may remove the same, and may
correct, repair and restore the Premises and any damage arising from such
removal, and Subtenant shall be liable for all costs and expenses incurred by
the Master Landlord or Sublessor in the performance of this work.
a. Subtenant may have any properly approved Alterations performed by
contractors of Subtenant's own choice, at Subtenant's expense, provided that
Subtenant shall have obtained written approval of the contractor by the
Landlord and Sublessor, which approval will be based upon the contractor's
being properly licensed and having adequate financial resources and experience
(or providing suitable bonds). Subtenant agrees to indemnify and hold
harmless Sublessor and the Master Landlord from any claims or demands arising
from Alterations to the Premises.
b. IN NO EVENT SHALL SUBTENANT COMMENCE ANY CONSTRUCTION AFFECTING THE
PREMISES UNLESS AND UNTIL IT HAS GIVEN MASTER LANDLORD AND SUBLESSOR NOT LESS
THAN 5 DAYS PRIOR WRITTEN NOTICE AND POSTED A NOTICE OF NON-RESPONSIBILITY ON
THE PREMISES AND TAKEN SUCH OTHER ACTION AS THE MASTER LANDLORD AND SUBLESSOR
SHALL REASONABLY REQUEST TO PROTECT THEIR RESPECTIVE INTERESTS. THE FAILURE
TO COMPLY WITH THIS PROVISION SHALL CONSTITUTE AN IMMEDIATE EVENT OF DEFAULT
UNDER THIS SUBLEASE FOR WHICH THERE SHALL BE NO GRACE NOR CURE PERIOD.
c. The Master Landlord and Sublessor shall at all times during normal
business hours have the right to inspect the work performed by any contractor
selected by Subtenant. Upon termination or expiration of this Sublease,
Subtenant shall, upon request of the Master Landlord or Sublessor, remove all
or some of all or any portion of the Alterations, repair all damage resulting
from such removal and restore the Premises to the condition as of the date
possession was delivered to Subtenant. If Subtenant fails or refuses to
remove such Alterations, or fails to correct, repair and restore the Premises,
the Master Landlord or Sublessor may cause the same to be removed, and repairs
and restoration to be made, in which event Subtenant shall reimburse to the
party who caused the Alterations to be removed and repairs made, the cost of
such removal, repairs and restoration, together with any and all damages which
the Master Landlord or Sublessor may suffer and sustain by reason of
Subtenant's failure or refusal to remove the Alterations, and interest on all
such sums at the Applicable Interest Rate from the date(s) paid until
reimbursed in full by Subtenant.
d. Sublessor shall have no obligation to provide any Alterations or to
contribute money to Alterations, redecorating or trade dress of, or signage
for, the Premises.
e. Subtenant shall comply with all rules and regulations promulgated by
the Master Landlord pursuant to the Lease and applicable to the Premises
and/or the building and/or project in which the Premises are located.
f. In addition to any Alterations which Sublessor or Master Landlord
requires Subtenant to remove, at the end of the Term or earlier termination of
this Sublease, Subtenant shall remove all of its fixtures, furniture and
equipment, other personal property, and all trade dress and signage, and shall
repair all damage resulting from such removal or their tenancy of the
Premises, and surrender the Premises in good condition (reasonable wear and
tear excepted, but not waste). The obligations of the Subtenant as herein
provided shall survive the termination of this Sublease.
12. ASSIGNMENT AND SUBLETTING. Under no circumstances shall Subtenant
assign this Sublease or further sublet all or any part of the Premises without
the prior written consent of Sublessor (and Master Landlord if required by the
Lease), which, in the case of Sublessor, may be given or withheld in its sole
discretion. In connection with any assignment or sublet request, Subtenant
shall pay to Sublessor the sum of $2,500 to cover Sublessor's expenses in
reviewing such request, and Sublessor's reasonable attorney's fees in
connection with such request, plus any charges and fees which the Master
Landlord is permitted to charge Sublessor under the Lease. In addition,
Subtenant shall pay to Master Landlord any fees and charges which Sublessor
may be obligated to pay to Master Landlord in connection with any such
assignment or sublet request.
13. WARRANTY BY SUBLESSOR. Sublessor warrants to Subtenant that (a) the
Lease has not been amended or modified except as expressly set forth in this
Sublease; (b) Sublessor is not now in default or breach of any of the
provisions of the Lease; and (c) that Sublessor has no knowledge of any claim
by Master Landlord that Sublessor is in default or breach of any of the
provisions of the Lease. Subtenant has inspected the Premises and has
satisfied itself as to the condition of the Premises. THIS SUBLEASE IS BEING
MADE ON AN "AS-IS, WHERE-IS" BASIS WITH RESPECT TO THE CONDITION OF THE
PREMISES, WITHOUT RECOURSE OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED,
INCLUDING ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE OR OTHERWISE, ALL SUCH WARRANTIES BEING EXPRESSLY EXCLUDED.
14. WARRANTY BY SUBTENANT. Subtenant hereby represents and warrants to
Sublessor that (a) Subtenant has taken all steps necessary to duly authorize
the execution, delivery and performance of the Sublease, (b) that the
person(s) executing the Sublease on behalf of Subtenant have been duly
authorized by Subtenant, and (c) Subtenant is a corporation duly formed and
existing under the laws of the State of California and is currently in good
standing.
15. BROKER PARTICIPATION. Sublessor and Subtenant warrant and represent
that they have dealt with no real estate broker in connection with this
Sublease other than Al Anz of The Anz Company and Xxx Xxxxxx & Associates, the
broker for the Subtenant (the "BROKERS"), and that no other broker is entitled
to a commission on account of this Sublease. The parties agree that on the
Commencement Date, Sublessor shall pay $25,000.00 to The Anz company and
$25,000.00 to Xxx Xxxxxx & Associates.
16. ENTRY. Sublessor reserves the right to enter the Premises on
reasonable notice to Subtenant to inspect the Premises or the performance by
Subtenant of the terms and conditions of this Sublease.
17. INSURANCE. Prior to taking possession of the Premises, Subtenant
shall procure and maintain such casualty and other forms of insurance as are
required by the Lease, and shall name Sublessor and the Master Landlord as an
additional insureds or loss payee, as applicable, as their interests may
appear, thereunder. In the event the Lease does not specify the quality or
amount of the required insurance, then such insurance shall be issued by
insurance carrier's having a Best's rating reasonably acceptable to Sublessor
and Master Landlord, shall be in such amounts as Sublessor shall reasonably
determine, and shall otherwise be in compliance with the Lease. All such
insurance certificates shall have ACCORD 27 form endorsements and otherwise be
in form and substance acceptable to Sublessor.
18. DEFAULT.
a. The occurrence or existence of any of the following events shall
constitute an Event of Default hereunder:
i. The occurrence or existence of a default or existence of a default or
event of default under the Master Lease, and the expiration of any applicable
cure or grace period; or
ii. The occurrence or existence of any breach of any payment or
performance obligation by Subtenant hereunder.
iii. The revocation or suspension of Subtenant's Liquor License for any
reason.
b. Upon an Event of Default hereunder, in addition to the remedies
contained in the Master Lease, Sublessor shall have the following rights and
remedies and any other rights and remedies accorded by applicable law. All
such rights and remedies shall be cumulative and none exclusive.
i. Sublessor can continue this Sublease in full force and effect, and the
Sublease will continue in effect as long as Sublessor does not terminate
Subtenant's right to possession, and Sublessor shall have the right to collect
rent when due. During the period Subtenant is in default, Sublessor can enter
the Premises and relet them, or any part of them, to third parties for
Subtenant' account. Subtenant shall be liable immediately to Sublessor for
all costs Sublessor incurs in reletting the premises, including, without
limitation, brokers' commissions, expenses of removing Subtenant's fixtures,
trade fixtures, trade dress, signage and equipment, remodeling the Premises
required by the reletting, and any other costs and fees paid or incurred by
Sublessor as a result or arising from Subtenant's default. Reletting can be
for a period shorter or longer than the remaining term of this Sublease.
Subtenant shall pay to Sublessor the Base Monthly Rent, Percentage Rent, and
any Additional Rent due under this Sublease on the dates such is due, less the
rent Sublessor receives from any reletting. No act by Sublessor allowed by
this paragraph shall terminate this Sublease unless Sublessor notifies
Subtenant in writing that Sublessor elects to terminate this Sublease. After
Subtenant's default and for as long as Sublessor does not terminate
Subtenant's right to possession of the Premises, if Subtenant obtains
Sublessor's consent, Subtenant shall have the right to assign or sublet its
interest in this Sublease, but Subtenant shall not be released from liability.
Sublessor's consent to a proposed assignment or subletting shall not be
unreasonably withheld, but only under this paragraph.
(1) If Sublessor elects to relet the Premises as provided in this
paragraph, rent that Sublessor receives from reletting shall be applied to the
payment of:
First, any indebtedness from Subtenant to Sublessor other than Base Monthly
Rent, Percentage Rent, and any Additional Rent due from Subtenant;
Second, all costs, including for maintenance and repairs, and attorney's fees
and expenses, court costs, and broker's fees, paid or incurred by Sublessor in
reletting;
Third, Base Monthly Rent, Percentage Rent and Additional Rent due and unpaid
under this Sublease. After deducting the payments referred to in this
paragraph, any sum remaining from the Base Monthly Rent, Percentage Rent, and
Additional Rent Sublessor receives from reletting shall be held by Sublessor
and applied in payment of future Base Monthly Rent, Percentage Rent, and
Additional Rent as Base Monthly Rent, Percentage Rent and Additional Rent
become due under this Sublease. In no event shall Subtenant be entitled to
any excess rent received by Sublessor. If, on the date Base Monthly Rent,
Percentage Rent and Additional Rent are due under this Sublease, the Base
Monthly Rent, Percentage Rent and Additional Rent received from the reletting
is less than the Base Monthly Rent, Percentage Rent and Additional Rent due
on that date, Subtenant shall pay to Sublessor, in addition to the remaining
Base Monthly Rent, Percentage Rent and Additional Rent due, all costs,
including for maintenance and repair, Sublessor incurred in reletting that
remain after applying the Base Monthly Rent, Percentage Rent and Additional
Rent received from the reletting as provided in this paragraph.
ii. Sublessor can terminate Subtenant's right to possession of the
Premises at any time. No act by Sublessor other than giving notice in writing
to Subtenant shall terminate this Sublease. Acts of maintenance, and efforts
to relet the Premises shall not constitute a termination of Subtenant's right
to possession. On termination, Sublessor has the right to recover from
Subtenant:
(1) The worth, at the time of the award, of the unpaid Base Monthly Rent,
Percentage Rent and Additional Rent that had been earned at the time of
termination of this lease;
(2) The worth, at the time of the award, of the amount by which the unpaid
Base Monthly Rent, Percentage Rent and Additional Rent that would have been
earned after the date of termination of this Sublease until the time of award
exceeds the amount of the loss of rent that Subtenant proves could have been
reasonably avoided;
(3) The worth, at the time of the award, of the amount by which the unpaid
Base Monthly Rent, Percentage Rent and Additional Rent for the balance of the
term after the time of award exceeds the amount of the loss of rent that
Subtenant proves could have been reasonably avoided; and
(4) Any other amount, and court costs, necessary to compensate Sublessor for
all detriment proximately caused by Subtenant's default.
"The worth, at the time of the award," as used in subparagraphs i and ii of
this paragraph is to be computed by allowing interest at the maximum rate an
individual is permitted by law to charge. "The worth, at the time of the
award," as referred to in iii of this paragraph, is to be computed by
discounting the amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of the award, plus 1%.
iii. Notice of Election to Terminate. If Sublessor obtains possession of
the Premises as a result of Subtenant's abandonment of same or by a decree
from a court of competent jurisdiction, this shall not be construed as an
election to terminate this Sublease unless Sublessor provides Subtenant with a
written notice of this election.
iv. In the event Sublessor takes any actions to enforce an Event of
Default under this Sublease, including the commencement of an unlawful
detainer action, and Subtenant either is permitted to cure such Event of
Default as a matter of law or Sublessor waives such Event of Default,
Sublessor, may in its sole discretion, upon written notice to Subtenant,
require that all rent thereafter payable under this Sublease be paid quarterly
in advance.
v. Notwithstanding anything to the contrary contained herein, it is
intended that, in the event of a breach or a default by Subtenant hereunder,
Subtenant shall have all of the rights and remedies available under applicable
law, including Section 1954 et seq. of the California Civil Code, as amended,
-- ---
and under the Master Lease and this Sublease. All such rights and remedies
shall be cumulative, and none exclusive, to the extent permitted by applicable
law.
19. ATTORNMENT. If the Lease terminates for any reason, Subtenant
will, if requested by Master Landlord, recognize Master Landlord as Sublessor
under this Sublease. However, Subtenant's obligation to attorn to Master
Landlord will be conditioned on Subtenant's receipt of a nondisturbance
agreement.
20. LATE CHARGE AND INTEREST. The late payment of any Base Monthly Rent
or other payment due to Sublessor hereunder will cause Sublessor to incur
additional costs, including the cost to maintain in full force the Master
Lease, administration and collection costs, and processing and accounting
expenses. If Sublessor has not received any installment of Base Monthly Rent
or other payment within 5 days after that amount is due, Subtenant will pay
five percent (5%) of the delinquent amount, which is agreed to represent a
reasonable estimate of the costs incurred by Sublessor. In addition, all
delinquent amounts will bear interest from the date the amount was due until
paid in full at the Applicable interest Rate. Sublessor and Subtenant
recognize that the damage Sublessor will suffer in the event of Subtenant's
failure to pay this amount is difficult to ascertain and that the late charge
and interest are the best estimate of the damage that Sublessor will suffer.
a. If a late charge becomes payable for any 2 installments of Base Monthly
Rent or other charge payable hereunder within any 12 month period, then all
Base Monthly Rent shall automatically become payable quarterly in advance.
b. In the event Sublessor pays or incurs any sums in order to pay or
perform any obligation of Subtenant hereunder, then such amount shall bear
interest at the Applicable Interest Rate until repaid in full.
c. The late charge payable hereunder shall be in addition to any other
late charges payable by Sublessor to Master Landlord under the Lease. In the
event Sublessor is required to pay a late charge to Master Landlord because of
the late payment by Subtenant to Sublessor, Subtenant shall reimburse
Sublessor therefor on demand.
21. WAIVERS. The failure of Sublessor to insist in any instance upon
the strict keeping, observance or performance of any co-tenant, agreement,
term, provision or condition of this Sublease or to exercise any election
herein contained shall not be construed as a waiver or relinquishment for the
future of such covenant agreement, term, provision, condition or election, but
the same shall continue and remain in full force and effect. No surrender of
possession of the Premises or of any part thereof or of any remainder of the
term of this Sublease shall release Subtenant from any of their obligations
hereunder unless accepted by Sublessor in writing. The receipt and retention
by Sublessor of rent from anyone other than Subtenant shall not be deemed a
waiver of the breach by Subtenant of any covenant, agreement, term or
provision of this Sublease, or as the acceptance of such other person as a
Subtenant, or as a release of Subtenant from the further keeping, observance
or performance by Subtenant of the covenants, agreements, terms, provisions
and conditions herein contained. The receipt and retention by Sublessor of
rent with knowledge of the breach of any covenant, agreement, term, provision
or condition herein contained shall not be deemed a waiver of such breach.
22. SUCCESSORS AND ASSIGNS. This Sublease shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors
and assigns, or heirs and personal representatives, as applicable.
23. NOTICES. Any and all communications delivered hereunder shall be sent
by first-class mail, or commercial overnight express carrier (e.g. Federal
Express, DHL, etc): if to Sublessor, at 0000 Xxxxxxxxxxxxx Xxxxxxx, Xxxxx,
Xxxxx 00000 (Attention: Vice President - Real Estate, with a copy to the
General Counsel); and if to Subtenant at BJ's Chicago Pizza & Brewery, Inc.,
00000 Xxxxxxxxxx Xxxxxxx, Xxxxx X, Xxxxxxx Xxxxx, XX 00000 (Attention: Xxxx
Xxxxxxx) or to such other address and attention as Sublessor or Subtenant
shall notify the other in writing. A copy of all such notices shall also be
sent to Xxxxxx X. Xxxxxxxx, Esq., Jeffer, Mangels, Xxxxxx & Marmaro LLP, Xxx
Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000.
24. ENTIRE AGREEMENT. This Sublease contains all of the covenants,
agreements, term, provisions, conditions, warranties and understandings
relating to the leasing of the Premises and Sublessor's obligations in
connection therewith, and neither Sublessor nor any agent or representative of
Sublessor has made or is making, and Subtenant in executing and delivering
this Sublease are not relying upon, any warranties, representations, promises
or statements whatsoever, except to the extent expressly set forth in this
Sublease. All understandings and agreements, if any, heretofore had between
the parties are merged into this Sublease, which alone fully and completely
expresses the agreement of the parties.
25. ATTORNEYS' FEES. If Sublessor or Subtenant or any Broker shall
commence an action against any one or both of the others arising out of or in
connection with this Sublease, including any bankruptcy proceeding, the
prevailing party shall be entitled to recover its costs of suit and reasonable
attorneys' fees and court costs from the opposing party in such action.
26. INDEMNIFICATION. Subtenant shall and hereby does indemnify and hold
the Master Landlord and Sublessor harmless from and against any and all
actions, claims, demands, damages, liabilities and expenses (including without
limitation, reasonable attorneys' fees and expenses) asserted against, imposed
upon or incurred by Sublessor or the Master Landlord by reason of (a) any
violation by Subtenant, its agents, servants, employees or invitees, of any of
the terms, covenants or conditions of the Master Lease or this Sublease, (b)
any damage or injury to persons or Premises occurring upon or in connection
with the use or occupancy of the Premises, except as a result of the gross
negligence of the Master Landlord or Sublessor, or their respective agents,
employees or invitees, and (c) the presence of any Hazardous Materials and
Hazardous Substances unrelated to the operation of the Premises on, under, in
or about the Premises, and the Costs associated with the clean-up of any such
Materials and Substances, or (d) any violation of any Environmental Laws on,
under, in, about, to or from the Premises. Sublessor has no actual knowledge
of any Hazardous Materials or Substances under, in or about the Premises
except for normal cooking and cleaning chemicals. As used herein, the
following terms shall have the following meanings:
a. "ENVIRONMENTAL LAWS" shall mean the Comprehensive Environmental
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Response, Compensation, and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., the Solid
Waste Disposal Act, as amended by the Resource Conservation and Recovery Act
of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42
USC 6901 et seq., The Federal Water Pollution Control Act, as amended by the
Federal Clean Water Act of 1977, 33 USC 1251 et seq., the Toxic Substance
Control Act of 1976, 15 USC 2601 et seq., the Emergency Planning and
Community Right to Know Act of 1986, 42 USC 11001 et seq., the Clean Air Act
as amended, 42 USC 7401 et seq., the National Environmental Policy Act of
1969, 42 USC 4321, the Rivers and Harbors Act of 1899, 33 USC 401 et seq.,
the Endangered Species Act of 1973, as amended, 29 USC 1531 et seq., the
Occupational Health and Safety Act of 1970, as amended, 29 USC 651 et seq.,
the Safe Drinking Water Act of 1974, as amended, 42 USC 300(f) et seq., the
California Environmental Quality Act, California Public Resources Code 21000
et seq., California Safe Drinking Water and Toxic Enforcement Act,
(Proposition 65) California Health and Safety Code 25249.5-25249.12,
California Clean Air Act, California Health and Safety Code 39000 et seq.,
Xxxxxx-Cologne Water Quality Control Act, California Water Code 13000 et
seq., California Endangered Species Act, California Fish and Game Code 2050
et seq., California Hazardous Waste Control Laws, California Health and Safety
Code 25100 et seq., California Hazardous Substance Act, California Health
and Safety Code 28740 et seq., and all amendments, rules, regulations and
guidance documents promulgated or published thereunder. In addition, the
term "Environmental Laws" also includes all future laws, rules, regulations,
and guidance documents relating to public health, safety or the environment,
including, without limitation, 1) Releases to air, water, groundwater, or
land; 2) withdrawal or use of groundwater; 3) the use, handling, or disposal
of polychlorinated biphenyls (PCB's), asbestos or urea formaldehyde; 4) the
treatment, storage, disposal, or management of Hazardous Substances (including
without limitation, petroleum, its derivatives, by-products or other
hydrocarbons), and any other solid, liquid, or gaseous substance, exposure to
which is prohibited, limited or regulated, or which may or could pose a hazard
to the health and safety of the occupants of the Premises or the Premises
adjacent to or surrounding the Premises; and 5) the exposure of persons to
toxic, hazardous, or other controlled, prohibited or regulated substances, and
any regulation, order, injunction, judgment, declaration, notice or demand
issued thereunder.
b. "HAZARDOUS SUBSTANCE" shall have the meaning given to it under Section
-------------------
101(14) of the Comprehensive Environmental Recovery Compensation & Liability
Act, as amended, 42 U.S.C. 9601(14). It shall also include, but not be
limited to, any substance: (i) the presence of which requires investigation
or remediation under any federal, state, or local statute, action, policy or
common law; or (ii) which is or becomes defined as a 'Hazardous Waste,'
'Hazardous Substance,' pollutant or contaminate under any federal, state or
local statute, regulation, rule or ordinance or amendment thereto including
without limitation the Resource Conservation & Recovery Act (42 U.S.C. 6901
et seq.); teratogenic or otherwise hazardous and is or becomes regulated by
any governmental authority, agency, department, commission, board, agency or
instrumentality of the United States, the State of Arizona or any political
subdivision thereof; or (iii) which contains, without limitation, gasoline,
diesel fuel, petroleum hydrocarbons, polychlorinated biphenyls (PCBs),
asbestos, formaldehyde, foam insulation, or radon gas.
c. "HAZARDOUS MATERIAL" shall mean any material which is listed in the
------------------
Department of Transportation Hazardous Materials Table, 49 CFR 172.101 or
which is toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic, teratogenic or otherwise hazardous and is or becomes
regulated by any governmental authority, agency, department, commission,
board, agency or instrumentality of the United States, the State of California
or any political subdivision thereof.
d. "COSTS" shall include, but is not limited to, attorneys' fees,
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paralegal fees, court costs, consultants fees, expert witness fees, litigation
expenses, third party claims for personal injury or real or personal property,
damages, actions, administrative proceedings (including, without limitation,
informal proceedings), judgments, damages, penalties, costs, expenses,
liabilities of any kind or nature (including, without limitation, sums paid in
settlements of claims or losses).
e. "RELEASE" shall mean any spilling, leaking, pumping, pouring, emitting,
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emptying, discharging, injecting, escaping, leaching, dumping, or disposing
into the environment, unless permitted or authorized by a regulatory agency.
27. TIMELY PERFORMANCE. Time is of the essence of all of Subtenant's
obligations and liabilities hereunder.
28. APPLICABLE LAW. This Sublease shall be governed by the internal laws
and decisions of the State of California, without regard to its conflict of
laws principles.
29. COUNTERPARTS. This Sublease may be executed in one or more
counterparts, each of which will be deemed an original, but all of which, when
taken together, will constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have duly executed this Sublease as of
the date first above written.
"Sublessor"
STEAK AND ALE OF CALIFORNIA, INC.,
a Nevada corporation
By: ________________________________
Name: ________________________________
Title: ________________________________
"Subtenant"
X.X.'S CHICAGO PIZZA & BREWERY, INC.,
a California corporation
By: ________________________________
Name: ________________________________
Title: ________________________________
MXF SFDOCS\88790 2 58794 0002 08/31/98
EXHIBIT A
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COPY OF LEASE
---------------
[Attached]
EXHIBIT B
----------
FORM OF XXXX OF SALE
------------------------
[ATTACHED]
MXF SFDOCS\88790 2 58794 0002 08/31/98
EXHIBIT B
XXXX OF SALE
--------------
THIS XXXX OF SALE is made as of September 1, 1998, by STEAK AND ALE OF
CALIFORNIA, INC., a Nevada corporation ("Seller"), in favor of X.X.'S CHICAGO
PIZZA & BREWERY, INC., a California corporation ("Buyer"). In consideration
of the receipt of the sum of Sixty-Three Thousand Dollars ($63,000.00), Seller
agrees as follows:
Seller hereby sells, assigns and transfers to Buyer, all of Seller's
right, title and interest in and to all of the property improvements (which
are not considered part of the leasehold), furniture fixtures and equipment
(collectively, the "FF&E") located as of the date hereof at certain premises
commonly known as 000 Xxxx Xxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000-0000
(the "Premises"), excluding, however, Seller's interest in (i) all of
"Bennigan's trademarked and proprietary items, including china, (ii) the point
of sale system, including all hardware and software, and (iii) any liquor
inventory.
THE SALE OF FF&E IS MADE BY SELLER TO BUYER ON AN "AS-IS, WHERE-IS" BASIS
WITHOUT RECOURSE OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING ANY
EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE OR OTHERWISE, ALL SUCH WARRANTIES BEING EXPRESSLY EXCLUDED.
IN WITNESS WHEREOF, Seller has executed and delivered this Xxxx of Sale
as of the date first shown above.
STEAK AND ALE OF CALIFORNIA, INC.,
a Nevada corporation
By: ________________________________
.Name: ________________________________
Title: ________________________________
ACCEPTED AND AGREED TO as of the date first shown above:
"Subtenant"
X.X.'S CHICAGO PIZZA & BREWERY, INC.,
a California corporation
By: ________________________________
Name: ________________________________
Title: ________________________________
