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Store No.
«Store_»
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«Site_Address»
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«City», «ST»
«Zip_Code»
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«BuyerLandlord»,
«Corp_Info»
as Landlord,
SSP PARTNERS,
a Texas general partnership,
as Tenant,
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PAGE
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ARTICLE I.
AGREEMENT TO LEASE
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1
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1.1
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Demise
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1
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1.2
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Condition
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1
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1.3
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Quiet
Enjoyment
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2
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ARTICLE II.
TERM
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2
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2.1
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Term
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2
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2.2
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Rental
Commencement Date
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2
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2.3
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Effective
Date
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2
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2.4
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Option to
Renew
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2
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2.5
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Termination
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3
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ARTICLE III.
RENT
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3
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3.1
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Base
Rent
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3
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3.2
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Annual Rent
Increases
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3
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3.3
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Additional
Rent; Rent Defined
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6
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3.4
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Payment of
Rent
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7
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3.5
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Past Due
Rent
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7
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3.6
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No Diminution
or Abatement of Rent
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6
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ARTICLE IV. USE
AND OPERATION OF PREMISES
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6
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4.1
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Permitted
Use
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6
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4.2
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Reserved
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7
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4.3
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Compliance With
Laws
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7
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4.4
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Compliance With
Restrictions, Etc
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8
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4.5
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Hazardous
Materials and Sewage
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8
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i
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PAGE
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4.6
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Resolution of
Environmental Matters at Expiration or Termination of
Tenancy
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13
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4.7
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Right to
Contest
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14
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4.8
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Sewage
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14
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4.9
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Survival
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14
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ARTICLE V.
TAXES AND ASSESSMENTS
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14
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5.1
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Real Estate
Taxes and Assessments
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14
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ARTICLE VI.
UTILITIES
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17
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ARTICLE VII.
RESERVED
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17
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ARTICLE VIII.
INSURANCE
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17
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8.1
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Insurance by
Tenant
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17
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8.2
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Carriers and
Features
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18
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8.3
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Failure to
Procure Insurance
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19
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8.4
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Self
Insurance
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19
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ARTICLE IX.
ADDITIONS, ALTERATIONS AND REMOVALS
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19
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9.1
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Prohibition
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19
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9.2
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Permitted
Renovations
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20
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ARTICLE X.
MAINTENANCE AND REPAIRS
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21
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10.1
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Repairs by
Tenant
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21
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10.2
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Landlord’s Obligation
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21
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ARTICLE XI.
DAMAGE OR DESTRUCTION
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21
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11.1
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Restoration and
Repair
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21
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11.2
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Escrow of
Insurance Proceeds
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22
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11.3
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Uninsured
Losses
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22
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ARTICLE XII.
CONDEMNATION
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22
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12.1
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Complete
Taking
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22
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ii
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PAGE
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12.2
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Partial
Taking
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23
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12.3
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Award
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23
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12.4
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Disputes
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23
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ARTICLE XIII.
LANDLORD’S RIGHT TO INSPECT
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23
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ARTICLE XIV.
ASSIGNMENT AND SUBLETTING BY TENANT
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24
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ARTICLE XV.
LANDLORD’S INTEREST NOT SUBJECT TO LIENS
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24
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15.1
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Liens,
Generally
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24
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15.2
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Mechanics
Liens
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25
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15.3
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Contest of
Liens
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26
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15.4
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Notices of
Commencement of Construction
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26
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ARTICLE XVI.
SUBORDINATION, ATTORNMENT AND NON-DISTURBANCE
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26
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16.1
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Subordination
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26
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16.2
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Attornment
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27
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16.3
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Rights of
Mortgagees and Assignees
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27
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ARTICLE XVII.
END OF TERM
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28
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17.1
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Surrender of
Premises
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28
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17.2
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Holding
Over
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28
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17.3
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Reserved
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28
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ARTICLE XVIII.
LIABILITY OF LANDLORD; INDEMNIFICATION
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28
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18.1
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Liability of
Landlord
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28
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18.2
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Indemnification
of Landlord
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29
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18.3
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Notice of Claim
or Suit/Notice of Environmental Matters
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29
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18.4
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Limitation on
Liability of Landlord
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29
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ARTICLE XIX.
DEFAULT
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29
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19.1
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Events of
Default
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29
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iii
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PAGE
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19.2
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Remedies on
Default
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32
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19.3
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Landlord May
Cure Tenant Defaults
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33
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19.4
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Waiver of
Landlord’s Lien
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33
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19.5
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Rights
Cumulative
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34
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ARTICLE XX.
NOTICES
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34
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ARTICLE XXI.
MISCELLANEOUS
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34
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21.1
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“Triple
Net” Lease
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34
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21.2
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Estoppel
Certificates
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35
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21.3
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Brokerage
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35
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21.4
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No Partnership
or Joint Venture
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35
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21.5
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Entire
Agreement
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36
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21.6
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Waiver
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36
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21.7
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Time
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36
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21.8
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Costs and
Attorneys’ Fees
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36
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21.9
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Financial
Data
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36
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21.10
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Captions and
Headings
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37
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21.11
|
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Severability
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37
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21.12
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Successors and
Assigns
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37
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21.13
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Applicable
Law
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37
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21.14
|
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Recordation of
Memorandum of Lease
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37
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21.15
|
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Waiver of Jury
Trial
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37
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21.16
|
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Counterparts
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37
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21.17
|
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Not a Security
Arrangement
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37
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21.18
|
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Maintenance
Records and Contracts
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37
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21.19
|
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Tenant’s
Personal Property
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37
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iv
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PAGE
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21.20
|
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Landlord’s Cooperation
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38
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21.21
|
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Reserved
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38
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21.22
|
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Guaranty
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38
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v
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—
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Legal
Description
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—
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Tenant Estoppel
Certificate
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—
|
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Memorandum of
Lease
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vi
THIS LEASE AND
AGREEMENT (the “ Lease ”) is made and
entered into effective as of the ___ day of December, 2005 by and
between , , (the “ Landlord ”), and
SSP PARTNERS , a Texas general partnership (the “
Tenant ”).
WHEREAS, Tenant or
Tenant’s affiliate is the owner of fee simple title to
certain real property located in the City of , County of , State of
and described in Exhibit A attached hereto (the
“ Land ” ) upon which a building has been
constructed, together with related site improvements including:
(i) the Storage Tank System as defined in Section 4.5 of
this Lease, (ii) canopies on the pump islands, and
(iii) the car wash, if any, located in, on or under the Land
(collectively, the “ Improvements ”) (the
Land and the Improvements, together with all licenses, rights,
privileges and easements appurtenant thereto shall be collectively
referred to herein as the “ Premises
”);
WHEREAS,
simultaneously with the date of this Lease Tenant or Tenant’s
affiliate has conveyed the Premises to Landlord together with
certain other properties owned by Tenant or Tenant’s
affiliates; and
WHEREAS, Tenant
desires to lease back from Landlord, and Landlord has agreed to
lease back to Tenant, all of the Premises upon the terms and
conditions as more particularly hereinafter provided and
described;
NOW, THEREFORE,
for and in consideration of the premises hereof, the sums of money
to be paid hereunder, and the mutual and reciprocal obligations
undertaken herein, the parties hereto do hereby covenant, stipulate
and agree as follows:
ARTICLE I.
AGREEMENT TO LEASE
1.1 Demise
. Landlord does hereby demise, let and lease unto Tenant, and
Tenant does hereby hire, lease and take as Tenant from Landlord the
entire Premises upon those terms and conditions hereinafter set
forth.
1.2
Condition . Tenant acknowledges and agrees that the Premises
is and shall be leased by Landlord to Tenant in its present
“as is” condition, and that Landlord makes absolutely
no representations or warranties whatsoever with respect to the
Premises or the condition thereof. Tenant acknowledges that
Landlord has not investigated and does not warrant or represent to
Tenant that the Premises are fit for the purposes intended by
Tenant or for any other purpose or purposes whatsoever, and Tenant
acknowledges that the Premises are to be leased to Tenant in their
existing condition, i.e., “as-is”, on and as of the
Effective Date. Tenant acknowledges that Tenant shall be solely
responsible for any and all actions, repairs, permits, approvals
and costs required for the rehabilitation, renovation, use,
occupancy and operation of the Premises in accordance with
applicable governmental requirements, including, without
limitation, all governmental charges and fees, if any, which may be
due or payable to applicable authorities. Tenant agrees that, by
leasing the Premises, Tenant warrants and represents that Tenant
has
1
examined and
approved all things concerning the Premises which Tenant deems
material to Tenant’s leasing and use of the Premises. Tenant
further acknowledges and agrees that (a) neither Landlord nor
any agent of Landlord has made any representation or warranty,
express or implied, concerning the Premises or which have induced
Tenant to execute this Lease except as contained in this Lease, and
(b) any other representations and warranties are expressly
disclaimed by Landlord.
1.3 Quiet
Enjoyment . Landlord covenants and agrees that so long as
Tenant shall timely pay all rents due to Landlord from Tenant
hereunder and keep, observe and perform all covenants, promises and
agreements on Tenant’s part to be kept, observed and
performed hereunder, Tenant shall and may peacefully and quietly
have, hold and occupy the Premises free of any interference from
Landlord; subject, however, and nevertheless to the terms,
provisions and conditions of this Lease.
2.1 Term .
The initial term of this Lease (the “ Initial
Term ”) shall, unless sooner terminated as elsewhere
provided in this Lease, commence on the Effective Date and shall
terminate and expire at 11:59 p.m. on the date immediately
preceding the twentieth (20 th )
anniversary of the Effective Date. The Initial Term, together with
any properly exercised Option Period (defined in Section 2.4
below) shall be collectively referred to herein as the “
Term ”.
2.2 Rental
Commencement Date . For the purposes of this Lease, the “
Rental Commencement Date ” shall be the
Effective Date hereof.
2.3 Effective
Date . For the purposes of this Lease, the “
Effective Date ” shall be the date set forth in
the first paragraph of this Lease.
2.4 Option to
Renew .2.5 Tenant shall have and is hereby granted five
(5) options (individually an “ Option
”) to extend this Lease beyond the Initial Term for an
additional period of five (5) years each (individually an
“ Option Period ”), upon the same terms,
covenants, conditions and rental as set forth herein. Tenant may
exercise each such Option successively by giving written notice to
Landlord not less than six (6) months prior to the expiration
of the Initial Term of this Lease or expiration of the then current
Option Period, as applicable (the “ Option
Notice ”). Notwithstanding the foregoing, Tenant
shall not be entitled to extend the Term of this Lease if, at the
time of exercise of an Option, an Event of Default has occurred and
is continuing. If Tenant does not elect to extend, or shall not be
entitled pursuant to the preceding sentence to extend the Term of
this Lease for an additional Option Period, all remaining rights of
renewal shall automatically expire.
Notwithstanding
anything else contained herein, if Tenant exercises an Option
hereunder and if the Base Rent for such Option Period (pursuant to
the calculation called for in Section 3.2(f) hereof),
(i) is less than the Base Rent that would be arrived at if the
Base Rent was increased pursuant to Section 3.2(e), then
Landlord may reject said Option Notice by delivering a written
notice of rejection to Tenant (the “ Rejection
Notice ”), and (ii) if the Base Rent for such
Option Period (pursuant to the calculation called for in
Section 3.2(f) hereof), is more than the
2
Base Rent that
would be arrived at if the Base Rent was increased pursuant to
Section 3.2(e), the Tenant may withdraw its Option Notice by
delivering written notice of withdrawal of the Option Notice within
thirty (30) days of determination of amount of Base Rent under
Section 3.2(f). Should Landlord deliver a Rejection Notice to
Tenant or should Tenant withdraw its Option Notice as provided for
above, Tenant’s Option Notice shall be void and of no effect
and the Lease shall expire and terminate at the end of the then
current Option Term. However, Tenant may, at its option, extend the
Term for the applicable Option Period after receipt of
Landlord’s Rejection Notice, by delivering within thirty
(30) days of receipt of Landlord’s Rejection Notice a
second Option Notice (the “ Second Option
Notice ”) stating that Tenant desires to extend the
Term for the Option Period and Tenant agrees to pay Base Rent equal
to Base Rent obtained by the application of the formula set forth
in Section 3.2(e) hereof. Tenant shall have no obligation
hereunder to deliver a Second Option Notice or to so extend the
Lease under the terms required in a Second Option Notice. Should
Tenant timely deliver to Landlord a Second Option Notice which
complies with the requirements of this Section, the Term of the
Lease shall be extended for the applicable Option Period at the
Base Rent called for in the Second Option Notice.
2.5
Termination . Notwithstanding any present or future law to
the contrary, this Lease shall not be terminated by Tenant for any
failure of Landlord to perform pursuant to the terms and conditions
of this Lease or otherwise for any reason except as expressly
provided herein.
3.1 Base
Rent . Beginning on the Rental Commencement Date, and subject
to proration as set forth below, Tenant shall pay annual base rent
for the Premises for the first Lease Year in equal monthly
installments of (“ Base Rent ”), together
with any sales and use taxes thereon, if any are ever imposed in
the State where the Premises is located. Such Base Rent shall be
paid in advance, on the first (1st) day of each calendar month
commencing on the first (1st) day of the calendar month immediately
following the Rental Commencement Date, it being agreed that Base
Rent payable with respect to the period between the Rental
Commencement Date and the first day of the following calendar month
shall be due at the time that the first payment of Base Rent is
due.
For the purposes
of this Lease, the term “ Lease Year ”
shall mean and be defined as each twelve month period commencing on
the first day of the calendar month immediately following the
Rental Commencement Date; provided, however, that the first Lease
Year shall include the period from the Rental Commencement Date to
the first day of the next following calendar month after the Rental
Commencement Date. Base Rent shall be proportionately prorated for
any extended or partial Lease Year (i.e., the first Lease Year
and/or the final Lease Year).
3.2 Annual Rent
Increases . The capitalized terms used herein are defined
below. Base Rent shall be increased each Lease Year during the Term
of the Lease, as more particularly set forth below.
(a)«Alternate_1»«Alternate_2»
3
(b)«Alternate_3»«Alternate_4»
(c) On
each of the tenth through nineteenth Adjustment Dates, Base Rent
shall increase by the percentage increase in the CPI, subject to
the Increase Cap set forth below. The increases in Base Rent will
be calculated as follows: (i) subtract one point zero (1.0)
from a fraction, the numerator of which shall be the Variable
Index, and the denominator of which shall be the Base Index; and
then (ii) multiply the result obtained in subpart
(i) above by the Base Rent for the Lease Year immediately
prior to the Adjustment Date. Notwithstanding the foregoing, in no
event shall the increase in Base Rent on the eleventh through
nineteenth Adjustment Dates exceed one and one half percent (1.5%)
(the “ Increase Cap ”), and in no event
shall the new Base Rent be less than the Base Rent for the Lease
Year prior to the Adjustment Date.
(d) INTENTIONALLY OMITTED.
(e) At
the beginning of the 1 st Option Period exercised by Tenant hereunder,
Base Rent shall be initially set to the Base Rent which would be
arrived at by increasing the Base Rent for the Lease Year prior to
the applicable Option Period by the percentage increase in the CPI,
using the same formula set forth in subsection 3.2(c) above and
subject to the Increase Cap.
(f) At
the beginning of each remaining Option Period, if any, exercised by
Tenant hereunder, Base Rent shall be initially set the Fair Market
Rental Value of the Premises as of the date of the commencement of
the Option Period.
(g) After
the resetting of the Base Rent for the beginning of each Option
Period as provided for in subsection 3.2(e) or 3.2(f) above, Base
Rent shall increase each Lease Year on each Adjustment Date in the
applicable Option Period by the percentage increase in the CPI,
using the same formula set forth in subsection 3.2(c) above and
subject to the Increase Cap.
(h) Landlord’s
delay or the failure of Landlord, beyond commencement of any
Adjustment Date in computing or billing for these adjustments will
not impair the continuing obligation of Tenant to pay any and all
Base Rent or other Rent due hereunder including any increased Base
Rent when billed.
(i) In
applying the foregoing formula for Base Rent adjustments, the
following terms shall have the following meaning:
(1) “
Adjustment Date ” shall mean, as the case may
require, the first (1 st )
day of the second Lease Year, and the first day of each succeeding
Lease Year during the Term, including any Option
Periods.
(2) “
Base Index ” for the first Adjustment Date
shall mean the CPI for the month which is two months prior to the
Rent Commencement Date. Thereafter, the Base Index shall mean the
CPI for the month which is two months prior to the prior Adjustment
Date.
4
By way of
example, for the first Adjustment Date, the Base Index will be the
CPI for the month which is two months prior to the Rent
Commencement Date, for the second Adjustment Date, the Base Index
will be the CPI for the month which is two months prior to the
first Adjustment Date, for the third Adjustment Date the Base Index
will be the CPI for the month which is two months prior to the
second Adjustment Date, etc.
(3) “
CPI ” shall mean the Consumer Price Index for
All Urban Consumers, All Items, U.S.A. Area, 1982-1984 = 100, as
published by the Bureau of Labor Statistics, United States
Department of Labor (U.S. City Average). If such index is
discontinued, CPI shall then mean the most nearly comparable index
published by the Bureau of Labor Statistics or other official
agency of the United States Government as determined by
Landlord.
(4) “
Fair Market Rental Value ” shall mean the
market rent for the Premises as determined as follows: Landlord and
Tenant shall each appoint an independent appraiser who is a
designated member (MAI) in good standing with the Appraisal
Institute, having at least ten (10) years experience in appraising
properties similar to the Premises. Each appraiser is encouraged to
share market data information with each other. Each appraiser shall
prepare and submit a written appraisal of the Fair Market Value of
the Premises within sixty (60) days after either party so
requests. The Fair Market Value shall be calculated as of the date
of said request. If the difference, if any, between the highest
appraisal submitted and the lowest appraisal submitted is an amount
less than or equal to ten percent (10%) of the amount of the lesser
appraisal, the appraised Fair Market Value of the Premises shall be
deemed to be equal to the numerical average of the amounts of the
two (2) appraisals submitted. If the difference between the
two (2) appraisals submitted is an amount greater than ten
percent (10%) of the amount of the lesser appraisal, then the two
appraisers shall appoint a third appraiser within thirty
(30) days after the two appraisers have submitted their
reports. The third appraiser shall prepare and submit a written
appraisal of the Premises within forty (40) days after such
appraiser’s appointment. If a third appraiser is required to
be submitted, the appraised Fair Market Value of the Premises shall
be deemed to be equal to the numerical average of the two
(2) appraisals that have the closest value. If the two
appraisers are unable to agree to the appointment of the third
appraiser, then either party may request such appointment by a
presiding district court judge for County, . Such appointed third
appraiser shall meet the same qualifications set forth herein.
Landlord and the Tenant shall each pay the costs and expenses for
their respective appraisers, and, if a third appraiser is
necessary, Landlord and Tenant shall share equally the expense of
the third appraiser. Landlord and Tenant each agree to cooperate
with the appraisers and provide the appraisers with such
information as the appraisers may request.
(a) “
Variable Index ” shall mean the CPI for the
month which is two months prior to the current Adjustment Date. By
way of example, for the first Adjustment Date the Variable Index
will be the CPI for the month which is two months prior to the
first Adjustment Date, and for the second Adjustment Date the
Variable Index will be the CPI for the month which is two months
prior to the second Adjustment Date, for the third Adjustment Date
the Variable Index will be the CPI for the month which is two
months prior to the third Adjustment Date, etc.
5
3.3 Additional
Rent; Rent Defined . If Landlord shall make any expenditure for
which Tenant is responsible or liable under this Lease, or if
Tenant shall become obligated to Landlord under this Lease for any
sum other than Base Rent or as hereinabove provided, the amount
thereof shall be deemed to constitute additional rent (“
Additional Rent ”) and shall be due and payable
by Tenant to Landlord, together with all applicable sales taxes
thereon, if any, simultaneously with the next succeeding monthly
installment of Base Rent or at such other time as may be expressly
provided in this Lease for the payment of the same.
For the purpose of
this Lease, the term “ Rent ” shall mean
and be defined as all Base Rent and Additional Rent due from Tenant
to Landlord hereunder.
3.4 Payment of
Rent . Each of the foregoing amounts of Rent and other sums
shall be paid to Landlord without demand and without deduction,
set-off, claim or counterclaim of any nature whatsoever which
Tenant may have or allege to have against Landlord, and all such
payments shall, upon receipt by Landlord, be and remain the sole
and absolute property of Landlord. All such Rent and other sums
shall be paid to Landlord in legal tender of the United States at
the address to which notices to Landlord are to be given or to such
other party or to such other address as Landlord may designate from
time to time by written notice to Tenant. If Landlord shall at any
time accept any such Rent or other sums after the same shall become
due and payable, such acceptance shall not excuse a delay upon
subsequent occasions, or constitute or be construed as a waiver of
any of Landlord’s rights hereunder. At the request of
Landlord, Tenant shall pay Base Rent and any Additional Rent
hereunder by electronic funds transfer or by wire, provided
Landlord provides to Tenant appropriate wire instructions or
electronic transfer instructions.
3.5 Past Due
Rent . If Tenant fails to make any payment of Rent or any other
sums or amounts to be paid by Tenant within five (5) days of
the date such payment is due and payable, Tenant shall pay to
Landlord an administrative late charge of two and one-half percent
(2.5%) of the amount of such payment. In addition, any past due
payment of Rent shall bear interest from the date such payment
became due to the date of payment thereof by Tenant at a rate which
is equal to the lesser of (i) twelve percent (12%) per annum,
or (ii) the maximum interest rate then allowable under the
laws of the State in which the Premises are located. Such late
charge and interest shall constitute Additional Rent and shall be
due and payable with the next installment of Rent due
hereunder.
3.6 No
Diminution or Abatement of Rent . No abatement, diminution or
reduction (i) of Rent, charges or other compensation, or
(ii) of Tenant’s other obligations hereunder shall be
allowed to Tenant or any person claiming under Tenant, under any
circumstances or for any reason whatsoever, except as expressly
provided otherwise herein.
ARTICLE IV.
USE AND OPERATION OF PREMISES
4.1 Permitted
Use . Tenant covenants that it shall, throughout the Term of
this Lease, use and occupy the Premises only for lawful purposes
which do not conflict with covenants, restrictions or other matters
of record affecting title to the Premises; notwithstanding the
foregoing provision, however, the following uses shall be
prohibited on the Premises:
6
(a) Any
obnoxious odor, noise or sound which can be heard or smelled
outside of the Building, provided that any usual paging system
shall be allowed and further provided that typical restaurant odors
shall not be deemed prohibited hereby if such restaurant facilities
have been properly constructed and maintained so as not to
pollute.
(b) Any
operation primarily used as a warehouse operation and any
assembling, manufacturing, distilling, refining, smelting,
agricultural or mining operation.
(c) Any
mobile home, trailer court, labor camp, junk yard or stock yard
(except that this provision shall not prohibit the temporary use of
construction trailers during periods of construction,
reconstruction or maintenance).
(d) Any
dumping, disposing, incineration or reduction of garbage (exclusive
of garbage compactors located in the rear of any
Building).
(e) Any
fire sale, bankruptcy sale (unless pursuant to a court order) or
auction house operation.
(f) A
facility whose primary business is auto or truck repair.
(g) Any
establishment which has as its principal business the selling or
exhibiting of pornographic materials, including, without limitation
any adult book or film store and any adult entertainment
nightclub.
(h) Any
so called “head shop” engaged primarily in the sale of
rolling paper and other drug paraphernalia.
4.3 Compliance
With Laws . Tenant shall at all times keep and maintain the
Premises in compliance with all applicable laws, ordinances,
statutes, rules, regulations, orders, directions and requirements
of all federal, state, county and municipal governments and of all
other governmental agencies or authorities having or claiming
jurisdiction over the Premises or the business activities conducted
thereon or therein and of all of their respective departments,
bureaus, agencies or officers, and of any insurance underwriting
board or insurance inspection bureau having or claiming such
jurisdiction or any other body exercising similar functions and of
all insurance companies from time to time selected by Tenant to
write policies of insurance covering the Premises and any business
or business activity conducted thereon or therein. However,
notwithstanding the foregoing, should there be a de minimis issue
of non-compliance with applicable law which does not have a
material adverse effect on the Premises, Tenant shall not be
obligated to correct such de minimis violation but Tenant shall
have the indemnity obligations set forth in Section 18.2 with
respect to any such de minimis violation, including indemnity
against any fines or penalties imposed against the Premises as a
result of such de minimis violations, if any.
Notwithstanding
the generality of the foregoing, but subject to the proviso set
forth in the last sentence of the preceding paragraph, Tenant
shall, at its sole expense, maintain the Premises in full
compliance with all applicable federal, state or municipal laws,
ordinances, rules and
7
regulations
currently in existence or hereafter enacted or rendered governing
accessibility for the disabled or handicapped, including, but not
limited to, any applicable provisions of The Architectural Barriers
Act of 1968, The Rehabilitation Act of 1973, The Americans With
Disabilities Act, the accessibility code(s), if any, of the State
in which the Premises is located, and all regulations and
guidelines promulgated under any all of the foregoing, as the same
may be amended from time to time (collectively the “
Accessibility Laws ”).
4.4 Compliance
With Restrictions, Etc . Tenant, at its expense, shall comply
with all restrictive covenants or other title exceptions affecting
the Premises and comply with and perform all of the obligations set
forth therein to the extent that the same are applicable to the
Premises or to the extent that the same, if not complied with or
performed, would impair or prevent the continued use, occupancy and
operation of the Premises. Further, in addition to Tenant’s
payment obligations under this Lease, Tenant shall pay (i) all
sums charged, levied or assessed under any restrictive covenants,
declaration, reciprocal easement agreement or other title
exceptions affecting the Premises promptly as the same become due
and shall furnish Landlord evidence of payment thereof, and
(ii) any fees, charges, fines, costs, assessments, taxes,
demands, orders, directives, or other requirements by any
governmental agency asserting jurisdiction, or under any
Environmental Laws which arise from or relate to Tenant’s use
of, or Tenant’s activities at, the Premises, including, but
not limited to, Storage Tank System registration fees, any
applicable fees, and any consultant or attorneys’ fees
related to or arising under any Environmental Laws.
4.5 Hazardous
Materials and Sewage .
(a)
Definitions . The following terms shall have the following
meanings:
(i) “
De Minimis Release ” shall mean a Release which
is (i) not reportable under any governmental authority under
any applicable Environmental Laws, or (ii) not above action
levels established by .
(ii)
“ Environmental Laws or Environmental Requirements
” , as used herein, shall mean all applicable federal,
state, and local government laws (including common law), rules,
regulations, statutes, codes, ordinances, directives, guidance
documents, cleanup or other standards, and any other governmental
requirements or standards which pertain to, regulate, or impose
liability or standards of conduct concerning the use, storage,
human exposure to, handling, transportation, release, cleanup or
disposal of Hazardous Materials.
(iii) “
Hazardous Materials ” shall mean and be defined
as any and all toxic or hazardous substances, chemicals, materials
or pollutants, of any kind or nature, which are regulated,
governed, restricted or prohibited by any federal, state or local
law, decision, statute, rule, or ordinance currently in existence
or hereafter enacted or rendered, and shall include (without
limitation), all oil, gasoline and petroleum based
substances.
(iv) “
Material Release ” shall mean any Release other
than a De Minimis Release.
(v)
“ Pre-Existing Environmental Condition ”
means presence of: (i) Hazardous Materials in soil,
groundwater or surface water on or about the Premises which
first
8
existed or
first occurred prior to the Effective Date; or (ii) any other
environmental condition which first existed or first occurred prior
to the Effective Date.
(vi) “
Release ” shall mean any spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping, or disposing into the environment any
Hazardous Materials on, over, under, from or affecting the Premises
or the air, soil, water vegetation, buildings, personal property,
persons or animals thereon, whether occurring before or during the
Term of this Lease.
(vii)
“ Storage Tank System ” means a complex
of one or more underground or aboveground storage tanks and their
associated underground, above ground, and/or connected piping and
related fuel dispensing, pumping, mechanical, control and
detectional equipment, as more particularly located on the
Land.
(b)
Environmental Compliance . Tenant shall comply with all
laws, including Environmental Laws, relating to the use, storage,
transportation, dispensing, sale or Release of Hazardous Materials
at the Premises, except for any noncompliance of a de minimis
nature or for which the result of noncompliance would not have a
material adverse effect on the Premises. Without limiting the
foregoing, Tenant shall comply with all laws, including
Environmental Laws, relating to Storage Tank Systems, their
construction, operation, maintenance, calibration and alarm
systems, and promptly shall implement any and all upgrade
requirements promulgated by any government agency having
jurisdiction at the earliest possible time, but in no event, no
later than any applicable deadline announced or promulgated by the
government agency. Tenant shall not intentionally Release, and
shall use commercially reasonable efforts to prevent any employee,
contractor, agent, sublessee, invitee or licensee from Releasing,
any Hazardous Materials on the Premises, into the air or the
surrounding land, surface water or ground water; provided, however,
a De Minimis Release on the Premises shall not be a violation of or
a default of Tenant under the Lease (but Tenant shall have the
remediation and indemnity obligations set forth in
Section 4.5(c) and 4.5(d) below). Tenant shall provide
Landlord with copies of all reports, studies, complaints, claims,
directives, citations, demands, inquiries, notices of violation, or
orders relating to Hazardous Materials at or emanating from or to
the Premises, at any time, or any alleged non-compliance with
Environmental Laws at the Premises, reasonably promptly (and in no
event later than fifteen (15) days) after such documents are
provided to or generated by Tenant. Tenant also shall notify
Landlord of any Material Release of Hazardous Materials at, on,
under or from the Premises promptly upon notification of Tenant
thereof, and promptly shall abate and remove any such Releases as
required in this Article. A Material Release in and of itself shall
not be a violation of or a default under this Lease, unless such
Material Release shall result from the intentional acts of Tenant
or from Tenant’s failure to use commercially reasonable
efforts to prevent any employee, contractor, agent, lessee, invitee
or licensee from Releasing, any Hazardous Materials on the
Premises, into the air or the surrounding land, surface water or
ground water; provided, however, Tenant’s failure to respond
or take action after a Material Release as otherwise required in
this Lease shall be a default hereunder. Any fuel spills
immediately shall be removed and cleaned up using absorbent or
other appropriate materials. Water shall not be used to clean
gasoline or diesel from the surfaces of the Premises, other than
for routine power washing and any water used by the fire department
in response to a fire. All reporting, investigation and/or
remediation requirements
9
under any
Environmental Law with respect to any and all Releases of Hazardous
Materials at, on, from or near the Premises are the responsibility
of Tenant.
(c)
Tenant’s Responsibility for Hazardous Materials .
Hazardous Materials at the Premises shall be the responsibility of
Tenant and Tenant shall be liable for and responsible for such
Hazardous Materials, including without limitation, at
Tenant’s sole cost (i) any Pre-Existing Environmental
Condition (provided, however, that Tenant represents that based on
the environmental information in Tenant’s files, there are no
known Pre-Existing Environmental Conditions on the date of this
Lease, and based on such information, the possibility of such a
Pre-Existing Environmental Condition is remote);
(ii) permitting, reporting, assessment, testing,
investigation, treatment, removal, remediation, transportation and
disposal of such Hazardous Materials as directed by any
governmental agency, as required by Environmental Laws;
(iii) damages, costs, expenditures and claims for injury to
persons, property, the Premises and surrounding air, land, surface
water, and ground water resulting from such Hazardous Materials;
(iv) claims by any governmental agency or third party
associated with injury to surrounding air, land, surface water and
ground water or other damage resulting from such Hazardous
Materials; (v) damages for injury to the buildings, fixtures,
appurtenances, equipment and other personal property of Landlord to
the extent caused by such Hazardous Materials; (vi) fines,
costs, fees, assessments, taxes, demands, orders, directives or any
other requirements imposed in any manner by any governmental agency
asserting jurisdiction, or under any Environmental Laws with
respect to such Hazardous Materials; (vii) damages, costs and
expenditures for injury to natural resources to the extent caused
by such Hazardous Materials as directed by any governmental agency
or otherwise as required by applicable law, including Environmental
Laws; (viii) compliance with Environmental Laws regarding the
use, storage, transportation, release, disposal, dispensing or sale
of Hazardous Materials; and (ix) any other liability or
obligation related to such Hazardous Materials. Except as otherwise
provided in Section 4.6(f) below, Landlord is not required to
incur any costs, fees (including attorney, consultant and expert
witness fees) or expenses for environmental compliance, testing,
investigation, assessment, remediation or cleanup relating to
Hazardous Materials, should Landlord incur any such reasonable
costs, expenses or fees relating to Hazardous Materials at the
Premises or surrounding lands or surface water or ground water,
Tenant shall promptly reimburse Landlord for said costs, expenses
or fees (except to the extent such costs, fees or expenses arise
from other property owned by Landlord, if any).
(d)
Tenant’s Environmental Indemnification . Tenant shall
indemnify, defend, and hold Landlord harmless from any and all
claims, judgments, damages, penalties, fines, costs, liabilities,
or losses (including, without limitation, diminution in value of
the Premises, damages for the loss or restriction on use of
rentable or usable space or of any amenity of the Premises, damages
arising from any adverse impact on marketing of space of the
Premises, and sums paid in settlement of claims, attorneys’
fees, consultation fees, and expert fees) which arise before, or
during the term of the Lease as a result of Hazardous Materials
(provided, however, that Tenant represents that based on the
environmental information in Tenant’s files, there are no
known Pre-Existing Environmental Conditions on the date of this
Lease, and based on such information, the possibility of such a
Pre-Existing Environmental Condition is remote). This
indemnification of Landlord by Tenant includes, without limitation,
costs incurred in connection with any investigation or site
conditions or any cleanup, remedial, removal, or restoration work
required by any federal, state, or local governmental agency or
political subdivision because of
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Hazardous
Materials present in the soil or ground water on or under the
Premises. Without limiting the foregoing, if the presence of any
Hazardous Materials on the Premises results in any contamination of
the Premises, Tenant shall promptly take all actions at its sole
expense as are recommended by environmental consultants hired by
Tenant and are necessary to return the Premises to the condition
required by the appropriate governmental authority; provided that
Landlord’s approval of such actions shall first be obtained,
which approval shall not be unreasonably withheld so long as such
actions would not potentially have any material adverse long-term
or short-term effect on the Premises. Should Tenant obtain a
“no further action” closure letter or similar evidence
of the completion of remediation from (an “ NFA
Letter ”) Tenant shall have no obligation to further
remediate the Premises, but Tenant shall continue to indemnify,
defend and hold harmless Landlord for any claims, judgments,
damages, penalties, fines, costs, liabilities, or losses as more
particularly set forth in the beginning of this paragraph.
Notwithstanding the foregoing, as more particularly provided for in
Section 4.6(b), upon the end of the Lease Term, should Tenant
obtain an NFA Letter, Tenant’s indemnity obligations under
this subsection shall be modified as more particularly set forth in
Section 4.6(b).
(e)
Tenant’s Notification Obligation . Tenant promptly
shall notify Landlord of any of the following: (i) any
correspondence or communication from any governmental entity
regarding the application of Environmental Laws to the Premises or
Tenant’s operation of the Premises, if such communication
would enlarge or materially change or has the potential to
materially change Tenant’s or Landlord’s obligations or
liabilities under the Environmental Laws; (ii) any
correspondence, communication or notifications as are required by
either the Federal or State Emergency Planning and Community Right
to Know Acts if such communication would enlarge or materially
change or has the potential to materially change Tenant’s or
Landlord’s obligations or liabilities under the Environmental
Laws; (iii) any material change in Tenant’s operations
on the Premises that will enlarge or materially change or has the
potential to materially change Tenant’s obligations or
liabilities under the Environmental Laws; (iv) any Material
Release or suspected Material Releases of any and all Hazardous
Materials at, from or near the Premises. In addition, within thirty
(30) days of Landlord’s written request, Tenant shall
provide to Landlord a copy of Tenant’s “
Leaseback Environmental Status Report ” or a
similar report if such report is no longer created by Tenant, which
describes all testing and test results of the Premises during the
prior year. Such request of shall not be made by Landlord more than
twice in any calendar year.
(f)
Landlord’s Right of Entry . If there has been a
Material Release, at Landlord’s sole expense and sole
discretion, Landlord may enter upon the Premises (without
interfering with Tenant’s business and operations on the
Premises) and make any inspection, tests, borings, measurements,
investigation or assessment Landlord deems necessary in the
exercise of its reasonable judgment in order to determine the
presence of Hazardous Materials. Provided, however, that Landlord
shall not conduct any soil borings or other invasive testing
procedures unless there has been a Material Release or Landlord has
a reasonable basis to suspect there has been a Material Release on
the Premises. Landlord shall select a qualified environmental
consultant to complete such tasks and shall not conduct any such
inspections or other activities described herein without consulting
and coordinating such efforts with the Tenant’s environmental
team. Nothing herein shall be deemed to require Landlord to conduct
any such testing, measurement, investigation or assessment.
Landlord shall give Tenant a
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minimum of five
(5) days written notice prior to conducting any such
inspection, tests, borings, measurements, investigation or
assessment, so that Tenant may have the opportunity to be present
and to receive split test samples and/or to observe such testing.
Landlord agrees to consult with and coordinate such actions with
Tenant’s environmental team. In conducting any such
inspections, and testing, Landlord shall not unduly interrupt or
interfere with the conduct of Tenant’s business.
Notwithstanding any other provisions of this Lease to the contrary,
Landlord shall be solely responsible for any costs, claims,
damages, expenses or liabilities that arise as a result of
Landlord’s inspections and testing to the extent attributable
to the negligence or misconduct of Landlord or Landlord’s
agents. Provided, however, no notice from Landlord to Tenant shall
be required under urgent or emergency conditions. Tenant shall be
provided with a copy of each report setting forth the results of
any test performed by Landlord promptly upon receipt.
Landlord’s right of entry and inspection shall include the
right to inspect Tenant’s records required to be maintained
pursuant to Environmental Laws.
(g)
Tenant’s Environmental Records . Landlord shall have
the right to require Tenant to provide to Landlord access to
Tenant’s file with respect to environmental matters affecting
the Premises upon two (2) business days prior written notice.
Upon such request, not to be made more than once in any calendar
year, Tenant shall provide a copy of all new correspondence,
reports and other written material in Tenant’s environmental
file for the Premises.
(h)
Tenant’s Right to Remove the Storage Tank System during
the Term .
Tenant shall
have the right, at its sole discretion, during the first fifteen
(15) Lease Years to remove all or part of the Storage Tank
System, and upon such removal Tenant shall not be obligated to
replace such Storage Tank System but shall be obligated to restore
the surface where the Storage Tank System was removed to grade
(including restoration of the asphalt or other Improvements damaged
by such removal, if any) consistent with the condition of the
surface and Improvements prior to such removal. After the first
fifteen (15) Lease Years, and only if Tenant has exercised the
next five-year option, Tenant shall have the right, at its sole
discretion, to remove all or part of the Storage Tank System, and
upon such removal Tenant shall not be obligated to replace such
Storage Tank System but shall be obligated to restore the surface
where the Storage Tank System was removed to grade (including
restoration of the asphalt or other Improvements damaged by such
removal, if any) consistent with the condition of the surface and
Improvements prior to such removal. Notwithstanding anything herein
to the contrary, if there is a Material Release after the fifteenth
(15 th
) Lease Year which results from a
material failure in the Storage Tank System, then Tenant shall have
the right to remove the Storage Tank System in order to remediate
the Premises in compliance with the appropriate governmental
authorities, and in such case, Tenant shall not have the obligation
to replace the Storage Tank System (regardless of whether Tenant
has exercised the next five-year option) but shall be obligated to
restore the surface where the Storage Tank System was removed to
grade (including restoration of the asphalt or other Improvements
damaged by such removal, if any) consistent with the condition of
the surface and Improvements prior to such removal. Any removal and
replacement of the Storage Tank System shall be performed in
accordance with all laws as required by Section 4.3, including
all Environmental Laws as required by this Section 4.5. If
there are any Hazardous Materials on, at or under the Premises at
the time of such removal and replacement, then Tenant shall
remediate such Hazardous Materials as otherwise required by this
Section 4.5.
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4.6 Resolution
of Environmental Matters at Expiration or Termination of
Tenancy .
(a)
Tenancy Close-Out Environmental Assessment and Report . Not
later than (i) thirty (30) days prior to the expiration
of the Lease or (ii) ninety days after an earlier termination
of the tenancy, whichever may apply, Tenant shall submit to the
Landlord (i) a copy of all of Tenant’s records relating
to obligations under this Article IV, and (ii) a report
of any environmental assessment pursuant to ASTM and/or prevailing
industry standards, conducted by a qualified, and adequately
insured consultant firm, to (1) identify and assess the
presence of Hazardous Materials on, in, at, and, where information
indicates migration of Hazardous Materials off site and it is
practical to do so, off site of the Premises; (2) all records
relating to the determination of the integrity and tightness of all
Storage Tank Systems on the Premises; and (3) determine any
needed remedial actions needed or pending regulatory obligations
performance or resolution of which is required to comply with
Environmental Laws or restore the Premises as set forth in this
Section 4.6. Tenant shall secure on behalf of Landlord the ability
of the Landlord to rely upon the report and be named as an
additional insured under the consultant’s insurance policies.
Tenant shall update and supplement such report as needed through
the date of the end of the tenancy to reflect any change in
conditions or new information pertaining to the methodology or
findings of the report. Tenant shall not be in default under this
Lease for failure to complete the matters in this paragraph if
Tenant is actively and diligently pursuing such matters.
(b)
Remedial and Corrective Actions; Closure of Storage Tank
Systems : Not later than (i) the expiration of the Lease,
(ii) six (6) months after the earlier termination of the
Lease, (iii) or such longer time as is approved in writing by
Governmental Authorities, if any is required, or as may be
necessary to complete such corrective action in compliance with
Governmental Authorities, and in any event, as consented to by
Landlord, which consent shall not be unreasonably withheld, Tenant
shall provide Landlord with written evidence and assurances that,
as of the date of the end of the tenancy, or as soon as reasonably
practicable thereafter, the Premises and any Storage Tank Systems
left at the Premises comply (or will comply if any remediation is
required) with all Environmental Laws and, where applicable, any
required regulatory closures or NFA Letter have been obtained. Upon
delivery of the evidence required hereunder, Tenant shall no longer
have any indemnity obligations under this Lease with respect to any
new suit or claim brought against Landlord or the Premises after
the end of the Term regarding any Release that occurred on the
Premises during the Term.
4.7 Right to
Contest . Tenant may, at its sole cost and expense, contest, or
cause to be contested, by appropriate legal proceedings conducted
in good faith and with due diligence, the application of laws,
ordinances, statutes or regulations to the Premises, including the
application of Environmental Laws or Environmental Requirements to
the Premises, provided Tenant indemnifies and holds Landlord
harmless from any expenses (including reasonable attorney’s
fees) or liability arising out of such contest, and posts any bond
or security required by law in connection with such
contest.
4.8 Sewage
. Tenant shall not discharge or permit to be discharged from the
Premises any sewage other than that which is normal waste water for
the business conducted by Tenant on, in or from the Premises. Any
sewage which is produced or generated in connection with the
use
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or operation of
the Premises shall be handled and disposed of by Tenant as required
by and in compliance with all applicable local, state and federal
laws, ordinances and rules or regulations.
4.9
Survival . The provisions of this Article IV shall
survive expiration or termination of the tenancy but nothing herein
shall obligate Tenant for any environmental conditions first
existing on the Premises after the date of expiration or
termination of Tenant’s tenancy hereunder.
ARTICLE V.
TAXES AND ASSESSMENTS
5.1 Real Estate
Taxes and Assessments . From and after the Effective Date and
continuing throughout the Term of this Lease Tenant’s
obligations with respect to Real Estate Taxes (as hereinafter
defined) shall be as follows:
(a) As
used herein, “ Real Estate Taxes ” shall
mean all taxes, assessments and other governmental impositions and
charges of every kind and nature whatsoever, extraordinary as well
as ordinary, and each and every installment thereof which during
the Term hereof or prior to the Term of the Lease shall be or have
been charged, laid, levied, assessed, or imposed upon, or arise in
connection with, the use, occupancy or possession of the Premises
or any part thereof, including, without limitation, ad valorem real
and personal property taxes, and all taxes charged, laid, levied,
assessed or imposed in lieu of or in addition to any of the
foregoing by virtue of all present or future laws, ordinances,
requirements, orders, directions, rules or regulations of federal,
state, county and municipal governments and of all other
governmental authorities whatsoever.
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