This Lease is made
and entered into between HARRISON LIMITED PARTNERSHIP ONE, a North
Carolina limited partnership, (the “Landlord”)
and COCA-COLA BOTTLING CO. CONSOLIDATED, a Delaware corporation
(the “Tenant” ).
ARTICLE 2. LEASED
PROPERTY
Section 2.01 Description of Leased
Property .
Landlord, for and
in consideration of the rents, covenants and agreements hereinafter
set forth and agreed to be paid, kept and performed by Tenant, does
hereby lease to Tenant, and Tenant hereby leases from Landlord,
that certain real property located in Mecklenburg County, North
Carolina, a description of which is attached hereto as
Exhibit A (the “Land” ), together
with all improvements located thereon, including, without
limitation, surrounding grounds, driveways, parking areas and
related facilities, and including all appurtenances, rights,
privileges, easements and advantages thereto belonging (the Land
and the aforesaid improvements shall be referred to collectively
herein as the “Leased Property” ).
Section 2.02 Landlord’s Covenants
of Title, Quiet Enjoyment .
Landlord covenants
that it has title to the Leased Property and the right to make this
Lease for the Term (as such term is defined hereinafter). Landlord
further covenants and warrants that as long as Tenant is not in
default under the terms of this Lease, Tenant, shall have quiet,
exclusive and peaceful possession of the Leased Property and shall
enjoy all of the rights herein granted without interference. Tenant
represents and warrants that it has made an independent
investigation of the
zoning of the
Land and determined that the same is satisfactory for its purposes
Tenant further acknowledges that the improvements constructed on
the Land have been inspected by it and that it leases the same from
Landlord in their “as is” condition without any
representation or warranty, implied or otherwise, as to condition
or the suitability thereof for Tenant’s purposes. Tenant
acknowledges and agrees that easement contained in Book 3648 at
Page 436 in the Mecklenburg Public Registry provides for a
waterline right-of-way which may be terminated by CSX Corp. at any
time. Such termination shall not affect the obligations of Tenant
hereunder.
The term of this
Lease (the “Term” ) shall be for a period of ten
(10) years, expiring at midnight on December 31, 2020,
unless extended as provided herein.
Section 3.02 Commencement of Term
.
The Term shall
commence on January 1, 2011 (the “Commencement
Date” ). The entry or presence of Tenant on the Land
prior to the Commencement Date, for the purpose of conducting its
business shall not constitute commencement of the Term.
Irrespective of such entry or presence, the Term and the payment of
“Base Rent” (as such term is defined hereinafter) shall
not begin until the Commencement Date. The Term shall also be
referred to herein from time to time as the “Initial
Term” .
Section 3.03 Options to Extend Term
.
Provided that
Tenant is not then in default under this Lease beyond any
applicable notice and cure period, Tenant shall be entitled to
extend the Term of this Lease for four (4) successive terms
(each of which is herein referred to as an “Extension
Term” ) of five (5) lease years each. The first
Extension Term shall commence (if properly exercised) immediately
upon the expiration
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of the Initial
Term, and each following Extension Term shall commence (if properly
exercised) immediately upon the expiration of the immediately
preceding Extension Term. In order to exercise an option to extend
the Term of this Lease as provided herein, Tenant shall give
Landlord written notice of such exercise not less than one hundred
eighty (180) days prior to the expiration of the Initial Term
or the then-current Extension Term, as applicable (the
“Renewal Notice” ). All of the terms and
conditions contained in this Lease shall be applicable and shall
continue in full force and effect during an Extension Term. In the
event Tenant does not timely or properly exercise an option to
extend the Term of this Lease in accordance with the foregoing,
then the subject option and all future options to extend the Term
of this Lease as provided above shall become null and void and be
of no further force or effect.
The annual base
rent (the “Base Rent” ) for the initial twelve
(12) month period of the Term shall be $3,411,329.25 (which
sum is the product obtained by multiplying 649,777 [the square
footage of the building] by $5.25), Beginning with the first
(1 st
) annual anniversary of the
Commencement Date, and continuing with each subsequent annual
anniversary of the Commencement Date, the Base Rent paid by Tenant
shall be increased by three percent (3%) of the Base Rent in effect
during the immediately preceding twelve (12) month period. All
references in this Lease to “Base Rent” shall be
deemed and construed to include the annual adjustment provided
herein.
Section 4.02 Payment of Rent
.
Tenant shall pay
the Base Rent in quarterly installments, in advance, and without
demand on the first (l st )
day of each and every quarter during the Term.
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Section 4.03 Late payment of Rent
.
In the event any
quarterly installment of Base Rent is not received on the due date,
such amount shall accrue interest at the rate of fifteen percent
(15%) per annum (or the maximum interest rate allowed by law if
less than 15%) and such interest shall be due and payable by Tenant
to Landlord for the period of time said payment is delinquent as
additional rent hereunder; provided that a default shall occur only
as specified in Section 13.01 herein. The imposition of
this charge shall not be deemed a waiver or be in lieu of
Landlord’s other rights hereunder.
ARTICLE 5. BUILDING OPERATIONAL
EXPENSES AND TAXES
Section 5.01 Operational Expenses
.
Tenant shall be
responsible for all expenses and charges which, during the Term,
shall be incurred in connection with the possession, occupation,
operation, alteration, maintenance, repair and use of the Leased
Property, and any other sums which, except for the execution and
delivery of this Lease, would be chargeable against the Leased
Property or the owner, occupant or possessor of the Leased
Property.
Tenant shall pay
to the appropriate taxing authorities prior to delinquency, all
real estate taxes and assessments of any nature whatsoever levied
or assessed on the Leased Property during the Term and taxes,
assessments and charges levied in lieu of such real estate taxes,
charges and assessments and taxes levied on or with respect to
rentals payable hereunder (other than income taxes on the overall
income of Landlord). Tenant shall, within ten (10) days after
the required date of payment, furnish to Landlord copies of paid
receipts for all such taxes, assessments and charges, Said taxes
and assessments shall be prorated for any partial calendar year or
tax period during the Term.
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Section 5.03 Review of Taxes
.
Tenant shall have
the right to challenge, by legal proceedings instituted and
conducted at Tenant’s own expense, and free of expense to
Landlord, any such taxes imposed upon or against the Land. Landlord
shall join in any such proceedings and hereby agrees that any such
proceeding may be brought in its name if the provisions of any law,
rule or regulation shall so require. Tenant shall nevertheless pay
and continue to pay, as the same becomes due and payable, such
impositions under protest, and Tenant shall be entitled to any
refund which is made of any such amounts. Landlord shall not,
without Tenant’s prior written approval, make or agree to any
settlement, compromise or other disposition of any such
proceedings, or discontinue or withdraw from any such proceedings
or accept any refund so long as Tenant shall comply with the terms
of this Lease, including specifically the requirement to pay
rent.
It is
Tenant’s intention to use or cause the Leased Property to be
used for the purpose of operating a Coca-Cola Bottling Plant and
related sales, storage and office facilities or such other lawful
business as Tenant may from time to time deem advisable; provided,
however, Tenant, shall not conduct any business within the Leased
Property which violates local, state or federal laws, rules or
regulations.
Section 6.02 Tenant’s Compliance
With Law .
Tenant shall at
all times during the Term comply with any and all laws, ordinances,
rules or regulations of any governmental authority having
jurisdiction over the Leased Property, including the making of any
structural changes on or to the Leased Property in order to comply
with any such law, regulation, requirement, or order.
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ARTICLE 7. FIXTURES AND
SIGNS
Section 7.01 Installation and Removal of
Trade Fixtures .
Tenant may install
in and affix to the Leased Property such fixtures, signs and
equipment as Tenant deems desirable (subject to Tenant’s
obligations under Section 6-02 above). All such
fixtures, signs and equipment shall remain the property of Tenant
and may be removed at any time provided that Tenant, at its
expense, shall repair any damage caused by reason of such removal.
Tenant shall pay all taxes or other charges or fees levied or
assessed against or as a result of such fixtures, signs and
equipment.
Section 7.02 Tenant’s Exclusive
Right to Erect Signs .
Tenant shall have
the exclusive right to erect and maintain upon the Leased Property
all signs which lawfully may be placed thereon and which it deems
appropriate to the conduct of its business, Landlord shall not
place any signs or advertising matter of any nature upon any part
of the Leased Property or permit others to do so.
Section 7.03 Landlord’s Right to
Erect Signs .
The provisions of
Section 7.02 notwithstanding, Landlord shall have the
right during the last one hundred eighty (180) days of the
Term to advertise and post “For Rent/Lease or Sale”
signs on the Leased Property. Tenant shall cooperate with Landlord
in showing the Leased Property to prospective tenants or purchasers
during normal business hours.
ARTICLE 8. REPAIRS, ALTERATIONS,
RECONSTRUCTION
Section 8.01 Tenant to Maintain
.
Subject to the
provisions of Sections 8.04 and 8.05 below,
Tenant shall, at its sole cost and expense, maintain the exterior,
roof, parking areas, landscaping, interior, interior and exterior
walls,
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plumbing,
heating and air conditioning systems, structure, plate glass and
all other components and parts of the Leased Property in good
condition and repair throughout the Term.
Section 8.02 Exterior Areas —
Maintenance .
Tenant shall
maintain and clean the parking, landscaping and other exterior
areas of the Leased Property, keeping the same in good condition
and repair throughout the Term, and Tenant shall provide for
lighting such areas at its sole cost and expense.
Section 8.03 Tenant’s Right to
Make Alterations or Additions .
Tenant may, at its
own expense, make such nonstructural alterations, additions and
changes to the Leased Property as it may deem necessary. Any
structural alteration, addition, or change to the Leased Premises
must be approved in writing by Landlord, which approval will not be
unreasonably withheld, and shall become a part of the Leased
Property and may not be removed upon termination of the Lease.
Non-structural alterations, additions, or changes shall become a
part of the Leased Property and upon the termination of this Lease,
Tenant shall have the right and may be required by Landlord to
remove the same. If Tenant removes any such alterations, additions
or changes installed by Tenant, Tenant shall repair all damage to
the Leased Property caused by such removal.
Section 8.04 Damage to Improvements
— Repairs or Election to Terminate .
(a)
Repairable Casualty . In the event the Leased Property shall
be damaged by fire, earthquake, other elements or other casualty
during the Term and Tenant does not elect to terminate this Lease
pursuant to Section 8.04(b) below, Tenant shall give
prompt notice of such casualty to Landlord, and shall proceed with
reasonable diligence to carry out any necessary demolition and to
restore, repair, replace and rebuild such building and improvements
at Tenant’s own cost and expense. If any insurance proceeds
shall have been paid by reason of such damage or
destruction,
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Tenant shall be
entitled to such proceeds in order to complete such repairs. If at
any time Tenant shall fail or neglect to supply sufficient workmen
or sufficient materials of proper quality, or fail in any other
respect to prosecute such work of demolition, restoration, repair,
replacement or rebuilding with diligence and promptness, then
Landlord may give to Tenant written notice of such failure or
neglect, and if such failure or neglect continues for more than
sixty (60) days after such notice, then Landlord, in addition
to all other rights which Landlord may have, may enter upon the
Leased Property, provide labor and/or materials, cause the
performance of any contract and/or do such other acts and things as
Landlord may deem advisable to prosecute such work, in which event
Landlord shall be entitled to reimbursement of its costs and
expenses out of any insurance proceeds for application to the cost
of such work. All costs and expenses incurred by Landlord in
carrying out such work for which Landlord is not reimbursed out of
insurance proceeds or other moneys shall be borne by Tenant and
shall be payable by Tenant to Landlord as additional rent within
ten (10) days of demand therefor, which demand may be made by
Landlord from time to time as such costs and expenses are incurred,
in addition to any or all damages to which Landlord shall be
entitled hereunder.
Rent shall not
abate hereunder by reason of any damage to or of the Leased
Property and Tenant shall continue to perform and fulfill all of
Tenant’s obligations, covenants and agreements hereunder
notwithstanding any such damage or destruction.
(b)
Substantial Casualty . If (i) the Leased Property shall
be damaged by fire, earthquake, other elements or other casualty
during the Term and the Board of Directors of Tenant shall
reasonably determine in good faith that the Leased Property has
been rendered unsuitable for continued use in Tenant’s
business, or (ii) during the last twelve (12) months of
the Term, the Leased Property is damaged by fire, earthquake, other
elements or other casualty and the amount of
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the damage is
greater than twenty-five percent (25%) of the replacement cost of
the Leased Property (excluding costs of footings, foundations,
excavation and paving) (each a “Substantial
Casualty” ), then Tenant may terminate this Lease by
delivery of written notice of termination to Landlord within ninety
(90) days after the Substantial Casualty occurs. Upon such
termination, Tenant shall surrender the Leased Property to
Landlord, and neither party shall have any further obligations or
liabilities under this Lease (except for such obligations and
liabilities as would survive the normal expiration of the Term, all
of which shall survive such early termination). Notwithstanding the
foregoing, Tenant shall be entitled to terminate this Lease
pursuant to this Section 8.04(b) if and only if insurance
proceeds resulting from such casualty event (which are to be paid
in full to Landlord in conjunction with such termination of this
Lease by Tenant) are sufficient to fully restore the damaged or
destroyed portion of the Leased Property. Upon the termination of
this Lease in accordance with the provisions of this
Section 8.04(b) , all insurance proceeds shall belong
to and shall be payable to Landlord, and Tenant shall have no right
or claim with respect to such insurance proceeds. In the event of
any termination of this Lease under the provisions of this
Section 8.04(b) , this Lease shall terminate at the end
of the calendar month in which the notice of termination is
given.
Section 8.05 Tenant’s Repairs for
Building and Occupancy Regulations .
If any
governmental agency or any department or division thereof shall
condemn the Leased Property or any part thereof as unsafe or as not
in conformity with the laws and regulations relating to the use,
occupation, and construction thereof (including, without
limitation, the Americans with Disabilities Act, as amended), or
shall order or require any rebuilding, alteration or repair, Tenant
shall immediately at Tenant’s own cost and expense (and
without any right of reimbursement from Landlord) effect such
alterations and repairs in the Leased Property as may be necessary
to comply
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with such laws,
regulations, orders, or requirements. All such alterations and
repairs shall be made in accordance with the plans and
specifications approved in writing by Landlord, which approval
shall not be unreasonably withheld.
Section 8.06 Condition of Leased
Property on Surrender .
At the termination
of this Lease, Tenant shall surrender the Leased Property to
Landlord in good condition and repair, subject only to the
consequences and effect of reasonable wear and tear and permissible
alteration, additions and changes under Section 8.03 ,
condemnation, casualty and acts of God and the terms of
Section 8.04 herein.
Section 8.07 Mechanic’s Liens
.
Tenant will pay
for all work performed on the Leased Property by its employees or
contractors and shall indemnify and hold Landlord harmless from all
liability resulting from any lien or claim of lien arising out of
such work. Tenant shall have the right, at its sole cost and
expense, to contest the validity of any such lien or claimed lien.
Landlord shall have the right to enter the Leased Property for the
purpose of posting notices of nonliability for work performed at
the direction of Tenant. Should a lien be filed against the Leased
Property or any other action, affecting title thereto be commenced,
the party first receiving notice thereof shall immediately give
written notice to the other party. Tenant shall promptly take all
necessary action to cause the same to be discharged or
removed.
Section 9.01 Condemnation
.
(a)
Repairable Condemnation . In the event of a condemnation of
less than all or substantially all of the Leased Property after
which this Lease does not terminate pursuant to
Section 9.01(b) below (a “Repairable
Condemnation” ), (i) Tenant shall promptly commence
and
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take
commercially reasonable efforts, to the extent of available
condemnation proceeds, to either restore any portion of the Leased
Property altered or damaged by such Repairable Condemnation to a
complete architectural unit, in which event Tenant shall be
entitled to so much of the condemnation award as may be necessary
to reimburse Tenant for its actual, third-party out-of-pocket costs
(the sum of the funds paid by Tenant for labor, services,
materials, supplies, insurance and bond premiums, development,
financing and all other third-party out-of-pocket costs and
expenses) directly related to such restoration, or demolish any
such damaged or altered portion of the Leased Property and
re-construct such portion of the Leased Property, and (ii) the
Base Rent shall be re-determined equitably by Landlord. If the net
condemnation award exceeds the cost of repair, Landlord may retain
such excess. All condemnation proceeds shall be made available to
Tenant to complete such repairs. This Lease shall continue in full
force and effect, and Base Rent shall not be abated as a result of
such taking.
(b)
Substantial Condemnation . In the event of a condemnation of
all or substantially all of the Leased Property (a taking of
“substantially all” of the Leased Property shall mean a
taking which, in the good faith opinion of Tenant’s Board of
Directors, renders the Leased Property unsuitable for continued use
in Tenant’s trade or business) (a “Substantial
Condemnation” ), this Lease shall terminate and expire on
the date of such Substantial Condemnation, and Base Rent hereunder
shall be apportioned and paid to the date of such Substantial
Condemnation. If this Lease shall terminate as a result of a
Substantial Condemnation, Landlord shall be entitled to all of the
condemnation award to compensate Landlord for: (a) the value
of the Leased Property, (b) the diminution in the value of
land which is not taken and which is owned by Landlord in the
vicinity of the Land which is taken, and (c) the loss of
future rental income from the Premises. In such case, Tenant may
pursue a separate claim against the condemning authority for moving
expenses, for the
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value of its
furniture, equipment and trade fixtures, and for loss of business,
but not for the value of Tenant’s leasehold estate (which
Tenant waives and relinquishes to Landlord in full), and in no
event shall any such separate award diminish in any respect the
condemnation award that Landlord is entitled to receive under this
Section 9.01(b).
Section 9.02 Notice of
Condemnation.
Landlord shall,
immediately after it receives notice of the intention of any such
authority to appropriate or take all or any portion of the Leased
Property, give to Tenant notice in writing of such intended
appropriation or taking.
Section 9.03 Voluntary Sale as
Taking.
A voluntary sale
by Landlord to any public body or agency having the power of
eminent domain, either under threat of condemnation or while
condemnation proceedings are pending, shall be deemed to be taking
under the power of eminent domain for the purposes of this
Article 9 .
ARTICLE 10. INDEMNITY AND
INSURANCE
Section 10.01 Indemnification of
Landlord by Tenant .
Landlord shall not
be liable for any damage or liability of any kind or for any damage
or injury to persons or property during the Term from any cause
whatsoever by reason of the use, occupation, and enjoyment of the
Leased Property by
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