Underlying lease of shopping center.
This lease, made and entered into _________[year], by and between _________, a _________ corporation, ("lessor") and _________, a _________ corporation, ("tenant"); witnesses:
That the lessor in consideration of the rents and covenants herein mentioned, to be paid and performed by the tenant, does hereby demise, lease and let unto the tenant, and the tenant does hereby hire and take from the lessor, the premises situated in the county of _________ and state of _________ and described on the attached "exhibit A," which is by this reference made a part hereof and incorporated herein, together with all right, privileges, easements and appurtenances belonging to or in any way pertaining to the leased premises.
The term of this lease shall commence on the day and year first above written and shall continue thereafter for a period concluding 99 years from the day and year first above written.
II. Nature of Occupancy.
The tenant agrees to use the leased premises only within the scope of all applicable laws, ordinances and regulations for the following purposes and for no other purposes, namely:
Construction, operation, and rental of a shopping center and such structures as are incidental thereto.
Tenant agrees to pay and the lessor hereby agrees to accept for and as the monthly rental for the demised premises commencing at a time when not less than _____% of the shopping center is open for business, however, no later than January 1, [year], the sum of $_____. Such rent shall be paid in equal monthly installments in advance on the first day of every month during the term hereof.
Pending construction of the shopping center, tenant agrees to pay and lessor agrees to accept for and as monthly rental for the period prior to the commencement of the annual rental above provided $_____.
In addition to the rentals as above stated, tenant agrees to pay to lessor a sum equal to _____%, if any, by which the rentals on percentage rental subleases exceed the minimum rental on said subleases.
Within 30 days after the end of each calendar year of this lease, after the commencement of the period in which the annual rental of $_____ is due, tenant shall deliver to lessor a complete statement signed by a duly authorized officer of tenant showing accurately and in reasonable detail the full amount of all rents collected by tenant from tenants sublessees. If the amount of rental due under the percentage as above stated is greater than the amount of rental previously paid with respect to the same lease year, the balance shall be paid by the tenant with the submission of such statement.
The tenant agrees that the lessor or lessor's agents may during normal business hours inspect the tenant's books and records for the purpose of verifying tenant's statement of rent collections.
It is expressly understood that all sums collected by tenant from its sublessees for such sublessee's share of taxes, insurance, common area maintenance and repairs shall not be deemed to be rentals collected by the tenant for the purpose of ascertaining lessor's share under the percentage arrangement above stated.
Such rentals shall be absolutely net to the lessor, so that this lease shall, except as herein provided to the contrary, yield net to lessor the rent as provided above, to be paid in each year during the term of this lease, and that all costs, expenses and obligations of every kind and nature whatever, relating to the demised premises, or any improvements thereon, which may arise or become due during the term of this lease, shall be paid by the tenant, and that the lessor shall be indemnified and saved harmless by the tenant from and against the same.
All rental payments shall be made in lawful money of the United States and shall be paid to the lessor at its office located at _________, or at such other place as may be designated in writing from time to time by the lessor.
IV. Taxes and Assessments.
The tenant agrees to pay or cause to be paid before penalty attaches thereto all taxes, installments of special assessments payable therewith, fees or other charges of whatever nature levied, assessed or imposed on the leased premises, including any improvements hereafter located thereon which are due and payable during the term hereof commencing with those due and payable on or after the day and year first above written and concluding with those due and payable in the calendar year in which the term of this lease expires.
Tenant shall not be in default hereunder in respect to the payment of any taxes, special assessments, fees or other charges which tenant shall be required by any provision hereof to pay so long as tenant shall first notify lessor in writing at least 15 days before the due date thereof of its intention to contest such payment and shall thereafter in good faith contest such payment, and tenant may file in the name of lessor, all such protests or other contests but shall, at the request of lessor, furnish assurance reasonably satisfactory to lessor that the tenant will indemnify the lessor against any loss or liability by reason of such contest.
V. Tenant's Right To Build and Alter.
At any time and from time to time during the term of this lease, consistent with restrictions on nature of occupancy provided for herein, and consistent also with applicable laws, ordinances and regulations, tenant shall have the right, at its own cost and expense:
A. To construct upon the leased premises such building or buildings and such other improvements as tenant may at any time and from time to time deem desirable.
B. To alter, enlarge, remodel or improve any building or buildings or other improvements upon the leased premises. In any event, however, the tenant covenants and agrees that it will use its best efforts toward completion of the construction of a shopping center on the leased premises at the earliest possible date, and further covenants and agrees that in all events the construction of a shopping center on the leased premises will be substantially completed no later than January 1, [year].
The tenant agrees before commencing construction to submit the preliminary drawings to lessor for approval, which approval shall not be unreasonably withheld; when preliminary drawings are submitted as required hereunder, lessor shall indicate its disapproval and reason therefor within 10 days after submission of such preliminary drawings, otherwise such preliminary drawings shall be deemed approved.
VI. Ordinances and Regulations.
The tenant covenants that during the term of this lease it will, at its own expense, comply with all valid applicable laws, ordinances and regulations of duly constituted public authorities now or hereafter in any manner affecting the leased premises and the improvements thereon or the use thereof. The tenant agrees to indemnify and hold the lessor harmless from the consequences of any violation of any such law, ordinance or regulation.
VII. Tenant To Have Title to Improvements.
The tenant shall at all times during the term of this lease have title to the buildings and improvements which tenant makes or installs in, on or under the leased premises. Upon the expiration, termination or forfeiture of this lease by any cause whatever, title to the buildings and other improvements, to the extent located upon the leased premises, shall automatically vest in the lessor, its successors and assigns. If, during the term of this lease, any building, buildings or other improvements are damaged or destroyed by fire or other casualty whatever, the tenant shall be entitled to the entire proceeds of all insurance which are payable by reason of such damage or destruction.
The tenant will not permit any mechanic's, laborer's or materialman's liens to stand against the leased premises for any labor or material furnished to or for the account of the tenant or claimed to have been so furnished in connection with any work performed or claimed to have been performed on the leased premises or on the adjoining premises, or both, by or at the direction or acquiescence of the tenant; provided, however, that the tenant shall have the right to contest the validity or amount of any such liens if the tenant shall give reasonable security (no less than one and one-half times the amount of the lien claim) as may be demanded by the lessor to insure payment thereof and to prevent any forfeiture of the leased premises by reason of such nonpayment. Upon final determination of such lien action, the tenant shall immediately pay any judgment rendered.
IX. Surety Bond.
If at any time during the term of this lease the tenant desires to erect a building, buildings or other improvements, either wholly or partially upon the leased premises, which building, buildings or other improvements the tenant's architect estimates will cost in excess of $_____, the tenant agrees to furnish to the lessor prior to commencing construction a performance bond in a sum at least equal to the estimated cost of such building, buildings or other improvements as the same shall be estimated by tenant's architect, which bond shall be executed by tenant and its prime contractor, if any, as principals and by a responsible surety company authorized in the state of _________ as surety.
The bond shall provide that no judgment entered against the leased premises or any part thereof on account of any such lien or claim shall constitute a breach of the conditions of such bond until such judgment shall become final because of the tenant's failure or prime contractor's failure to appeal therefrom or the affirmance thereof by the highest court to which judgment may be appealed.
X. Indemnification of Lessor.
The tenant agrees to hold the lessor harmless from any and all claims for damage or injury arising out of or as a result of the tenant's use of the leased premises. Without limiting the tenant's liability hereunder, the tenant agrees to maintain comprehensive general liability insurance protecting the lessor equally with the tenant from liability with respect to accidents occurring on or about the leased premises or arising out of the use thereof in reasonable amounts but not less than $_____ for injury or death to any person, $_____ for injuries or deaths arising out of any one accident, and $_____ for any property damage claims arising out of any one accident, written by companies reasonably acceptable to the lessor, and will deliver to the lessor a certificate of such insurance providing for 15 days' written notice to lessor prior to cancellation thereof. Tenant may cause its obligations hereunder to be made a part of its comprehensive general liability insurance coverage.
XI. Eminent Domain.
In the event 10% or more of the total area of the leased premises is taken under the power of eminent domain, then the tenant shall have the option of terminating this lease as of the date of such taking, and the lessor agrees to return to the tenant any unearned rent paid in advance; provided, however, that if the tenant does not terminate this lease by notice in writing served upon the lessor within 60 days from the date of such taking, the tenant's right to so terminate shall be waived, and provided further that in case any partial taking does not result in a termination of the term of this lease, the rent for the period or periods after which such taking occurs shall be reduced from the date of such taking in the proportion that the taken area on which there were buildings constructed by tenant bears to the entire area of the leased premises.
XII. Assignment, Subletting and Mortgaging.
The lessor agrees that the tenant shall have the right at any time and from time to time during the term of this lease to assign this lease and to sublet the leased premises in whole or in part, and to mortgage, pledge and hypothecate this lease; provided, however, any assignment or subletting hereof shall not release tenant from its obligations hereunder. It is anticipated by the parties hereto that tenant or its successors or assigns will be constructing improvements on the leased premises and will be placing a mortgage or mortgages on the leased premises or various mortgages on portions of the leased premises to finance such improvements. Lessor agrees to join in the execution of any such mortgage or mortgages for the limited purpose of pledging its interest in the leased premises to the lien of such mortgage or mortgages without assuming any obligation for the payment or performance thereof; provided, however, that such mortgages shall be with reputable lending institutions and that lessor shall not be personally liable for the payment or performance thereof.
XIII. Lessor To Join in Leases.
Lessor hereby agrees at tenant's request to join in the execution of leases for space in the building or buildings to be constructed on the leased premises; provided, however, that lessor hereunder shall have no personal liability under such leases except only from and after the effective date of the termination of this lease. Lessor hereby further agrees to join in the execution of assignments of lessor's interest in lease or assignments of rent or other security documents relating to leases of such space in such building or buildings pertaining to the leased premises which may be required by the mortgage or mortgages referred to in article XII.
XIV. Quiet Enjoyment.
Lessor represents and warrants to tenant that it has fee simple title to the demised premises and the power and authority to execute and deliver this lease and to carry out and perform all covenants to be performed by it hereunder.
Tenant, upon paying the rent and observing and keeping all covenants, warranties, agreements and conditions of this lease on its part to be kept, shall quietly have and enjoy the demised premises during the term of this lease, without hindrance or molestation by anyone.
XV. Notice to Mortgagee Upon Request.
If the interest of the tenant in the leased premises shall be conveyed by mortgage by the tenant and if the mortgagee notifies the lessor in writing of the existence of such a mortgage, together with the name and address of the mortgagee, then, and in such event a duplicate copy of all notices and demands given by the lessor to the tenant shall be served on the mortgagee. Notwithstanding the provisions of article XVIII, no notice shall be deemed to have been served upon the tenant unless at or prior to the time such notice or demand is served upon the tenant a duplicate copy thereof is served upon such mortgagee. Such notice shall be deemed to have been served on the mortgagee on the date the same is deposited in the United States mail, registered or certified, postage prepaid, addressed to such mortgagee at the address furnished to the lessor.
If the tenant shall default (a) in the payment of any installment of rent, or (b) in the payment of any mortgage installment or other obligation under any mortgage joined in by lessor as provided above, or (c) in the observance or performance of any of the tenant's other covenants, agreements or obligations hereunder, and if the lessor shall give the tenant notice in writing of such default and tenant shall fail to pay such rent or cure such other default within 90 days after the giving of such notice, or if such other default is of such a character as to require more than 90 days within which to cure the same and the tenant shall fail to use reasonable diligence in curing such default, then, and in any such event, (1) lessor may, at its option cure any default included in (b) or (c) above for the act and at the cost and expense of the tenant, and all sums so expended by the lessor shall be deemed to be additional rent and upon demand shall be paid by the tenant on the day on which the next rental payment hereunder shall become due and payable, and (2) the lessor, at its option, may declare a forfeiture of this lease and may thereupon reenter into possession of the leased premises and remove all persons therefrom and collect all rents owing but unpaid for all periods to and including the last day of the month during which the lessor shall obtain possession of the leased premises, together with any costs, expenses or damages incurred or suffered as a result of such default, which sums shall thereupon become immediately due and payable.
In the event the tenant defaults in the observance or performance of any of the tenant's covenants, agreements or obligations hereunder, and a duplicate copy of a default notice or demand is served on the mortgagee under the provisions of article XV, then notwithstanding the foregoing provisions of this article XVI such mortgagee shall have the right to cure such fault within the same time and in the same manner as the tenant before lessor may declare a forfeiture of this lease and reenter into possession of the leased premises.
No right or remedy herein conferred upon the lessor is intended to be exclusive of any other right or remedy, and each right and remedy shall be cumulative and in addition to any other right or remedy given hereunder or now or hereafter existing at law or in equity. No waiver by the lessor of any breach by the tenant hereunder shall be deemed to be a waiver of any subsequent breach nor shall any forbearance by the lessor to seek a remedy for such breach by the tenant be deemed a waiver by the lessor of its right and remedy with respect to such breach. Reasonable attorneys' fees and other expenses incurred by the lessor by reason of any default of the tenant in complying with any requirement of this lease shall constitute an additional rental hereunder payable upon demand with interest thereon at the rate of _____% per annum until paid.
XVII. Force Majeure.
In the event that lessor or tenant shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of strikes, lockouts, labor troubles, inability to procure materials, failure of power, restrictive governmental laws or regulations, riots, insurrection, the act, failure to act, or default of the other party, war or other reason beyond their control, then performance of such act shall be excused for the period of the delay and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay.
Wherever in this lease it shall be required or permitted that notice or demand be given or served by either party to this lease to or on the other, such notice or demand shall not be deemed to have been duly given or served unless in writing and forwarded by registered or certified mail, postage prepaid, addressed as follows: to lessor at: _________; to tenant at:_________. Such addresses may be changed from time to time by either party by serving notices as above provided.
XIX. Successors and Assigns.
All of the terms, covenants, provisions and conditions of this lease shall be binding upon and inure to the benefit of the parties hereto, their respective successors, heirs and assigns.
XX. Short Form Lease.
The parties hereto covenant and agree that at the request of either party a short form lease shall be prepared in form and substance reasonably satisfactory to each of the parties hereto and shall be executed by each of the parties hereto in duplicate, such lease to be filed for record in the office of the register of deeds or in the office of the registrar of titles, as the case may be, in and for _________ county, _________.
In witness whereof, the lessor and the tenant have caused this instrument to be duly executed the day and year first above written.
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