R-2013-064-2013-04-22RESOLUTION NO. R2013-64
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PEARLAND,
TEXAS, AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO
ENTER INTO A LEASE AGREEMENT FOR THE PEARLAND
CONVENTION AND VISITORS BUREAU.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
Section 1. That certain Lease Agreement by and between the City of Pearland
and Pearland Ground, LLC, a copy of which is attached hereto as Exhibit "A" and made a
part hereof for all purposes, is hereby authorized and approved.
Section 2. That the City Manager or his designee is hereby authorized to execute
and the City Secretary to attest a Lease Agreement for the Pearland Convention and
Visitors Bureau.
PASSED, APPROVED and ADOPTED this the 22nd day of April, A.D., 2013.
ATTEST:
L4)1(01/-44 U A.Q-D)
MARIA E. RODRIGUEZ
DEPUTY CITY SECRETARY
APPROVED AS TO FORM:
A .
DARRIN M. COKER
CITY ATTORNEY
TOM REID
MAYOR
CBL
April 19, 2013
Jon R. Branson
CITY OF PEARLAND
3519 Liberty Drive
Pearland, Texas 77581
Ph 281-652-1674
UPS #: 1ZE505211397012051
RE: CITY OF PEARLAND d/h/a PFARLAND COVENTION AND VISITORS BURFAII
PEARLAND TOWN CENTER
Pearland, Texas
Dear Mr.. Branson:
CHARLES B LEBOVITZ
Chairman of the Board
JOHN N FOY
Vice Chairman
of the Board and
Chief Financial Officer
STEPHEN D. LEBOVITZ
President and
Chief Executive Off,cer
BEN 5 LANDRESS
Executive Vic President
MOSES LEBOVITZ
(1905-1990
Please find enclosed two (2) execution copies of the Lease for the above -referenced Tenant, which has been
prepared pursuant to instructions from Lori McCommons.
Please review the enclosed Lease and provide any comments directly to my attention at your earliest convenience
via email (candace churchla)cbloronerties.com) or fax ((423) 893-4288). If the Lease is acceptable, please have both
execution copies executed on behalf of the Tenant and returned to my attention at:
CBL & Associates Properties, Inc
CBL Center, Suite 500
2030 Hamilton Place Boulevard
Chattanooga, TN 37421-6000
»»>IMPORTANT PLEASE READ««<
In order to expedite the execution process and avoid a delay caused by the return of improperly executed documents, please
have the Lease signed by an authorized officer and witnessed by one witness.
It is important that vou have your documents witnessed regardless of the entity tune. Your documents
may be returned to vou for witnessing if submitted without those signatures and will delay execution.
Please note that there are two signature blocks on the signature page. The last block is for the Tenant
to sign. Please do not mark above the Tenant signature block. The Landlord block is for our use only.
Please note that this transmittal is not an offer to enter into the Lease, and until the Lease has been
approved and fully executed by the Landlord, the Lease is not an enforceable document.
If you have questions or need additional assistance, please contact me (423) 490-8295.
Sincerely,
Cad
CANDACE CHURCH
Legal Secretary
/cc
Enclosures
cc: Steve Brower, Lori McCommons (via email)
--_'500 202 'aminn311 02,:2 Chatano ,-, TIv 37421-605 1n.423.855.001 f. 423 1'70.806,2 ;Hlpr-Jpnrci_ .-gym
CBL
April 26, 2013
3519 Liberty Drive, Ste 262
City Secretary's Office
Reference:
City of Pearland
d/b/a Pearland Convention and Visitors Bureau
Space # 1390 (1540 square feet)
Pearland Town Center
Pearland, TX
To Maria,
Enclosed please find ONE (1) fully executed document for your premises located in the
center listed above.
Should you have any questions please do not besitatc to contact me.
Sincerely,
CBL & ASSOCIATES PROPERTIES, INC.
Meagan Gentry
Leasing Assistant
(423) 553-8768
CBL & Associates Properness Snc. CBL Centel, Suite 500 2030 Hamilton Place Boulevard Chattanooga, TN 37421-6000 p. 423.855.0001
CHARLES B. LEBOVITZ
Chairman of the Board
JOHN N. FOY
Vice Chairman
of the Board and
Chief Financial Officer
STEPHEN D. LEBOVITZ
President and
Chief Executive Officer
BEN S. LANDRESS
Executive Vice President
MOSES LEBOVITZ
(1905-1991)
f. 423.490.8662
cblproperties.com
s
PEARLAND TOWN CENTER
Resolution No. R2013-64
Exhibit "A'
SHOPPING CENTER LEASE
SHOPPING CENTER PEARLAND TOWN CENTER - PEARLAND, TEXAS
LANDLORD PEARLAND GROUND, LLC, a Texas limited liability company
TENANT CITY OF PEARLAND d/b/a PEARLAND CONVENTION AND VISITORS
BUREAU
TABLE OF CONTENTS
ARTICLE I - REFERENCE PROVISIONS, SHOPPING CENTER, LEASED PREMISES AND TERM
Section 1.1
Section 1.2
Section 1.3
Section 1.4
Section 1.5
Reference Provisions
Shopping Center, Leased Premises, and Term
Acceptance of Leased Premises
Quiet Enjoyment
Parties to Have No Liability if Shopping Center Not Constructed
ARTICLE II - RENT AND OTHER CHARGES
Section 2.1 Minimum Annual Rent
Section 2.2 Percentage Rent
Section 2.3 Taxes
Section 2.4 Common Areas and Operating Costs
Section 2.5 Utilities Charges
ARTICLE III - CONSTRUCTION OF LEASED PREMISES
ARTICLE IV - USE OF LEASED PREMISES
Section 4.1 Use of Leased Premises
Section 4.2 Joint Opening of Shopping Center
Section 4.3 Continuous Operation by Tenant
Section 4.4 Additional Covenants of Tenant
Section 4.5 Signs, Awnings and Canopies
Section 4.6 Retail Restriction Limit
Section 4.7 Relocation
ARTICLE V - INSURANCE REQUIRED OF TENANT
Section 5.1
Section 5.2
Section 5.3
Insurance Required of Tenant
Fire Insurance Rate and Requirements
Waiver of Subrogation
ARTICLE VI - REPAIRS AND MAINTENANCE
Section 6.1 Repairs by Landlord
Section 6.2 Repairs and Maintenance by Tenant
Section 6.3 Inspection
Section 6.4 Obstructions
ARTICLE VII - ADDITIONS AND ALTERATIONS
Section 7.1
Section 7.2
By Landlord
By Tenant
ARTICLE VIII - DAMAGE, DESTRUCTION OR CONDEMNATION OF THE LEASED PREMISES
Section 8.1
Section 8.2
Damage or Destruction
Condemnation
ARTICLE IX - GENERAL PROMOTION FUND
Section 9.1 Amounts
Section 9.2 Intentionally Deleted
Section 9.3 Intentionally Deleted
Section 9.4 Intentionally Deleted
Section 9.5 General Promotion Fund
Form 9,21 12
PEARLAND TOWN CENTER
ARTICLE X - FINANCING
Section 10.1 Financing
Section 10.2 Subordination
ARTICLE XI - DEFAULT BY TENANT
Section 11.1 Default
Section 11.2 Landlord's Rights on Default
Section 11.3 Non -Waiver Provisions
Section 11.4 Force Majeure
Section 11.5 Enforcement Expenses
ARTICLE XII - OTHER PROVISIONS
Section 12.1 Definition and Liability of Landlord
Section 12.2 Relationship of the Parties
Section 12.3 Security Deposit
Section 12.4 Indemnity
Section 12.5 Damage to Property or Persons
Section 12.6 Assignment, Subletting, or Licensing
Section 12.7 Surrender of Premises and Holding Over
Section 12.8 Lien of Landlord for Rent, Taxes and Other Sums
Section 12.9 Liens
Section 12.10 Landlord's Right of Cancellations
Section 12.11 Interest
Section 12.12 Late Payments
Section 12.13 Consents
Section 12.14 Waiver of Right of Redemption
Section 12.15 Notices
Section 12.16 No Broker
Section 12.17 Short Form Lease
Section 12.18 Entire and Binding Agreement
Section 12.19 Provisions Severable
Section 12.20 Captions, Underlining, Line-outs
Section 12.21 Rule Against Perpetuities
Section 12.22 Warranty and Authority
Section 12.23 Irrevocable Offer
Section 12.24 Disputed Charges and Landlord's Records
Section 12.25 Landlord's Right to Terminate
RIDER TO LEASE
Section 12.26
Section 12.27
Tenant VAV Box
Tenant's Rieht to Terminate
EXHIBIT A - SHOPPING CENTER PREMISES
EXHIBIT B - CONSTRUCTION
Form 9;21,12
r
f
PEARLAND TOWN CENTER
Kj14/12/13; dsp 04/18/13
SHOPPING CENTER LEASE
THIS LEASE made and entered into as of the2 2 day of Apr i 1 ,201 3 by and between PEARLAND
GROUND, LLC, a Texas limited liability company ("Landlord"), and CITY OF PEARLAND d/b/a PEARLAND
CONVENTION AND VISITORS BUREAU ("Tenant").
ARTICLE I
REFERENCE PROVISIONS, SHOPPING CENTER, LEASED PREMISES AND TERM
Section 1.1 Reference Provisions.
(a) LEASED PREMISES --cross hatched and/or designated as space # 1390 on EXHIBIT A annexed hereto
and made a part hereof and containing approximately 1,540 square feet. The Leased Premises are in a
building in a Shopping Center known as Pearland Town Center, located on or near the intersection of
State Highway 288 and State Highway 518 in an area in or near the Town or City of Pearland, County of
Brazoria, State of Texas.
(b) TERM --shall be for a period of Five (5) years commencing as provided in Section 1.2. As used in this
Section 1.1, the term "year" shall mean each successive twelve (12) calendar month period commencing on
the first day of a calendar month. If the Term commences on a day other than the first day of a calendar
month, then the period commencing with the first day of the Term and ending on the last day of the
calendar month in which the Term commenced shall be added to the first year of the Term.
(c) MINIMUM ANNUAL RENT—Sixteen Thousand One Hundred Eighty -Five and 40/100 Dollars
($16,185.40) per year for the first year of the Lease Term, with annual increases of three percent (3%) per
year over the amount payable for the previous year through the balance of the Lease Term, prorated for a
partial year if applicable.
(d) PERCENTAGE RENT AND BASE—None.
(e) USE—For the operation of office space and information center for the Pearland Convention and Visitors
Bureau; and for no other purpose.
(f) (i) INTENTIONALLY DELETED.
(ii) INTENTIONALLY DELETED.
(iii) GENERAL PROMOTION FUND: None.
SECURITY DEPOSIT --None.
(g)
(h)
NOTICE ADDRESS --
TENANT
City of Pearland
3519 Liberty Drive
Pearland, Texas 77581
LANDLORD
CBL & Associates Management, Inc.
CBL Center, Suite 500
2030 Hamilton Place Boulevard
Chattanooga, Tennessee 37421-6000
Anchor Stores shall mean the spaces designated Buildings A, C, D, E, F and Future Building B on Exhibit
A attached hereto and any future spaces of 20,000 square feet or more of floor area.
Dap rt
ass than 25000 -square -feet.
Store Hours shall mean Monday through Saturday continuously between the hours of -10:00 7:30 A.M. and
9:00 P.M. and Sundays continuously between the hours of 11:00 A.M. and 7:00 P.M.
OPERATING COSTS – Tenant's Operating Costs Charge is Nine and 00/100 Dollars ($9.00) per square
foot of the Leased Premises for the 2013 calendar year increased by five percent (5%) each calendar year
thereafter over the amount payable for the previous calendar year (prorated for a partial calendar year, if
applicable). Notwithstanding the f-egoing, if at are; time during the Term of this Lease Iiandlord causes a
s
first full calendar month followSFg the completion of said refu. Jishirg and/or renovation.
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PEARLAND TOWN CENTER
More than
acual tc or locf., than
Unlimited
Rcfurbishir:g Charge
On ^alar Y
year in which the Refurbishing
Charge : activated
Two Dci'_l„rs per-Square-foot-ef the
year in which the Reft:bshi: b
Charge -is -activated
per -square-feet, the a: qa»1 i:: = -
October 31s' of such calendar year. Results: from January ar; 1st through October 313t Tenant's Operating Cost:,
of $1 per square foot prorated through Docombor 31st ($.17 por square
On Jalaary4 _of the-immedi y
pc square-feet-thr-eugliDeccr c 315'
darir:g Such calendar year then an Januar,--1-
Tar.ant' e : _ . • - - 41 $13.7
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r,
PEARLAND TOWN CENTER
Section 1.2 Shopping Center, Leased Premises, and Term. Landlord hereby leases to Tenant and
Tenant rents from Landlord those certain premises ("Leased Premises") now existing or hereafter to be erected in
the Shopping Center described in Section 1.1(a) and shown on EXHIBIT A hereto. The Term [as described in
Section 1.1(b)] shall commence on the earlier of (1) the date which is One Hundred Twenty (120) Ni -(90)
days following Landlord's tender of possession of the Leased Premises, or (2) the date on which Tenant opens for
business in the Leased Premises. Providing such entry does not interfere with Landlord's general construction of the
Shopping Center and/or Landlord's work to be done, if any, in preparing the Leased Premises for Tenant's
occupancy, Tenant, its agents, employees, and contractors, shall have the right to enter the Leased Premises prior to
the tender of possession for the purposes of taking measurements and obtaining other information required in
connection with Tenant's prospective occupancy thereof. Any access by Tenant to the Leased Premises prior to the
commencement of the Term shall be upon all of the terms, covenants and conditions of this Lease except for the
payment of rent and other charges. Tenant shall pay all utility charges relating to the Leased Premises which accrue
after Landlord's tender of possession.
Tender of possession shall be deemed to have occurred when Landlord has completed Landlord's work, if
any, required by Exhibit B annexed hereto and made a part hereof.
The Leased Premises shall extend to the exterior faces of exterior walls or to the building line where there
is no wall, or the center line of those walls separating said premises from other leased premises in the Shopping
Center, together with the appurtenances specifically granted in this Lease, but reserving and excepting to Landlord
or its designee the right to install, maintain, use, repair and replace pipes, ductwork, conduits, utility lines and wires
through hung ceiling space, column space, and partitions, in or beneath the floor slab or above or below the Leased
Premises or other parts of the Shopping Center, except that Landlord shall not unreasonably interfere with or
interrupt the business operations of Tenant within the Leased Premises, and except where necessary as determined
by Landlord's architect, no pipes, conduits, utility lines, or wires installed by Landlord shall be exposed in the sales
area of the Leased Premises.
Tenant agrees to complete Tenant's work and open the Leased Premises for business to the public not later
than the commencement date of the Term. In the event Tenant fails to take possession and open for business to the
public fully fixtured, stocked, and staffed on the commencement date of the Term, then and in such event Landlord
shall have, in addition to all remedies in this Lease provided, the right to collect in addition to the Minimum Annual
Rent and other sums payable under this Lease a further item of additional rent at a rate equal to twice the Minimum
Annual Rent per day for each and every day that Tenant shall fail to be open for business_ ,
Section 1.3 Acceptance of Leased Premises. As often as may be requested by Landlord, Tenant shall
promptly and without cost to Landlord execute, acknowledge, and deliver to Landlord and/or Landlord's mortgagee
a written acceptance or estoppel certificate with respect to the Leased Premises in form and substance acceptable to
Landlord.
Section 1.4 Quiet Enjoyment. Tenant, upon paying the rents herein reserved and performing and
observing all of the other terms, covenants, and conditions of this Lease on Tenant's part to be performed and
observed, shall peaceably and quietly have, hold, and enjoy the Leased Premises during the Term, subject,
nevertheless, to the terms of this Lease and to any mortgages, ground or underlying leases, agreements, and
encumbrances to which this Lease is subordinate.
Section 1.5 Parties to Have No Liability if Shopping Center Not Constructed. If f reazon
ARTICLE 1I
RENT AND OTHER CHARGES
Section 2.1 Minimum Annual Rent. Upon commencement of the Term, Tenant shall pay to Landlord
without previous demand therefor and without any setoff or deduction whatsoever, the Minimum Annual Rent
provided in Section 1.1(c), payable in equal monthly installments, in advance, on the first day of each and every
calendar month throughout the Term, - --- 'linin:an Arno Rant -shall -be -paid -upon
and, if the Term commences on a date other than the first day of a month, Tenant shall
pay Landlord on the first day of the Term, a pro -rata portion of such Minimum Annual Rent, calculated based upon
the number of calendar days in the month in which Tenant's obligation to pay Minimum Annual Rent commences.
If at any time aufing the Tarr: of this Lease, the Shopping Centcr tha'.1 ha'.o moro than the Triggoring
e in cxe ss of the Tr o Numbe
enar.t shay! pa;'
are, an arnaa1 mount equal to fifteen percent (15%) of Tenant's
1 i ai Annual Rent, if any, as they occur) as defined in Section 1.1(c).
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PEARLAND TOWN CENTER
aeras an annual arcane equal
sur) or the
cur), as the -ace may
Tenant shall Fra said Additional Depart
, Tenant does not rely
on, and Landlord does not make any express or implied representation, promise or condition that any specific type,
quality or number of Anchor Stores or Department Stores shall occupy any space in the Shopping Center during all
or any part of the term of the Lease or renewals or extensions thereof, if any.
The Minium Annual Rent, and all future incremental incr-easas thereto, shall bo increased at tho
Rent -base -she l be adjusted-accor.dingly-.
Section 2.2 Percentage Rent. (a) Tenant shall pe.
(b) The term "Gross Sales" moans tho soiling pried of all merchandise sold or delivered in, at, on, or from
shall include sales and e';arg
(1) returns and :ofunds in fact made by Tenant icon t. sactions included within Gro:.c Sac not-exceedtngthe
se';Srg prig
•
o:.:,urmat4tr.
s are mad
•
(bat not by any vendor of Tenant). A
drr is f -i
•
or things
other similar
Or if, pursuant to mail; tom,
(c) Tenant shall 11 p.
ss than three (3) years,
unting pra =
Gross Sales for each month th throughent-the Ter::.. Tar. : agrees that all Gross Sales shall bo registered at the timo
(d) On or before the tenth (10th) day of each month during the Term, Tenant shall fr:r i 1; Landlord at tho
the -Shopping -Center's mana
d substance, certified as correct by a
Sales for such year together with en itemization -of a?1 claimed-deuuat4ons thorefreim Tat shall require its
'oh similar statements. Lar:
confidence, except that Landlord may reveal suck r
prospective mortgagee,
forth in Section 1.1(d)
ear eo: mens.., with the month the
Percentage -Rost baszs are stat
during such year appl
sixty five (365). The sari c
year.
ear shall be -determined
eat base by a fraction, the nuir.eretor of wbieh shall b
ic,h stz.11 be -three -hundred
Rent 'hese for such
cti p»rttial ;ear -shall
c Pent b,so sot forth in
•
the Gross Sales for the first year of the Term and the Percentage Rent base shall be p
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th sl^rall b„ added to
PEARLAND TOWN CENTER
.. , - •• ' _ -_ .. ours, ince ct-the--records
of Gress Salce n -oda by Tenant, provided such inspection is commenced within tkr;o (3) years after Landlord's
receipt -eta -certified annual Etat _ . and Is li
na;.t shall promptly -pay -to
on Duch deficiency, if any. If such audit by Landlord shall
disclose a deficiency in Gross Sales of two percent (2%) or more, then Tenant shall promptly pay Landlord
audit. If Tenant fails to file a certified er .ual
Section 2.3 Taxes. Tenant shall pay promptly when due or make reimbursement to Landlord for all taxes
imposed upon Tenant's rent, Lease, and business operation, including, without limitation, all sales taxes, value
added taxes, documentary taxes, stamp taxes, and other taxes assessed upon the consideration to be received by
Landlord for this Lease, upon all personal property of Tenant, and shall also pay to Landlord, as additional rent,
Tenant's share of real estate taxes as specified in this Section 2.3. Tenant's share of real estate taxes shall be
computed by multiplying the total amount of such taxes assessed against the Shopping Center, less only amounts
contributed towards such taxes by the tenants, occupants or owners of Anchor Stores (other than Landlord and/or its
affiliates), by a fraction, the numerator of which shall be the number of square feet of floor area in the Leased
Premises, and the denominator of which shall be the "Leased Shops Floor Area", as hereinafter defined (said
fraction sometimes hereinafter referred to as "Tenant's Proportionate Share"). Leased Shops Floor Area shall mean
the greater of (a) the actual leased floor area of Shops, as hereinafter defined, included in the Shopping Center as of
July 1 in each year, or (b) eighty percent (80%) of the total leasable floor area of Shops included in the Shopping
Center as of July 1 in each year. Shops shall mean any existing or future in-line individual space within the
Shopping Center which is designed for the exclusive use and occupancy of rent paying tenants, excluding Anchor
Stores, and shall in no event include common areas, areas occupied by retail merchandising units, storage areas,
mezzanine areas and areas, if any, used as a community room, or for management and promotion offices.
Notwithstanding the foregoing, if the Shopping Center opens subsequent to July 1, the actual leased floor area and
the total leaseable floor area of Shops for such year of opening shall be determined as of December 31st of such year.
Tenant acknowledges and stipulates that Landlord has made no representation or agreement of any kind as to the
total dollar amount of such taxes, actual or estimated, or Tenant's dollar share thereof.
The term "real estate taxes" shall mean all taxes and assessments (special or otherwise) levied or assessed
directly or indirectly against the Shopping Center (land, buildings and/or improvements as the same may be enlarged
or reduced from time to time), personal property used in connection with the common areas and other taxes arising
out of the use and/or occupancy of the Leased Premises imposed by federal, state, or local governmental authority or
any other taxing authority having jurisdiction over the Shopping Center, including expenses incurred by Landlord in
reviewing and/or in contesting the validity of, in seeking a reduction in, or in seeking to prevent an increase in any
such tax(es) or assessment(s) including but not limited to tax consultants and/or tax advisors, but shall exclude
franchise, capital stock, income, estate or inheritance taxes personal in nature to Landlord. Notwithstanding
anything to the contrary contained herein, if the Shopping Center is located in the State of Tennessee the term "real
estate taxes" shall also mean any taxes based upon the value of the Shopping Center, including, without limitation,
the value of the Shopping Center as part of the "net worth" or value of the Landlord's assets as a component of any
franchise tax; if the Shopping Center is located in the State of Michigan the term "real estate taxes" shall also mean
the Michigan Business Tax.
Landlord shall estimate the taxes referred to in this Section 2.3, and Tenant shall pay one -twelfth (1/12)
thereof monthly in advance, together with the payment of Minimum Annual Rent. After the end of each calendar
year Landlord shall furnish Tenant a statement in reasonable detail of the actual real estate taxes, prepared in
accordance with sound accounting practices by Landlord's accounting department, and there shall be an adjustment
between Landlord and Tenant, with payment to or repayment by Landlord, as the case may require, to the end that
Landlord shall receive the entire amount of Tenant's annual share for such period.
In no event shall Tenant's share of real estate taxes due hereunder be reduced by, nor shall Tenant be
entitled to share or participate in any tax refund, rebate, and/or abatement related to any government incentive for
the development of, redevelopment of, improvement of any kind to, or expansion of the Shopping Center and the
financial benefits of such tax reduction, refund, rebate, and/or abatement shall belong solely to Landlord and/or its
designees.
Section 2.4 Common Areas and Operating Costs. All common areas and other common facilities
(hereinafter collectively called "common areas") made available by Landlord in or about the Shopping Center shall
be subject to the exclusive control and management of Landlord, expressly reserving to Landlord, without
limitation, the right to erect and install within the malls and/or the parking areas, kiosks, planters, pools, sculpture,
free-standing buildings, additional stories to buildings, or otherwise. Common areas (as initially constructed or as
the same may be enlarged or reduced at any time thereafter) shall mean all areas, space, facilities, equipment, signs,
and special services from time to time made available by Landlord for the common and joint use and benefit of
Landlord and its designees, the Tenant and other tenants and occupants of the Shopping Center, and their respective
employees, agents, subtenants, concessionaires, licensees, customers, and invitees, which may include (but shall not
be deemed a representation as to their availability), the sidewalks, parking areas, access roads, driveways,
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PEARLAND TOWN CENTER
landscaped areas, truck serviceways, tunnels, loading docks, pedestrian malls (enclosed or open), courts, stairs,
ramps, elevators, escalators, comfort and first aid stations, public restrooms, community hall or auditorium, and
parcel pick-up stations. Landlord hereby expressly reserves the right from time to time, to construct, maintain, and
operate lighting and other facilities, equipment, and signs on all of the common areas; to police the same; to change
the area, level, location, and arrangement of the parking areas and other facilities forming a part of the common
areas; to construct, operate, maintain, repair, and replace retention ponds and mitigation areas which serve the
Shopping Center; to build multi -story parking facilities; to restrict parking by tenants and other occupants of the
Shopping Center and their employees, agents, subtenants, concessionaires, and licensees; to enforce parking charges
(by operation of meters or otherwise); to close temporarily all or any portion of the common areas for the purpose of
making repairs or changes thereto and to discourage non -customer parking; to establish, modify, and enforce
reasonable rules and regulations with respect to the common areas and the use to be made thereof; to grant rights to
hold events in the common areas such as automobile displays and carnivals; and to grant individual tenants the right
to conduct sales in the common areas. Landlord shall operate, manage, equip, light, and maintain the common areas
in such manner as Landlord may from time to time determine, and Landlord shall have the right and exclusive
authority to employ and discharge all personnel, including independent contractors, with respect thereto. Tenant is
hereby given a non-exclusive license to use, during the Term, the common areas of the Shopping Center as they may
now or at any time during the Term exist, provided, however, that if the size, location, or arrangement of such
common areas or the type of facilities at any time forming a part thereof is changed or diminished, Landlord shall
not be subject to any liability therefor, nor shall Tenant be entitled to any compensation or diminution or abatement
of rent therefor, nor shall such change or diminution of such areas be deemed a constructive or actual eviction.
Landlord reserves the right to grant to third persons the non-exclusive right to cross over and use in common with
Landlord and all tenants of the Shopping Center the common areas as designated from time to time by Landlord. In
order to establish that the Shopping Center and any portion thereof is and will continue to remain private property
and to prevent a dedication thereof or the accrual of any rights to any person or the public therein, Landlord hereby
reserves the unrestricted right to close all or any portion of the Shopping Center owned, leased, or controlled by
Landlord to the general public for one (1) day in each calendar year, and, in connection therewith, to seal off all
entrances to the Shopping Center, or any portion thereof. Tenant hereby acknowledges, consents, and agrees that
any and/or all services, facilities, and access by the public to the Leased Premises and/or to the Shopping Center
may be suspended in whole or in part during such temporary times as any of the anchor stores in the Shopping
Center are not open for business, on legal holidays, or such other days as may be declared by local, state, or federal
authorities as days of observance, and/or during any periods of actual or threatened civil commotion, insurrection, or
other circumstances beyond Landlord's control.
In consideration of Landlord's managing, repairing, operating, advertising, promoting, and maintaining the
Shopping Center, Tenant hereby agrees to pay Landlord as additional rent the annual Operating Costs Charge set
forth in Section 1.1(m) each year during the Term, which Operating Costs Charge shall automatically increase as set
forth in Section 1.1(m). Tenant shall pay the annual Operating Costs Charge monthly in twelve (12) equal
installments each year, in advance, together with the payment of Minimum Annual Rent. Landlord and Tenant
acknowledge and agree that the Operating Costs Charge has been freely negotiated and agreed upon between the
parties and is not subject to dispute, review, challenge or audit at law or in equity.
Lease ica renewal lease andor a laas
(whether -the -previous ife is
parent, s'abn diary or affiliate), i:: oni &i tc enter into this Lease, Tenant on behalf of
itself, its par -rut, its subs-diari _ : _ e "Ton -ant .
amounts -paid-frau : the b
of tiro rolat'
for nark '
merchants ass
r :inolog
7.
3r any
ision may pleaded-irn
•
etion and that -r
Landlord shall have the right to allocate any portion of the Operating Costs Charge to a promotion fund(s)
as Landlord deems appropriate in its sole discretion. As part of the promotion of the Shopping Center, there may bo
11-ich shall be --determined by Landlord. Such campaigns ma;
mail, tabloids, and various other -types -of
out from T
such advertising. Tartar
tionl information for prcmot-i-o al p',i.poses-to
alien not be responsible for the contents of any advertising
in€ormatin-sapsli
any and all claims, demands, or action:: arising
!cr incro arra: et f rt he n then in that
do name ar
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Section 2.5 Utilities Charges. (a) Tenant shall pay promptly, as and when the same become due and
payable, all water rents, rates and charges, all sewer rents and all charges for electricity, gas, heat, steam, hot and/or
chilled water, air conditioning, ventilating, lighting systems, and other utilities supplied to the Leased Premises. If
any such utilities are not separately metered or assessed or are only partially separately metered or assessed and are
used in common with other tenants in the Shopping Center, Tenant will pay to Landlord a proportionate share of
such charges, in addition to Tenant's payments of the separately metered charges. Landlord may install re-
registering meters and collect any and all charges aforesaid from Tenant, making returns to the proper public utility
company or governmental unit, provided that Tenant shall not be charged more than the rates it would be charged
for the same services if furnished directly to the Leased Premises by the Local Utility Company, as hereinafter
defined.
(b) Landlord shall have the absolute right at any time and from time to time to select and change
utility providers serving the Shopping Center (each such utility provider designated by Landlord is hereafter referred
to as a "Designated Service Provider"), and Tenant shall accept such utility service (including, without limitation,
any heating, ventilating, air conditioning, and/or lighting systems serving the Leased Premises and/or any other
Shopping Center areas) from Landlord's Designated Service Provider to the exclusion of all other suppliers. In
addition to the foregoing, at the option of Landlord, any utility or related service which Landlord may at any time
elect to provide to the Leased Premises may be furnished by Landlord or any agent employed or independent
contractor selected by Landlord, and Tenant shall accept the same therefrom to the exclusion of all other suppliers.
SEE RIDER TO LEASE AT A.
(c) Notwithstanding anything else contained in this Lease to the contrary, Landlord shall have the
right, at any time and from time to time, to cause one or more utilities (including, without limitation, any heating,
ventilating, air conditioning, and/or lighting systems serving the Leased Premises and/or any other Shopping Center
areas) to be furnished by means of an on-site or off-site energy system and/or to provide some other alternative
energy system (whether so-called "total energy" or otherwise) in lieu of the direct furnishing of the same to Tenant
and other occupants of the Shopping Center from the Local Utility Company or the Designated Service Provider,
and Tenant agrees in any such case, to accept any such utility from Landlord in lieu of the Local Utility Company or
the Designated Service Provider and to pay Landlord and/or other designee as Landlord shall determine all costs and
charges therefor, provided that the same shall not result in any additional cost or expense to Tenant over and above
that which it would pay if it purchased same directly from the Local Utility Company, as hereinafter defined; and
provided further that same is in compliance with all laws, regulations, ordinances and other governmental
requirements.
(d) Landlord shall not be liable for any loss, damage, or expense that Tenant may sustain or incur
by reason of any change, failure, interference, disruption, or defect in the supply or character of any utility services
furnished to the Leased Premises, or if the quantity or character of utility services is no longer available or suitable
for Tenant's requirements, and no such change, failure, defect, unavailability or unsuitability shall constitute an
actual or constructive eviction, in whole or in part, or entitle Tenant to any abatement or diminution of Minimum
Annual Rent or other charges, or relieve Tenant from any of its obligations under this Lease.
ARTICLE III
CONSTRUCTION OF LEASED PREMISES
The Leased Premises shall be constructed by Tenant in accordance with the provisions of
Exhibit B annexed hereto and made a part hereof.
Tenant is responsible, at its sole cost and expense, for obtaining any and all required governmental
approval of the plans and specifications, including but not limited to building permit fees and any other fees, taxes,
costs, and expenses attributable to the Leased Premises and for assuring that the plans and specifications comply
with all governmental rules, regulations, codes, and ordinances, including but not limited to, those required by the
City, County and State in which the Shopping Center is located, state and local health departments, and state and
local fire marshals. Tenant hereby agrees to remodel the Leased Premises and storefront in keeping with Tenant's
most current prototype store and Landlord's design criteria subject to the requirements of Exhibit B of the Lease,
with all work to be completed on or before the commencement date of the Term.
ARTICLE IV
USE OF LEASED PREMISES
Section 4.1 Use of Leased Premises. Tenant agrees to use the Leased Premises only for the permitted use
set forth in Section 1.1(e) and for no other purpose.
Tenant covenants that the Leased Premises during the Term of this Lease shall be used only and
exclusively for lawful and moral purposes, Tenant's business shall be conducted in a lawful manner, and no part of
the Leased Premises or improvements thereon shall be used in any manner whatsoever for any purpose in violation
of the laws, ordinances, regulations, or orders of the United States, including without limitation the Americans with
Disabilities Act, all amendments thereto and all regulations promulgated thereunder (collectively, the "ADA"), or of
the state, county, and/or city where the Leased Premises are located. Tenant shall comply with all such laws,
ordinances, regulations, or orders now in effect or hereafter enacted or passed during the Term of this Lease insofar
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as the Leased Premises and any signs of the Tenant are concerned, including, but not limited to zoning ordinances,
the ADA, building codes, and fire codes, and shall make at Tenant's own cost and expense all additions and
alterations to the Leased Premises ordered or required by such laws or authorities, whether in order to meet the
special needs of Tenant, or by reason of the occupancy of Tenant, or otherwise; provided, however, Tenant shall not
be required to make structural alterations to the Leased Premises or the building in which the Leased Premises are
located unless made necessary by reason of the nature of Tenant's business, work performed in the Leased Premises,
or the manner of operation thereof.
Tenant shall not make, store, use, treat, or dispose of any "hazardous substance," "contaminant," or
"pollutant" (as those terms are defined under any federal, state, and local law or regulation, or common law,
pertaining to health, safety, or environmental protection, as from time to time amended, referred to herein in the
aggregate as "hazardous substance laws") on or about the Leased Premises; except, to the extent that Tenant's
manufacturing, storage, use, treatment, or disposal is permitted by or excepted from such hazardous substance laws.
In cases of such permits or exceptions, Tenant shall provide Landlord,
a) current copies of all such permits and restrictions on such permits; and,
b) current documents required as a condition of such permits or exceptions as mandated by
hazardous substance laws.
These permits, documents, or exceptions shall be furnished to Landlord prior to execution and acceptance of the
Lease. Tenant shall also furnish Landlord a monthly certification that such permits, documents, or exceptions are
still current, that Tenant shall immediately notify Landlord of any change, revocation, or enforcement action
concerning such permits, documents, or exceptions.
Section 4.2 Joint Opening of Shopping Center.
thirty (30) days from the date it a.
netwitlistancling-Seeticr.1.2
Center,
i:: ant vent -and
Section 4.3 Continuous Operation by Tenant. Tenant agrees that a shopping center is an interdependent
enterprise, that the Shopping Center's success is dependent on the continued operation of Tenant's business, and that
maintenance of the character and quality of the Shopping Center is enhanced by the continued occupancy of the
Leased Premises and the regular conduct of Tenant's business therein. Accordingly, Tenant agrees to open the
Leased Premises for business on the commencement date provided in Section 1.2 hereof and operate one hundred
percent (100%) of the Leased Premises during the entire Term under the name set forth in this Lease or such other
name as Landlord may approve in writing, with due diligence and efficiency and -so ac to produce all of the Gross
or:. Tarrant • - - - . .
stock of merchandise of such size, character, and quality as shall be reasonably designed to produce rnax4fr2..im Gross
Sales. Tenant shall continuously conduct its business in the Leased Premises at least during the Store Hours and
such additional hours as any Anchor Store in the Shopping Center is open for business, or at Landlord's election
such other or additional hours as may be determined by Landlord. If Tenant fails to perform its obligations under
this Section, (a) Landlord shall be entitled to injunctive relief requiring Tenant to occupy the Leased Premises and
operate as hereinabove provided, and/or (b) recognizing that the actual damages Landlord will incur by reason of
Tenant's failure to comply with this Section are likely to be uncertain and not easily proven, Tenant and Landlord
hereby agree that Landlord may elect to receive from Tenant as liquidated damages and not as a penalty, and Tenant
hereby agrees to pay to Landlord promptly upon receipt of notice thereof, in addition to the Minimum Annual Rent
and other sums due under this Lease, in each month or any part thereof during the remainder of the Term during
which Tenant does not comply with this Section, additional sums equal to (i) twice the Minimum Annual Rent per
month, _ •_ •'as t atnun-: ' : - _ . .. ..:, ' . , . Fr. ant at art,:
time during the Term, the parties further agreeing that the amount of liquidated damages hereunder has been arrived
at by Landlord and Tenant in good faith in an effort to establish agreed upon liquidated damages which Landlord
will suffer in the event Tenant fails to comply with this Section, and/or (c) at Landlord's election after giving ten
(10) days' written notice, Landlord shall be entitled to immediate possession of the Leased Premises for the purpose
of commencing reletting efforts. Landlord's rights and remedies under this Section are in addition to and are
without prejudice to Landlord's rights and other remedies set forth in Section 11.2 hereof. A vacation of premises or
cessation of operations by any other tenant(s) in the Shopping Center shall not in any way release Tenant from
Tenant's obligations under this Lease, such obligations being independent covenants of this Lease.
Section 4.4 Additional Covenants of Tenant. Tenant's use of the Leased Premises and the common
areas shall be subject at all times during the Term to reasonable rules and regulations adopted by Landlord not in
conflict with any of the express provisions hereof governing the use of the parking areas, malls, walks, driveways,
passageways, signs, exteriors of buildings, lighting, and other matters affecting other tenants in and the general
management and appearance of the Shopping Center. Tenant agrees to comply with all such rules and regulations
upon notice to Tenant from Landlord. In the event Tenant fails to comply with such rules and regulations or any of
the other covenants set forth in this Section after twenty-four (24) hours' notice from Landlord of this non-
compliance (which notice may be oral or in writing), then Tenant shall pay to Landlord as additional rent the sum of
one hundred dollars ($100.00) for each violation, acceptance of such additional rent to be without prejudice to any
other rights or remedies available to Landlord. Each day on which a violation occurs or continues shall be a separate
violation. Tenant expressly agrees as follows:
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(a) All deliveries to or from the Leased Premises shall be done only at such times, in the areas, and through
the entrances designated for such purpose by Landlord.
(b) All garbage and refuse shall be kept inside the Leased Premises in the kind of container specified by
Landlord, and shall be placed outside of the Leased Premises prepared for collection in the manner and at the times
and places specified by Landlord. If Landlord shall provide or designate a service for picking up refuse and
garbage, Tenant shall use same at Tenant's cost. Tenant shall pay the cost of removal of any of Tenant's refuse and
garbage, and maintain all common loading areas in a clean manner satisfactory to the Landlord. If any part of the
Tenant's business shall consist of the preparation and/or sale of food, including without limitation the operation of a
restaurant, snack shop, or food market, Tenant shall provide refrigerated garbage containers at Tenant's expense for
the disposal of its food scraps and refuse. Tenant shall use any trash compactor Landlord provides for the general
use of Tenant or tenants in a designated area of the Shopping Center. Notwithstanding the foregoing provisions, in
the event Tenant is or becomes a generator of medical waste, Tenant shall be solely responsible for complying with
all federal, state and local laws, whether existing now or established in the future, relating in any way to the storage,
containment, treatment, transfer, transportation and disposal of medical waste (including the use of licensed medical
waste management companies) and shall indemnify and hold Landlord harmless for Tenant's noncompliance or
violations thereof. For purposes hereof, "medical waste" shall mean any solid, semisolid or liquid waste which is
generated in the diagnosis, treatment (e.g., provisions of medical services), immunization or performance of a
service to the body of human beings or animals, in research pertaining thereto or in the production or testing of
biologicals. "Generator" shall mean any person or entity whose act or process produces medical waste as
hereinbefore defined.
(c) No radio or television aerial or other device shall be erected on the roof or exterior walls of the Leased
Premises or the building in which the Leased Premises are located without first obtaining in each instance
Landlord's consent in writing. Any aerial or device installed without such written consent shall be subject to
removal at Tenant's expense without notice at any time.
(d) No loud speakers, televisions, phonograph, radios, tape players, or other devices shall be used in a
manner so as to be heard or seen outside of the Leased Premises without the prior written consent of Landlord, nor
shall Tenant solicit business or distribute advertising or promotional material in the common areas. No electronic or
communication devices shall be used in the Leased Premises or in connection therewith which interrupt or interfere
with the use and enjoyment of electronic or communication devices of other occupants of the Shopping Center or of
the neighborhood in which the Shopping Center is located.
(e) Intentionally deleted.
(f) The plumbing facilities shall not be used for any other purpose than that for which they are constructed;
no foreign substance of any kind shall be thrown therein, and the expense of any breakage, stoppage, or damage
resulting from a violation of this provision shall be borne by Tenant. All grease traps, if any, shall be installed and
maintained in accordance with applicable law and in accordance with Landlord's requirements.
(g) Subject to Landlord's approval of all service providers, Tenant at its expense shall contract for termite
and pest extermination services covering the Leased Premises, to be rendered as needed but at least annually.
(h) Tenant shall not burn any trash or garbage of any kind in the Leased Premises, the Shopping Center, or
within three (3) miles of Shopping Center.
(i) Tenant shall keep any display windows or signs in or on the Leased Premises well lighted during such
hours and days that any enclosed mall in the Shopping Center is lighted by Landlord or if no enclosed mall exists,
then during such hours and days as specified by Landlord.
(j) Tenant shall keep and maintain the Leased Premises (including, without limitation, exterior and interior
portions of all windows, doors and all other glass) in a neat and clean condition.
(k) Tenant at its expense shall participate in any reasonable window cleaning program that may be
established by Landlord for all or substantially all other stores in the Shopping Center.
(1) Tenant shall take no action which would violate Landlord's labor contracts, if any, affecting the
Shopping Center, nor create any work stoppage, picketing, labor disruption or dispute, or any interference with the
business of Landlord or any other tenant or occupant in the Shopping Center or with the rights and privileges of any
customer or other person(s) lawfully in and upon said Shopping Center, nor shall Tenant cause any impairment or
reduction of the good will of the Shopping Center. Tenant, General Contractor and sub -contractor shall execute a
labor disharmony letter setting forth the aforesaid covenants prior to commencement of construction in the Leased
Premises.
(m) Tenant shall pay before delinquency all license or permit fees and charges of a similar nature for the
conduct of any business in the Leased Premises.
(n) Tanana 3 »ll us r name an
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(o) Tenant shall store and/or stock in the Leased Premises only such merchandise as Tenant is permitted to
offer for sale in the Leased Premises pursuant to this Lease. Tenant shall not violate applicable federal and state
laws prohibiting the sale or display of products which infringe on the trademarks or copyrights of others.
(p) Tenant shall not conduct or permit any fire, bankruptcy, auction, or "going out of business" sale
(whether real or fictitious) or any other sale that conveys to the public that business operations are to be discontinued
at the Leased Premises, or utilize any unethical method of business operation. Tenant shall not use the Leased
Premises as a clearance, outlet or wholesale center.
(q) Tenant shall not perform any act or carry on any practice which may damage, mar, or deface the Leased
Premises or any other part of the Shopping Center.
(r) Tenant shall not use any forklift truck, tow truck, or any other powered machine for handling freight in
the Shopping Center except in such manner and in those areas in the Shopping Center as may be approved by
Landlord in writing. All such equipment shall have rubber wheels only.
(s) Tenant shall not place a load on any floor in the interior delivery system, if any, or in the Leased
Premises, or in any area of the Shopping Center, exceeding the floor load which such floor was designed to carry,
nor shall Tenant install, operate, or maintain therein any heavy item or equipment except in such manner as to
achieve a proper distribution of weight.
(t) Tenant shall not install, operate, or maintain in the Leased Premises or in any other area of the Shopping
Center any electrical equipment which does not bear Underwriter's Laboratory approval, or which would overload
the electrical system or any part thereof beyond its capacity for proper and safe operation as determined by
Landlord.
(u) Tenant shall not suffer, allow, or permit any vibration, noise, light, noxious odor, or other effect to
emanate from the Leased Premises, or from any machine or other installation therein, or otherwise suffer, allow, or
permit the same to constitute a nuisance or otherwise interfere with the safety, comfort, and convenience of
Landlord or any of the other occupants of the Shopping Center or their customers, agents, invitees, or any others
Lawfully in or upon the Shopping Center. Upon notice by Landlord to Tenant that any of the aforesaid is occurring,
Tenant agrees to forthwith remove or control the same.
(v) Tenant shall not use or occupy the Leased Premises in any manner or for any purpose which would
injure the reputation or impair the present or future value of the Leased Premises, the Shopping Center, and/or the
neighborhood in which the Shopping Center is located.
(w) Tenant shall not store, display, sell, or distribute any alcoholic beverages or any dangerous materials
(including without limitation fireworks) unless specifically permitted in this Lease.
(x) Tenant shall not use or occupy the Leased Premises or do or permit anything to be done therein in any
manner which shall prevent Landlord and/or Tenant from obtaining at standard rates any insurance required or
desired, or which would invalidate or increase the cost to Landlord of any existing insurance, or which might cause
structural injury to any building, or which would constitute a public or private nuisance, or which would violate any
present or future laws, including the ADA, regulations, ordinances, or requirements (ordinary or extraordinary,
foreseen or unforeseen) of the federal, state, or municipal governments, or of any department, subdivisions, bureaus,
or offices thereof, or of any other governmental public or quasi -public authorities now existing or hereafter created
having jurisdiction over the Leased Premises or the Shopping Center of which they form a part.
(y) Tenant shall not operate on the Leased Premises or in any part of the Shopping Center any coin or token
operated vending machine or similar device (including, without limitation, pay telephones, pay lockers, pay toilets,
scales, amusement devices, and machines for the sale of beverages, foods, candy, cigarettes, or other merchandise
and/or commodities), except for the sole and exclusive use of Tenant's employees.
(z) Tenant shall not allow any third party to make use of any portion of the Leased Premises in any manner
including but not limited to the display of advertising material for which Tenant is compensated.
Section 4.5 Signs, Awnings and Canopies. Landlord may erect and maintain such suitable signs as it in
its sole discretion may deem appropriate in the Shopping Center. Tenant may erect and maintain only such signs in
compliance with Exhibit B. Section 1.3. as Landlord may approve. Tenant shall submit to Landlord detailed
drawings of its sign for review and approval by Landlord prior to erecting said sign on the Leased Premises.
Tenant shall keep insured and maintain such sign in good condition, repair, and operating order at all times.
If any damage is done to Tenant's sign, Tenant shall commence to repair same within five (5) days or Landlord may
at its option repair same at Tenant's expense.
Tenant shall not place or permit to be placed or maintained on any door, exterior wall, or window of the
Leased Premises any sign, awning, canopy, advertising matter, or other thing of any kind, and shall not place or
maintain any decoration, lettering, or advertising matter on the glass of any window or door of the Leased Premises
without first obtaining Landlord's written consent. Tenant further agrees to maintain any such signs, awnings,
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canopies, decorations, lettering, advertising matter, or other things as may be approved by Landlord in good
condition, operating order, and repair at all times. All signs of Tenant visible from the common areas of the
Shopping Center shall be in good taste and shall conform to the standards of design, motif, and decor from time to
time established by Landlord for the Shopping Center. No flashing signs shall be permitted. No credit card signs or
advertisements, nor any hand lettered signs shall be visible from the common areas. Tenant shall install
professionally lettered name signs on its service door.
Section 4.6 Retail Restriction Limit. The parties acknowledge that the realization of the benefits of a
T3ncrt's mai izrelzing its Gross Sales, and that self competition i;,
en 3f Ma'.fi71um-CroCs Sc
Annual R
self -competition by Tenant will deprive Landlord of a bargained -for consideration. Further, the parties acknowledge
that the Shopping Center is an interdependent and synergistic environment and that self -competition by Tenant is
inconsistent with such environment. Accordingly, Tenant covenants and agrees that during the Term and any
extension or renewals thereof Tenant will not, directly or indirectly, engage in any business similar to or in
competition with that for which the Leased Premises are let, within a radius of five (5) three (3) miles of the
Shopping Center, measured from the perimeter of the Shopping Center, without Landlord's prior written consent.
The covenant of the preceding sentence shall be inapplicable to any business of Tenant existing as of the date
hereof, provided the nature, character, and/or size of such business remains the same and is continuously operated at
the same location. If Tenant shall breach the covenant contained in this Section 4.6, then in addition to the rights
and remedies provided in Article XI of this Lease, Landlord may, at its option, either (i) terminate this Lease upon
thirty (30) days' written notice to Tenant, or (ii) enjoin the operation of the violative store of Tenant, , or (iii)
ting the P
Lease.
•
Section 4.7 Relocation. At any time during the Term of the Lease if Landlord desires to relocate Tenant,
then, subject to Tenant's right to terminate pursuant to the next paragraph, Landlord shall have the right, upon giving
no less than sixty (60) days prior written notice to Tenant ("Notice of Relocation"), to relocate the Leased Premises
to a space containing approximately the same square footage as the Leased Premises (not more than ten percent
(10%) variation) anywhere in the Shopping Center (the "Relocation Premises"). Tenant's term for such Relocation
Premises shall be for the balance of the Term of the Lease at the same per square foot charges (subject to increase in
accordance with the terms of this Lease), including but not limited to the Minimum Annual Rent
Rent and otherwise on the same terms of this Lease. In the event of such relocation, Landlord shall promptly
reimburse Tenant for the direct and actual reasonable costs and expenses incurred by Tenant related to the moving
and relocation of Tenant as evidenced by invoices and paid receipts provided such costs and expenses do not exceed
the lesser of (i) Two and 50/100 Dollars ($2.50) per square foot of the Leased Premises and (ii) Five Thousand
Dollars ($5,000.00) (not including any installation or construction) and Landlord shall perform at Landlord's sole
cost and expense the build -out of the Relocation Premises to at least the equivalent quality and condition of the
existing Leased Premises(in Landlord's commercially reasonable judgment) immediately prior to such relocation,
including all furniture, fixtures, trade fixtures, leasehold improvements and equipment. Landlord shall be permitted
to reuse furniture, fixtures, trade fixtures, leasehold improvements and equipment from the Leased Premises in the
Relocation Premises. The date Tenant relocates or should have relocated to the Relocation Premises shall be the
Relocation_Date. Such relocation shall take place in a manner so that Tenant may operate in the original Leased
Premises until the Relocation Premises are nary prepared for the operation of Tenant's business taking into
account Landlord's right to use furniture, fixtures, trade fixtures, leasehold improvements and equipment from the
Leased Premises in the Relocation Premises. Notwithstanding the foregoing, in the event Landlord relocates
Tenant, Landlord shall have the right to (but not the obligation) and Tenant agrees to extend the Term of the Lease
for a period that causes the Lease Term to expire on the fifth (5th) anniversary of the Relocation Date (any period of
time after the last year of the initial Lease Term (as described in Section 1.1(b)) hereinafter the "Relocation
Extension Term") unless there are more than five (5) years remaining in the Lease Term upon the date Tenant opens
for business (or should have opened) in the Relocation Premises. In the event the Term is so extended Tenant's
Minimum Annual Rent per year after the last year of the initial Lease Term shall be the Minimum Annual Rent per
square foot of the Leased Premises during the last year of the initial Lease Term
payable during the last year of the initial T 3sa Term 3: a per square -feet -basis (hereinafter the Extended Rent).
Such Extended Rent shall commence at the beginning of the Relocation Extension Term and continue through the
balance of the Relocation Extension Term. Upon relocation, this Lease shall continue to remain in full force and
effect and the Relocation Premises shall become the Leased Premises for all purposes set forth in this Lease. In the
event of a relocation Landlord shall provide Tenant with a letter reflecting the aforementioned changes.
Within twenty (20) days of the date of the Notice of Relocation, Tenant shall notify Landlord in writing
either that (a) Tenant agrees to relocate to the Relocation Premises in accordance with the terms in the Notice of
Relocation or (b) Tenant elects to terminate the Lease with such termination to be effective on the date Landlord
intended the Leased Premises to be returned to Landlord as indicated in the Notice of Relocation. Failure by Tenant
to respond to the Notice of Relocation within the aforesaid twenty (20) day period will be deemed to mean that
Tenant agrees to relocate in accordance with the aforesaid terms and conditions. In the event Tenant elects to
terminate the Lease, Landlord shall have the right within ten (10) days thereafter to withdraw its notice requiring
Tenant to relocate, in which event Tenant's right to terminate the Lease shall be null and void and Tenant shall
remain in the Leased Premises and this Lease shall continue in full force and effect. If Landlord shall not so
withdraw its notice, and Tenant's rejection of the Relocation Premises terminates this Lease, then the Landlord shall
reimburse Tenant for the unamortized cost of Tenant's actual investment in the leasehold improvements installed in
the Leased Premises (calculated as of the date of such termination and amortized on a straight line basis over a
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period of time equal to the original Lease Term not to exceed ten (10) years) excluding any amounts contributed by
Landlord for construction of the Leased Premises. Following Landlord's request, said unamortized costs of
leasehold improvements installed in the Leased Premises shall be certified to Landlord by Tenant's chief financial
officer. Landlord's reimbursement to Tenant of the aforementioned unamortized costs of leasehold improvements
installed in the Leased Premises shall occur within thirty (30) days after the date Tenant vacates the Leased Premises
and Landlord shall deduct from said reimbursement any sums then due Landlord
ARTICLE V
INSURANCE REQUIRED OF TENANT
Section 5.1 Insurance Required of Tenant. (a) Tenant shall obtain and provide, on or before the earlier
of the commencement of the Term or Tenant's entering the Leased Premises for any purpose, and keep in force at all
times thereafter, the following insurance coverages with respect to the Leased Premises:
(i) Commercial General Liability Insurance, with contractual liability endorsement, relating to
the Leased Premises and its appurtenances on an occurrence basis with a combined single limit of not less than One
Million Dollars ($1,000,000.00) per occurrence and Two Million Dollars ($2,000,000.00) in the aggregate for bodily
injury, death and property damage.
(ii) All Risk (except for those items specifically excluded) Coverage, and Flood (if required by
Landlord, any mortgagee or governmental authority) Insurance and such other coverages as Landlord may
reasonably elect to require in an amount adequate to cover the replacement cost of all personal property, decorations,
trade fixtures, furnishings, equipment, and all contents therein.
(iii) Boiler and Machinery (Mechanicals) Insurance covering all pressure vessels; boilers; heating,
ventilating, and air conditioning equipment; or similar equipment, if any, in, on, adjoining, above, or beneath the
Leased Premises which serve the Leased Premises, in a minimum amount of One Million Dollars ($1,000,000.00);
provided, however, Tenant shall not be required to maintain separate coverage if the risks contemplated herein are
adequately covered by Tenant's other insurance required pursuant to this Section.
(iv) tion Insuname covering those risks referred to in (ii) above at: amaunt
equal `.0 ai .`�-inimii da. . .. '
(v) As required by the law of the State where the Leased Premises are located, Worker's
Compensation Insurance covering all persons employed, directly or indirectly, in connection with any finish work
performed by Tenant or any repair or alteration authorized by this Lease or consented to by Landlord, and all
employees and agents of Tenant with respect to whom death or bodily injury claims could be asserted against
Landlord or Tenant with Employer's Liability Insurance with limits of not less than One Million Dollars
($1,000,000.00) per accident or disease. Tenant's Worker's Compensation Insurance shall include a waiver of
subrogation rights as to all claims against Landlord and the parties designated by Landlord as Additional Insureds.
(vi) Plate Glass Insurance, provided. however. the initial Tenant named herein (or anv assignee or
subtenant permitted without Landlord's prior consent pursuant to Section 12.6 of this Lease) may self -insure the risks
covered under this subsection.
(vii) In the event Tenant or its employees or its licensees provide medical, dental, optometric, or
other products or services for which Professional Liability or Medical Malpractice Insurance coverage is available,
Professional Liability/Medical Malpractice coverage on an occurrence form, if available, with a limit of liability of
not less than One Million Dollars ($1,000,000). All professionals working within the practice including, but not
limited to, doctors, nurses, physician assistants, dentists, and assistants must be insured by the policy. If an
occurrence policy is not available, a claims made policy is acceptable with a retroactive date no later than the date
the practice became a tenant of Landlord. Further, coverage must be maintained for a minimum of two (2) years
after the practice is no longer a tenant of Landlord.
(viii) Such other insurance as may be carried on the Leased Premises and Tenant's operation
thereof, as may be determined by Landlord.
(b) Before undertaking any alterations, additions, improvements, or construction, Tenant shall obtain at its
expense a commercial general liability insurance policy insuring Tenant and Landlord against any liability which
may arise on account of such proposed alterations, additions, improvements, or construction on an occurrence basis
with the minimum limits set forth in this Section 5.1.
(c) All of the aforesaid insurance shall be written by one or more Best Rated ANII or better insurance
companies licensed in the state where the Shopping Center is located and in form satisfactory to Landlord and shall
be written in the name of Tenant with Landlord (and any designee(s) of Landlord) named as Additional Insured,
except the Worker's Compensation Insurance required by subparagraph (a)(v) above for which Tenant shall not be
required to name Landlord and its designees as Additional Insureds; all such insurance may be carried under a
blanket policy covering the Leased Premises and any other of Tenant's stores; all such insurance shall contain
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endorsements that such insurance may not be cancelled or amended with respect to Landlord (or its designees)
except upon thirty (30) days' prior written notice to Landlord (and any such designees) by the insurance company;
Tenant shall be solely responsible for payment of premiums and that Landlord (or its designees) shall not be
required to pay any premium for such insurance; in the event of payment of any loss covered by such policy,
Landlord (or its designees) shall be paid first as their interests may appear by the insurance company for Landlord's
loss. The minimum limits of the commercial general liability policy of insurance shall in no way limit or diminish
Tenant's liability hereunder. Tenant shall deliver to Landlord at least fifteen (15) days prior to the time such
insurance is first required to be carried by Tenant, and thereafter at least fifteen (15) days prior to the expiration of
such policy, either a stamped certified true duplicate original or a certificate of insurance on all policies procured by
Tenant in compliance with its obligations hereunder, together with evidence satisfactory to Landlord of the payment
of the premiums therefor. If Tenant fails to obtain and provide any or all of the aforesaid insurance, then Landlord
may, but shall not be required to, purchase such insurance on behalf of Tenant and add the cost of such insurance as
additional rent payable with the next installment of Minimum Annual Rent.
(d) The rnilliniu
of the third (3rd) full year of the Term if same shall
wrd thcrcfer--by-bandlerd, T-e::z~.t shall
Prn^' L
(e) Tenant agrees to notify Landlord in writing not less than thirty (30) days prior to the date Tenant opens
for business in the Leased Premises of the actual cost of all permanent leasehold improvements and betterments
installed or to be installed by Tenant in the Leased Premises (whether same have been paid for entirely or partially
by Tenant), but exclusive of Tenant's personal property, movable trade fixtures and contents, in order that Landlord
can insure said improvements and betterments from and after the date Tenant opens for business in the Leased
Premises on an All Risk (except for those items specifically excluded) basis, and such other risks as Landlord may
elect to insure. Similar notification shall be given to Landlord not less than thirty (30) days prior to the
commencement of any proposed alterations, additions, or improvements to the Leased Premises by Tenant (if same
are permitted under the terms of this Lease) subsequent to the initial construction of the Leased Premises. If, on
account of the failure of Tenant to comply with the foregoing provisions, Landlord is adjudged a co-insurer by its
insurance carrier, then any loss or damage Landlord shall sustain by reason thereof shall be borne by Tenant and
shall be immediately paid by Tenant upon receipt of a bill therefor together with evidence of such loss.
Section 5.2 Fire Insurance Rate and Requirements. (a) Tenant agrees, at its own cost and expense, to
comply with all of the rules and regulations of the Fire Insurance Rating Organization having jurisdiction and any
similar body. If, at any time and from time to time, as a result of or in connection with any failure by Tenant to
comply with the foregoing sentence or any act of omission or commission by Tenant, its employees, agents,
contractors, or licensees, or as a result of or in connection with the use to which the Leased Premises are put
(notwithstanding that such use may be for the purposes hereinbefore permitted or that such use may have been
consented to by Landlord), the hazard insurance rate(s) applicable to the Leased Premises, or the building in which
same are located, or to any other premises in said building, or to any adjacent property owned or controlled by
Landlord, or an affiliate of Landlord, and/or to the contents in any or all of the aforesaid properties (including rent
insurance relating thereto) shall be higher than that which would be applicable for the least hazardous type of
occupancy legally permitted therein, Tenant agrees that it will pay to Landlord, on demand, as additional rent, such
portion of the premiums for all hazard insurance policies in force with respect to the aforesaid properties (including
rent insurance relating thereto) and the contents of any occupant thereof as shall be attributable to such higher
rate(s). If Tenant installs any electrical equipment that overloads the lines in the Leased Premises or the building in
which the Leased Premises are located, Tenant shall, at its own cost and expense, promptly make whatever changes
are necessary to remedy such condition and to comply with all requirements of the Landlord and the Fire Insurance
Rating Organization and any similar body and any governmental authority having jurisdiction thereof. For the
purpose of this paragraph, any finding or schedule of the Fire Insurance Rating Organization having jurisdiction
thereof shall be deemed to be conclusive.
(b) In the event that this Lease so permits and Tenant engages in the preparation of food or packaged foods
or engages in the use, sale, or storage of inflammable or combustible material, Tenant shall install chemical
extinguishing devices (such as ansul) approved by the Fire Insurance Rating Organization and shall keep such
devices under service as required by such organization.
(c) If gas is used in the Leased Premises, it shall only be permitted to be used for cooking equipment and in
no event for heating the Leased Premises, and Tenant shall install at its expense gas cut-off devices (manual and
automatic).
Section 5.3 Waiver of Subrogation. Landlord shall not be liable for any damage by fire or other peril
includable in the coverage afforded by an All Risk (except for those items specifically excluded) Insurance policy,
(whether or not such coverage is in effect), no matter how caused, it being understood that the Tenant will look
solely to its insurer for reimbursement. Tenant shall not be liable for any damage by fire or other peril includable in
the coverage afforded by an All Risk (except for those items specifically excluded) Insurance policy (whether or not
such coverage is in effect), no matter how caused, it being understood that Landlord will look solely to its insurer for
reimbursement.
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ARTICLE VI
REPAIRS AND MAINTENANCE
Section 6.1 Repairs by Landlord. Within a reasonable period after receipt of written notice from Tenant,
Landlord shall make necessary structural repairs to the exterior walls (excluding the exterior of and the frames
surrounding all windows, doors, plate glass, store fronts, and signs); necessary repairs to the roof, foundations, load
bearing items, plumbing, pipes, and conduits located outside the Leased Premises and/or in the common areas, and
necessary repairs to sidewalks, malls, parking areas, and curbs. Landlord shall not be required to make any repairs
where same were made necessary by any act or omission or negligence of Tenant, any subtenant, or concessionaire,
or their respective employees, agents, invitees, licensees, visitors, or contractors, or by fire or other casualty or
condemnation, except as provided in Article VIII.
Section 6.2 Repairs and Maintenance by Tenant. Tenant shall make and pay for all repairs to the
Leased Premises and all equipment and systems serving the Leased Premises exclusively and shall replace all things
which are necessary to keep the same in a good state of repair and operating order, such as (but not limited to) all
fixtures, furnishings, lighting, and store signs of Tenant. Tenant shall also maintain, replace, and keep in good
repair and operating order all components exclusively serving the Leased Premises, whether located within or
without the Leased Premises, including but not limited to air conditioning, ventilating, plumbing, sprinklering,
heating, and electrical installations, ceilings, inside walls, carpeting, and floor surfaces. Tenant shall at all times
keep the Leased Premises and all exterior entrances, exterior walls, glass and show mouldings, partitions, doors,
floor surfaces, fixtures, equipment, and appurtenances thereof in good order, condition, and repair, and in a
reasonably satisfactory condition of cleanliness, including reasonable periodic painting of the Leased Premises, and
Tenant shall make such other necessary repairs in and to the Leased Premises not specified in Section 6.1 hereof as
being the responsibility of Landlord, and as required by Section 5.3 hereof. Tenant shall at its expense replace all
broken or damaged glass or substitutes therefor, as the case may be. The provisions of this Section 6.2 shall not
limit Landlord's obligation to restore or repair under Article VIII hereof in the event of fire or other casualty.
If (i) Tenant does not repair properly as required hereunder and to the reasonable satisfaction of Landlord,
or (ii) Landlord, in the exercise of its sole discretion, determines that emergency repairs are necessary, or (iii)
repairs or replacements to the Shopping Center and/or common areas are made necessary by any act or omission or
negligence of Tenant, its agents, employees, subtenants, assignees, concessionaires, contractors, invitees, licensees,
or visitors, then in any of such events Landlord may make such repairs without liability to Tenant for any loss or
damage that may accrue to Tenant's merchandise, fixtures, or other property, or to Tenant's business by reason
thereof, and upon completion thereof, Tenant shall pay Landlord's costs for making such repairs plus twenty percent
(20%) for overhead, upon presentation of a bill therefor, as additional rent. Said bill shall include Interest from the
date such repairs were billed by the contractor(s) making such repairs.
Section 6.3 Inspection. Landlord or its representatives shall have the right to enter the Leased Premises
during any business day (and in emergency at all times) during the Term.
Section 6.4 Obstructions. Tenant agrees to keep its loading facilities, if any, and the sidewalks and mall
areas immediately adjoining the Leased Premises free from Tenant's trash, litter, or obstructions, and, in addition, if
the Leased Premises open onto an outside area, to keep said outside sidewalk area immediately adjoining the Leased
Premises free from ice and snow.
ARTICLE VII
ADDITIONS AND ALTERATIONS
Section 7.1 By Landlord. Landlord reserves the right from time to time to make changes, alterations,
repairs, additions, and eliminations in and to the buildings and structures and the common areas in the Shopping
Center, to build additional stories on the building in which Leased Premises are contained, to install seating, kiosks,
and planting areas, temporary or permanent free-standing units and vending devices in such areas, including public
areas, common areas, and malls, and as it deems feasible, to erect any new or additional buildings or kiosks in any
part of the Shopping Center; to enclose any and all malls, make such changes in the roadways and parking facilities
including multi-level, double -decked, elevated, or subterranean parking facilities as it deems feasible, and use the
air rights over any building or structures; install a sprinkler system in the Shopping Center, which may or may not
include the Leased Premises, and relocate the various buildings, parking areas, and other common areas; enlarge or
reduce the Shopping Center at the sole option of Landlord by addition(s) to the Shopping Center of land and/or
buildings or by the diminution thereof; randomly extend all or some storefronts beyond their present positions; vary,
alter, remodel, renovate, relocate, revise, eliminate, and/or modify the following: the mall floor and/or ceilings, the
entrance and exit door locations to the enclosed mall, mall skylights, the color scheme throughout the Shopping
Center, canopies, and columns in the mall and common areas and on the exterior of the Shopping Center, the
exterior and interior facade of the Shopping Center, the Shopping Center logo and name, exterior identification and
roadways in the Shopping Center, as Landlord or its managing agent, architect, engineers, designers, or planners
may deem feasible, reasonable, and/or desirable, which in Landlord's sole, uncontrolled, and exclusive discretion it
may deem necessary and/or desirable to all of which and to any resulting inconvenience Tenant hereby consents,
and none of which shall entitle Tenant to any abatement of rent or constitute an eviction. Such alterations,
renovations and additions constructed by Landlord shall comply with applicable laws, including but not limited to
building codes, zoning ordinances and the ADA. Tenant shall cooperate with Landlord in Landlord's efforts to
comply therewith, which shall include the obligation to make required modifications to the Leased Premises at
Tenant's expense.
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expense-te-FEL bis r: a
s and Fn-alls, Tanant agrees at Tenant':,
). All of Tenant's rcfarbis.hing :..rAlar
to this prragrapl. ^"a" be perf rmed in a t razly manner so as to be
Tenant shall, at -its -expense; atony tiny.; during th ith *r- int
f the
- - - erior finis
•
(ii) at :and!
an -ant's tl
gn trar4 -and characteristics established by Landlord for
d's prior :vFittEn approves
Section 7.2 By Tenant. Tenant may from time to time (if Tenant shall not then be in default), at its own
expense, alter, renovate, or improve the Leased Premises provided the same be performed in a good and
workmanlike manner; in accordance with accepted building practices and applicable laws including, but not limited
to, building codes, zoning ordinances and the ADA; and so as not to weaken or impair the strength or lessen the
value of the building in which the Leased Premises are located. Tenant shall be entitled to all salvage resulting
therefrom. No changes, alterations, or improvements affecting the exterior of the Leased Premises or the structure
of the building shall be made by Tenant. Prior to commencement of all such work, Tenant shall obtain Landlord's
prior written approval of the plans and specifications therefor and shall cause Landlord's requirements for bonding,
insurance, and other contractor requirements to be satisfied. Any work done by Tenant under the provisions of this
Section 7.2 shall not interfere with the use by the other tenants of their premises in the Shopping Center. Tenant
shall pay or reimburse Landlord for the cost of all modifications to the common areas necessitated by Tenant's
construction or alterations to the Leased Premises.
ARTICLE VIII
DAMAGE, DESTRUCTION OR CONDEMNATION OF THE LEASED PREMISES
Section 8.1 Damage or Destruction. (a) If all or any part of the Leased Premises shall be damaged or
destroyed by fire or other hazard insured under an All Risk (except for those items specifically excluded) Insurance
policy applicable to the Leased Premises, Landlord shall, except as otherwise provided herein, repair and/or rebuild
the same with reasonable diligence, but Landlord's obligation hereunder shall be limited to the performance of
Landlord's work, if any, in accordance with Exhibit B hereof, and Landlord shall not be obligated to commence
such repairs and/or rebuilding until insurance proceeds are released to Landlord. Landlord's obligation hereunder
shall be limited to the proceeds received and retained by Landlord under its insurance policy which are allocable to
the Leased Premises. Should Tenant have notified Landlord in writing of the permanent leasehold improvements
and betterments installed by Tenant in the completed Leased Premises (whether same have been paid for entirely or
partially by Tenant) and should such notice accurately state the full insurable value of such permanent leasehold
improvements and betterments, then and in those events, and subject to the first and second sentences of this
subsection, Landlord shall repair and/or rebuild the Leased Premises to a condition comparable to that existing prior
to such damage or destruction. Nothing hereinabove contained shall impose upon Landlord any liability or
responsibility to repair, rebuild, or replace any property belonging to Tenant. If there should be a substantial
interference with the operation of Tenant's business in the Leased Premises as a result of such damage or destruction
which requires Tenant to temporarily close its business to the public, provided Tenant did not cause such damage or
destruction the Minimum Annual Rent and other sums payable hereunder shall abate, but only to the extent of the
proceeds actually received by Landlord on account of Landlord (or its designee(s)) under any policy of rent and/or
business interruption insurance. • • : - _ - .. - _ _ . _ _ shall be pr
t'e ba:. ass-iu-clased:
Unless this Lease is terminated as hereinafter provided, Tenant shall repair, redecorate, and refixture the
Leased Premises and restock the contents thereof in a manner and to at least a condition equal to that existing prior
to its destruction or casualty, and the proceeds of all insurance carried by Tenant on its personal property,
decorations, trade fixtures, furnishings, equipment, and contents in the Leased Premises shall be held in trust by
Tenant for such purposes. Tenant agrees to exercise reasonable diligence to reopen for business in the Leased
Premises as soon as practicable unless this Lease is terminated as hereinafter provided.
(b) Notwithstanding anything else to the contrary contained in this Section 8.1 or elsewhere in this Lease,
Landlord, at its option, may terminate this Lease on thirty (30) days' notice to Tenant given within one hundred
eighty (180) days after the occurrence of any of the following:
(i) The Leased Premises and/or building in which the Leased Premises are located shall be
damaged or destroyed as a result of an occurrence which is not covered by Landlord's insurance; or
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(ii) The Leased Premises and/or building in which the Leased Premises are located shall be
damaged or destroyed and the cost to repair the same shall amount to more than twenty-five percent (25%) of the
cost of replacement thereof; or
(iii) The Leased Premises shall be damaged or destroyed to the extent of twenty-five percent
(25%) or more of the cost of replacement during the last three (3) years of the Term or any extended term; or
(iv) Any or all of the buildings or common areas of the Shopping Center are damaged (whether or
not the Leased Premises are damaged) to such an extent that, in the sole judgment of Landlord, the Shopping Center
cannot be operated as an economically viable unit.
(c) Except to the extent specifically provided for in this Lease, none of the Minimum Annual Rent and
other sums payable by Tenant, nor any of Tenant's other obligations under any provisions of this Lease, shall be
affected by any damage to or destruction of the Leased Premises by any cause whatsoever.
(d) The term "cost of replacement" as used in this section shall be determined by the company or
companies selected by Landlord insuring Landlord against the casualty in question, or if there shall be no insurance,
then as the parties hereto shall agree, or in absence of any insurance company determination or an agreement, as
shall be determined by arbitration according to the rules and practices of the American Arbitration Association in
Chattanooga, Tennessee.
(e) Tenant shall give to Landlord and to all mortgagees of record prompt written notice of any damage to or
destruction of any portion of the Leased Premises resulting from fire or other hazard.
Section 8.2 Condemnation. If the entire Leased Premises shall be appropriated or taken under the power
of eminent domain by any public or quasi -public authority, or conveyance shall be made in lieu thereof, this Lease
shall terminate and expire as of the date of such taking, and the parties shall thereupon be released from all liability
hereunder which accrues after the date of such taking.
Anything in this Lease to the contrary notwithstanding, in the event more than fifteen percent (15%) of the
Leased Premises or more than twenty-five percent (25%) of the then existing paved parking spaces of the Shopping
Center shall be appropriated or taken, or conveyance made in lieu thereof, either party shall have the right to cancel
and terminate this Lease as of the date of such taking upon giving notice to the other of such election within thirty
(30) days after such taking. In the event of such cancellation, the parties shall thereupon be released from any
further liability under this Lease (except for obligations existing on the effective date of such termination); provided,
however, that if more than twenty-five percent (25%) of the then existing paved parking spaces shall be appropriated
or taken and fifteen percent (15%) or less of the Leased Premises shall be appropriated or taken, and Tenant shall
have given notice to Landlord of cancellation, Landlord may at its option nullify and vacate Tenant's cancellation by
giving Tenant notice within thirty (30) days prior to the effective date of taking that it will provide substitute parking
on or adjacent to the Shopping Center sufficient to cause the paved parking spaces after such substitution to be
reduced by not more than twenty-five percent (25%) of the number of spaces prior to such taking, in which event the
Lease shall remain in full force and effect.
If a portion of the Leased Premises is taken, or conveyance made in lieu thereof, and if this Lease shall not
be terminated as provided in the preceding paragraph, then the Minimum Annual Rent
(Gross Sales figure) shall be ratably apportioned according to the space so taken, and Landlord shall, at its own
expense, restore the remaining portion of the Leased Premises to a complete architectural unit, but such work shall
not exceed the scope of the work required to be done by Landlord, if any, pursuant to Exhibit B hereto. The cost of
Landlord's obligation hereunder shall be limited to that portion of the net proceeds of the condemnation award
actually received and retained by Landlord which are allocable to the Leased Premises.
If more than fifteen percent (15%) of the leasable floor space within the Shopping Center shall be so taken,
regardless of whether or not the Leased Premises shall have been partially taken, then Landlord shall have the right
to terminate this Lease on thirty (30) days' written notice.
All compensation awarded or paid upon such a total or partial taking of the Leased Premises shall belong to
and be the property of Landlord without any participation by Tenant.
It is mutually agreed that (i) any reduction in the parking area, number of parking spaces in the Shopping
Center, and/or restriction on the number of motor vehicles that may enter the Shopping Center by action or order of
any governmental authority, quasi -governmental authority, and/or by any court having jurisdiction which does not in
fact constitute a physical taking of property shall not constitute such a taking or condemnation under this Lease that
would entitle Tenant to terminate the Lease, (ii) any such environmental condemnation and/or compliance by
Landlord with any order, rule or regulation of any such authority, with any such judicial decree, and/or any such
existing or future law shall not constitute a default under this Lease by Landlord so as to entitle Tenant to terminate
the Lease and the Lease shall remain in full force and effect, and (iii) as between Landlord and Tenant, Landlord
may but shall not be obligated to comply with any such order, rule, regulation, judicial decree or law, it being
understood by the parties that Landlord may elect to refuse to comply in order to test such order, rule, regulation,
judicial decree, or law.
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Section 9.1 Amounts.
Seetio 9.1.; I
the Gaf:ara-i Prom
ARTICLE IX
GENERAL PROMOTION FUND
•
(a) INTENTIONALLY DELETED.
(b) INTENTIONALLY DELETED.
(c) General Promotion Fund.
(i) Initial Charee. Tenant shall pay
a .
h is this Lease for
La+ dimer, bill therefer.
(h)
E--n-ar:siz' Refurbish:. Cha Subsc
subsequent-paymentc shall t c is ar. ars
foot of the Leased Premises. Tat thall j -y
(10) days after Tenant's receipt of Landlord's bill th
i in subsection 9.5(c) below. Such
Z. Tarr. of this Lease.
Section 9.1.2 INTENTIONALLY DELETED.
Section 9.1.3 INTENTIONALLY DELETED.
Section 9.2 INTENTIONALLY DELETED.
Section 9.3 INTENTIONALLY DELETED.
Section 9.4 INTENTIONALLY DELETED.
Section 9.5 General Promotion Fund. The General Promoter: Fund shall be -used -far -the -additional
:i)
(b) Fc L
Sheeein-eCenter. I` Tz a:t's L
Ter_aM's ch
than 'Ninety (90) Days after t'r I iti&1 avenins of tho
ongoing prommot_•
the Leased Premises.
(c) ar:: c
f th-ic L e
ten percent (10%) or more or cau:,os e cruor ra .rrbishing of • all or part of the Shopping Center (tho
shi- g"), t .. _ . . . . c Enpa.:.%
forth in--Soct:or. 9.1.1
Win.
ARTICLE X
FINANCING
Section 10.1 Financing. If any lending institution and/or any bonding authority with which Landlord or
any such bonding authority has negotiated or may negotiate interim or long term financing for the Shopping Center
or part thereof does not approve the credit rating of Tenant, or if such lending institution or bonding authority shall
require change(s) in this Lease as a condition of its approval of this Lease for such financing; and if within fifteen
(15) days after notice from Landlord (i) Tenant fails or refuses to supply or execute guarantees which are stated by
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Landlord as necessary to secure the approval of Tenant's credit by any such lending institution or bonding authority,
or (ii) if Tenant fails or refuses to execute with Landlord the amendment or amendments to this Lease accomplishing
the change(s) which are stated by Landlord to be needed in connection with approval of this Lease for purposes of
such financing, or (iii) if for any reason, such financing in an amount satisfactory to Landlord cannot be obtained,
Landlord shall have the right to cancel this Lease at any time prior to the commencement of the Term. In the event
of cancellation by Landlord hereunder, this Lease shall be and become null and void and both parties shall
automatically be released as of the date of Landlord's cancellation notice from any and all liability or obligation
under this Lease, except that Landlord shall return the security, if any, made by Tenant. Notwithstanding anything
contained herein to the contrary, Tenant shall not be required to agree, and Landlord shall not have any right of
cancellation for Tenant's refusal to agree, to any modification of the provisions of this Lease relating to the amount
of Minimum Annual Rent and Percentage Rent reserved, the size and/or location of the Leased Premises, the
duration and/or commencement date of the Term, or reducing the improvements to be made by Landlord to the
Leased Premises prior to the tender of possession.
Section 10.2 Subordination. Landlord and Tenant agree that this Lease is and shall be subject and
subordinate at all times to all ground and underlying leases and to all mortgages (in any amounts and all advances
thereon which may now or hereafter affect such leases or the real property of which the Leased Premises form a
part), and to all renewals, modifications, consolidations, participations, replacements, and extensions thereof. The
term "mortgage(s)" as used herein shall be deemed to include trust indenture(s), deed(s) of trust, and security
deed(s). Tenant agrees to attorn to any underlying ground lessor or mortgagee, its affiliates, successors and assigns
or any purchaser of the Shopping Center in a foreclosure proceeding or by a deed in lieu of foreclosure (a
"Mortgagee Party") who shall succeed to Landlord's interest in this Lease upon request of such ground lessor or
Mortgagee Party. Upon request of Landlord, Tenant shall promptly execute and acknowledge, without charge
therefor, an agreement acknowledging such subordination and agreeing to attorn to any underlying ground lessor or
Mortgagee Party who shall succeed to Landlord's interest in this Lease. Upon request of such ground lessor
succeeding to Landlord's interest in this Lease or Mortgagee Party, Tenant shall execute such agreement in
confirmation of such attornment as such successor -in -interest shall reasonably request.
If any Mortgagee Party requires that this Lease be prior rather than subordinate to any such mortgage,
Tenant shall, promptly upon request therefor by Landlord or such Mortgagee Party, and without charge therefor,
execute a document effecting and/or acknowledging such priority, which document shall contain, at the option of
such Mortgagee Party, an attornment obligation to the Mortgagee Party as Landlord in the event of foreclosure or to
any party acquiring title through such mortgage in such event.
Upon request of any Mortgagee Party of record, Tenant shall give prompt written notice in the manner
provided in Section 12.15 of any default of Landlord hereunder, and Tenant shall allow such Mortgagee Party a
reasonable length of time (in any event, not less than sixty (60) days from the date of such notice) in which to cure
any such default. Any such notice shall be sent to the Mortgage Loan Department of any such Mortgagee Party at
its home office address.
ARTICLE XI
DEFAULT BY TENANT
Section 11.1 Default. Tenant shall be in default hereunder if (1) Tenant fails to pay without any setoff or
deduction whatsoever when due Minimum Annual Rent and any other sums due under this Lease and such failure
shall continue for more than five (5) days after written notice from Landlord to Tenant; or (2) Tenant fails to observe
and perform any of the other terms, covenants and/or conditions of this Lease and such failure shall continue for
more than ten (10) days after written notice from Landlord to Tenant; or (3) Tenant fails to pay when due the
Minimum Annual Rent and any other sums payable under this Lease three (3) or more times in any period of twelve
(12) consecutive months; or (4) the Leased Premises shall be abandoned, deserted, vacated, or if Tenant fails to take
possession of the Leased Premises and initially open for business to the public as required hereunder. If the nature
of a default under (2) above is such that it cannot reasonably be cured within the aforesaid time period, and work
thereon shall be commenced within said period and diligently prosecuted to completion, then Landlord's rights
under Section 11.2 shall be inapplicable. The Leased Premises and all trade fixtures, equipment, and inventory
therein shall be conclusively deemed abandoned by Tenant upon (a) fifteen (15) consecutive days' absence from the
Leased Premises by Tenant or its agents (unless such absence results from fire or other casualty) together with the
failure to pay Minimum Annual Rent, or (b) removal of all or a substantial portion of Tenant's trade fixtures,
equipment, or inventory from the Leased Premises together with a failure to pay Minimum Annual Rent. In such
event and in addition to Landlord's remedies set forth in Section 11.2, Landlord may enter the Leased Premises and
may remove all such remaining trade fixtures, equipment, and inventory at Tenant's expense. All such property
shall, at Landlord's option, become the property of Landlord, or said property may be placed in storage at Tenant's
cost and expense, or sold or otherwise disposed of, in which event the proceeds of such sale or other disposition
shall belong to Landlord.
If at any time during the Term there shall be filed by or against Tenant or any successor tenant then in
possession or any guarantor of either under this Lease, in any court pursuant to any statute either of the United States
or of any state, a petition (i) in bankruptcy, (ii) alleging insolvency, (iii) for reorganization, (iv) for the appointment
of a receiver, or (v) for an arrangement under the Bankruptcy Acts, or if a similar type of proceeding shall be filed,
Landlord may terminate Tenant's rights under this Lease by notice in writing to Tenant, and thereupon Tenant shall
immediately quit and surrender the Leased Premises to Landlord, but Tenant shall continue liable for the payment of
rent and all other sums due hereunder.
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Section 11.2 Landlord's Rights on Default. In the event of any default by Tenant, Landlord may (1)
apply the Security Deposit, if any, specified in Section 1.1(g) toward the satisfaction and cure of such a default,
and/or (2) cure Tenant's default at Tenant's cost and expense, and/or (3) without terminating this Lease re-enter the
Leased Premises and remove all persons and all or any property therefrom, by any suitable action or proceeding at
law, or by force or otherwise, without being liable for any prosecution therefor or damages therefrom, and repossess
and enjoy the Leased Premises, with all additions, alterations, and improvements, and Landlord may at its option,
repair, alter, remodel, and/or change the character of the Leased Premises as it may deem fit, and/or (4) at any time
relet the Leased Premises or any part or parts thereof, as the agent of Tenant or in Landlord's own right, and/or (5)
terminate this Lease upon not less than three (3) days' written notice to Tenant. The exercise by Landlord of any
right granted in this Section shall not relieve Tenant from the obligation to make all rental payments, and to fulfill all
other covenants required by this Lease, at the time and in the manner provided herein, and, if Landlord so desires, all
current and future rent and other monetary obligations due hereunder shall become immediately due and payable.
Tenant throughout the remaining Term hereof shall pay Landlord, no later than the last day of each month during the
Term, the then current excess, if any, of the sum of the unpaid rentals and costs to Landlord resulting from such
default by Tenant over the proceeds, if any, received by Landlord from such reletting, if any, but Landlord shall
have no liability to account to Tenant for any excess. Landlord shall not be required to relet the Leased Premises
nor exercise any other right granted to Landlord hereunder, nor shall Landlord be under any obligation to minimize
Tenant's loss as a result of Tenant's default. If Landlord attempts to relet the Leased Premises, Landlord shall be
the sole judge as to whether or not a proposed tenant is suitable and acceptable. If Landlord relets the Leased
Premises (no inference being made that Landlord is required to do so), then any proceeds from such reletting shall
be applied in the following order of priority: (a) to the payment of all expenses Landlord may have incurred in
connection with reentering, ejecting, removing, dispossessing, reletting, altering, repairing, redecorating,
subdividing or otherwise preparing the Leased Premises for said reletting, including court costs, attorney's and
brokerage fees; (b) to the payment of any past -due indebtedness or obligations due hereunder from Tenant to
Landlord, including the cost of debt collection; and (c) the residue, if any, to the payment of the on-going
obligations of Tenant to Landlord pursuant to the terms and conditions of this Lease, and Tenant hereby waives all
claims to any excess. All of the foregoing shall bear Interest from the date incurred until the date of payment.
In the event of a breach by Tenant of any of the covenants or provisions hereof, Landlord shall have, in
addition to any other remedies which it may have, the right to invoke any remedy allowed at law or in equity to
enforce Landlord's rights or any of them, as if re-entry and other remedies were not herein provided for. With
respect to any litigation arising out of this Lease, Tenant hereby expressly waives the right to a trial by jury and the
right to file any countersuit or crossclaim against Landlord. Tenant agrees that no demand for rent and no re-entry
for condition broken and no notice to quit possession or other notices prescribed by statute shall be necessary to
enable Landlord to recover such possession, but that all right to any such demand and any such re-entry and any
notice to quit possession or other statutory notices or prerequisites are hereby expressly waived by Tenant.
In the event Tenant is a corporation, partnership, or limited liability company, Tenant agrees prior to
commencement of the Term to appoint an agent for service of process having an address in the state in which the
Leased Premises are located and to continuously maintain such appointment during the Term. In the absence of
such appointment, Tenant hereby appoints the Secretary of State of the state in which the Leased Premises are
located as its agent for service of process.
Section 11.3 Non -Waiver Provisions. The failure of Landlord to insist upon a strict performance of any
of the terms, conditions, and covenants herein shall not be deemed to be a waiver of any rights or remedies that
Landlord may have and shall not be deemed a waiver of any subsequent breach or default in the terms, conditions,
and covenants herein contained except as may be expressly waived in writing.
The maintenance of any action or proceeding to recover possession of the Leased Premises, or any
installment or installments of rent or any other moneys that may be due or become due from Tenant to Landlord,
shall not preclude Landlord from thereafter instituting and maintaining subsequent actions or proceedings for the
recovery of possession of the Leased Premises or of any other moneys that may be due or become due from Tenant.
Any entry or re-entry by Landlord shall not be deemed to absolve or discharge Tenant from liability hereunder.
Section 11.4 Force Majeure. If Landlord or Tenant is delayed or prevented from performing any of their
obligations under this Lease by reason of strike or labor troubles or any cause whatsoever beyond either party's
control, the period of such delay or such prevention shall be deemed added to the time herein provided for the
performance of any such obligation by Landlord or Tenant, except for the payment of rent and all other monetary
obligations payable by Tenant in accordance herewith.
Section 11.5 Enforcement Expenses. If at any time Tenant shall be in default hereunder, and if Landlord
shall deem it necessary to engage attorneys to enforce Landlord's rights hereunder, the determination of such
necessity to be in the sole discretion of Landlord, Tenant will reimburse Landlord for court costs, reasonable
attorney's fees (in both the trial court and appellate courts) and all other reasonable expenses.
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ARTICLE XII
OTHER PROVISIONS
Section 12.1 Definition and Liability of Landlord. The term "Landlord" as used in this Lease means
only the owner or mortgagee in possession for the time being of the building in which the Leased Premises are
located or the owner of a leasehold interest in said building and/or the land thereunder so that in the event of sale of
said building or leasehold interest or an assignment of this Lease, or a demise of said building and/or land, Landlord
shall be and hereby is entirely freed and relieved of all obligations of Landlord subsequently accruing.
It is specifically understood and agreed that there shall be no personal liability of
Landlord (nor Landlord's agent, if any) in respect to any of the covenants, conditions, or
provisions of this Lease. In the event of a breach or default by Landlord of any of its
obligations under this Lease, Tenant shall look solely to the equity of the Landlord in the
Shopping Center for the satisfaction of Tenant's remedies.
In addition hereto, it is specifically understood and agreed that Landlord's rights, privileges, duties, and
obligations may be administered by Landlord's designee, including, but not limited to, Landlord's agent, and that
such designee shall have the full authority of Landlord hereunder to perform all of Landlord's functions hereunder
including, but not limited to, the execution of this Lease and any other related documentation.
Section 12.2 Relationship of the Parties. Nothing contained in this Lease shall be deemed or construed
as creating the relationship of principal and agent or of partnership or joint venture between the parties hereto, it
being understood and agreed that neither the method of computing rent nor any other provision contained herein nor
any acts of the parties hereto shall be deemed to create any relationship between the parties other than that of
Landlord and Tenant. If the named Landlord in this Lease is represented by an agent or managing agent, then
Tenant agrees that the word "Landlord" shall be deemed to refer solely to such agent's principal.
Section 12.3 Security Deposit.Tenant-has-deposited or shall deposit with Landlord as socurity for tho
orth i S3ction 1.1(g) hereof. Landlord may use,
sum act
apply -on Tenant's baba'£ retain (without iiab 1ity
n r,ardlo
r ani' purohaoor iut ti fereelesory &a1 or a sale in lieu of
on fr. ;P.: Tana .t'D Dccarit'y
In the event of a sale of the Shapping Centar or ac i
mortgagee,-Landlerd shall have thz right to transfer the security to its vendee or assignee, subject to Tenant's
return of such aocarit
Z.
cuccQssars and asG-i
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ar sigr_m
Section 12.4 Indemnity. To the extent allowed by law. Tenant agrees to defend, indemnify and save
Landlord and any ground and underlying lessor(s) of the Leased Premises harmless from and against any and all
claims and demands (except such as result from the negligence of Landlord, or any such ground or underlying
lessor(s) or their respective agents, contractors, servants, or employees, subject to Section 5.3) for, or in connection
with, any accident, injury, damage, fine, penalty or resulting costs whatsoever caused to any person or property
arising, directly or indirectly, out of the business conducted in or the use and/or occupancy of the Leased Premises
or occurring in, on, or about the Leased Premises or any part thereof, or arising directly or indirectly, from any
violation of law, the ADA, act or omission of Tenant or any concessionaire or sub -tenant or their respective
licensees, servants, agents, employees, or contractors, and from and against any and all costs, expenses, attorneys'
fees and liabilities incurred in connection with any such claims and/or proceedings brought thereon. The
commercial general liability and property damage coverage maintained by Tenant pursuant to this Lease shall
specifically insure the contractual obligations of Tenant as set forth in this Section and/or as provided in this Lease.
Tenant further agrees to defend, indemnify, and hold Landlord, any ground and underlying lessor(s) and
any mortgagee harmless from all loss, damage, expense, fees, claims, costs, fines, penalties, and liabilities including,
but not limited to clean up costs, remedial and monitoring costs, damages to the environment, attorneys' fees and
costs of litigation, arising out of the Tenant's installation of any hazardous substances or violation of any hazardous
substance law (as defined in Section 4.1 hereof). In the event insurance coverage is available, or becomes available,
for the losses or liabilities described in this paragraph, Tenant shall furnish such coverage for the protection of both
Tenant and Landlord (and any designees of Landlord).
The covenants of this Section 12.4 shall survive the termination or expiration of this Lease.
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Section 12.5 Damage to Property or Persons. Landlord shall not be liable for any loss of or damage to
property of Tenant or of others located in the Leased Premises or the Shopping Center, by theft or otherwise, nor for
any loss or damage whatsoever to any property which Tenant could remove at the end of the Term as provided in
Section 12.7 hereof. Landlord shall not be liable for any injury or damage to persons or property or to the interior of
the Leased Premises resulting from fire, explosion, falling plaster, steam, gas, electricity, water, rain, snow, or leaks
from any part of the Leased Premises or from the pipes, appliances, or plumbing works or from the roof, street, or
subsurface or from any other place or by dampness or by any other cause of whatsoever nature. Landlord shall not
be liable for any such injury or damage caused by other tenants or any person(s) either in the Leased Premises or
elsewhere in the Shopping Center, or by occupants of property adjacent to the Shopping Center, or by the public, or
by operations in the construction of any private, public, or quasi -public work. Landlord shall not be liable for any
latent defect in construction except for a period of one (1) year from the date the general contractor constructing the
Shopping Center substantially completes construction of the shell of the Leased Premises. The parties agree that
any liability of Landlord under the preceding sentence shall be limited to cost of repair only. Landlord shall not be
responsible for damage or loss of property of Tenant kept or stored on the Leased Premises, no matter how caused.
Notwithstanding anything contained herein to the contrary, Landlord shall be liable for its negligence, except as set
forth in Section 5.3 hereof.
Section 12.6 Assignment, Subletting, or Licensing.
Section 12.6.1 Transfer, Assignment, Sublease, or License. Tenant shall not, voluntarily,
involuntarily, or by operation of law, sell, mortgage, pledge, or in any manner transfer or assign this Lease in whole
or in part, or sublet or license the whole or any part of the Leased Premises, or permit any other persons or entity to
occupy same without the consent of Landlord, references elsewhere herein to assignees, subtenants, licensees, or
other persons or entities notwithstanding. In the event that Tenant requests permission to either assign this Lease, or
to sublet or license the whole or any part of the Leased Premises, or this Lease is deemed to be assigned pursuant to
Section 12.6.2 of this Lease, then Landlord may, in its sole and absolute discretion, elect to consent or withhold
consent. If Landlord's consent is obtained (no inference being intended herein that Landlord is in any way obligated
to grant such consent), then, in addition to such other conditions as Landlord shall have then imposed, if any, such
assignment or subletting or licensing shall be subject to and conditioned upon the following:
(a) at the time of any such proposed assignment or subletting or licensing, Tenant shall not be in default
under any of the terms, conditions, or covenants of this Lease; and,
(b) the proposed assignee or sublessee or licensee shall occupy the Leased Premises and conduct its
business in accordance with the terms, conditions, and covenants of this Lease, including the use specified
in Section 1.1(e) hereof; and,
(c) that if the Minimum Annual Rent or any additional rent or charges required to be paid by any such
proposed assignee or sublessee or licensee exceeds the Minimum Annual Rent and/or items of additional
rent reserved hereunder, then Tenant shall pay to Landlord monthly the entire amount of such excess,
which shall be deemed additional rent; and,
(d) Tenant and its proposed assignee or sublessee or licensee shall execute, acknowledge, and deliver to
Landlord a fully executed counterpart of a written assignment of lease or sublease or license, as the case
may be, duly consented to by any Guarantor of this Lease by the terms of which,
(i) in case of an assignment, Tenant will assign to such proposed assignee Tenant's entire interest
in this Lease, together with all prepaid rents hereunder, and the proposed assignee will accept said
assignment and assume and agree to perform, directly for the benefit of Landlord, all of the terms,
conditions, and covenants of this Lease on Tenant's part to be performed hereunder; or,
(ii) in case of a subletting or licensing, the sublease or license will in all respects be subject and
subordinate to all of the terms, conditions, and covenants of this Lease, it being understood that
Landlord shall have the right to prohibit such sublease or license if in the opinion of Landlord or
its counsel such sublease or license would result in income to Landlord which is not "rents from
real property" as defined in Section 856(d) of the INTERNAL REVENUE CODE OF 1986, as amended,
and the proposed sublessee or licensee will agree to be bound by and to perform all of the terms,
conditions, and covenants of this Lease on Tenant's part to be performed hereunder, except the
payment of Minimum Annual Rent and all items of additional rent reserved hereunder, which
Tenant shall continue to pay to Landlord; and,
(e) notwithstanding any assignment or subletting or licensing under the terms of this Article, both Tenant
and any Guarantor of this Lease will acknowledge that, notwithstanding such assignment or sublease or
license and the consent of Landlord thereto, both Tenant and any Guarantor of this Lease will not be
released or discharged from any liability whatsoever under this Lease and will continue to remain liable
thereon with the same force and effect as though no assignment or sublease had been made; and,
(f) Tenant shall pay to Landlord or Landlord's designee Landlord's administrative costs, overhead, and
fees of counsel in connection with each such assignment, sublease, or license, but not less than the
minimum sum of One Thousand Dollars ($1,000.00); and,
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(g) in no event and under no circumstances shall any sublessee whether permitted pursuant to the terms
and conditions of this Lease or occupying (or having occupied) the Leased Premises in violation of the
Lease terms be considered a third party beneficiary to this Lease, and any such sublessee shall have no
rights against Landlord.
The acceptance of rent from any other entity shall not be deemed to be a waiver of any of the provisions of this
Lease or to be a consent to the assignment of this Lease or the subletting or licensing of the Leased Premises.
Section 12.6.2 Transfer of Stock or Interest of Tenant or Guarantor. If at any time during the
Term of this Lease, any part or all its outstanding voting stock, if Tenant is a corporation, or any interest in the
partnership, if Tenant is a partnership, or any membership interest, if Tenant is a limited liability company shall be
transferred by sale, assignment, bequest, inheritance, operation of law, or other dispositions so as to result in a
change in the present effective voting control of Tenant by the person or persons owning a majority of said
outstanding voting stock or a majority interest in the partnership or limited liability company, as the case may be, on
the date of this Lease, then such event shall constitute an assignment for the purposes of this Lease.
In the event there is a Guarantor of this Lease, then if at any time during the Term of this Lease,
(a) any part or all of such Guarantor's outstanding voting stock, if such Guarantor is a corporation, or any
interest in the partnership, if such Guarantor is a partnership, or any membership interest, if Tenant is a
limited liability company shall be transferred by sale, assignment, bequest, inheritance, operation of law, or
other dispositions so as to result in a change in the present effective voting control of such Guarantor by the
person or persons owning a majority of said outstanding voting stock or a majority interest in the
partnership or limited liability company, as the case may be, on the date of this Lease; or,
(b) such Guarantor is dissolved,
Tenant shall so notify Landlord. Such notice shall be effective in accordance with this Section 12.6.2 only if said
notice shall include or state all of the following: (1) that said notice is given pursuant to Section 12.15 of this Lease;
(2) the occurrences giving rise to such notice, stated with particularity as to the effective dates, parties involved or
affected and the shares or interests affected; (3) in the event of a transfer of shares or a partner's or member's
interest, a recent financial statement (certified by an independent Certified Public Accountant) of the transferee(s);
and (4) that Landlord shall have thirty (30) days from receipt of such notice to terminate this Lease as described
herein.
Landlord shall have the right, at its option, to terminate this Lease by notice to Tenant given within thirty
(30) days after Landlord's receipt of such notice from Tenant. In the event Landlord receives other notice of such
transfer or of the dissolution of such Guarantor, then Landlord shall have the right, at its option, within ninety (90)
days after receipt of such other notice, to terminate this Lease or to declare a default pursuant to Article XI of this
Lease.
The foregoing provisions shall not apply to that portion of the outstanding voting stock which is listed on a
National Securities Exchange as defined in the Securities Exchange Act of 1934, as amended. For the purposes of
this Section 12.6.2, stock ownership shall be determined in accordance with the principles set forth in Section 544 of
the Internal Revenue Code of 1954, as the same existed on August 16, 1954, and the term "voting stock" shall refer
to the shares of stock regularly entitled to vote for the election of directors of the corporation.
Section 12.6.3 Assignment to Parent, Subsidiary, Affiliated Corporation of Tenant.
Notwithstanding anything in this Article XII to the contrary, Tenant shall have the unrestricted right to assign this
Lease to its parent corporation or to any subsidiary or affiliated corporation or to a corporation which directly or
indirectly owns at least fifty percent (50%) interest in Tenant or in which Tenant owns at least fifty percent (50%),
provided that Tenant shall deliver to Landlord within ten (10) days after the date of such assignment, an executed
copy of the assignment wherein such parent corporation, subsidiary, affiliated corporation, or the corporation which
directly or indirectly owns fifty percent (50%) interest in Tenant or in which Tenant owns at least a fifty percent
(50%) interest, assumes for the benefit of Landlord all of the obligations of Tenant under this Lease and further
provided that any such assignment shall not relieve Tenant from liability for the payment of rent or other sums
herein provided or from the obligation to keep and be bound by the terms, conditions, and covenants of this Lease.
In the event such parent, subsidiary, or affiliated corporation or the corporation which directly or indirectly owns at
least fifty percent (50%) interest in Tenant or in which Tenant owns at least a fifty percent (50%) interest shall at
any time after the date of such assignment no longer be a parent, subsidiary, or affiliated corporation or the
corporation which directly or indirectly owns at least a fifty percent (50%) interest in Tenant or in which Tenant
owns at least a fifty percent (50%) interest, then such an event shall constitute an assignment for the purposes hereof
and shall be subject to the provisions of Section 12.6.1.
Section 12.6.4 Assignment in Instances of Merger, Consolidation, Acquisition.
Notwithstanding anything contained in this Article XII to the contrary, and provided Tenant directly owns at least
ten (10) other stores operating under the same trade name as the trade name Tenant is operating under pursuant to
the terms of this Lease, Tenant shall have the right to assign this Lease to any corporation into which Tenant may
merge or to any corporation arising out of consolidation of Tenant with another corporation or to a corporation or
other entity acquiring all or substantially all the assets of Tenant or all of the issued and outstanding voting stock of
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Tenant. Such right to assign this Lease shall be expressly conditioned upon Tenant's delivering to Landlord, within
ten (10) days after the date of such assignment, evidence that the corporation into which Tenant may merge or the
corporation arising out of a consolidation of Tenant with another corporation or such acquiring corporation or other
entity, as the case may be, has a net worth and financial condition equal to or greater than the net worth and financial
condition of Tenant and the Guarantor, if any, as of the date of this Lease or as of the date of such assignment,
whichever is greater, in a form reasonably acceptable to Landlord wherein the corporation into which Tenant may
merge or the corporation arising out of a consolidation of Tenant with another corporation or such acquiring
corporation or other entity, as the case may be, assumes for the benefit of Landlord all of the terms, conditions, and
covenants set forth in this Lease to be observed and performed by Tenant and agrees to be bound by the terms,
conditions, and covenants of this Lease. Any such assignment shall not relieve Tenant from liability for the
payment of rent or other sums herein provided or from the obligation to keep and be bound by the terms, conditions,
and covenants of this Lease.
Section 12.7 Surrender of Premises and Holding Over. At the expiration of the tenancy hereby created,
Tenant shall surrender the Leased Premises in good condition, reasonable wear and tear excepted, and damage by
unavoidable casualty excepted to the extent that the same is covered by Landlord's All Risk (except for those items
specifically excluded) Coverage, and Tenant shall surrender all keys for the Leased Premises to Landlord at the
place then fixed for the payment of rent and shall inform Landlord of all combinations on locks, safes, and vaults, if
any, in the Leased Premises. If Tenant shall default in so surrendering the Leased Premises, Tenant's occupancy
subsequent to such expiration, whether or not with the consent or acquiescence of Landlord, shall be deemed to be
that of a tenancy at will and in no event from month to month or from year to year, and it shall be subject to all the
terms, covenants, and conditions of this Lease applicable thereto, except that Minimum Annual Rent shall be twice
the amount payable in the last year of the Term, and no extension or renewal of this Lease shall be deemed to have
occurred by such holding over. Prior to the expiration or sooner termination of this Lease, Tenant shall remove any
and all trade fixtures, equipment and other unattached items which Tenant may have installed, stored, or left in the
Leased Premises or elsewhere in the Shopping Center, including but not limited to counters, shelving, show cases,
chairs, and unattached movable machinery purchased or provided by Tenant and which are susceptible of being
moved without damage to the building. At Landlord's request, facia, canopy, and undercanopy signage installed by
Tenant or for Tenant at Tenant's expense shall be professionally removed at Tenant's expense. If vinyl or fabric
canopy signage is utilized in the Shopping Center, a blank panel shall be professionally installed in its place by
Tenant at Tenant's expense. Tenant shall repair any damage to the Leased Premises caused by its removal of such
fixtures, movables, and signs. In the event Tenant does not make such repairs, removals, and replacements, Tenant
shall be liable for and agrees to pay Landlord's costs and expenses in making such repairs, together with a sum equal
to twenty percent (20%) of such costs and expenses to cover Landlord's overhead in making such repairs for Tenant.
Tenant shall not remove any plumbing or electrical fixtures or equipment, heating or air-conditioning equipment,
floor coverings (including but not limited to wall to wall carpeting), walls, or ceilings, all of which shall be deemed
to constitute a part of the freehold and/or leasehold interest of Landlord, nor shall Tenant remove any fixtures or
machinery that were furnished or paid for by Landlord (whether initially installed or replaced), provided, however,
on Landlord's written request, Tenant shall, at its expense, remove any hazardous substances installed or placed in
the Leased Premises or the Shopping Center by Tenant, its agents, employees, subtenants, assignees, licensees or
contractors and any alterations or additions which were added to the Leased Premises for Tenant's particular use
and/or occupancy. The Leased Premises shall be left in a broom -clean condition. If Tenant shall fail to remove its
trade fixtures or other property as provided in this Section 12.7, such fixtures and other property not removed by
Tenant shall be deemed abandoned by Tenant and at the option of Landlord shall become the property of Landlord,
or at Landlord's option may be removed by Landlord at Tenant's expense plus twenty percent (20%) as hereinabove
provided, or placed in storage at Tenant's expense, sold, or otherwise disposed of, in which event the proceeds of
such sale or other disposition shall belong to Landlord. Tenant's obligation to observe or perform these covenants
shall survive the expiration or other termination of the Term of this Lease.
Section 12.8 Lien of Landlord for Rent, Taxes and Other Sums. Landlord shall have, and Tenant
hereby gran c, » s fa..r ti gs, equipment, fixtures, inventory, accounts receivable, chattel
cash and ti
is -granted -fa: the p'arl ase-ef ace:Irk-b tk
hereunder. Upon Tenant's default or breach of any covenants of this Lease, Landlord shall have all remedies
avai-labia ander th
to time Financing Statements at Landlord's request or if
Financing -Statements. In a
minimum war. of Thr
'e admin strative-:harg: hot :not less than the
Section 12.9 Liens. Tenant shall discharge or bond over any lien filed against the Shopping Center or any
part thereof for work done or materials furnished with respect to the Leased Premises within ten (10) days after such
lien is filed and Tenant shall obtain execution of lien waivers prior to commencement of construction in the Leased
Premises. If Tenant fails to keep this covenant, in addition to any other remedies available to Landlord under this
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Lease or otherwise, Landlord may at its option discharge such lien, in which event Tenant agrees to pay Landlord a
sum equal to the amount of the lien thus discharged plus Landlord's internal administrative costs, attorneys' fees,
expenses, and damages thereby caused Landlord.
Section 12.10 Landlord's Right of Cancellation. If Tenant thail fail to pay Percentage Rent in an
amount -equal -to at least t? = • • . - - - ° Annual Rant payable pursuant to Section 1.1(c)
•
d may, at is
se. Tar:ar.
s:3kall tate an
cqua'. •
Section 12.11 Interest. Whenever this Lease refers to "Interest," same shall be computed at a rate equal
to the Prime Rate (as hereinafter defined) plus two (2) percentage points. If, however, payment of interest at such
rate should be unlawful, that is, violative of usury statutes or otherwise, then "Interest" shall, as against such party,
be computed at the maximum legal rate payable by such party.
"Prime Rate" shall mean the Prime Rate as published in The Wall Street Journal from time to time (or the
average Prime Rate if more than one is published), any change in such Prime Rate to effect a change in the rate
charged hereunder on the date of each such change. If The Wall Street Journal ceases to be published or ceases to
publish a Prime Rate, then Landlord shall designate another publication.
Section 12.12 Late Payments. Should Tenant fail to pay when due any installment of Minimum Annual
Rent, Percentage Rent, or any other sum payable to Landlord under the terms of this Lease, then Interest shall accrue
from and after the date on which any such sum shall be due and payable, and such Interest together with a Late
Charge of Two Hundred Dollars ($200.00) to cover the extra expense involved in handling such delinquency shall
be paid by Tenant to Landlord at the time of payment of the delinquent sum.
Section 12.13 Consents. With respect to any provision of this Lease which either provides or is held to
provide that Landlord shall not unreasonably withhold or unreasonably delay any consent or approval, Tenant shall
not be entitled to make any claim for, and Tenant hereby expressly waives, any claim for damages, it being
understood and agreed that Tenant's sole remedy therefor shall be an action for specific performance.
Section 12.14 Waiver of Right of Redemption. Tenant hereby expressly waives any and all rights of
redemption conferred by statute or otherwise.
Section 12.15 Notices. Whenever notice shall be given by either party to the other, notice shall be in
writing addressed to the address of the party being notified at the address set forth in this Lease or to such other
address as a party may from time to time designate by notice to the other party. Notice may be given by hand
delivery, express service, electronic means, or by postage paid certified or registered mail with return receipt
requested. Notice given by hand delivery, express service, or electronic means shall be deemed to have been given
upon receipt by the party being notified. Notice given by certified or registered mail shall be deemed to have been
given at the time return receipt is signed for, provided, however, that if delivery is refused or the notice is
unclaimed, notice shall be deemed received five (5) days after the same shall have been deposited in the mail.
Section 12.16 No Broker. Tenant and Landlord warrant and represent that no broker was involved on
either's behalf in negotiating or consummating this Lease, except for Evergreen Realty (the "Broker") on behalf of
Tenant, and agree to indemnify and hold the other harmless from and against any and all claims for brokerage
commissions arising out of any communications or negotiations had by either with any other broker regarding the
Leased Premises or any other premises in the Shopping Center and/or the consummation of this Lease. Landlord
shall be responsible for the payment of any and all commissions and fees which may be payable to the Broker,
subiect to the terms of a separate agreement.
Section 12.17 Short Form Lease. Tenant agrees not to record this Lease without the express written
consent of Landlord and further agrees to execute, acknowledge, and deliver at any time after the date of this Lease,
at the request of Landlord, a "short form lease" suitable for recording.
Section 12.18 Entire and Binding Agreement. This Shopping Center Lease contains all of the
agreements between the parties hereto, and it may not be modified in any manner other than by agreement in writing
signed by all the parties hereto or their successors in interest. The terms, covenants, and conditions contained herein
shall inure to the benefit of, and be binding upon, Landlord and Tenant and their respective successors and assigns,
except as may be otherwise expressly provided in this Lease. Tenant acknowledges that neither Landlord nor any
broker has made any representations to, or agreements with, Tenant which are not contained in this Lease. The
parties hereto specifically agree that this Lease has been negotiated as an arm's-length transaction, that each party
had the benefit of being or the opportunity to be represented by legal counsel, that this document as executed by the
parties evidences the agreement between the parties, and that no weight of construction shall be given to one party
or another as the drafter of this Lease.
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Section 12.19 Provisions Severable. If any term or provision of this Lease or the application thereof to
any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the
application of such term or provision to persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby and each term and provision of this Lease shall be valid and be enforced
to the fullest extent permitted by law.
Section 12.20 Captions, Underlining, Line -Outs. The captions contained herein are for convenience and
reference only and shall not be deemed as part of this Lease or construed as in any manner limiting or amplifying the
terms and provisions of this Lease to which they relate. The underlining of certain portions of this Lease shall not
mean that such portions are to be given any greater or lesser force or effect than the non -underlined portions. Any
portion of this Lease which has been lined out was the agreement of the parties to eliminate and the language of any
such lined -out provisions shall be given no force and effect whatsoever.
Section 12.21 Rule Against Perpetuities. If the Term of this Lease shall not have commenced within five
(5) years from the date appearing on Page 1 of this Lease, then this Lease shall thereupon become null and void and
have no further force and effect whatsoever in law or equity.
Section 12.22 Warranty and Authority. Tenant hereby represents and warrants to Landlord that (a)
there are no proceedings pending nor to Tenant's knowledge threatened before any court or administrative agency
that would materially adversely affect the financial condition of Tenant or the ability of Tenant to enter into this
Lease or the validity or enforceability of this Lease; (b) there is no provision of any existing mortgage, indenture,
contract or agreement binding on Tenant which would conflict with or in any way prevent the execution, delivery or
performance of the terms of this Lease by Tenant; (c) any financial statements of Tenant provided to Landlord in
connection with this Lease are true, complete and correct in all material respects, fairly present the financial
condition of Tenant as of the date and for the period referred to therein and have been prepared in accordance with
generally accepted accounting principles consistently applied; (d) there has been no material adverse change in the
financial condition of Tenant since the date of such financial statements and to the knowledge of Tenant, no such
material adverse changes are pending or threatened; and (e) Tenant is not, and shall not become, a person or entity
with whom Landlord is restricted from doing business with under regulations of the Office of Foreign Asset Control
("OFAC") of the Department of the Treasury (including, but not limited to, those named on OFAC's Specially
Designated and Blocked Persons list) or under any statute, executive order (including, but not limited to, the
September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions With Persons Who Commit,
Threaten to Commit, or Support Terrorism), or other governmental action and is not and shall not engage in any
dealings or transaction or be otherwise associated with such persons or entities. Tenant acknowledges that Landlord
is executing this Lease in reliance upon the foregoing representations and warranties and that such representations
and warranties are a material element of the consideration inducing Landlord to enter into and execute this Lease. If
this Lease is executed by more than one party (whether any such party is an individual or a corporation, partnership,
limited partnership, joint venture, sole proprietorship or any other firm, person or entity), the parties executing this
Lease shall be jointly and severally liable hereunder. If Tenant is a corporation, partnership, limited liability
company or other entity, the persons executing this Lease on behalf of Tenant represent and warrant to Landlord that
they have the authority to enter into this Lease on behalf of Tenant, to bind Tenant and that this Lease has been
authorized and approved by the Board of Directors or other governing body of Tenant.
Section 12.23 Irrevocable Offer. In consideration of Landlord's administrative expense in considering
this Lease and the terms of Tenant's proposed tenancy hereunder, Landlord's reservation of the Leased Premises
pending such consideration and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Tenant's submission to Landlord of this Lease, duly executed by Tenant, shall constitute
Tenant's irrevocable offer to continue for thirty (30) days from and after receipt by Landlord of the said Lease duly
executed by Tenant or until Landlord shall deliver to Tenant written notice of rejection of Tenant's offer, whichever
shall first occur. If within said thirty (30) day period Landlord shall neither return the Lease duly executed by
Landlord nor so advise Tenant of Landlord's rejection of Tenant's offer, then after said thirty (30) day period Tenant
shall be free to revoke its offer, provided, however, Tenant's offer shall continue until (a) revoked by Tenant in
writing or (b) accepted or rejected by Landlord.
Section 12.24 Disputed Charges and Landlord's Records. Notwithstanding anything to the contrary
contained in the Lease, Tenant shall notify Landlord in writing within one year after making a payment or receipt of
any notice of payments due under this Lease if Tenant disputes the amount of such payment or the fact that such
payment is due from Tenant. If Tenant fails to deliver this notice such failure will constitute a waiver of Tenant's
right to dispute such billing or the amount thereof and such shall be deemed by Tenant an account stated. Delivery
of notice hereunder will not release Tenant of its responsibility to make such payment in a timely fashion, nor
mitigate Landlord's rights under this Lease in connection with Tenant's failure to do so. Upon receipt of notice of a
disputed charge and the payment of such charge, Landlord agrees to cooperate as reasonably necessary to
demonstrate to Tenant the propriety of the billing, however, Tenant hereby waives any and all legal and equitable
rights it has or may have to inspect and/or audit Landlord's records and contracts relating to Tenant's charges under
the terms of this Lease, Tenant acknowledging and agreeing that any such inspections or audits impose an
unreasonable burden and expense upon Landlord and Landlord's administrative staff.
Section 12.25. Landlord's Right to Terminate. If at any time during the Term of this Lease Landlord
initiates any or all of the following: i) remerchandises and/or redevelops the Shopping Center, ii) relocates any
occupants of the Shopping Center containing 15,000 square feet or more of floor area, iii) adds any occupants
containing 15,000 square feet or more of floor area to the Shopping Center, then Landlord shall have the right to
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terminate Tenant's Lease by giving advance written notice to Tenant. In such event, the effective date of termination
(hereinafter referred to in this section as "Termination Date") shall be one hundred twenty (120) sib -(60) days
from the date Landlord sends said notice unless the parties shall agree in writing to a different date of termination. In
the event Landlord terminates this Lease as set forth herein, Landlord shall reimburse Tenant for the unamortized
cost of Tenant's actual investment in the Leased Premises' leasehold improvements (calculated as of the date of
such termination and amortized on a straight line basis over the initial Term of the Lease (not to exceed a period of
ten (10) years)), less any amounts contributed by Landlord for construction of the Leased Premises, if applicable.
Following Landlord's request, said unamortized costs of leasehold improvements shall be certified to Landlord by
Tenant's chief financial officer. Landlord's reimbursement to Tenant of the aforementioned unamortized costs of
leasehold improvements shall occur within thirty (30) days after the Termination Date and Landlord shall deduct
from said reimbursement any sums then due Landlord. Upon the Termination Date, Tenant shall surrender the
Leased Premises to Landlord in accordance with the terms of Section 12.7 of this Lease and Landlord and Tenant
shall be released from any and all further liability hereunder except for obligations and liabilities that survive the
expiration or earlier termination of this Lease. Notwithstanding the foregoing, Tenant agrees to pay to Landlord all
rent and other sums due under the Lease including any year end adjustments which shall accrue through the
Termination Date.
Rider to Lease. A Rider to lease numbered consecutively herewith and attached hereto is hereby made a
part hereof. Any conflict or inconsistency between the terms of the main body of the Lease and the terms of the
Rider shall be resolved in favor of the terms of the Rider.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease as of the day and year first
above written, each acknowledging receipt of an executed copy hereof.
LANDLORD:
PEARLAND GROUND, LLC, a Texas limited
liability company, Federal Identification Number 45-
3464666, by CBL & Associates Management, Inc.,
a Delaware corporation, Federal Identification
Number 62-1542279, Managing Agent
By:
Print e: Jeffery V. Curry
Its: ief Legal Officer
DATE:
TENANT:
. I n, 2.O3
ls"
Legal
CITY OF PEARLAND d/b/a PEARLAND
CONVENTION AND VISITORS BUREAU Federal
Identification N �s ber 7 4 5..0 2 8 9 0 9
WITNESS: By:
o Print Name:
tOhLk 4-Cili Its:
Maria E. Rodriguez!
Deputy City Secretary
27
Rill Ficon
Ci ty Manager
DATE: April 77 7n1 3
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RIDER TO LEASE
A. Section 2.5 of the Lease is supplemented as follows:
Environmental Charee. At Landlord's election Landlord or its designee may collect from Tenant as
additional rent under this Lease an "Environmental Charge" which may contain, without limitation, the following
items which Landlord may supply to the Leased Premises.
(a) Electricity. (i) If Landlord elects as an element of said Environmental Charge to supply electricity,
then Tenant shall use electricity supplied by Landlord as Tenant's sole source of energy. Such electricity shall be
supplied to Tenant in accordance with Exhibit B to this Lease, for Tenant's reasonable use in connection with such
lighting, heating and air conditioning systems and such other electrical appliances and equipment (Tenant's
Electrical Installations) as may be installed in the Leased Premises with Landlord's permission. The "Electrical
Charge" as hereinafter defined shall as a component of the Environmental Charge be deemed additional rent under
this Lease and may be determined by one of the following methods, depending on the location of the Shopping
Center and applicable utility laws and regulations:
1) Tenant agrees that Landlord's engineer shall make, at any time and from time to time, a survey and an
estimate of the energy which will be used by Tenant's Electrical Installations. The energy estimate shall be based
upon data obtained from Tenant's plans and specifications as verified by a survey of Tenant's premises following
completion of Tenant's construction work, and shall take into consideration the Tenant's hours of usage of
connected electrical loads consisting primarily of lighting and air-conditioning equipment and other miscellaneous
electric equipment as may be installed and controlled by Tenant. Landlord's engineer shall use the aforesaid survey
estimate to establish as a component of the Environmental Charge the Tenant's monthly "Electrical Charge" which
shall be one -twelfth (1/12) of the Tenant's annual charge for electrical energy (the "Electrical Charge"). In
connection with such survey Tenant shall supply Landlord upon request with the information necessary to estimate
Tenant's connected load. Tenant shall be notified of the survey findings which shall be conclusive and binding upon
the parties. Tenant shall pay to Landlord monthly in advance together with the payment of Minimum Annual Rent
as a portion of the Environmental Charge a sum equal to Tenant's monthly Electrical Charge which shall be based
upon the aforesaid survey.
Notwithstanding anything contained herein to the contrary, Landlord shall upon Landlord's volition or at
Tenant's written request and expense, install a test meter if permitted by law to measure electrical energy consumed
by Tenant in the Leased Premises no more than once annually. If the test meter discloses that the consumption of
the electrical energy in the Leased Premises for such period is different from the amount Landlord's engineer
estimated to be consumed therein, then, Tenant's annual total Electrical Charge for the next annual period shall be
adjusted to reflect the electrical energy consumed in Leased Premises. Landlord shall submit a statement to Tenant
after the test meter results have been obtained setting forth (1) the manner of calculation of Tenant's Electrical
Charge; and (2) the adjustment, if any, in the Electrical Charge.
or
2) Tenant agrees that Landlord may at Tenant's expense furnish and install a test meter that shall be read
monthly or at some other regular interval by Landlord and Tenant shall pay monthly or at some other regular
interval, as the case may be, as its Electrical Charge (the `Electrical Charge") for the electrical energy consumed in
the Leased Premises.
The Electrical Charge shall include a proportionate cost of the central electrical distribution system but only
that portion from the electric master meter to the Leased Premises, including the cost of the electric meter Tenant
would have paid had electricity not been supplied by Landlord, but shall exclude the cost of the conduit provided by
Landlord in accordance with Exhibit B hereof. Also, the Electrical Charge shall include a reasonable allowance for
Landlord's survey, if applicable, billing and administrative expenses, and Landlord's costs of repair and
maintenance of Landlord's electrical supply system. The Electrical Charge may be revised by Landlord from time
to time to reflect an increase or decrease in the following: taxes, costs of repair and maintenance of Landlord's
electrical supply system, rates charged to similar consumers by the Local Utility Company or the Designated Service
Provider, as the case may be, Tenant's connected load, any adjustment required as a result of actual operating
experience, and seasonal requirements. Regardless of whether the Electrical Charge is determined by method 1 or 2
above, the rate segment of the Electrical Charge shall not exceed the rate (including taxes) which Tenant as the
operator of a separately metered and billable facility would otherwise pay for continuous comparable service to the
applicable municipality, governmental authority or utility company located in and serving retail facilities of a size
and with the same requirements as Tenant's in the geographic location of the Shopping Center ("Local Utility
Company") if such electrical energy were not supplied by Landlord and had Tenant purchased such electricity
directly from the Local Utility Company. In addition Tenant acknowledges that underground utility lines must be
drawn from outside the property line to the building of which the Leased Premises is a part, and therefore, in
addition to the Electrical Charge, Tenant shall pay a user surcharge on the cost of this electrical utility construction
to be paid by the Landlord, beginning with the first electrical charge billing. Said surcharge is to reimburse the
Landlord for on-site electrical costs including primary feeders, transformers, switchgear and associated equipment.
This surcharge shall include Interest on this unpaid balance to be adjusted quarterly, upon the aforementioned costs
to be incurred by Landlord. The aforesaid costs that Tenant shall pay, shall be that which Tenant would have paid
had Tenant purchased such electricity directly from the Local Utility Company and such had not been supplied by
Landlord.
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(ii) The amount charged to Tenant as a component of the Environmental Charge which is
attributable to the electricity consumed in the Leased Premises shall be as hereinbefore described. In no event shall
payment of the Electrical Charge component of the Environmental Charge abate, nor shall Tenant have any right of
offset or counterclaim against the payment of such Electrical Charge component of the Environmental Charge.
(b) Water. (i) If Landlord elects as an element of said Environmental Charge to supply water ("Water
Service"), then Tenant shall use Water Service supplied by Landlord as Tenant's sole source of Water Service. The
"Water Charge" as hereinafter defined shall as a component of the Environmental Charge be deemed additional rent
under this Lease and may be determined by one of the following methods, depending on the location of the
Shopping Center and applicable utility laws and regulations:
1) Tenant agrees that Landlord's engineer shall make, at any time and from time to time, a survey and an
estimate of the water (including taxes and sewer charges) which will be used by Tenant in the Leased Premises. The
water estimate shall be based upon data obtained from Tenant's plans and specifications as verified by a survey of
Tenant's premises following completion of Tenant's construction work, and shall take into consideration the
Tenant's usage of water in the Leased Premises. Landlord's engineer shall use the aforesaid survey estimate to
establish as a component of the Environmental Charge the Tenant's monthly Water Charge which shall be one -
twelfth (1/12) of the Tenant's annual charge for water service (the "Water Charge"). In connection with such survey
Tenant shall supply Landlord upon request with the information necessary to estimate Tenant's water consumption.
Tenant shall be notified of the survey findings which shall be conclusive and binding upon the parties. Tenant shall
pay to Landlord monthly in advance together with the payment of Minimum Annual Rent as a portion of the
Environmental Charge a sum equal to Tenant's monthly Water Charge which shall be based upon the aforesaid
survey.
Notwithstanding anything contained herein to the contrary, Landlord shall upon Landlord's volition or at
Tenant's written request and expense, install a test meter if permitted by law to measure water consumed by Tenant
in the Leased Premises no more than once annually. If the test meter discloses that the consumption of water in the
Leased Premises for such period is different from the amount Landlord's engineer estimated to be consumed therein,
then, Tenant's annual total Water Charge for the next annual period shall be adjusted to reflect the water consumed
in the Leased Premises. Landlord shall submit a statement to Tenant after the test meter results have been obtained
setting forth (1) the manner of calculation of Tenant's Water Charge; and (2) the adjustment, if any, in the Water
Charge.
or
2) Tenant agrees that Landlord may at Tenant's expense furnish and install a test meter that shall be read
monthly or at some other regular interval by Landlord and Tenant shall pay monthly or at some other regular
interval, as the case may be, as its Water Charge (the "Water Charge") for Tenant's water usage.
or
3) An alternative method of calculating the Water Charge applied uniformly to all similarly situated Shops,
as defined in Section 2.3, receiving such service.
There shall be included in the Water Charge a reasonable allowance for Landlord's survey, if applicable,
the cost of a water meter Tenant would have paid had water not been supplied by Landlord, billing and
administrative expenses, and Landlord's cost of repair and maintenance of Landlord's water supply system. The
Water Charge may be revised by Landlord from time to time to reflect an increase or decrease in the following:
taxes, costs of repair and maintenance of Landlord's water supply system, rates charged to similar consumers by the
Local Utility Company or the Designated Service Provider, as the case may be, Tenant's consumption, any increase
required as a result of actual operating experience, and seasonal requirements. The portion of Tenant's
Environmental Charge attributable to the annual Water Charge component shall not exceed the total charges
(including taxes) which Tenant as the operator of a separately metered and billable facility would otherwise pay if
such water service were not supplied by Landlord and had Tenant purchased such water directly from the Local
Utility Company.
(ii) The amount charged to Tenant as a component of the Environmental Charge which is
attributable to the water consumed on the Leased Premises shall be as hereinbefore described. In no event shall
payment of the Water Charge component of the Environmental Charge abate, nor shall Tenant have any right of
offset or counterclaim against the payment of such Water Charge component of the Environmental Charge.
(c) Heating and Air -Conditioning. If Landlord elects, as an element of said Environmental Charge, to
supply heating, ventilating and air conditioning ("HVAC Service") in the form of chilled water or treated air (at
Landlord's option), then Tenant shall use HVAC Service furnished by Landlord as Tenant's sole source of HVAC
Service. The "HVAC Charge" as hereinafter defined shall as a component of the Environmental Charge be deemed
additional rent under this Lease.
Since Tenant's Mechanical installations are not presently ascertainable, Tenant agrees that Landlord's
engineer shall make a survey and an estimate of the charges (including taxes) which Tenant as the operator of a store
separately equipped with curb -mounted, air-cooled rooftop type HVAC equipment with economizer, electric
resistance type heaters would otherwise incur. The estimate shall include an additional component for the cost of
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Y
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the installation of such an "assumed" rooftop type HVAC equipment, as well as an estimate of on-going
maintenance and repair. There shall be added to and included in the HVAC estimate a reasonable allowance for
Landlord's survey, billing and administrative expenses.
In connection with such survey Tenant shall furnish Landlord upon request with the information necessary
to estimate Tenant's heating and air conditioning load. Tenant shall be notified of the survey findings which shall
be conclusive and binding upon the parties. Tenant shall pay to Landlord monthly in advance together with the
payment of Minimum Annual Rent, as a portion of the Environmental Charge, a sum equal to the amortization of the
HVAC Service ("HVAC Charge") over a ten-year period, including interest at prime plus 2%, as of Tenant's
opening date.
(d) Telephone Service and Charees. If telephone service is desired, Tenant shall be responsible for the
obtaining and installation of such service, equipment and fixtures in accordance with the provisions of this Lease, all
local laws, rules, regulations, and ordinances. If the local serving utility shall directly serve the Leased Premises
with telephone service, Tenant shall, at its expense, pay all charges for such service directly to the serving utility. If
Landlord, who shall have the option to do so, shall elect to supply telephone service, Tenant shall purchase such
service from Landlord and shall pay to Landlord a Telephone Service Charge that would be similar to that paid if
Tenant were obtaining telephone service directly from the serving utility. At its option, Landlord may elect to
provide monthly statements of Tenant's Telephone Service Charge or may elect to establish an annual Telephone
Service Charge in which event Tenant shall pay to Landlord on or before the first day of each month, one twelfth
(1/12) of such annual Telephone Service Charge.
(e) If Landlord hereafter determines that it is not feasible in Landlord's sole judgment to supply or to
continue supplying as elements of the Environmental Charge electricity, water service, HVAC, or telephone service
or if it shall hereafter become unlawful for Landlord to supply electricity, water service, or telephone service, then
Landlord may discontinue providing any or all of such services. In such event Tenant shall purchase water and/or
electricity and/or telephone service as the case may be directly from another utility provider of Tenant's choice,
Tenant shall at Tenant's sole cost and expense cause the Leased Premises to be separately metered and billable, and
Tenant shall pay any other expenses charged directly or indirectly to Landlord as a result of Tenant's use of another
provider.
(f) Tenant agrees that Landlord shall not be liable to Tenant for disruption or diminution of any utility
service nor for any shortages or curtailments of the use of any utility services, and in no event shall such disruption,
shortages or curtailments constitute an eviction, actual or constructive, or entitle Tenant to damages nor to any
abatement of Minimum Annual Rent or other charges due under this Lease.
(g) In the event Tenant fails to pay any sum due under this Rider or Section, as the case may be, Landlord
may, in addition to all other remedies, cease supplying the utility service(s) to which such nonpayment relates while
such nonpayment exists.
(h) If Landlord is required to pay a deposit to any Designated Service Provider or to the Local Utility
Company, as the case may be, servicing the Shopping Center, Tenant herewith agrees to pay its share of said deposit
by paying to Landlord a utility deposit in an amount equal to two months' Electrical Charge or Water Charge or
Telephone Service Charge, as the case may be, payable within ten (10) days after receipt of the bill therefor.
B. Section 2.3 of the Lease is hereby modified by adding:
Notwithstanding anything in Section 2.3 to the contrary, "real estate taxes" shall also include real estate
taxes, assessments, excises, association dues, fees, levies, charges and other taxes of every kind and nature
whatsoever, general and special, extraordinary and ordinary, foreseen and unforeseen, including interest on
installment payments, which may be levied or assessed against or arise in connection with the ownership, use,
occupancy, rental, operation or possession of the Shopping Center (including personal property taxes for property
that is owned by Landlord or used in connection with the operation, maintenance and repair of the Shopping
Center), or substituted, in whole or in part, by any taxing authority for a tax previously included, or assessed in lieu
of an increase to any such tax, or paid as rent under any ground lease. Real estate taxes do not include Landlord's
income, franchise, or estate taxes (except to the extent such excluded taxes are assessed in lieu of taxes included
above). Notwithstanding anything in this Section 2.3 to the contrary, for purposes of this Lease, "real estate taxes"
shall include the Margin Tax associated with the gross receipts from the Shopping Center for the year in question.
As used herein, "Margin Tax" shall mean the business tax enacted by House Bill 3 as passed during the 31"d called
session of the Texas Legislature in 2006, which, when effective, will be codified in Chapter 171, Texas Tax Code.
C. Section 11.2 of the Lease is hereby modified as follows:
1. The following is hereby added as the last sentence of the first paragraph:
Tenant hereby expressly waives notice of presentment, notice of intent to accelerate and notice of
acceleration.
2. The following is hereby added as the last paragraph:
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a t J
PEARLAND TOWN CENTER
Notwithstanding anything contained in the Lease to the contrary, in the event of a default by
Tenant, Landlord has the right to terminate Tenant's right to possession of the Leased Premises
and change the locks, without judicial process, and, in compliance with applicable law, expel and
remove Tenant, Tenant's property and/or any parties occupying all or any part of the Leased
Premises. If Landlord terminates Tenant's possession of the Leased Premises under this Section
11.2, Landlord shall have no obligation to post any notice and Landlord shall have no obligation
whatsoever to tender to Tenant a key for new locks installed in the Leased Premises. TENANT
ACKNOWLEDGES THAT THE PROVISIONS OF THIS PARAGRAPH OF THIS LEASE
SUPERSEDE THE LOCKOUT PROVISIONS OF THE TEXAS PROPERTY CODE AND
TENANT FURTHER WARRANTS AND REPRESENTS THAT IT HEREBY
KNOWINGLY WAIVES ANY RIGHTS IT MAY HAVE THEREUNDER TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW.
D. Section 4.5 of the Lease is hereby modified by adding:
Notwithstanding anything herein to the contrary, blade sign(s) will be a part of Tenant's required signage
package. If no blade sign(s) exist, Landlord will provide the blade sign bracket(s) and Tenant will reimburse
Landlord for such bracket(s) within thirty (30) days after receipt of Landlord's bill therefor. Prior to the
commencement of the Term and subject to Landlord's prior written approval, Tenant, at Tenant's sole cost and
expense, shall be responsible for providing the blade sign panel(s), the graphics to be installed on the blade sign
panel(s) as well as the installation of the blade sign bracket(s) and blade sign panel(s).
E. The following is hereby added as Section 12.26 of the Lease:
Section 12.26. Tenant VAV Box. The HVAC system for Tenant's Leased Premises consists of Landlord
supplied primary distribution ductwork. The Tenant shall tap into the primary air distribution ductwork with a
Tenant provided and Tenant installed VAV box with electric heat and electronic controls. Landlord requires Tenant
to purchase the VAV box through Landlord's contractor who will furnish, install, and start up the equipment based
upon the required size per Tenant's specifications. The following price index is applicable to these Tenant's costs:
Size 2-6, 3KW Heat (200-400 CFM) Titus Fan Powered Box
Size 2-8, 3KW Heat (401-650 CFM) Titus Fan Powered Box
Size 3-10, 3KW Heat (651-850 CFM) Titus Fan Powered Box
Size 5-12, 3KW Heat (851-1200 CFM) Titus Fan Powered Box
Size 6-14, 3KW Heat (1201-1800 CFM) Titus Fan Powered Box
Size 7-16, 3KW Heat (1801-2500 CFM) Titus Fan Powered Box
$4,580.00
$4,580.00
$4,640.00
$4,775.00
$4,980.00
$5,090.00
The location of the Landlord installed primary ductwork will be per the sole direction of the Landlord. The Tenant
supplied and installed equipment will be submitted for Landlord approval along with the Tenant supplied
mechanical calculations. Mechanical system load calculations shall be prepared by Tenant for the Leased Premises.
These calculations shall indicate the requirements for all HVAC. HVAC load calculations shall be as recommended
in the ASHRAE Handbooks and other ASHRAE publications and based on weather data obtained for Pearland,
Texas. The load calculations shall be submitted to Landlord for review and record purposes. These calculations
shall provide sufficient detail to allow further analysis using various parameters, factors and areas. Tenant shall
provide all low-pressure ductwork and related devices downstream of the VAV box.
F. The following is hereby added as Section 12.27 of the Lease:
Section 12.27. Tenant's Right to Terminate. Tenant. at its option. shall have the right to terminate and
cancel this Lease by sending written notice to Landlord within sixty (60) days after the last day of the third year of
the Lease Term. The Lease shall terminate on a date specified in Tenant's written notice which shall be a date no
less than sixty (60) days from the date of Tenant's written notice to Landlord advising Landlord of such termination
(such date hereinafter "Termination Date"). If Tenant so elects to terminate and cancel, Tenant shall vacate and
surrender the Leased Premises in the condition required by the terms of the Lease no later than the Termination
Date. Landlord and Tenant hereby agree that in the event Tenant fails to vacate and surrender the Leased Premises
on the Termination Date. Tenant shall be deemed to be trespassing or. at Landlord's election. holding over and
Landlord shall have the right to invoke any remedy allowed by law and/or in equity and/or the Lease, and
furthermore. Tenant expressly admits that Tenant's indemnity obligations of the Lease include. but are not limited
to. any and all damages incurred by Landlord due to Tenant's failure to abide by said covenant to vacate and
surrender on the Termination Date. Tenant acknowledges that Landlord may suffer damages as a result of
Landlord's contractual obligations to third parties based on Landlord's reliance on Tenant's covenant to vacate and,
surrender the Leased Premises on the Termination Date. Tenant agrees to pay all rent and other sums due under this
Lease in accordance with its terms until the later to occur of (i) Tenant vacating and surrendering the Leased
Premises. or (ii) the Termination Date along with any year end adiustments and Percentage Rent payable for a
partial year. Landlord and Tenant hereby each relinauish. release. and waive any and all claims of any kind
whatsoever arising under or in connection with this Lease accruing subseauent to the later to occur of (i) Tenant
vacating and surrendering the Leased Premises. or (ii) the Termination Date. and on the Termination Date this Lease
shall be deemed terminated and of no further force and effect whatsoever except as otherwise provided for herein,
Version #2 — 4/18/13
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Pearland, Texas
PEARLAND TOWN CENTER
and except for the provisions of Section 12.7 of the Lease. indemnity obligations arising out of facts occurring prior
to the later to occur of (il Tenant vacating and surrendering the Leased Premises. or (ii) the Termination Date. and
those lease covenants which expressly survive the termination or expiration of this Lease. Nothing contained herein
shall be deemed as consent by Landlord to Tenant remaining in possession of the Leased Premises beyond the
Termination Date.
Version #2 — 4/18/13
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Pearland, Texas
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0
EXHIBIT 'A'
4
PEARLAND TOWN CENTER
EXHIBIT B
CONSTRUCTION
Section 1.1 Condition of Premises. (a) Tenant acknowledges that it has examined and inspected the
Leased Premises, is familiar with the physical condition thereof, and finds same suitable for Tenant's purposes.
Tenant further acknowledges (i) that Landlord has not made and does not hereby make any representations
regarding the physical condition of the Leased Premises or the Shopping Center, and (ii) that there are no warranties,
either express or implied, regarding the condition of the Leased Premises and/or the Shopping Center. Landlord
shall have no responsibility for (a) the removal, modifications, or upgrading of any existing construction or
equipment to accommodate Tenant's occupancy of the Leased Premises, (b) the undertaking of any additional
improvements or alterations, or (c) the installation of any equipment. Accordingly, Tenant hereby accepts the
Leased Premises in their "AS IS" condition.
(b) For the purpose of construing Landlord's obligations under Sections 8.1 and 8.2 of the Lease,
Landlord's work referred to in said Sections shall be deemed to refer to the Leased Premises in the condition
existing at the time of tender of possession, together with any additional items of Landlord's work specifically
enumerated in this Exhibit.
Section 1.2 Tenant's Plans and Snecifications. (a) In the event Tenant plans to improve, renovate or alter
the Leased Premises, Tenant shall, within fifteen (15) days following the execution of this Lease or earlier if
required to meet the commencement date of the Lease, prepare at Tenant's sole cost and present to Landlord
complete plans and specifications for work to be done to alter the Leased Premises in accordance with Landlord's
design criteria and Tenant's requirements. Failure by Tenant to submit its plans and specifications as herein
required shall constitute an event of default under this Lease.
(b) With regard to Tenant's plans and specifications Landlord may either: (i) evidence its approval by
endorsement to that effect by signature or initials on one (1) set of said plans and specifications and the return of
such signed or initialed set to Tenant (whereupon such approved preliminary plans and specifications shall then
constitute the final plans and specifications), or (ii) refuse such approval if Landlord shall determine that the same:
(A) do not conform to the Landlord's design criteria and the standards of design, motif and decor established or
adopted by Landlord and/or other tenants in the Shopping Center; and/or (B) would subject Landlord to any
additional cost, expense or liability or the Leased Premises to any violation, fine, or penalty; and/or (C) would in any
way adversely affect the reputation, character and/or nature of the Shopping Center; and/or (D) would provide for or
require any installation or work which is or might be unlawful or create an unsound or dangerous condition or
adversely affect the structural soundness of the Leased Premises and/or the building of which the Leased Premises
are a part; and/or (E) interfere with or abridge the use and enjoyment of any adjoining space in the building in which
the Leased Premises are located. If Landlord refuses approval, Landlord shall advise Tenant of those revisions or
corrections which Landlord requires, and Tenant shall within ten (10) days thereafter submit revised plans and
specifications to Landlord for its approval in accordance with this Section. In the event Tenant does not comply
with the foregoing requirements, then Landlord may place Tenant in default.
(c) Tenant shall at Tenant's cost and expense obtain all necessary permits and approvals from any
governmental authority or agency having jurisdiction which are required for the performance of the work shown on
the approved plans and specifications and Tenant's occupancy of the Leased Premises. Tenant shall obtain all
necessary permits, approvals, meters and hook-ups from the appropriate utility companies, and Tenant shall pay all
fees, charges and deposits required in connection therewith.
(d) Tenant's plans and specifications shall be prepared and sealed by an architect or engineer duly licensed
in the state in which the Shopping Center is located. If the drawings for Tenant's work are not prepared in
accordance with the foregoing, Landlord shall have the right to cause the project architect to redraft, sign and seal
Tenant's plans at Tenant's cost and expense.
(e) No construction work shall be commenced by Tenant until Tenant receives prior written approval of
the final plans and specifications from Landlord. Approval of Tenant's plans and specifications by Landlord or
Landlord's architect does not relieve Tenant of the responsibility to comply with the requirements of applicable
codes and regulations. All changes after final approval are subject to Landlord's prior written approval. After
approval by Landlord of Tenant's plans and specifications, Tenant shall pay for any additional architectural or
construction costs incurred by Landlord in reviewing and/or making requested changes, substitutions or eliminations
in such approved plans and specifications requested by Tenant. Tenant shall pay for any architectural costs incurred
by Landlord in connection with any subsequent remodeling, alteration, repair or rebuilding of the Leased Premises.
Landlord's plan reviewers are not authorized to obligate Landlord beyond the Lease requirements.
(f) Nothing contained in this Lease or this Exhibit shall be deemed or construed in any way as constituting
the consent or request of Landlord, express or implied, by inference or otherwise, to any General Contractor,
subcontractor, laborer, mechanic or materialman, for the performance of any labor or the furnishing of any materials
for any specific improvement, alteration or repair of the Leased Premises or any part thereof nor as giving Tenant a
right, power or authority, as otherwise provided in this Lease or this Exhibit to contract for or permit the rendering
of any services or the furnishing of any materials that would give rise to the filing of any mechanics' or material -
men' s liens or claims of liens against the Leased Premises, Tenant's interest therein, or the Shopping Center.
Version #2 — 4/18/13 Exhibit B - Construction - As -Is
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4
PEARLAND TOWN CENTER
Section 1.3 Sian Criteria.
(a) Signs are to be furnished and installed by Tenant and approved by Landlord's architect. Tenant's sign
contractor or architect must submit a colored rendering of Tenant's sign prior to approval. Tenant's sign shall be
located within the limits of Tenant's storefront and shall not project more than 8" beyond the storefront if the
Shopping Center is a mall, and not more than 12" beyond the storefront if the Shopping Center is a strip center.
Sign is limited to Tenant's trade name only ("d/b/a"). The following sign requirements will be reviewed in
conjunction with the Shopping Center's design criteria:
(b) Sign Size:
(i) Malls:
(A) Up to 30' storefront: Capitals - 18"
Lower case - 12"
(B) 30'-1" and greater storefront: Capitals - 24"
Lower case - 18"
(ii) Strip Centers:
(A) Up to 30' storefront:
(B) 30'-1" and greater storefront:
Capitals - 24"
Lower case - 18"
Capitals - 30"
Lower case - 24"
(c) The length of Tenant's sign shall be limited to 70% of Tenant's storefront.
(d) All conduit, wiring for and connection to sign shall be furnished by Tenant.
(e) No flashing signs or exposed neon tubing permitted.
(f) In a mall no outdoor signs permitted without Landlord's prior written approval.
(g) All signs shall be composed of individually lighted, separate letters; provided, however, in a strip
center an internally illuminated aluminum box, finished on all exposed faces, with sign letters individually cut into
the face panel, and with Plexiglas letters may be permitted by Landlord.
(h) In a strip center, under -canopy sign design shall be as designated by Landlord.
(i) No exterior signs shall be permitted without Landlord's prior written approval.
(j) For spaces fronting on an enclosed mall, Tenant shall furnish and install in a convenient location above
the sign panel specified above one (1) 110 -volt electrical outlet for use with seasonal promotions.
Section 1.4 Construction by Tenant. (a) Tenant shall perform at Tenant's sole cost and expense all
construction and demolition work required to complete the Leased Premises in accordance with the Tenant's plans
and specifications as approved by Landlord and the Shopping Center's tenant construction requirements. Tenant is
responsible for all removals, modifications, and upgrades to any existing construction or equipment to accommodate
Tenant's work and occupancy of the Leased Premises. No construction shall be commenced by Tenant prior to
Tenant's compliance with the requirements of this Exhibit and Landlord's written authorization and consent to the
commencement of work in the Leased Premises. All construction work shall comply with applicable building, fire
and underwriter's codes and shall be performed in a workmanlike manner. If Tenant elects or the Landlord does not
permit the reuse of existing improvements and equipment, the Tenant shall remove such improvements and repair
the remaining construction to its original condition, or as may be required by the Landlord.
(b) (i) Anything in this Exhibit to the contrary notwithstanding, all roof penetrations and roof
restoration as well as the installation of all structural supports shall be performed at Tenant's expense by the roofing
contractor who performed the roofing work upon the initial construction of the Shopping Center or by such roofing
contractor as Landlord may designate. In addition, any tenant producing grease exhaust will install a Landlord
approved grease protection system on the Shopping Center roof. Upon completion of said roofing work the roofing
contractor shall furnish a letter addressed to Landlord stating that the work done in accordance with Tenant's ap-
proved plans and specifications has not affected the roof bond or guaranty for the Shopping Center roof.
(ii) Anything in this Exhibit to the contrary notwithstanding, all upper level tenants whose use includes the
preparation and/or sale of food must install a waterproof membrane under its entire floor and above the concrete
slab, and any penetrations of such membrane shall be sealed tight.
(c) Tenant's General Contractor (the "General Contractor") shall be subject to Landlord's prior written
approval, which approval may be withheld in Landlord's sole discretion. Tenant and Tenant's General Contractor
shall comply with the requirements set forth in this subsection (c). Tenant and Tenant's General Contractor shall
Version #2 — 4/18/13 Exhibit B - Construction - As -Is
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4
PEARLAND TOWN CENTER
enter into a construction contract in the form of the current edition of Document A101 or A107 of The American
Institute of Architects in which the General Contractor agrees to perform Tenant's work required hereunder. Said
contract shall be subject to Landlord's prior written approval. Said contract shall provide, among other things, as
follows:
(i) That notwithstanding anything contained in the Contract Documents to the contrary, the
General Contractor will perform the work and furnish the materials required therefor on the sole credit of Tenant;
that no lien for labor or materials will be filed or claimed by the General Contractor against the Shopping Center
premises of which the Leased Premises are a part or against the Leased Premises; that the General Contractor will
discharge any such lien filed or claims by any person or entity that furnishes labor or materials to the Leased
Premises; and that the General Contractor will indemnify and save Landlord harmless from any and all costs and
expenses, including reasonable attorney's fees, suffered or incurred as a result of any such lien that may be filed or
claimed in connection with or arising out of the work;
(ii) That the General Contractor shall furnish the following satisfactory in form and substance to
Landlord prior to commencement of the work: (A) a payment bond and a performance bond in the amount of the
contract issued by a bonding company acceptable to Landlord licensed in the state where the Shopping Center is
located wherein Landlord is named a co -obligee, or a guaranty of such construction in the form and executed by
such persons as Landlord may require; (B) a lien waiver executed by the General Contractor, lien waivers executed
by all subcontractors, and lien waivers executed by all materialmen who will furnish materials in excess of Two
Thousand Dollars ($2,000.00) in the aggregate, and (C) a letter executed by the General Contractor which provides
in substance that the General Contractor will not permit its worker and subcontractors to create any disharmony or
interfere with any worker, general contractors or subcontractors working in the Shopping Center, that either
Landlord or Tenant shall have the right to suspend work under said contract on twenty-four (24) hours notice until
any such condition ceases, and that either Landlord or Tenant shall have the right to terminate said contract without
liability if any such condition continues for thirty (30) days;
(iii) That the General Contractor shall furnish Tenant and Landlord with certificates of insurance
setting forth the following coverages: (A) worker's compensation insurance with limits of not less than Five
Hundred Thousand Dollars ($500,000.00); (B) bodily injury, including death, with limits of $500,000.00 per person
and $2,000,000.00 per occurrence and $4,000,000.00 aggregate; (C) property damage, with limits of $2,000,000.00
per occurrence and $4,000,000.00 aggregate; (D) motor vehicle liability and property damage in the amounts set
forth in (B) and (C); and (E) Builder's Risk Insurance in the full amount of the Replacement Cost on an Agreed
Amount Basis;
(iv) That the General Contractor shall be responsible from the time of its execution of the
agreement or from the time of the beginning of the first work, whichever shall be earlier, for all injury or damage of
any kind resulting from the work to persons or property. In addition to the liability imposed upon the General
Contractor on account of personal injury (including death) or property damage suffered through the General
Contractor's negligence, which liability is not impaired or otherwise affected hereby, the General Contractor shall
assume the obligation to save Landlord harmless and to indemnify Landlord from every expense, liability, or
payment arising out of or through injury (including death) to any person or persons or damage to property of any
person at any place in which work is located arising out of or suffered through any act or omission of the General
Contractor or any Subcontractor, or any one either (A) directly or indirectly employed by or (B) under the
supervision of any of them in the prosecution of the work; and
(v) That the General Contractor shall at all times keep the Leased Premises and adjacent areas
free from accumulation of waste materials or rubbish caused by its operations. The General Contractor shall be
responsible for initiating, maintaining and supervising all safety precautions and programs in connection with the
work and shall take all necessary precautions for the safety of, and shall provide all necessary protection to prevent
damage, injury or loss to (A) all employees on the work and other persons who may be affected thereby, including
without limitation licensees and invitees of the Shopping Center and other tenants in the Shopping Center; (B) all
the work and other materials and equipment to be incorporated therein, and (C) other property at the site or adjacent
thereto. Such precautions shall include, but shall not be limited to, the furnishing of guard rails, barricades and the
securing of the Leased Premises.
(d) Tenant's General Contractor shall insure that all trash, waste and refuse from its work in the Leased
Premises is deposited at designated collection points in the Shopping Center and shall pay to Landlord, prior to the
time of commencement of work in the Leased Premises, the sum of Ninety -Seven Cents ($.97) per square foot of
floor area in the Leased Premises for disposal of said trash, waste and refuse.
(e) If Landlord furnishes temporary electric power to the Leased Premises, Tenant's General Contractor
shall pay to Landlord at the time of commencement of work in the Leased Premises, and on the first day of each
month thereafter in which such temporary electric power is provided, the sum of Twenty -Five Cents ($0.25) per
square foot per month or partial month for such temporary electric power for construction purposes; provided,
however, if Tenant uses permanent power (including HVAC) available in the Leased Premises, Tenant's usage of
such permanent power (including HVAC) shall be paid at the currently established rate commencing on the first day
of such usage in lieu of the temporary electric power charge.
Version #2 - 4/18/13 Exhibit B - Construction - As -Is
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L. McCommons 36 Pearland, Texas
RI
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PEARLAND TOWN CENTER
Section 1.5 Landlord's Contribution to Construction of Leased Premises. Of the costs incurred by Tenant
in constructing or improving qualified long-term real property for use in Tenant's trade or business at the Leased
Premises (the "Leasehold Improvements"), Landlord agrees to pay to Tenant the lesser of (a) the actual cost of said
construction of or improvements to said real property made in accordance with this Exhibit, or (b) the sum of
Seventv-Seven Thousand and 00/100 Dollars ($77.000.001 less any sums owed to Landlord by Tenant under this
Lease or this Exhibit, and the excess, if any, shall be paid by Tenant. Landlord's obligations under the preceding
sentence shall not bind any Mortgagee Party of the Shopping Center nor any party acquiring title through or under
any such Mortgagee Party. The sum to be paid by Landlord hereunder shall be paid by check to Tenant after all of
the following conditions shall have been satisfied:
(a) The Leased Premises shall have been completed in all respects in accordance with this Exhibit and
with the approved plans and specifications; and,
(b) Tenant shall have furnished evidence satisfactory to Landlord from its general contractor and any
subcontractors that any and all liens that have been, or may be, filed have been satisfied of record
or waived and an affidavit that all work has been paid for; and,
(c) Tenant shall have opened for business in the Leased Premises; and,
(d) Tenant shall have executed and delivered to Landlord a letter or an estoppel, in Landlord's
discretion, in form and substance satisfactory to Landlord accepting the Leased Premises; and,
(e) Tenant shall have provided Landlord with any certificates of insurance required by this Exhibit
and by Section 5.1 of this Lease; and,
(f) Tenant shall have provided Landlord with a Certificate of Occupancy, if available in the
jurisdiction where the Leased Premises are located, or other evidence satisfactory to Landlord that
the Leased Premises conform to all applicable building codes; and,
(g)
Tenant shall not then be in default under any of the provisions of the Lease or modification or
Exhibit thereto. In the event Tenant is in default and/or there remain outstanding sums due
Landlord in accordance with the Lease any modification or Exhibit thereto, Landlord may apply
such portion of Tenant's construction allowance as may be required to satisfy said outstanding
sums and/or to cure Tenant's default; and,
(h) Completion of punch list items, if any; and,
(i) Tenant shall have provided Landlord with a copy of Tenant' s W-9 form containing Tenant' s
current address and correct Federal Identification Number; and,
(j) Tenant shall have furnished Landlord with a letter satisfactory in form and substance to Landlord
certified by an officer or other duly authorized representative of Tenant outlining in reasonable
itemized detail, including the associated costs, the Leasehold Improvements for which Tenant is
seeking payment and including a representation that all of the construction allowance has been
used only for the purpose of constructing or improving qualified long-term real property for use in
Tenant's trade or business at the Leased Premises, in accordance with Section 110(a) of the
Internal Revenue Service Regulations, as may be amended from time to time and that no portion
of the construction allowance has been used for Tenant's personal property including, but not
limited to, trade fixtures, point of sale equipment, security systems, counters, display cases, free
standing display racks, unattached movable equipment and machinery and goods held for sale to
the public. Note: Landlord shall be the legal title and beneficial owner of all improvements
immediately upon their placement in the Leased Premises. Each party shall prepare its federal,
state and local income tax forms and schedules, and calculate taxable income, in a manner
consistent with Landlord's ownership of such improvements for all taxable years. Eligible
Leasehold Improvements to which the construction allowance may be applied shall only include
the following costs and/or fees: architect, building permit, dumpsters and clean-up, barricades and
staging area, demolition, concrete work, masonry work, structural and miscellaneous steel, roof
work, carpentry, doors and roll -up grilles, drywall and metal studs, lay -in ceiling work, floor
covering (carpet, VCT, vinyl base), ceramic tile, granite and marble, non -fixture package millwork
and trim, painting and wall covering, storefront and glazing, plumbing, fire protection sprinkler,
HVAC work (inc. curbs and units), electrical and lighting, fire alarm, connections to energy
management system, meters and connection fees, utility usage fees and impact fees.
Version lit — 4/18/13 Exhibit B - Construction - As -Is
.1: IPearland Town CenterlPearland Convention and Visitors Bureau open air fixed lease version 2 WATERMARK.doc Pearland Town Center
L. McCommons 37 Pearland, Texas