EXHIBIT 10.1

 

LEASE AGREEMENT

 

by and between

 

BT (MULTI) LLC,

a Delaware limited liability company

 

as LANDLORD

 

and

 

MCRIL, LLC

a Virginia limited liability company

 

as TENANT

 

 

Premises:

Joliet, Illinois

 

 

Fargo, North Dakota

 

 

Ashwaubenon, Wisconsin

 

 

Brookfield, Wisconsin

 

 

Greendale, Wisconsin

 

 

Wauwatosa, Wisconsin

 

Dated as of: June 26, 2015

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

1.

Demise of Premises

1

2.

Certain Definitions

1

3.

Title and Condition; Single Lease Transaction

9

4.

Use of Leased Premises; Quiet Enjoyment

11

5.

Term

12

6.

Basic Rent

12

7.

Additional Rent

13

8.

Net Lease: Non-Terminability

14

9.

Payment of Impositions

15

10.

Compliance with Laws and Easement Agreements; Environmental Matters

16

11.

Liens; Recording

18

12.

Maintenance and Repair

18

13.

Alterations and Improvements

19

14.

Permitted Contests

20

15.

Indemnification

21

16.

Insurance

22

17.

Casualty and Condemnation

24

18.

Termination Events

26

19.

Restoration

28

20.

Procedures Upon Purchase

29

21.

Assignment and Subletting: Prohibition against Leasehold Financing

30

22.

Events of Default

34

23.

Remedies and Damages Upon Default

36

24.

Notices

39

25.

Estoppel Certificate

40

26.

Surrender

40

27.

No Merger of Title

40

28.

Books and Records

41

29.

Determination of Value

42

30.

Non-Recourse as to Landlord

43

31.

Financing

44

32.

Subordination, Non-Disturbance and Attornment

44

33.

Tax Treatment; Reporting

44

34.

Miscellaneous

45

35.

State Specific Provisions

47

36.

Right of First Offer

49

37.

Post-Closing Obligations

51

 

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EXHIBITS

 

Exhibit “A”

—

Premises

Exhibit “B”

—

Machinery and Equipment

Exhibit “C”

—

Schedule of Permitted Encumbrances

Exhibit “D”

—

Rent Schedule

Exhibit “E”

—

Premises Percentage Allocation of Basic Rent

Exhibit “F”

—

Approved Subleases

Exhibit “G”

—

Existing Subleases

Exhibit “H”

—

Post-Closing Obligations

 

 

 

Schedule 28(b)

—

Store Scorecards

 

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LEASE AGREEMENT, made as of this 26th day of June, 2015, between  BT (MULTI)
LLC, a Delaware limited liability company (“Landlord”), with an address c/o W.
P. Carey Inc., 50 Rockefeller Plaza, 2nd Floor, New York, New York 10020, and
MCRIL, LLC, a Virginia limited liability company (“Tenant”) with an address at
c/o The Bon-Ton Stores, Inc., 2801 East Market Street, York, Pennsylvania 17402.

 

In consideration of the rents and provisions herein stipulated to be paid and
performed, Landlord and Tenant hereby covenant and agree as follows:

 

1.                                      Demise of Premises.

 

Landlord hereby demises and lets to Tenant, and Tenant hereby takes and leases
from Landlord, for the term and upon the provisions hereinafter specified, the
following described property (hereinafter referred to collectively as the
“Leased Premises” and individually as the “Joliet, IL Premises”, “Fargo, ND
Premises”, “Ashwaubenon, WI Premises”, “Brookfield, WI Premises”, “Greendale, WI
Premises”, and “Wauwatosa, WI Premises”, each of which premises shall include
the following item (a) and the following items (b) and (c) of this Paragraph 1
located thereon or therein and appertaining thereto:  (a) the real property
described in Exhibit “A” hereto, together with the Appurtenances (collectively,
the “Land”); (b) the buildings containing approximately 1,002,731square feet in
the aggregate, structures and other improvements now or hereafter constructed on
the Land (collectively, the “Improvements”); and (c) the fixtures, machinery,
equipment and other property described in Exhibit “B” hereto (collectively, the
“Equipment”).

 

2.                                      Certain Definitions.

 

“Acquisition Cost” shall mean $84,000,000.

 

“Additional Rent” shall mean Additional Rent as defined in Paragraph 7.

 

“Affected Premises” shall mean a Related Premises that is the subject of a
Casualty/Condemnation Termination Event.

 

“Alterations” shall mean all changes, additions, improvements or repairs to, all
alterations, reconstructions, restorations, renewals, replacements or removals
of and all substitutions or replacements for any of the Improvements or
Equipment, both interior and exterior, structural and non-structural, and
ordinary and extraordinary.

 

“Approved Subleases” shall mean the subleases identified on Exhibit “F” attached
hereto.

 

“Appurtenances” shall mean all tenements, hereditaments, easements,
rights-of-way, rights, privileges in and to the Land, including (a) easements
over other lands granted by any Easement Agreement and (b) any rights with
respect to any streets, sidewalks, ways, driveways, alleys, vaults, gores or
strips of land adjoining the Land.

 

“Assignment” shall mean any assignment of rents and leases from Landlord to a
Lender which (a) encumbers any of the Leased Premises and (b) secures

 

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Landlord’s obligation to repay a Loan, as the same may be amended, supplemented
or modified from time to time.

 

“Basic Rent” shall mean Basic Rent as defined in Paragraph 6.

 

“Basic Rent Payment Date” shall mean Basic Rent Payment Date as defined in
Paragraph 6.

 

“BONT” shall mean The Bon-Ton Stores, Inc., a Pennsylvania corporation.

 

“Casualty” shall mean any loss of or damage to or destruction of or which
affects the Leased Premises.

 

“Casualty/Condemnation Premises Percentage Allocation” shall mean for purposes
of allocation of rent in connection with a Casualty or Condemnation, the
percentage allocated to each Related Premises in Exhibit “E” to this Lease as
the same may be adjusted in accordance with the formula specified in
Exhibit “E”.

 

“Casualty/Condemnation Termination Amount”  shall mean the greater of (i) the
sum of the Fair Market Value of the applicable Related Premises and the
applicable Prepayment Premium which Landlord will be required to pay in
prepaying or defeasing, as applicable, any Loan with proceeds of the
Casualty/Condemnation Termination Amount or (ii) the sum of the product of the
Acquisition Cost multiplied by the applicable Casualty/Condemnation Premises
Percentage Allocation for the applicable Related Premises and the applicable
Prepayment Premium which Landlord will be required to pay in prepaying or
defeasing, in whole or in part, as applicable, any Loan with the proceeds of the
Casualty/Condemnation Termination Amount.

 

“Casualty/Condemnation Termination Date” shall mean the Casualty/Condemnation
Termination Date as defined in Paragraph 18.

 

“Casualty/Condemnation Termination Event” shall mean a Casualty/Condemnation
Termination Event as defined in Paragraph 18.

 

“Casualty/Condemnation Termination Notice” shall mean Casualty/Condemnation
Termination Notice as defined in Paragraph 18(a).

 

“Commencement Date” shall mean Commencement Date as defined in Paragraph 5.

 

“Condemnation” shall mean a Taking.

 

“Condemnation Notice” shall mean notice from the applicable governmental
authority of the institution of or imminent intention to institute a proceeding
for Condemnation.

 

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“Costs” of a Person or associated with a specified transaction shall mean all
reasonable costs and expenses incurred by such Person or associated with such
transaction, including without limitation, attorneys’ fees and expenses
(including in house), court costs, brokerage fees, escrow fees, title insurance
premiums, mortgage commitment fees, mortgage points, recording fees and transfer
taxes, as the circumstances require.  Notwithstanding the foregoing, with
respect to Landlord, Costs shall include the expenses of internal counsel, at
market rates, only with respect to those matters where Landlord is utilizing
internal counsel.

 

“CPI” shall mean CPI as defined in Exhibit “D” hereto.

 

“Default Rate” shall mean the Default Rate as defined in Paragraph 7(a)(iv).

 

“Easement Agreement” shall mean any conditions, covenants, restrictions,
easements, declarations, licenses and other agreements listed as Permitted
Encumbrances or as may hereafter affect any Related Premises.

 

“Environmental Law” shall mean (a) whenever enacted or promulgated, any
applicable federal, state, foreign and local law, statute, ordinance, rule,
regulation, license, permit, authorization, approval, consent, court order,
judgment, decree, injunction, code, requirement or agreement with any
governmental entity, (i) relating to pollution (or the cleanup thereof), or the
protection of air, water vapor, surface water, groundwater, drinking water
supply, land (including land surface or subsurface), plant, aquatic and animal
life from injury caused by a Hazardous Substance or (ii) concerning exposure to,
or the use, containment, storage, recycling, reclamation, reuse, treatment,
generation, discharge, transportation, processing, handling, labeling,
production, disposal or remediation of any Hazardous Substance or Hazardous
Condition or governing the conduct of any Hazardous Activity, in each case as
amended and as now or hereafter in effect, and (b) any common law or equitable
doctrine (including, without limitation, injunctive relief and tort doctrines
such as negligence, nuisance, trespass and strict liability) that may impose
liability or obligations for injuries or damages due to or as a result of the
presence of, exposure to, or ingestion of, any Hazardous Substance.  The term
Environmental Law includes, without limitation, the federal Comprehensive
Environmental Response Compensation and Liability Act of 1980, the Superfund
Amendments and Reauthorization Act, the federal Water Pollution Control Act, the
federal Clean Air Act, the federal Clean Water Act, the federal Resources
Conservation and Recovery Act of 1976 (including the Hazardous and Solid Waste
Amendments to RCRA), the federal Solid Waste Disposal Act, the federal Toxic
Substance Control Act, the federal Insecticide, Fungicide and Rodenticide Act,
the federal Occupational Safety and Health Act of 1970 (to the extent it relates
to Hazardous Substances), the federal National Environmental Policy Act and the
federal Hazardous Materials Transportation Act, each as amended and as now or
hereafter in effect and any similar state or local Law.

 

“Environmental Violation” shall mean (a) any direct or indirect discharge,
disposal, spillage, emission, escape, pumping, pouring, injection, leaching,
release, seepage, filtration or transporting of any Hazardous Substance at,
upon, under, onto or within any Related Premises, or from any Related Premises
to the environment, in violation of any Environmental Law, (b) any deposit,
storage, dumping, placement or use of any Hazardous Substance at, upon,

 

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under or within any Related Premises in violation of any Environmental Law,
(c) the abandonment or discarding of any barrels, containers or other
receptacles containing any Hazardous Substances in violation of any
Environmental Laws, (d) any activity, occurrence or condition which could
reasonably be expected to result in any liability to Landlord or Lender under,
or which could reasonably be expected to result in the creation of any lien on
any Related Premises under, any Environmental Law, or (e) or any other violation
of or noncompliance with any Environmental Law.

 

“Equipment” shall mean the Equipment as defined in Paragraph 1.

 

“Event of Default” shall mean an Event of Default as defined in Paragraph 22(a).

 

“Existing Subleases” shall mean the subleases identified on Exhibit “G” attached
hereto.

 

“Fair Market Value” of either the Leased Premises or any Related Premises, as
the case may be, and the context may require, shall mean the higher of (a) the
fair market value of the Leased Premises or any Related Premises, as the case
may be, as of the Relevant Date as if unaffected and unencumbered by this Lease
or (b) the fair market value of the Leased Premises or Related Premises, as the
case may be, as of the Relevant Date as affected and encumbered by the term of
this Lease (but excluding any renewal terms not yet exercised).  For all
purposes of this Lease, Fair Market Value shall be determined in accordance with
the procedure specified in Paragraph 29.

 

“Fair Market Value Date” shall mean the date when the Fair Market Value is
determined in accordance with Paragraph 29.

 

“Federal Funds” shall mean federal or other immediately available funds which at
the time of payment are legal tender for the payment of public and private debts
in the United States of America.

 

“Guarantor” shall mean, collectively, BONT, THE BON-TON DEPARTMENT STORES, INC,
a Pennsylvania corporation, and CARSON PIRIE SCOTT II, INC., a Florida
corporation.

 

“Guaranty” shall mean the Guaranty and Suretyship Agreement dated as of the date
hereof from Guarantor to Landlord guaranteeing the payment and performance by
Tenant of all of Tenant’s obligations under this Lease.

 

“Hazardous Activity” means any activity, process, procedure or undertaking which
directly or indirectly (a) procures, generates or creates any Hazardous
Substance; (b) causes or results in (or threatens to cause or result in) the
release, seepage, spill, leak, flow, discharge or emission of any Hazardous
Substance into the environment (including the air, ground water, watercourses or
water systems), (c) involves the containment or storage of any Hazardous
Substance; or (d) would cause any of the Leased Premises or any portion thereof
to become a hazardous waste treatment, recycling, reclamation, processing,
storage or disposal facility within the meaning of any Environmental Law.

 

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“Hazardous Condition” means any condition which would support any claim or
liability under any Environmental Law, including the presence of underground
storage tanks.

 

“Hazardous Substance” means (i) any substance, material, product, petroleum,
petroleum product, derivative, compound or mixture, mineral (including
asbestos), chemical, gas, medical waste, or other pollutant, in each case
whether naturally occurring, man-made or the by-product of any process, that is
toxic, harmful or hazardous or acutely hazardous to the environment or public
health or safety or (ii) any substance supporting a claim under any
Environmental Law, whether or not defined as hazardous as such under any
Environmental Law.  Hazardous Substances include, without limitation, any toxic
or hazardous waste, pollutant, contaminant, industrial waste, petroleum or
petroleum-derived substances or waste, radon, radioactive materials, asbestos,
asbestos containing materials, microbial matter (including but not limited to
mold, mildew and other fungi or bacterial matter which reproduces through the
release of spores or the splitting of cells), urea formaldehyde foam insulation,
lead and polychlorinated biphenyls.

 

“Impositions” shall mean the Impositions as defined in Paragraph 9(a).

 

“Improvements” shall mean the Improvements as defined in Paragraph 1.

 

“Indemnitee” shall mean an Indemnitee as defined in Paragraph 15.

 

“Insurance Requirements” shall mean the requirements of all insurance policies
maintained in accordance with this Lease.

 

“Land” shall mean the Land as defined in Paragraph 1.

 

“Law” shall mean any constitution, statute, rule of law, code, ordinance, order,
judgment, decree, injunction, rule, regulation, policy, requirement or
administrative or judicial determination, even if unforeseen or extraordinary,
of every duly constituted governmental authority, court or agency, now or
hereafter enacted or in effect.

 

“Lease” shall mean this Lease Agreement.

 

“Lease Year” shall mean, with respect to the first Lease Year, the period
commencing on the Commencement Date and ending at midnight on the last day of
the twelfth (12th) full consecutive calendar month following the month in which
the Commencement Date occurred, and each succeeding twelve (12) month period
during the Term.

 

“Leased Premises” shall mean the Leased Premises as defined in Paragraph 1.

 

“Legal Requirements” shall mean the requirements of all present and future Laws
(including but not limited to Environmental Laws and Laws relating to
accessibility to, usability by, and discrimination against, disabled
individuals) and all covenants, restrictions and conditions now or hereafter of
record which may be applicable to Tenant or to any of the Leased Premises or any
Related Premises, or to the use, manner of use, occupancy, possession,

 

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operation, maintenance, alteration, repair or restoration of any of the Leased
Premises or any Related Premises, even if compliance therewith necessitates
structural changes or improvements or results in interference with the use or
enjoyment of any of the Leased Premises or any Related Premises or requires
Tenant to carry insurance other than as required by this Lease.

 

“Lender” shall mean any Person (and its respective successors and assigns) which
may, on or after the date hereof, make a Loan to Landlord or be the holder of a
Note.

 

“Loan” shall mean any loan made by one or more Lenders to Landlord, which loan
is secured by a Mortgage and an Assignment and evidenced by a Note.

 

“Monetary Obligations” shall mean Rent and all other sums payable by Tenant
under this Lease to Landlord, to any third party on behalf of Landlord or to any
Indemnitee.

 

“Moody’s” shall mean Moody’s Investor Services, Inc.

 

“Mortgage” shall mean any mortgage or deed of trust from Landlord to a Lender
which (a) encumbers any of the Leased Premises and (b) secures Landlord’s
obligation to repay a Loan, as the same may be amended, supplemented or
modified.

 

“Net Award” shall mean (a) the entire award payable to Landlord or Lender by
reason of a Condemnation whether pursuant to a judgment or by agreement or
otherwise, or (b) the entire proceeds of any insurance required under
clauses (i), (ii) (to the extent payable to Landlord or Lender), (iv),
(v) or (vi) of Paragraph 16(a), as the case may be, less any reasonable expenses
incurred by Landlord and Lender in collecting such award or proceeds.

 

“Note” shall mean any promissory note evidencing Landlord’s obligation to repay
a Loan, as the same may be amended, supplemented or modified.

 

“Partial Casualty” shall mean any Casualty which does not constitute a
Casualty/Condemnation Termination Event.

 

“Partial Condemnation” shall mean any Condemnation which does not constitute a
Casualty/Condemnation Termination Event.

 

“Permitted Encumbrances” means collectively, (a) the liens and security
interests created or permitted by this Lease, (b) all liens, encumbrances and
other matters disclosed in the title insurance policy insuring Landlord’s
interest in the Leased Premises, as set forth in Exhibit “C” hereto, (c) liens,
if any, for Impositions not yet due or payable, (d) liens and other matters that
are being contested in accordance with Paragraph 14 hereof and (e) rights of
tenants, occupants and licensees of the Leased Premises to the extent the same
are permitted under this Lease.

 

“Person” shall mean an individual, partnership, association, corporation or
other entity.

 

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“Post Closing Obligations” shall mean those obligations of Tenant specified in
Paragraph 37 hereof.

 

“Prepayment Premium” shall mean any payment required to be made by Landlord to a
Lender under a Note or other document evidencing or securing a Loan (other than
payments of principal and/or interest which Landlord is required to make under a
Note or a Mortgage) by reason of any prepayment or defeasance by Landlord of any
principal due under a Note or Mortgage, and which may, without limitation, take
the form of (a) a “make whole” or yield maintenance clause requiring a
prepayment premium or (b) a defeasance payment (such defeasance payment to be an
amount equal to the positive difference between (i) the total amount required to
defease a Loan and (ii) the outstanding principal balance of, and accrued
interest under, the Loan as of the date of such defeasance (plus reasonable
Costs of Landlord and Lender) or (c) “breakage costs” or (d) any combination of
clauses (a), (b) and (c) above. Notwithstanding the foregoing, if the Prepayment
Premium under any future Loan is calculated based upon a principal balance or
allocated principal balance that is in excess of the original principal balance
or original allocated principle balance, as applicable, of the original Loan in
effect as of the Commencement Date, then, the Prepayment Premium shall not be
greater than the Prepayment Premium if same had been calculated on the original
principal balance or allocated principle balance of the initial Loan.

 

“Present Value” of any amount shall mean such amount discounted by a rate per
annum which is the lower of (a) the Prime Rate at the time such present value is
determined or (b) eight and two-tenths percent (8.2%) per annum.

 

“Prime Rate” shall mean the interest rate per annum as published, from time to
time, in The Wall Street Journal as the “Prime Rate” in its column entitled
“Money Rate”.  The Prime Rate may not be the lowest rate of interest charged by
any “large U.S. money center commercial banks” and Landlord makes no
representations or warranties to that effect.  In the event The Wall Street
Journal ceases publication or ceases to publish the “Prime Rate” as described
above, the Prime Rate shall be the average per annum discount rate (the
“Discount Rate”) on ninety-one (91) day bills (“Treasury Bills”) issued from
time to time by the United States Treasury at its most recent auction, plus
three hundred (300) basis points.  If no such 91-day Treasury Bills are then
being issued, the Discount Rate shall be the discount rate on Treasury Bills
then being issued for the period of time closest to ninety-one (91) days.

 

“Related Premises” shall mean any one of the “Joliet, IL Premises”, “Fargo, ND
Premises”, “Ashwaubenon, WI Premises”, “Brookfield, WI Premises”, “Greendale, WI
Premises”, and “Wauwatosa, WI Premises”.

 

“Relevant Date” shall mean (a) the date immediately prior to the date on which
the applicable Condemnation Notice is received, in the event of a
Casualty/Condemnation Termination Notice under Paragraph 18 which is occasioned
by a Taking, (b) the date immediately prior to the date on which the applicable
Casualty occurs, in the event of a Casualty/Condemnation Termination Notice
under Paragraph 18 which is occasioned by a Casualty, and (c) the date when Fair
Market Value is redetermined, in the event of a redetermination of Fair Market
Value pursuant to Paragraph 20(c).

 

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“Remaining Premises” shall mean the Related Premises which are not Affected
Premises under Paragraph 18.

 

“Renewal Term” shall mean Renewal Term as defined in Paragraph 5.

 

“Rent” shall mean, collectively, Basic Rent and Additional Rent.

 

“S&P” shall mean Standard and Poor’s Corporation.

 

“Site Assessment” shall mean a Site Assessment as defined in Paragraph 10(c).

 

“State” shall mean the State of Wisconsin.

 

“Subsidiary(ies)” of a Person means a corporation, partnership, limited
liability company, or other entity in which that Person directly or indirectly
owns or controls the shares of stock or other equity interests having ordinary
voting power to elect a majority of the board of directors (or appoint other
comparable managers) of such corporation, partnership, limited liability
company, or other entity.

 

“Surviving Obligations” shall mean any obligations of Tenant under this Lease,
actual or contingent, which arise on or prior to the expiration or prior
termination of this Lease or which survive such expiration or termination by
their own terms.

 

“Taking” shall mean (a) any taking or damaging of all or a portion of any of the
Leased Premises (i) in or by condemnation or other eminent domain proceedings
pursuant to any Law, general or special, or (ii) by reason of any agreement with
any condemnor in settlement of or under threat of any such condemnation or other
eminent domain proceeding, or (iii) by any other means substantially similar to
clauses (i) or (ii) above, or (b) any de facto condemnation.  The Taking shall
be considered to have taken place as of the later of the date actual physical
possession is taken by the condemnor, or the date on which the right to
compensation and damages accrues under the law applicable to the Related
Premises.

 

“Tenant Group” shall mean BONT and its respective Subsidiaries if and for so
long as each such Person shall be part of the group for the purpose of reporting
financial positions and results on a consolidated basis.

 

“Term” shall mean the Term as defined in Paragraph 5.

 

“Third Party Purchaser” shall mean the Third Party Purchaser as defined in
Paragraph 21 (h).

 

“Warranties” shall mean Warranties as defined in Paragraph 3(d).

 

“Work” shall mean Work as defined in Paragraph 13(b).

 

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3.                                      Title and Condition; Single Lease
Transaction.

 

(a)                                 The Leased Premises are demised and let
subject to (i) the Mortgage and Assignment in effect as of the Commencement
Date, (ii) the rights of any Persons in possession of the Leased Premises,
(iii) the existing state of title of any of the Leased Premises, including any
Permitted Encumbrances, (iv) any state of facts which an accurate survey or
physical inspection of the Leased Premises might show, (v) all Legal
Requirements, including any existing violation of any thereof, and (vi) the
condition of the Leased Premises as of the commencement of the Term, without
representation or warranty by Landlord.

 

(b)                                 Tenant acknowledges that the Leased Premises
are in good condition and repair at the inception of this Lease.  LANDLORD
LEASES AND WILL LEASE AND TENANT TAKES AND WILL TAKE THE LEASED PREMISES AS IS
WHERE IS AND WITH ALL FAULTS.  TENANT ACKNOWLEDGES THAT LANDLORD (WHETHER ACTING
AS LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT MADE AND WILL NOT MAKE,
NOR SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY WARRANTY OR REPRESENTATION,
EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES, INCLUDING ANY
WARRANTY OR REPRESENTATION AS TO (i) ITS FITNESS, DESIGN OR CONDITION FOR ANY
PARTICULAR USE OR PURPOSE, (ii) THE QUALITY OF THE MATERIAL OR WORKMANSHIP
THEREIN, (iii) THE EXISTENCE OF ANY DEFECT, LATENT OR PATENT, (iv) LANDLORD’S
TITLE THERETO, (v) VALUE, (vi) COMPLIANCE WITH SPECIFICATIONS, (vii) LOCATION,
(viii) USE, (ix) CONDITION, (x) MERCHANTABILITY, (xi) QUALITY,
(xii) DESCRIPTION, (xiii) DURABILITY (xiv) OPERATION, (xv) THE EXISTENCE OF ANY
HAZARDOUS SUBSTANCE, OR (xvi) COMPLIANCE OF THE LEASED PREMISES WITH ANY LAW OR
LEGAL REQUIREMENT; AND ALL RISKS INCIDENT THERETO ARE TO BE BORNE BY TENANT. 
TENANT ACKNOWLEDGES THAT THE LEASED PREMISES ARE OF ITS SELECTION AND TO ITS
SPECIFICATIONS AND THAT THE LEASED PREMISES HAVE BEEN INSPECTED BY TENANT AND
ARE SATISFACTORY TO IT.  IN THE EVENT OF ANY DEFECT OR DEFICIENCY IN ANY OF THE
LEASED PREMISES OF ANY NATURE, WHETHER LATENT OR PATENT, LANDLORD SHALL NOT HAVE
ANY RESPONSIBILITY OR LIABILITY WITH RESPECT THERETO OR FOR ANY INCIDENTAL OR
CONSEQUENTIAL DAMAGES (INCLUDING STRICT LIABILITY IN TORT).  THE PROVISIONS OF
THIS PARAGRAPH 3(b) HAVE BEEN NEGOTIATED, AND ARE INTENDED TO BE A COMPLETE
EXCLUSION AND NEGATION OF ANY WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH
RESPECT TO ANY OF THE LEASED PREMISES, ARISING PURSUANT TO THE
UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW OR HEREAFTER IN EFFECT OR ARISING
OTHERWISE.

 

(c)                                  Tenant represents to Landlord that Tenant
has examined the title to the Leased Premises prior to the execution and
delivery of this Lease and has found the same to be satisfactory for the
purposes contemplated hereby.  Tenant acknowledges that (i) fee simple title
(both legal and equitable) to the Leased Premises is in Landlord and that Tenant
has only the leasehold right of possession and use of the Leased Premises, as
provided herein, (ii) the Improvements conform to all material Legal
Requirements and all Insurance Requirements,

 

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(iii) all easements necessary or appropriate for the use or operation of the
Leased Premises have been obtained, (iv) all contractors and subcontractors who
have performed work on or supplied materials to the Leased Premises have been
fully paid (or will in due course be paid, subject to any disputes which may
arise), and all materials and supplies have been fully paid for (or will in due
course be paid, subject to any disputes which may arise) (v) the Improvements
have been fully completed in all material respects in a workmanlike manner, and
(vi) all Equipment necessary or appropriate for the use or operation of the
Leased Premises has been installed and is presently fully operative in all
material respects.

 

(d)                                 Landlord hereby assigns to Tenant, without
recourse or warranty whatsoever, the right to enforce all assignable warranties,
guaranties, indemnities, causes of action and similar rights (collectively
“Warranties”) which Landlord may have against any manufacturer, seller,
engineer, contractor or builder in respect of any of the Leased Premises.  Such
assignment shall remain in effect until the expiration or earlier termination of
this Lease (unless Tenant or its affiliate or designee acquires any of the
Leased Premises, in which instance such assignment shall become permanent and
irrevocable with respect to such Leased Premises), whereupon such assignment
shall cease and all of the Warranties shall automatically revert to Landlord. 
In confirmation of such reversion Tenant shall execute and deliver promptly any
certificate or other document reasonably required by Landlord.  Landlord shall
also retain the right to enforce any Warranties during the continuance of an
Event of Default.  Tenant shall use commercially reasonable efforts to enforce
the Warranties in accordance with their respective terms.

 

(e)                                  LANDLORD AND TENANT AGREE THAT IT IS THEIR
MUTUAL INTENT TO CREATE, AND THAT THIS LEASE CONSTITUTES, A SINGLE LEASE WITH
RESPECT TO ALL PARCELS OF LAND AND IMPROVEMENTS (WHEREVER LOCATED) THAT THIS
LEASE IS NOT INTENDED AND SHALL NOT BE CONSTRUED TO BE SEPARATE LEASES AND THAT
ALL THE TERMS AND CONDITIONS HEREOF SHALL GOVERN THE RIGHTS AND OBLIGATIONS OF
LANDLORD AND TENANT WITH RESPECT THERETO.

 

(f)                                   TENANT, ON BEHALF OF ITSELF AND ANY
TRUSTEE OR LEGAL REPRESENTATIVE EXPRESSLY ACKNOWLEDGES AND AGREES THAT,
NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH 18 HEREOF OR ANY OTHER PROVISION IN
THIS LEASE TO THE CONTRARY, IT IS THE EXPRESS INTENT OF LANDLORD AND TENANT TO
CREATE, AND THAT THIS LEASE CONSTITUTES, A SINGLE LEASE WITH RESPECT TO ALL
PARCELS OF LAND AND IMPROVEMENTS AND EQUIPMENT (WHEREVER LOCATED) AND SHALL NOT
BE (OR BE DEEMED TO BE) DIVISIBLE OR SEVERABLE INTO SEPARATE LEASES FOR ANY
PURPOSE WHATSOEVER (EXCEPT AS CONTEMPLATED BY PARAGRAPH 18 IN CONNECTION WITH A
SUBSTANTIAL CASUALTY OR CONDEMNATION), AND TENANT, ON BEHALF OF ITSELF AND ANY
SUCH TRUSTEE OR LEGAL REPRESENTATIVE, HEREBY WAIVES ANY RIGHT TO CLAIM OR ASSERT
A CONTRARY POSITION IN ANY ACTION OR PROCEEDING; IT BEING FURTHER UNDERSTOOD AND
AGREED BY TENANT THAT THE PERCENTAGE ALLOCATION OF BASIC RENT AS SET FORTH ON
EXHIBIT “E” HEREOF IS INCLUDED TO PROVIDE A FORMULA FOR RENT ADJUSTMENT AND
LEASE TERMINATION UNDER CERTAIN OCCURRENCES OF

 

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CASUALTY AND CONDEMNATION, WHICH ARE BEYOND THE REASONABLE CONTROL OF THE
PARTIES AND AS AN ACCOMMODATION TO TENANT.  ANY EVENT OF DEFAULT HEREUNDER IN
CONNECTION WITH ANY RELATED PREMISES SHALL BE DEEMED TO BE AN EVENT OF DEFAULT
WITH RESPECT TO THE ENTIRE LEASED PREMISES (WHEREVER LOCATED).  THE FOREGOING
AGREEMENTS AND WAIVERS BY TENANT IN THIS PARAGRAPH 3(f) ARE MADE AS A MATERIAL
INDUCEMENT TO LANDLORD TO ENTER INTO THE TRANSACTION CONTEMPLATED BY THIS LEASE
AND THAT, BUT FOR THE FOREGOING AGREEMENTS AND WAIVERS BY TENANT, LANDLORD WOULD
NOT CONSUMMATE THIS LEASE TRANSACTION.

 

4.                                      Use of Leased Premises; Quiet Enjoyment.

 

(a)                                 Tenant may occupy and use the Leased
Premises, subject to paragraph (c) below, for retail use and ancillary office
and storage use and for no other purpose without the consent of Landlord, such
consent not to be unreasonably withheld or delayed.  Tenant shall not use or
occupy or permit any of the Leased Premises to be used or occupied, nor do or
permit anything to be done in or on any of the Leased Premises, in a manner
which would or might reasonably be expected to (i) violate any Law, Legal
Requirement or Permitted Encumbrance, (ii) make void or voidable or cause any
insurer to cancel any insurance required by this Lease, or make it difficult or
impossible to obtain any such insurance at commercially reasonable rates,
(iii) make void or voidable, cancel or cause to be cancelled or release any of
the material Warranties, (iv) cause structural injury to any of the Improvements
(other than in connection with any Alterations or restoration permitted
hereunder and being constructed in accordance with the terms of this Lease) or
(v) constitute a public or private nuisance or waste.

 

(b)                                 Subject to the provisions hereof, so long as
no Event of Default has occurred and is continuing, Tenant shall quietly hold,
occupy and enjoy the Leased Premises throughout the Term, without any hindrance,
ejection or molestation by Landlord with respect to matters that arise after the
date hereof, provided that Landlord or its agents may enter upon and examine any
of the Leased Premises at such reasonable times as Landlord may select and upon
reasonable notice to Tenant (except in the case of any emergency, in which event
no notice shall be required) for the purpose of inspecting the Leased Premises,
verifying compliance or non-compliance by Tenant with its obligations hereunder
and the existence or non-existence of an Event of Default or event which with
the passage of time and/or notice would constitute an Event of Default, showing
the Leased Premises to prospective Lenders and purchasers, making any repairs
and taking such other action with respect to the Leased Premises as is permitted
by any provision hereof.  Each such entry and/or examination shall be conducted
in a manner which will minimize interference with Tenant’s (and its subtenants’
and licensees’) use and occupancy of the Leased Premises.

 

(c)                                  In no event shall any portion of the Leased
Premises be used or occupied or permitted to be used or occupied for any of the
following purposes: (i) any nightclub, bar or discotheque; (ii) any adult
bookstore or video shop, nude or semi-nude or “adult” entertainment
establishment or any lewd, obscene or pornographic purpose; (iii) any store in
which a material portion of the inventory is not available for sale or rental to
children under 18 years of age because such inventory explicitly deals with,
relates to, or depicts human sexuality, or in which

 

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any of the inventory constitutes drug paraphernalia of the kind associated with
or sold by so-called “head shops”; (iv) any dumping, disposing, incineration or
reduction of garbage (exclusive of appropriately screened dumpsters and/or
recycling bins and garbage disposal in the ordinary course of business); (v) any
mortuary; (vi) any fire sale, bankruptcy sale (unless pursuant to a court order)
or auction house operation; (vii) any gas station; (viii) any central laundry or
dry cleaning plant or Laundromat; (ix) any automobile, truck, trailer or RV
sales, leasing, display or repair; (x) any “flea market”, secondhand or surplus
store; (xi) any gambling or off-track betting operation, or (xii) any massage
parlor or carnival.

 

5.                                      Term.

 

(a)                                 Subject to the provisions hereof, Tenant
shall have and hold the Leased Premises for an initial term (such term, as
extended or renewed in accordance with the provisions hereof, being called the
“Term”) commencing on the date hereof (the “Commencement Date”) and ending on
the last day of the two-hundred and fortieth (240) full calendar month next
following the date hereof (the “Expiration Date”).

 

(b)                                 Provided that if, on or prior to the
Expiration Date or any other Renewal Date (as hereinafter defined) this Lease
shall not have been terminated pursuant to any provision hereof, then on the
Expiration Date and on the tenth (10th) and twentieth (20th) anniversaries of
the Expiration Date (the Expiration Date and each such anniversary being
referred to herein as a “Renewal Date”), the Term shall be deemed to have been
automatically extended for an additional period of ten (10) years (each such
extension, a “Renewal Term”), unless Tenant shall notify Landlord in writing at
least eighteen (18) months prior to the next Renewal Date that Tenant is
terminating this Lease as of the next Renewal Date.  Any such extension of the
Term shall be subject to all of the provisions of this Lease, as the same may be
amended, supplemented or modified (except that Tenant shall not have the right
to any additional Renewal Terms).

 

(c)                                  If Tenant exercises its option pursuant to
Paragraph 5(b) not to have the Term automatically extended, or if an Event of
Default exists, then Landlord shall have the right during the remainder of the
Term then in effect and, in any event, Landlord shall have the right during the
last year of the Term, to (i) advertise the availability of any of the Leased
Premises for sale or reletting and to erect upon any of the Leased Premises
signs indicating such availability and (ii) show any of the Leased Premises to
prospective purchasers or tenants or their agents at such reasonable times as
Landlord may select upon reasonable prior notice to Tenant.  All such showings
shall be conducted in a manner which will minimize interference with Tenant’s
(and its subtenants’ and licensees’) use and occupancy of the Leased Premises.

 

6.                                      Basic Rent.

 

Tenant shall pay to Landlord, as annual rent for the Leased Premises during the
Term, the amounts determined in accordance with Exhibit “D” hereto (“Basic
Rent”), payable in advance for the next calendar month, commencing on the
twenty-fifth (25th) day of the first month following the date hereof and
continuing on the same day of each month thereafter during the Term which shall
be payable as set forth in said Exhibit “D”.  The date that each payment of
Basic Rent is due is hereinafter referred to as a “Basic Rent Payment Date”. 
Each such payment of Basic Rent shall be made via ACH transfer for value in
Federal Funds on each Basic Rent

 

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Payment Date to Landlord and/or to such one or more other Persons, pursuant to
transfer instructions delivered to Tenant from time to time at such addresses
and in such proportions as Landlord may direct by fifteen (15) days’ prior
written notice to Tenant; provided, however, that the first payment of Basic
Rent shall be paid on the Commencement Date.

 

7.                                      Additional Rent.

 

(a)                                 Tenant shall pay and discharge, as
additional rent (collectively, “Additional Rent”):

 

(i)                                     except as otherwise specifically
provided herein, all costs and expenses of Tenant, and all reasonable costs and
expenses of Landlord which are incurred in connection or associated with (A) the
ownership, use, non-use, occupancy, monitoring, possession, operation,
condition, design, construction, maintenance, alteration, repair or restoration
of any of the Leased Premises, (B) the performance of any of Tenant’s
obligations under this Lease, (C) any sale or other transfer of any of the
Leased Premises to Tenant under this Lease, including costs and expenses
incurred in connection with the payment of a Prepayment Premium, (D) any
Condemnation proceedings, (E) the adjustment, settlement or compromise of any
insurance claims involving or arising from any of the Leased Premises, (F) the
prosecution, defense or settlement of any litigation involving or arising from
any of the Leased Premises, this Lease, or the sale of the Leased Premises to
Landlord, (G) the exercise or enforcement by Landlord, its successors and
assigns, of any of its rights under this Lease, (H) any amendment to or
modification or termination of this Lease made at the request of Tenant,
(I) Costs of Landlord’s external counsel and reasonable Costs of legal services
provided by Landlord’s affiliate incurred in connection with the preparation,
negotiation and execution of this Lease, or incurred in connection with any act
undertaken by Landlord (or its counsel, affiliate or otherwise) at the request
of Tenant, any act of Landlord performed on behalf of Tenant or the review and
monitoring of compliance by Tenant with the terms of this Lease, including
compliance with Post Closing Obligations and applicable Law, (J) the reasonable
internal Costs of Landlord incurred in connection with any act undertaken by
Landlord at the request of Tenant or Tenant’s failure to act promptly in an
emergency situation, (K) all of Tenant’s costs and fees associated with the
payment of Rent, and (L) any other items specifically required to be paid by
Tenant under this Lease;

 

(ii)                                  after the date all or any portion of any
installment of Basic Rent is due and not paid, an amount equal to five percent
(5%) of the amount of such unpaid installment or portion thereof (“Late
Charge”); provided, however, that with respect to the first late payment of all
or any portion of any installment of Basic Rent in any Lease Year, the Late
Charge shall not be due and payable unless the Basic Rent has not been paid
within two (2) days following notice from Landlord that such payment or portion
thereof has not been received;

 

(iii)                               a sum equal to any additional sums
(including any late charge and fees of Lender’s counsel) which are payable by
Landlord to any Lender under any Note by reason of Tenant’s late payment or
non-payment of Basic Rent or by reason of an Event of Default;

 

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(iv)                              interest at the rate (the “Default Rate”) of
five percent (5%) over the Prime Rate per annum on the following sums until paid
in full: (A) all overdue installments of Basic Rent from the respective due
dates thereof, (B) all overdue amounts of Additional Rent relating to
obligations which Landlord shall have paid on behalf of Tenant, from the date of
payment thereof by Landlord, and (C) all other overdue amounts of Additional
Rent which are payable to Landlord, from the date when any such amount becomes
overdue; and

 

(v)                                 five thousand dollars ($5,000) per month for
each full calendar month that Tenant is late in the delivery of the annual and
quarterly financial statements that are required to be delivered pursuant to
Paragraph 28(b).

 

(b)                                 Tenant shall pay and discharge (i) any
Additional Rent referred to in Paragraph 7(a)(i) when the same shall become due,
provided that amounts which are billed to Landlord or any third party, but not
to Tenant, shall be paid within five (5) days after Landlord’s demand for
payment thereof, and (ii) any other Additional Rent which is payable to
Landlord, within five (5) days after Landlord’s demand for payment thereof.

 

(c)                                  In no event shall amounts payable under
Paragraph 7(a)(ii), (iii) and (iv) or elsewhere in this Lease exceed the maximum
amount permitted by applicable Law.

 

8.                                      Net Lease: Non-Terminability.

 

(a)                                 This is a net lease and all Monetary
Obligations shall be paid without notice or demand (except as otherwise
expressly provided herein) and without set-off, counterclaim, recoupment,
abatement, suspension, deferment, diminution, deduction, reduction or defense
(collectively, a “Set-Off”), subject to Tenant’s contest rights set forth in
Paragraph 14.

 

(b)                                 This Lease and the rights of Landlord and
the obligations of Tenant hereunder shall not be affected by any event or for
any reason or cause whatsoever foreseen or unforeseen.

 

(c)                                  The obligations of Tenant hereunder shall
be separate and independent covenants and agreements, all Monetary Obligations
shall continue to be payable in all events (or, in lieu thereof, Tenant shall
pay amounts equal thereto), and the obligations of Tenant hereunder shall
continue unaffected unless the requirement to pay or perform the same shall have
been terminated pursuant to an express provision of this Lease.  The obligation
to pay Rent or amounts equal thereto shall not be affected by any collection of
rents by any governmental body pursuant to a tax lien or otherwise, even though
such obligation results in a double payment of Rent.  All Rent payable by Tenant
hereunder shall constitute “rent” for all purposes (including
Section 502(b)(6) of the Federal Bankruptcy Code).

 

(d)                                 Except as otherwise expressly provided
herein, Tenant shall have no right and hereby waives all rights which it may
have under any Law (i) to quit, terminate or surrender this Lease or any of the
Leased Premises, or (ii) to any Set-Off of any Monetary Obligations.

 

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9.                                      Payment of Impositions.

 

(a)                                 Tenant shall, before interest or penalties
are due thereon, pay and discharge all taxes (including real and personal
property, franchise, sales, use, gross receipts and rent taxes), all charges for
any easement or agreement maintained for the benefit of any of the Leased
Premises, all assessments and levies, all permit, inspection and license fees,
all rents and charges for water, sewer, utility and communication services
relating to any of the Leased Premises, all ground rents and all other public
charges whether of a like or different nature, even if unforeseen or
extraordinary, imposed upon or assessed against (i) Tenant’s possessory interest
in the Leased Premises, (ii) any of the Leased Premises or (iii) Landlord as a
result of or arising in respect of the acquisition, ownership, occupancy,
leasing, use, possession or sale of any of the Leased Premises, any activity
conducted on any of the Leased Premises, or the Rent (collectively, the
“Impositions”); provided, that nothing herein shall obligate Tenant to pay
(A) income, excess profits or other taxes of Landlord (or Lender) which are
determined on the basis of Landlord’s (or Lender’s) net income or net worth
(unless such taxes are in lieu of or a substitute for any other tax, assessment
or other charge upon or with respect to the Leased Premises which, if it were in
effect, would be payable by Tenant under the provisions hereof or by the terms
of such tax, assessment or other charge), (B) any estate, inheritance,
succession, gift or similar tax imposed on Landlord, (C) any capital gains tax
imposed on Landlord in connection with the sale of the Leased Premises to any
Person, or (D) any transfer tax payable upon a transfer of a Related Premises
(or any interest therein or any direct or indirect interest in Landlord) to any
Person.  Landlord shall have the right to require Tenant to pay, together with
scheduled installments of Basic Rent, the amount of the gross receipts or rent
tax, if any, payable with respect to the amount of such installment of Basic
Rent.  If any Imposition may be paid in installments without interest or
penalty, Tenant shall have the option to pay such Imposition in installments; in
such event, Tenant shall be liable only for those installments which accrue or
become due and payable during the Term.  Tenant shall be responsible to obtain
all bills for the payment of Impositions and shall prepare and file all tax
reports required by governmental authorities which relate to the Impositions. 
Tenant shall deliver to Landlord (1) copies of all settlements and notices
pertaining to the Impositions which may be issued by any governmental authority
within ten (10) days after Tenant’s receipt thereof, (2) receipts for payment of
all real estate taxes required to be paid by Tenant hereunder within thirty (30)
days after the due date thereof and (3) receipts for payment of all other
Impositions within ten (10) days after Landlord’s request therefor.

 

(b)                                 Following the occurrence of an Event of
Default, or if Landlord is required by a Lender, Tenant shall pay to Landlord
such amounts (each an “Escrow Payment”) monthly or as required by such Lender
(but not more often than monthly) so that there shall be in an escrow account an
amount sufficient to pay the Escrow Charges (as hereinafter defined) as they
become due.  As used herein, “Escrow Charges” shall mean real estate taxes and
assessments on or with respect to the Leased Premises or payments in lieu
thereof and premiums on any insurance required by this Lease; provided, however,
that if any such insurance is provided by an blanket policy covering the Leased
Premises and other premises occupied by Tenant or its Affiliates, then the
insurance premiums with respect to such insurance shall be excluded from the
calculation of Escrow Charges so long as no Event of Default exists.  Landlord
shall in good faith determine the amount of the Escrow Charges (it being agreed
that if required by a Lender, such amount shall equal any corresponding escrow
installments required to

 

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be paid by Landlord) and the amount of each Escrow Payment.  The Escrow Payments
may be commingled with other funds of Landlord or other Persons and no interest
thereon shall be due or payable to Tenant.  Landlord shall apply the Escrow
Payments to the payment of the Escrow Charges in such order or priority as
Landlord shall determine or as required by Law.  If at any time the Escrow
Payments theretofore paid to Landlord shall be insufficient for the payment of
the Escrow Charges, Tenant, within ten (10) days after Landlord’s demand
therefor, shall pay the amount of the deficiency to Landlord.

 

10.                               Compliance with Laws and Easement Agreements;
Environmental Matters.

 

(a)                                 Tenant shall, at its expense, comply with
and conform to, and cause the Leased Premises and any other Person occupying any
part of the Leased Premises to comply with and conform to, all Insurance
Requirements, Easement Agreements, and Legal Requirements (including all
applicable Environmental Laws).  Tenant shall not at any time (i) cause, permit
or suffer to occur any Environmental Violation or (ii) permit any sublessee,
assignee or other Person occupying the Leased Premises under or through Tenant
to cause, permit or suffer to occur any Environmental Violation and, at the
request of Landlord or Lender, Tenant shall promptly remediate or undertake any
other appropriate response action to correct any existing Environmental
Violation, however immaterial, and (iii) without the prior written consent of
Landlord and Lender, permit any drilling or exploration for or extraction,
removal, or production of any minerals from the surface or the subsurface of the
Land, regardless of the depth thereof or the method of mining or extraction
thereof.  Any and all reports prepared for or by Landlord with respect to the
Leased Premises shall be for the sole benefit of Landlord and Lender and no
other Person shall have the right to rely on any such reports.

 

(b)                                 Tenant, at its sole cost and expense, will
at all times promptly and faithfully abide by, discharge and perform all of the
covenants, conditions and agreements contained in any Easement Agreement on the
part of Landlord or the occupier to be kept and performed thereunder.  Tenant
will not alter, modify, amend or terminate any Easement Agreement, give any
consent or approval thereunder, or enter into any new Easement Agreement
without, in each case, the prior written consent of Landlord, such consent not
to be unreasonably withheld or delayed.  Promptly upon request, Tenant shall
execute any agreement as may reasonably be required with respect to the
modification, amendment, replacement, or termination of any Easement Agreement,
or the entering into of a new Easement Agreement, with respect to any Related
Premises.

 

(c)                                  Upon reasonable prior written notice from
Landlord, Tenant shall permit such persons as Landlord may designate (“Site
Reviewers”) to visit the Leased Premises during normal business hours and in a
manner which does not unreasonably interfere with Tenant’s operations and
perform and conduct, as agents of Tenant, environmental site investigations and
assessments (“Site Assessments”) on the Leased Premises in any of the following
circumstances:  (i) in connection with any sale, financing or refinancing of the
Leased Premises, (ii) within the six month period prior to the expiration of the
Term, (iii) if required by Lender or the terms of any credit facility to which
Landlord is bound, (iv) if an Event of Default exists, or (v) at any other time
that, in the opinion of Landlord or Lender, a reasonable basis exists to believe
that an Environmental Violation or any condition that could reasonably be
expected to result in any Environmental Violation exists.  Such Site Assessments
may include both above and below the

 

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ground testing for Environmental Violations and such other tests as may be
necessary, in the reasonable opinion of the Site Reviewers, to conduct the Site
Assessments.  Tenant shall supply to the Site Reviewers such historical and
operational information regarding the Leased Premises as may be reasonably
requested by the Site Reviewers to facilitate the Site Assessments, and shall
make available for meetings with the Site Reviewers appropriate personnel having
knowledge of such matters.  The cost of performing and reporting any Site
Assessments shall be paid by Tenant, if such Site Assessment shall disclose an
Environmental Violation; otherwise the cost shall be paid by Landlord and shall
not be Additional Rent.

 

(d)                                 If an Environmental Violation occurs or is
found to exist and, in Landlord’s reasonable judgment, the cost of remediation
of, or other response action with respect to, the same is likely to exceed
$250,000, Tenant shall provide to Landlord, within thirty (30) days after
Landlord’s request therefor, adequate financial assurances that Tenant will
effect such remediation in accordance with applicable Environmental Laws.  Such
financial assurances shall be a bond or letter of credit reasonably satisfactory
to Landlord in form and substance and in an amount equal to or greater than
Landlord’s reasonable estimate, based upon a Site Assessment performed pursuant
to Paragraph 10(c), of the anticipated cost of such remedial action (but taking
into account any security, escrow or other financial assurances that Tenant may
be required to provide to any governmental entity or other Person in connection
with such remediation).  Such bond or letter of credit shall be reduced from
time to time in proportion to the amount of the remediation work which has been
completed.

 

(e)                                  Notwithstanding any other provision of this
Lease, if an Environmental Violation occurs or is found to exist and the Term
would otherwise terminate or expire, then, at the option of Landlord, the Term
shall be automatically extended beyond the date of termination or expiration and
this Lease shall remain in full force and effect beyond such date until the
earlier to occur of (i) the completion of all remedial action in accordance with
applicable Environmental Laws or (ii) the date specified in a written notice
from Landlord to Tenant terminating this Lease.

 

(f)                                   If Tenant fails to comply with any
requirement of any Environmental Law in connection with any Environmental
Violation which occurs or is found to exist, Landlord shall have the right (but
no obligation) after ten (10) days’ prior written notice to Tenant, to take any
and all actions as Landlord shall deem reasonably necessary or advisable in
order to cure such Environmental Violation.

 

(g)                                  Tenant shall notify Landlord promptly after
becoming aware of any Environmental Violation (or alleged Environmental
Violation) or noncompliance with any of the covenants contained in this
Paragraph 10 and shall forward to Landlord promptly upon receipt thereof copies
of all orders, reports, notices, permits, applications or other communications
relating to any such violation or noncompliance.

 

(h)                                 All future leases, subleases or concession
agreements relating to the Leased Premises entered into by Tenant shall contain
covenants of the other party thereto which are substantially identical to the
covenants contained in clauses (a), (c), (d), (e) and (f) of this Paragraph 10.

 

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11.                               Liens; Recording.

 

(a)                                 Tenant shall not, directly or indirectly,
create or permit to be created or to remain and shall promptly discharge or
remove any lien, levy or encumbrance on any of the Leased Premises or on any
Rent or any other sums payable by Tenant under this Lease, other than any
Mortgage or Assignment, the Permitted Encumbrances and any mortgage, lien,
encumbrance or other charge created by or resulting solely from any act or
omission of Landlord.  NOTICE IS HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE
FOR ANY LABOR, SERVICES OR MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT OR
TO ANYONE HOLDING OR OCCUPYING ANY OF THE LEASED PREMISES THROUGH OR UNDER
TENANT, AND THAT NO MECHANICS’ OR OTHER LIENS FOR ANY SUCH LABOR, SERVICES OR
MATERIALS SHALL ATTACH TO OR AFFECT THE INTEREST OF LANDLORD IN AND TO ANY OF
THE LEASED PREMISES.  LANDLORD MAY AT ANY TIME POST ANY NOTICES ON THE LEASED
PREMISES REGARDING SUCH NON-LIABILITY OF LANDLORD.

 

(b)                                 Tenant shall execute, deliver and record,
file or register (collectively, “record”) all such instruments as may be
required or permitted by any present or future Law in order to evidence the
respective interests of Landlord and Tenant in any of the Leased Premises, and
shall cause a memorandum of this Lease (or, if such a memorandum cannot be
recorded, this Lease), and any supplement hereto or thereto, to be recorded in
such manner and in such places as may be required or permitted by any present or
future Law in order to protect the validity and priority of this Lease.

 

12.                               Maintenance and Repair.

 

(a)                                 Tenant shall at all times maintain each
Related Premises in as good repair and appearance as each is in on the date
hereof and fit to be used for their intended use in accordance with the better
of the practices generally recognized as then acceptable by other companies in
its industry or observed by Tenant with respect to similar properties in
comparable retail environments that are owned or operated by it, and, in the
case of the Equipment, in as good mechanical condition as it was on the later of
the date hereof or the date of its installation, except for ordinary wear and
tear.  Tenant shall take every other action necessary or appropriate for the
preservation and safety of each Related Premises.  Tenant shall promptly make
all Alterations of every kind and nature, whether foreseen or unforeseen, which
may be required to comply with the foregoing requirements of this
Paragraph 12(a).  Landlord shall not be required to make any Alteration, whether
foreseen or unforeseen, or to maintain any Related Premises in any way, and
Tenant hereby expressly waives any right which may be provided for in any Law
now or hereafter in effect to make Alterations at the expense of Landlord or to
require Landlord to make Alterations.  Any Alteration made by Tenant pursuant to
this Paragraph 12 shall be made in conformity with the provisions of
Paragraph 13.

 

(b)                                 If any Improvement, now or hereafter
constructed, shall (i) encroach upon any setback or any property, street or
right-of-way adjoining any Related Premises, (ii) violate the provisions of any
restrictive covenant affecting any Related Premises, (iii) hinder or obstruct
any easement or right-of-way to which any Related Premises is subject or
(iv) impair the rights of others in, to or under any of the foregoing, Tenant
shall, promptly after receiving notice or

 

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otherwise acquiring knowledge thereof, either (A) obtain from all necessary
parties waivers or settlements of all claims, liabilities and damages resulting
from each such encroachment, violation, hindrance, obstruction or impairment,
whether the same shall affect Landlord, Tenant or both, or (B) take such action
as shall be reasonably necessary to remove all such encroachments, hindrances or
obstructions and to end all such violations or impairments, including, if
necessary, making Alterations.

 

13.                               Alterations and Improvements.

 

(a)                                 Tenant shall have the right, without having
obtained the prior written consent of Landlord or Lender,  (i) to make
non-structural Alterations or a series of related non-structural Alterations
that, as to any such Alterations or series of related Alterations, do not cost
in excess of $500,000 (as adjusted in accordance with the terms and conditions
set forth below in this Paragraph 13(a)) with respect to any Related Premises
and (ii) to install Equipment in the Improvements or accessions to the Equipment
that, as to such Equipment or accessions, do not cost in excess of $500,000 (as
adjusted in accordance with the terms and conditions set forth below in this
Paragraph 13(a)), so long as at the time of construction or installation of any
such Equipment or Alterations no Event of Default exists and the value and
utility of the Leased Premises is not diminished thereby.  If the cost of any
non-structural Alterations, series of related non-structural Alterations,
Equipment or accessions thereto is in excess of $500,000 (as adjusted in
accordance with the terms and conditions set forth below in this Paragraph
13(a)) or if Tenant desires to make structural Alterations to any Related
Premises, the prior written approval of Landlord and Lender shall be required,
such approval not to be unreasonably withheld or delayed.  Tenant shall not
construct upon the Land any additional buildings without having first obtained
the prior written consent of Landlord and Lender, which approval shall not be
unreasonably withheld or delayed.  For the purposes of this Paragraph, a
structural Alteration means an Alteration that materially alters the structural
components of the Improvements or materially adversely affects the structural
integrity of the Improvements.  The $500,000 amount above provided shall be
adjusted in proportion to the CPI adjustment of Basic Rent as provided in
Section 2 of Exhibit D.

 

(b)                                 If Tenant makes any Alterations pursuant to
this Paragraph 13 or as required by Paragraph 12 or 17 (such Alterations and
actions being hereinafter collectively referred to as “Work”), then (i) the
market value of the Leased Premises shall not be lessened by any such Work or
its usefulness impaired, (ii) all such Work shall be performed by Tenant in a
good and workmanlike manner, (iii) all such Work shall be expeditiously
completed in compliance with all Legal Requirements, (iv) all such Work shall
comply with the requirements of all insurance policies required to be maintained
by Tenant hereunder, (v) if any such Work involves the replacement of Equipment
or parts thereto, all replacement Equipment or parts shall have a value and
useful life equal to the greater of (A) the value and useful life on the date
hereof of the Equipment being replaced or (B) the value and useful life of the
Equipment being replaced immediately prior to the occurrence of the event which
required its replacement (assuming such replaced Equipment was then in the
condition required by this Lease), (vi) Tenant shall promptly discharge or
remove all liens filed against any of the Leased Premises arising out of such
Work, (vii) Tenant shall procure and pay for all permits and licenses required
in connection with any such Work, (viii) all such Work shall be the property of
Landlord and shall be subject to this Lease, and Tenant shall execute and
deliver to Landlord any document requested by Landlord

 

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evidencing the assignment to Landlord of all estate, right, title and interest
(other than the leasehold estate created hereby) of Tenant or any other Person
thereto or therein, and (ix) Tenant shall comply, to the extent reasonably
requested by Landlord or required by this Lease, whether or not such Work
involves restoration of any Related Premises, (1) with the provisions of
Paragraph 12(a) and (2) in the case of Alterations which require Landlord’s
consent, with the provisions of Paragraph 19(a), as if a disbursement of
restoration funds was being requested.

 

14.                               Permitted Contests.

 

Notwithstanding any other provision of this Lease, Tenant shall not be required
to (a) pay any Imposition, (b) comply with any Legal Requirement, (c) discharge
or remove any lien referred to in Paragraph 11 or 13 or (d) take any action with
respect to any encroachment, violation, hindrance, obstruction or impairment
referred to in Paragraph 12(b) (such non-compliance with the terms hereof being
hereinafter referred to collectively as “Permitted Violations”) and may dispute
or contest the same, so long as at the time of such non-compliance no Event of
Default exists and so long as Tenant shall contest, in good faith, the
existence, amount or validity thereof, the amount of the damages caused thereby,
or the extent of its or Landlord’s liability therefor by appropriate proceedings
which shall operate during the pendency thereof to prevent or stay (i) the
collection of, or other realization upon, the Permitted Violation so contested,
other than the payment of any monetary sum claimed due with respect to such
Permitted Violation, (which for the avoidance of doubt Tenant shall pay (or,
“bond over” with respect to mechanics’ liens) if required, ) (ii) the sale,
forfeiture or loss of any Related Premises or any Rent to satisfy or to pay any
damages caused by any Permitted Violation, (iii) any interference with the use
or occupancy of any of the Leased Premises, (iv) any interference with the
payment of any Rent, (v) the cancellation or increase in the rate of any
insurance policy or a statement by the carrier that coverage will be denied or
(vi) the enforcement or execution of any injunction, order or Legal Requirement
with respect to the Permitted Violation. Tenant shall provide Landlord security
which is satisfactory, in Landlord’s reasonable judgment, to assure that such
Permitted Violation is corrected, including all Costs, interest and penalties
that may be incurred or become due in connection therewith, taking into account
any security which Tenant is obligated to provide to any governmental authority
or other Person in connection with such contest.  While any proceedings which
comply with the requirements of this Paragraph 14 are pending and the required
security is held by Landlord, Landlord shall not have the right to correct any
Permitted Violation thereby being contested unless Landlord is required by Law
to correct such Permitted Violation and Tenant’s contest does not prevent or
stay such requirement as to Landlord.  Each such contest shall be promptly and
diligently prosecuted by Tenant to a final conclusion, except that Tenant, so
long as the conditions of this Paragraph 14 are at all times complied with, has
the right to attempt to settle or compromise such contest through negotiations. 
Tenant shall pay any and all losses, judgments, decrees and Costs in connection
with any such contest and shall, promptly after the final determination of such
contest, fully pay and discharge the amounts which shall be levied, assessed,
charged or imposed or be determined to be payable therein or in connection
therewith, together with all penalties, fines, interest and Costs thereof or in
connection therewith, and perform all acts the performance of which shall be
ordered or decreed as a result thereof.  No such contest shall subject Landlord
to the risk of any civil or criminal liability.

 

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15.                               Indemnification.

 

(a)                                 Tenant shall pay, protect, indemnify,
defend, save and hold harmless Landlord, Lender and all other Persons described
in Paragraph 30 (each an “Indemnitee”) from and against any and all liabilities,
losses, damages (including punitive damages, but only if such punitive damages
are assessed against an Indemnitee in connection with a claim brought against
such Indemnitee by a third party), penalties, Costs (including attorneys’ fees
and costs), causes of action, suits, claims, demands or judgments of any nature
whatsoever, howsoever caused, without regard to the form of action and whether
based on strict liability, gross negligence, negligence or any other theory of
recovery at law or in equity (each, a “Loss”), arising from (i) any matter
pertaining to the acquisition (or the negotiations leading thereto), ownership,
leasing, use, non-use, occupancy, operation, management, condition, design,
construction, maintenance, repair or restoration of any of the Leased Premises,
(ii) any casualty in any manner arising from any of the Leased Premises, whether
or not Indemnitee has or should have knowledge or notice of any defect or
condition causing or contributing to said casualty, (iii) any violation by
Tenant of any provision of this Lease, any contract or agreement to which Tenant
is a party, any Legal Requirement or any Permitted Encumbrance or any
encumbrance Tenant consented to (other than a Mortgage or Assignment) or
(iv) any alleged, threatened or actual Environmental Violation, including
(A) liability for response costs and for costs of removal and remedial action
incurred by the United States Government, any state or local governmental unit
or any other Person, or damages from injury to or destruction or loss of natural
resources, including the reasonable costs of assessing such injury, destruction
or loss, incurred pursuant to Section 107 of CERCLA, or any successor section or
act or provision of any similar state or local Law, (B) liability for costs and
expenses of abatement, correction or clean-up, fines, damages, response costs or
penalties which arise from the provisions of any of the other Environmental Laws
and (C) liability for personal injury or property damage arising under any
statutory or common-law tort theory, including damages assessed for the
maintenance of a public or private nuisance or for carrying on of a dangerous
activity. Notwithstanding the foregoing, Tenant shall have no responsibility
under this paragraph for any Loss resulting from the gross negligence or willful
misconduct of an Indemnitee, including any Claim for damage to property or
injury to persons resulting from acts of Landlord or its agents during their
actual entry upon the Leased Premises; provided that the foregoing shall not
apply to the extent the applicable Claim is an alleged or claimed omission on
the part of Landlord or its agents based upon the absence of Landlord or its
agents from the Leased Premises or their absence of any knowledge of any
condition thereon.

 

(b)                                 In case any action or proceeding is brought
against any Indemnitee by reason of any such claim, (i) Tenant may, except in
the event of a conflict of interest or a dispute between Tenant and any such
Indemnitee or during the continuance of an Event of Default, retain its own
counsel and defend such action (it being understood that Landlord may employ
counsel of its choice to monitor the defense of any such action, the cost of
which shall be paid by Landlord) and (ii) such Indemnitee shall notify Tenant to
resist or defend such action or proceeding by retaining counsel reasonably
satisfactory to such Indemnitee, and such Indemnitee will cooperate and assist
in the defense of such action or proceeding if reasonably requested to do so by
Tenant.  In the event of a conflict of interest or dispute or during the
continuance of an Event of Default, Landlord shall have the right to select
separate counsel, and the cost of such separate counsel shall be paid by Tenant.

 

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(c)                                  The obligations of Tenant under this
Paragraph 15 shall survive any termination, expiration or rejection in
bankruptcy of this Lease.

 

16.                               Insurance.

 

(a)                                 Tenant shall obtain, pay for and maintain
the following insurance on or in connection with the Leased Premises:

 

(i)                                     Insurance against all risk of physical
loss or damage to the Improvements and Equipment as provided under “Special
Causes of Loss” form coverage, and including customarily excluded perils of
hail, windstorm, flood coverage, earthquake and, to the extent reasonably
required by Lender and required pursuant to clause (vii) below, terrorism
insurance, in amounts not less than the actual replacement cost of the
Improvements and Equipment; provided that, if Tenant’s insurance company is
unable or unwilling to include any of all of such excluded perils, Tenant shall
have the option of purchasing coverage against such perils from another insurer
on a “Difference in Conditions” form or through a stand-alone policy.  Such
policies shall contain Replacement Cost and Agreed Amount Endorsements and “Law
and Ordinance” coverage (at full replacement cost).  Such policies and
endorsements shall contain deductibles not more than $100,000 per occurrence.

 

(ii)                                  Commercial General Liability Insurance and
Business Automobile Liability Insurance (including Non-Owned and Hired
Automobile Liability) against claims for personal and bodily injury, death or
property damage occurring on, in or as a result of the use of the Leased
Premises, in an amount not less than $15,000,000 per occurrence/annual
aggregate, with no self-insured retention or deductible, on a claims occurrence
basis.

 

(iii)                               Workers’ compensation insurance in the
amount required by applicable Law and employers’ liability insurance covering
all persons employed by Tenant in connection with any work done on or about any
of the Leased Premises.

 

(iv)                              Comprehensive Boiler and Machinery/Equipment
Breakdown Insurance on any of the Equipment or any other equipment on or in the
Leased Premises, in an amount not less than $5,000,000 per accident for damage
to property (and which may be carried as part of the coverage required under
clause (i) above or pursuant to a separate policy or endorsement).  Either such
Boiler and Machinery policy or the Special Causes of Loss policy required in
clause (i) above shall include at least $1,000,000 per incidence for
Off-Premises Service Interruption, Expediting Expenses, Ammonia Contamination,
and Hazardous Materials Clean-Up Expense and may contain a deductible not to
exceed $100,000.

 

(v)                                 Business Income/Extra Expense Insurance at
limits sufficient to cover 100% of the period of indemnity not less than
twelve (12) months from time of loss, including extended period of indemnity
which provides that after the physical loss to the Improvements and Equipment
has been repaired, the continued loss of income will be insured until such
income either returns to the same level it was at prior to the loss, or the
expiration of six (6) months from the date that the applicable Related Premises
is repaired or replaced and operations are resumed, whichever first occurs.

 

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(vi)                              During any period in which substantial
Alterations at the Leased Premises are being undertaken, builder’s risk
insurance covering the total completed value, including all hard and soft costs
(which shall include business interruption coverage) with respect to the
Improvements being constructed, altered or repaired (on a completed value,
non-reporting basis), replacement cost of work performed and equipment, supplies
and materials furnished in connection with such construction, alteration or
repair of Improvements or Equipment, together with such other endorsements as
Landlord may reasonably require, and general liability, worker’s compensation
and automobile liability insurance with respect to the Improvements being
constructed, altered or repaired.  Such builder’s risk insurance may be obtained
by the contractor performing such Alterations in lieu of Tenant.

 

(vii)                           Such other insurance (or other or different
terms with respect to any insurance required pursuant to this Paragraph 16,
including without limitation amounts of coverage, deductibles, form of mortgagee
clause, insurer rating) on or in connection with any of the Leased Premises as
Landlord or Lender may reasonably require, provided that such insurance is
customarily obtained by tenants of properties similar in size, location and use
to the Leased Premises, other than mold insurance.  In addition, with respect to
the insurance coverages required to be maintained pursuant to
clauses (i) through (vi) of this Paragraph 16(a), Tenant shall use commercially
reasonable efforts, consistent with those of prudent owners of institutional
quality commercial real estate, and to the extent available under TRIA, to
maintain insurance coverage against any loss, damage or injury resulting from
acts of terrorism.

 

(b)                                 The insurance required by
Paragraph 16(a) shall be written by companies having a Best’s rating of A:VII or
above.  The insurance policies shall be in amounts sufficient at all times to
satisfy any coinsurance requirements thereof. If said insurance or any part
thereof shall expire, be withdrawn, or become void, for any reason, including a
breach of any condition thereof by Tenant or the failure or impairment of the
capital of any insurer, Tenant shall immediately obtain new or additional
insurance reasonably satisfactory to Landlord.  The insurance referred to in
Paragraphs 16(a)(i), 16(a)(iv) and 16(a)(vi) shall name Landlord and Lender as
loss payee as its interest may appear and Lender as mortgagee.  The insurance
referred to in Paragraph 16(a)(ii) shall name Landlord and Lender as additional
insureds, and the insurance referred to in Paragraph 16(a)(v) shall name
Landlord as insured and Lender and Landlord as loss payee as its interest may
appear.

 

(c)                                  Each insurance policy referred to in
clauses (i), (iv), (v) and (vi) of Paragraph 16(a) shall contain standard
non-contributory mortgagee clauses in favor of and acceptable to Lender.  Each
policy required by any provision of Paragraph 16(a), except
clause (iii) thereof, shall provide that it may not be cancelled, substantially
modified or allowed to lapse on any renewal date except after at least
thirty (30) days’ prior written notice to Landlord and Lender.

 

(d)                                 Tenant shall pay as they become due all
premiums for the insurance required by Paragraph 16(a), shall renew or replace
each policy and deliver to Landlord evidence of the payment of the full premium
therefor or installment then due at least ten (10) days prior to the expiration
date of such policy, and shall promptly deliver to Landlord all original
certificates of insurance evidencing such coverages or, if required by Lender
and if a claim or legal proceeding is in process under a policy, the original or
a certified copy of such policy. All

 

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certificates of insurance (including liability coverage) provided to Landlord
and Lender shall be on an appropriate ACORD Form reasonably acceptable to
Landlord and Lender.

 

(e)                                  Anything in this Paragraph 16 to the
contrary notwithstanding, any insurance which Tenant is required to obtain
pursuant to Paragraph 16(a) may be carried under a “blanket” policy or policies
covering other properties of Tenant and/or its affiliates or under an “umbrella”
policy or policies covering other liabilities of Tenant and/or affiliates, as
applicable; provided that, such blanket or umbrella policy or policies otherwise
comply with the provisions of this Paragraph 16, and upon request, Tenant shall
provide to Landlord a Statement of Values which may be reviewed annually and
shall be amended to the extent reasonably determined necessary by Landlord based
on revised Replacement Cost Valuations.  The original or a certified copy of
each such blanket or umbrella policy shall promptly be delivered to Landlord
upon request.

 

(f)                                   Tenant shall not carry separate insurance
concurrent in form or contributing in the event of a Casualty with that required
in this Paragraph 16 unless (i) Landlord and Lender are included therein as
additional insureds, and/or loss payee as provided herein, and (ii) such
separate insurance complies with the other provisions of this Paragraph 16. 
Tenant shall promptly notify Landlord of such separate insurance and shall
deliver to Landlord the original policies or certified copies thereof upon
request.

 

(g)                                  Each policy shall contain an effective
waiver by the carrier against all claims for payment of insurance premiums
against Landlord and shall contain a full waiver of subrogation against the
Landlord.

 

(h)                                 The proceeds of any insurance required under
Paragraph 16(a) shall be payable as follows:

 

(i)                                     proceeds payable under clauses (ii),
(iii) and (iv) of Paragraph 16(a) and proceeds attributable to the general
liability coverage of Builder’s Risk insurance under clause (vi) of
Paragraph 16(a) shall be payable to the Person entitled to receive such
proceeds; and

 

(ii)                                  proceeds of insurance required under
clause (i) of Paragraph 16(a) and proceeds attributable to Builder’s Risk
insurance (other than its general liability coverage provisions) under
clause (vi) of Paragraph 16(a) shall be payable to Landlord or Lender and
applied as set forth in Paragraph 17 or, if applicable, Paragraph 18.  Tenant
shall apply the Net Award to restoration of the Leased Premises in accordance
with the applicable provisions of this Lease unless a Casualty/Condemnation
Termination Event shall have occurred and Tenant has given a
Casualty/Condemnation Termination Notice.

 

17.                               Casualty and Condemnation.

 

(a)                                 If any Casualty occurs to any Related
Premises, Tenant shall give Landlord and Lender immediate notice thereof. 
Landlord and Lender are hereby authorized to adjust, collect and compromise, in
their discretion and upon notice to Tenant (except that no notice to Tenant
shall be required if an Event of Default has occurred and is continuing), all
claims under any of the insurance policies required by Paragraph 16(a) (except
public liability

 

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insurance claims payable to a Person other than Tenant, Landlord or Lender) and
to execute and deliver on behalf of Tenant all necessary proofs of loss,
receipts, vouchers and releases required by the insurers.  Provided that no
Event of Default has occurred and is continuing, Tenant shall be entitled to
participate with Landlord and Lender in any adjustment, collection and
compromise of the Net Award payable in connection with a Casualty.  Tenant
agrees to sign, upon the request of Landlord or Lender, all such proofs of loss,
receipts, vouchers and releases.  If Landlord or Lender so requests, Tenant
shall adjust, collect and compromise any and all such claims, and Landlord and
Lender shall have the right to join with Tenant therein.  Any adjustment,
settlement or compromise of any such claim shall be subject to the prior written
approval of Landlord and Lender, such approval not to be unreasonably withheld
or delayed, and Landlord and Lender shall have the right to prosecute or
contest, or to require Tenant to prosecute or contest, any such claim,
adjustment, settlement or compromise.  Subject to Paragraph 19(d) below, each
insurer is hereby authorized and directed to make payment under said policies,
including return of unearned premiums, directly to Landlord or, if required by
the Mortgage, to Lender instead of to Landlord and Tenant jointly, and Tenant
hereby appoints each of Landlord and Lender as Tenant’s attorneys-in-fact to
endorse any draft therefor.  The rights of Landlord under this
Paragraph 17(a) shall be extended to Lender if and to the extent that any
Mortgage so provides.  Notwithstanding anything to the contrary set forth in
this Paragraph 17(a), so long as no Event of Default shall be continuing, Tenant
shall have the right to adjust, settle and compromise, and to execute all proofs
of loss, receipts, vouchers and releases with respect to, any and all claims
under this Paragraph 17(a), provided that Landlord and Lender shall retain the
right to join with Tenant therein; and provided further that any adjustment,
settlement or compromise of any such claim by Tenant shall be subject to the
prior written approval of Landlord and Lender, such approval not to be
unreasonably withheld or delayed.

 

(b)                                 Tenant, immediately upon receiving a
Condemnation Notice, shall notify Landlord and Lender thereof.  Landlord and
Lender are authorized to collect, settle and compromise, in their discretion
(and, if no Event of Default exists, upon notice to Tenant), the amount of any
Net Award.  Provided that no Event of Default has occurred and is continuing,
Tenant shall be entitled to participate with Landlord and Lender in any
Condemnation proceeding or negotiations under threat thereof and to contest the
Condemnation or the amount of the Net Award therefor.  No agreement with any
condemnor in settlement or under threat of any Condemnation shall be made by
Tenant without the written consent of Landlord and Lender, such approval not to
be unreasonably withheld or delayed.  Subject to the provisions of this
Paragraph 17(b) and Paragraph 19(d), Tenant hereby irrevocably assigns to
Landlord any award or payment to which Tenant is or may be entitled by reason of
any Condemnation, whether the same shall be paid or payable for Tenant’s
leasehold interest hereunder or otherwise; but nothing in this Lease shall
impair Tenant’s right to any award or payment on account of Tenant’s trade
fixtures, equipment or other tangible property which is not part of the
Equipment, moving expenses or loss of business, if available, to the extent that
and so long as (i) Tenant shall have the right to make, and does make, a
separate claim therefor against the condemnor and (ii) such claim does not in
any way reduce either the amount of the award otherwise payable to Landlord for
the Condemnation of Landlord’s fee interest in the applicable Related Premises
or the amount of the award (if any) otherwise payable for the Condemnation of
Tenant’s leasehold interest hereunder.  The rights of Landlord under this
Paragraph 17(b) shall also be extended to Lender if and to the extent that any
Mortgage so provides.  Notwithstanding anything to the contrary set forth in
this Paragraph 17(b), so long as no Event of Default shall be continuing Tenant
shall

 

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have the right to settle and compromise any and all claims under this Paragraph
17(b), provided that Landlord and Lender shall retain the right to join with
Tenant therein; and provided further that any agreement with any condemnor in
settlement or under threat of any Condemnation shall be subject to the prior
written approval of Landlord and Lender, such approval not to be unreasonably
withheld or delayed.

 

(c)                                  If any Partial Casualty (whether or not
insured against) or Partial Condemnation shall occur to any Related Premises,
this Lease shall continue with respect to the Leased Premises, notwithstanding
such event, and there shall be no abatement or reduction of any Monetary
Obligations.  Promptly after such Partial Casualty or Partial Condemnation,
Tenant, as required in Paragraphs 12(a) and 13(b), shall commence and diligently
continue to restore the Leased Premises as nearly as possible to its value,
condition and character immediately prior to such event (assuming the Leased
Premises to have been in the condition required by this Lease).  Upon the
receipt by Landlord of the entire Net Award of such Partial Casualty or Partial
Condemnation, Landlord shall make such Net Award available to Tenant for
restoration in accordance with and subject to the provisions of
Paragraph 19(a) and 19(c) (unless such Casualty or Condemnation resulting in the
Net Award is a Casualty/Condemnation Termination Event).  If any Casualty or
Condemnation which is not a Partial Casualty or Partial Condemnation shall
occur, Tenant shall comply with the terms and conditions of Paragraph 18.

 

18.                               Termination Events.

 

(a)                                 If either (i) any one of the Related
Premises shall be taken by a Taking or (ii) any substantial portion of any
Related Premises shall be taken by a Taking or all or any substantial portion of
the Related Premises shall be damaged or destroyed by a Casualty and, in such
case, Tenant certifies and covenants to Landlord that it will forever abandon
operations at such Related Premises (each of the events described in the above
clauses (i) and (ii) shall hereinafter be referred to as a
“Casualty/Condemnation Termination Event”), then (x) in the case of (i) above,
Tenant shall be obligated, within sixty (60) days after Tenant receives a
Condemnation Notice and (y) in the case of (ii) above, Tenant shall have the
option, within sixty (60) days after Tenant receives a Condemnation Notice or
sixty (60) days after the Casualty, as the case may be, to give to Landlord and
Lender written notice in the form described in Paragraph 18(b) of the Tenant’s
election to terminate this Lease with respect to such Related Premises (a
“Casualty/Condemnation Termination Notice”).  If Tenant elects under
clause (y) above not to give Landlord a Casualty/Condemnation Termination
Notice, then Tenant shall rebuild or repair such Related Premises in accordance
with Paragraphs 17 and 19.

 

(b)                                 A Casualty/Condemnation Termination Notice
shall contain (i) notice of Tenant’s intention to terminate this Lease as to the
Affected Premises on the first Basic Rent Payment Date which occurs at least
sixty (60) days after the Fair Market Value Date (the “Casualty/Condemnation
Termination Date”), (ii) a binding and irrevocable offer of Tenant to pay to
Landlord the Casualty/Condemnation Termination Amount and (iii) if the
Casualty/Condemnation Termination Event is an event described in
Paragraph 18(a)(ii), the certification and covenants described therein and a
certified resolution of the Board of Directors of Tenant authorizing the same. 
Promptly upon the delivery to Landlord of a Casualty/Condemnation Termination
Notice, Landlord and Tenant shall commence to determine the Fair Market Value.

 

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(c)                                  If Landlord shall reject such offer by
Tenant to pay to Landlord the Casualty/Condemnation Termination Amount as to the
Affected Premises pursuant to Paragraph 18(b) above by written notice to Tenant
(a “Rejection”) which Rejection shall contain the written consent of Lender to
Landlord’s rejection of Tenant’s offer to pay the Casualty/Condemnation
Termination Amount, not later than thirty (30) days following the Fair Market
Value Date, then this Lease shall terminate as to the Affected Premises on the
Casualty/Condemnation Termination Date; provided that, if Tenant has not
satisfied all Monetary Obligations and all other obligations and liabilities
under this Lease which have arisen as to the Affected Premises (collectively,
“Remaining Obligations”) on or prior to the Casualty/Condemnation Termination
Date, then Landlord may, at its option, extend the date on which this Lease may
terminate as to the Affected Premises to a date which is no later than the first
Basic Rent Payment Date after the Casualty/Condemnation Termination Date on
which Tenant has satisfied all Remaining Obligations.  Upon such termination
(i) all obligations of Tenant hereunder as to the Affected Premises shall
terminate except for any Surviving Obligations, (ii) Tenant shall immediately
vacate and shall have no further right, title or interest in or to any of the
Affected Premises and (iii) the Net Award shall be retained by Landlord. 
Notwithstanding anything to the contrary hereinabove contained, if Tenant shall
have received a Rejection and, on the date when this Lease would otherwise
terminate with respect to the Affected Premises as provided above, Landlord
shall not have received the full amount of the Net Award payable by reason of
the applicable Casualty/Condemnation Termination Event, then the date on which
this Lease is to terminate with respect to the Affected Premises shall be
automatically extended to the first Basic Rent Payment Date after the receipt by
Landlord of the full amount of the Net Award provided that, if Tenant has not
satisfied all Remaining Obligations on such date, then Landlord may, at its
option, extend the date on which this Lease may terminate as to the Affected
Premises to a date which is no later than the first Basic Rent Payment Date
after such date on which Tenant has satisfied all such Remaining Obligations.

 

(d)                                 Unless Tenant shall have received a
Rejection not later than the thirtieth (30th) day following the Fair Market
Value Date, Landlord shall be conclusively presumed to have accepted such offer
from Tenant to pay the Casualty/Condemnation Termination Amount.  If such offer
from Tenant to pay the Termination Amount is accepted by Landlord then, on the
Casualty/Condemnation Termination Date, Tenant shall pay to Landlord the
Casualty/Condemnation Termination Amount and all Remaining Obligations and, if
requested by Tenant, Landlord shall convey to Tenant or its designee the
Affected Premises or the remaining portion thereof, if any, all in accordance
with Paragraph 20 and in such event, notwithstanding anything to the contrary
contained in this Lease, the Net Award shall be paid to Tenant.

 

(e)                                  In the event of the termination of this
Lease as to the Affected Premises as hereinabove provided, this Lease shall
remain in full force and effect as to the Remaining Premises; provided, that the
Basic Rent for the Remaining Premises to be paid after such termination shall be
the Basic Rent otherwise payable hereunder with respect to the Leased Premises
multiplied by a percentage equal to the sum of the percentages set forth on
Exhibit “E” for the Remaining Premises.

 

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19.                               Restoration.

 

(a)                                 If any Net Award is in excess of $500,000,
Landlord (or Lender if required by any Mortgage) shall hold the Net Award in a
fund (the “Restoration Fund”) and disburse amounts from the Restoration Fund
only in accordance with the following conditions:

 

(i)                                     prior to commencement of restoration,
(A) the architects, contracts (including the retainage provisions contained
therein), contractors, plans and specifications and a budget for the restoration
shall have been approved by Landlord, such approval not to be unreasonably
withheld or delayed, and (B) Landlord and Lender shall be provided with
acceptable performance and payment bonds which insure satisfactory completion of
and payment for the restoration, are in an amount and form and have a surety
reasonably acceptable to Landlord, and name Landlord and Lender as additional
dual obligees, and (C) appropriate waivers of mechanics’ and materialmen’s liens
shall have been filed (to the extent permitted under applicable law);

 

(ii)                                  at the time of any disbursement, no Event
of Default shall exist and no mechanics’ or materialmen’s liens shall have been
filed against any of the Leased Premises and remain undischarged;

 

(iii)                               disbursements shall be made from time to
time in an amount not exceeding the cost of the Work completed since the last
disbursement, upon receipt of (A) satisfactory evidence, including architects’
certificates, of the stage of completion, the estimated total cost of completion
and performance of the Work to date in a good and workmanlike manner in
substantial accordance with the contracts, plans and specifications, (B) waivers
of liens for work previously paid for and/or conditional lien waivers,
(C) contractors’ and subcontractors’ sworn statements as to completed Work and
the cost thereof for which payment is requested, (D) a bringdown of title
insurance reasonably satisfactory to Landlord and (E) other evidence of cost and
payment reasonably satisfactory to Landlord so that Landlord and Lender can
verify that the amounts disbursed from time to time are represented by Work that
is completed, in place and free and clear of mechanics’ and materialmen’s lien
claims;

 

(iv)                              each request for disbursement shall be
accompanied by a certificate of Tenant, signed by the president or a vice
president of Tenant, describing the Work for which payment is requested, stating
the cost incurred in connection therewith, stating that Tenant has not
previously received payment for such Work and, upon completion of the Work, also
stating that the Work has been fully completed and complies with the applicable
requirements of this Lease;

 

(v)                                 If the Restoration Fund is held by Landlord,
the Restoration Fund shall not be commingled with Landlord’s other funds and
shall bear interest at a rate agreed to by Landlord and Tenant; and

 

(vi)                              such other reasonable conditions as Landlord
or Lender may impose.

 

(b)                                 Prior to commencement of restoration and at
any time during restoration, if the estimated cost of completing the restoration
Work free and clear of all liens, as reasonably

 

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determined by Landlord, exceeds the amount of the Net Award available for such
restoration, the amount of such excess shall, upon demand by Landlord, be paid
by Tenant to Landlord to be added to the Restoration Fund.  Any sum so added by
Tenant which remains in the Restoration Fund upon completion of restoration
shall be refunded to Tenant.  For purposes of determining the source of funds
with respect to the disposition of funds remaining after the completion of
restoration, the Net Award shall be deemed to be disbursed prior to any amount
added by Tenant.

 

(c)                                  If any sum remains in the Restoration Fund
after completion of the restoration and any refund to Tenant pursuant to
Paragraph 19(b), such sum shall be retained by Landlord or, if required by a
Note or Mortgage, paid by Landlord to a Lender.

 

(d)                                 Any Net Award not in excess of $500,000
shall be paid over to Tenant by Landlord or Lender promptly upon receipt and
shall be used by Tenant to restore the applicable Related Premises in accordance
with the provisions of Paragraph 17(c).  The $500,000 amount above provided
shall be adjusted in proportion to the CPI adjustment of Basic Rent as provided
in Section 2 of Exhibit D.

 

20.                               Procedures Upon Purchase.

 

(a)                                 If the Leased Premises or any of the Related
Premises are purchased by Tenant pursuant to any provision of this Lease,
Landlord need not convey any better title thereto than that which was conveyed
to Landlord, and Tenant or its designee shall accept such title, subject,
however, to the Permitted Encumbrances and to all other liens, exceptions and
restrictions on, against or relating to any of the Leased Premises or the
applicable Related Premises and to all applicable Laws, but free of the lien of
and security interest created by any Mortgage or Assignment and liens,
exceptions and restrictions on, against or relating to the Leased Premises or
the applicable Related Premises which have been created by or resulted solely
from acts of Landlord after the date of this Lease, unless the same are
Permitted Encumbrances or customary utility easements benefiting the Leased
Premises or were created with the concurrence of Tenant or as a result of a
default by Tenant under this Lease.

 

(b)                                 Upon the date fixed for any such purchase of
the Leased Premises or any of the Related Premises pursuant to any provision of
this Lease (any such date the “Purchase Date”), Tenant shall pay to Landlord, or
to any Person to whom Landlord directs payment, the Casualty/Condemnation
Termination Amount therefor specified herein, in Federal Funds, less any credit
of the Net Award received and retained by Landlord or a Lender allowed against
the Casualty/Condemnation Termination Amount  , and Landlord shall deliver to
Tenant (i) a special warranty deed which describes the premises being conveyed
and conveys the title thereto as provided in Paragraph 20(a), (ii) such other
instruments as shall be necessary to transfer to Tenant or its designee any
other property (or rights to any Net Award not yet received by Landlord or a
Lender) relating to the Related Premises then held by Landlord, (iii) any Net
Award received by Landlord, not credited to Tenant against the
Casualty/Condemnation Termination Amount and required to be delivered by
Landlord to Tenant pursuant to this Lease and (iv) any other instruments,
certificates, affidavits or other documents customarily provided in connection
with a transfer of real estate or required by Law, such as a title affidavit and
transfer tax forms; provided, that if any Monetary Obligations remain
outstanding on such date, then Landlord may deduct from the Net Award the amount
of such Monetary Obligations; and further

 

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provided, that if any event has occurred which, in Landlord’s reasonable
judgment, is likely to subject any Indemnitee to any liability which Tenant is
required to indemnify against pursuant to Paragraph 15, then an amount shall be
deducted from the Net Award which, in Landlord’s reasonable judgment, is
sufficient to satisfy such liability, which amount shall be deposited in an
escrow account with a financial institution reasonably satisfactory to Landlord
and Tenant pending resolution of such matter.  If on the Purchase Date any
Monetary Obligations remain outstanding and no Net Award is payable to Tenant by
Landlord or the amount of such Net Award is less than the amount of the Monetary
Obligations, then Tenant shall pay to Landlord on the Purchase Date the amount
of such Monetary Obligations.  Upon the completion of such purchase, this Lease
and all obligations and liabilities of Tenant hereunder with respect to the
applicable Related Premises (but not with respect to the Remaining Premises)
shall terminate, except any Surviving Obligations.

 

(c)                                  If the completion of such purchase shall be
delayed after (i) the Casualty/Condemnation Termination Date, in the event of a
purchase pursuant to Paragraph 18 or, (ii) the date scheduled for such purchase,
in the event of a purchase under any other provision of this Lease then (x) Rent
shall continue to be due and payable until completion of such purchase and
(y) at Landlord’s sole option, Fair Market Value shall be redetermined and the
Casualty/Condemnation Termination Amount payable by Tenant pursuant to the
applicable provision of this Lease shall be adjusted to reflect such
redetermination.

 

(d)                                 Any prepaid Monetary Obligations paid to
Landlord shall be prorated as of the Purchase Date, and the prorated unapplied
balance shall be deducted from the Casualty/Condemnation Termination Amount due
to Landlord; provided, that no apportionment of any Impositions shall be made
upon any such purchase.

 

21.                               Assignment and Subletting: Prohibition against
Leasehold Financing.

 

(a)                                 Except as otherwise expressly provided to
the contrary in this Paragraph 21, Tenant may not assign this Lease, voluntarily
or involuntarily, whether by operation of law or otherwise (including through
merger or consolidation) to any Person without the prior written consent of
Landlord, which consent may be granted or withheld by Landlord in accordance
with the provisions of Paragraphs 21(b) below, as applicable.  Any purported
sublease or assignment in violation of this Paragraph 21 shall be null and
void.  In addition, notwithstanding anything to the contrary contained in this
Paragraph 21, Tenant shall not have the right to assign this Lease (voluntarily
or involuntarily, whether by operation of law or otherwise), or sublet any of
the Leased Premises to any Person at any time that an Event of Default shall
exist.

 

(b)                                 If Tenant desires to assign this Lease,
whether by operation of law or otherwise, to a Non-Preapproved Assignee (as such
term is defined below) (each a “Non-Preapproved Assignment”) then Tenant shall,
not less than sixty (60) days prior to the date on which it desires to make a
Non-Preapproved Assignment, submit to Landlord and Lender information regarding
the following with respect to the Non-Preapproved Assignee (collectively, the
“Review Criteria”):  (A) credit, (B) capital structure, (C) management,
(D) operating history, (E) proposed use of the Leased Premises, including
whether such proposed use would violate any Easement Agreement and (F) risk
factors associated with the proposed use of the Leased

 

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Premises by the Non-Preapproved Assignee, taking into account factors such as
environmental concerns, product liability and the like.  Landlord and Lender
shall review such information and shall approve or disapprove the
Non-Preapproved Assignee no later than the thirtieth (30th) day following
receipt of all such information, and Landlord and Lender shall be deemed to have
acted reasonably in granting or withholding consent if such grant or disapproval
is based on their review of the Review Criteria applying prudent business
judgment.In addition to the foregoing, Landlord shall not unreasonably withhold,
condition, or delay its consent to any assignment (including through merger or
consolidation)  of this Lease to any Investment Grade Assignee (as such term is
defined below).

 

(c)                                  (i) Tenant shall have the right, upon not
less than thirty (30) days prior written notice to Landlord but without any
consent or approval of Landlord, to enter into one or more subleases for up to
ten percent (10%), in the aggregate, of the rentable square footage of any
Related Premises, so long as any such subleased premises is integrated into
Tenant’s retail operations; such as a sales counter located on the retail floor
of the Leased Premises (each, a “Preapproved Sublet”).  In addition, the
following subleases are deemed Preapproved Sublets: (x) the Approved Subleases,
(y) subject to the notice requirements set forth above in this paragraph (c),
any future sublease to a Subsidiary of BONT, and (z) the Existing Subleases; but
however, conditioned upon (1) such existing sublessees and/or licensees
acknowledging that any such existing sublease and/or license is subordinate to
this Lease and (2) to the extent that any Existing Sublease also satisfies the
express definition of a Preapproved Sublet (as opposed to being deemed a
Preapproved Sublet), the square footage allocated to such existing sublease
and/or license being subject to the 10% cap described above.  Other than
pursuant to Preapproved Sublets, at no time during the Term shall subleases
exist without the prior written consent of Landlord, which consent shall be
granted or withheld based on a review of the Review Criteria as they relate to
the proposed sublessee and the terms of the proposed sublease.  Landlord and
Lender shall be deemed to have acted reasonably in granting or withholding
consent if such grant or disapproval is based on their reasonable review of the
Review Criteria.

 

(ii)                                  In addition to the Preapproved Sublets
described above, but still subject to Paragraph 21(d) below, Tenant shall have
the right, with respect to not more than two (2) Related Premises and upon not
less than thirty (30) days prior written notice to Landlord but without any
consent or approval of Landlord or Lender, to enter into an Acceptable Sublease
with an Acceptable Subtenant.  For purposes of this Paragraph 21(c)(ii), the
following definitions shall apply:

 

(a)                                 “Acceptable Sublease” shall mean a sublease
of any entire Related Premises by an Acceptable Subtenant at market rents and
with other market terms and which sublease would not violate or cause the
violation of the terms of any applicable Easement Agreement, including any
operating covenants therein.

 

(b)                                 “Acceptable Subtenant” shall mean a tenant
which operates at least ten (10) retail operations in the United States
(exclusive of the Related Premises) consisting of at least 1,000,000 square feet
in the aggregate.

 

(d)                                 If Tenant assigns all its rights and
interest under this Lease, the assignee under such assignment shall expressly
assume all the obligations of Tenant hereunder, actual or

 

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contingent, including obligations of Tenant which may have arisen on or prior to
the date of such assignment, by a written instrument delivered to Landlord at
the time of such assignment.  Each sublease of any of the Leased Premises shall
(A)  be expressly subject and subordinate to this Lease and any Mortgage
encumbering the Leased Premises; (B) not extend beyond the then current Term
minus one day (unless the Term is extended, in which event such sublease may be
extended); (C) terminate upon any termination of this Lease, unless Landlord
elects in writing, to cause the sublessee to attorn to and recognize Landlord as
the lessor under such sublease, whereupon such sublease shall continue as a
direct lease between the sublessee and Landlord upon all the terms and
conditions of such sublease; and (D) bind the sublessee to all covenants
contained in Paragraph 4(a), 10 and 12 with respect to subleased premises to the
same extent as if the sublessee were the Tenant.  In addition, any sublease or
assignment under this Lease Agreement, and the use of the Leased Premises by any
such sublessee or assignee thereunder, shall not violate any Easement Agreement,
including but not limited to causing any operating covenant therein to be
violated.  Notwithstanding anything to the contrary set forth in this Paragraph
21, Tenant may assign this Lease to a Preapproved Assignee (as such term is
defined below) so long as the proposed use by such assignee does not violate any
of the Easement Agreements. Upon any assignment (i) to a Person that immediately
following such assignment has a publicly traded unsecured senior debt rating of
“A” or better from Moody’s Investors Services, Inc. or a rating of “A” or better
from Standard & Poor’s Corporation, and in the event all of such rating agencies
cease to furnish such ratings, then a comparable rating by any rating agency
(“Replacement Agency”) reasonably acceptable to Landlord and Lender, (a
“Preapproved Assignee”) or (ii) any assignment to a Person that is not a
Preapproved Assignee (such Person being a “Non-Preapproved Assignee”) that is
consented to by Landlord and Lender and that, immediately following such
assignment has a publicly traded unsecured senior debt rating of “Baa” or better
from Moody’s Investors Services, Inc. or a rating “BBB” from Standard & Poor’s
Corporation, or a Replacement Agency (such Person, an “Investment Grade
Assignee”), Tenant shall be released from all of its obligations hereunder which
arise after the date of such assignment, except for Surviving Obligations.  No
other assignment and no sublease shall affect or reduce any of the obligations
of Tenant hereunder or of the Guarantor under the Guaranty, and all such
obligations of Tenant and Guarantor shall continue in full force and effect as
obligations of a principal and not as obligations of a guarantor, as if no
assignment or sublease had been made.  No assignment or sublease shall impose
any additional obligations on Landlord under this Lease.

 

(e)                                  Notwithstanding any provision in this
Paragraph 21 or elsewhere in this Lease to the contrary, including any right or
option Tenant may have to assign this Lease or sublease all or any portion of
the Leased Premises without Landlord’s consent, Tenant shall, upon the request
of Landlord, provide and cause such assignee or sublessee to provide, such
information (including, without limitation, any certification) as to any
proposed assignee or sublessee and its principals as may be required for
Landlord and Tenant to comply with regulations administered by the Office of
Foreign Asset Control (“OFAC”) of the Department of the Treasury, codified at 31
C.F.R. Part 500 (including those named on OFAC’s Specially Designated and
Blocked Persons list) or under any statute, executive order (including 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 regarding persons or entities with whom U.S.
persons or entities are restricted from doing

 

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business (including persons or entities who have violated the U.S. Foreign
Corrupt Practices Act 15 U.S.C. §§78dd-1, 78dd-2 and 78dd-3).

 

(f)                                   Tenant shall, within ten (10) days after
the execution and delivery of any assignment or sublease, deliver a duplicate
original copy thereof to Landlord which, in the event of an assignment, shall be
in recordable form.  With respect to any assignment to any Preapproved Assignee
or any Preapproved Sublet, at least thirty (30) days prior to the effective date
of such assignment or sublease, Tenant shall provide to Landlord information
reasonably required by Landlord to establish that the Person involved in any
such proposed assignment or sublet satisfies (or will, as of the effective date
of such assignment or subletting, satisfy) the criteria set forth in this Lease
for a Preapproved Assignment or Preapproved Sublet.

 

(g)                                  As security for performance of its
obligations under this Lease, Tenant hereby grants, conveys and assigns to
Landlord all right, title and interest of Tenant in and to all subleases now in
existence or hereafter entered into for any or all of the Leased Premises, any
and all extensions, modifications and renewals thereof and all rents, issues and
profits therefrom.  Landlord hereby grants to Tenant a license to collect and
enjoy all rents and other sums of money payable under any sublease of any of the
Leased Premises; provided, however, that if an Event of Default shall exist,
Landlord shall have the absolute right, upon notice to Tenant and any
subtenants, to revoke said license and to collect such rents and sums of money
and to retain the same.  Any amounts collected shall be applied to Rent payments
next due and owing to Landlord.  Tenant shall not consent to, cause or allow any
modification or alteration of, any of the monetary or material non-monetary
terms, conditions or covenants of any of the subleases or the termination
thereof (except in the event of a default by the subtenant thereunder), without
the prior written approval of Landlord, which approval shall not be unreasonably
withheld, nor shall Tenant accept any rents more than thirty (30) days in
advance of the accrual thereof.

 

(h)                                 Tenant shall not have the power to mortgage,
pledge or otherwise encumber its interest under this Lease or any sublease of
the Leased Premises, and any such mortgage, pledge or encumbrance made in
violation of this Paragraph 21 shall be void and of no force and effect.

 

(i)                                     Subject to the provisions of
Paragraph 36 hereof (Tenant’s right of first offer), Landlord may sell or
transfer all of the Leased Premises at any time without Tenant’s consent to any
third party (each a “Third Party Purchaser”) other than to a Tenant Competitor. 
In the event of any such transfer, Tenant shall attorn to any Third Party
Purchaser as Landlord so long as such Third Party Purchaser and Landlord notify
Tenant in writing of such transfer.  At the request of Landlord, Tenant will
execute such documents confirming the agreement referred to above and such other
agreements as Landlord may reasonably request, provided that such agreements do
not increase the liabilities and obligations of Tenant hereunder. For purposes
of this Paragraph 21(i), a “Tenant Competitor” shall mean any Person whose
business includes the operation of one or more traditional retail department
stores (or stores with departments similar to Tenant) in a state in which BONT
or any Subsidiary of BONT operates a retail department store.  Notwithstanding
anything to the contrary set forth in this paragraph (i), Tenant’s consent shall
not be required (x) if an Event of Default shall be continuing under this Lease
or (y) in connection with (A) any sale of the Leased Premises pursuant to a
private power of sale under or judicial foreclosure of any Mortgage or other
security instrument or device to which Landlord’s

 

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interest in the Leased Premises is now or hereafter subject, (B) any transfer of
Landlord’s interest in the Leased Premises to a Lender, beneficiary under deed
of trust or other hold of a security interest therein or their designees by deed
in lieu of foreclosure, or (C) any transfer that occurs after any occurrence
described in (A) or (B) of the foregoing.

 

(j)                                    [Intentionally Omitted].

 

(k)                                 Tenant shall not in a single transaction of
series of related transactions, sell or convey, transfer, abandon or lease all
or substantially all of its assets (an “Asset Transfer”) to any Person, and any
such Asset Transfer shall be deemed an assignment in violation of this Lease. 
Notwithstanding the foregoing, Tenant shall have the right in a single
transaction or series of related transactions to sell or convey all or
substantially all of its assets to a Person if the following conditions are met:

 

(i)                                     this Lease is assigned to such Person in
compliance with the provisions of this Paragraph 21; and

 

(ii)                                  immediately after such transaction the
purchaser, assignee or transferee is in compliance with the terms and covenants
of this Lease.

 

22.                               Events of Default.

 

(a)                                 The occurrence of any one or more of the
following (after expiration of any applicable cure period as provided in
Paragraph 22(b)) shall, at the sole option of Landlord, constitute an “Event of
Default” respecting the entire Leased Premises (wherever located) under this
Lease:

 

(i)                                     a failure by Tenant to make any payment
of Basic Rent, regardless of the reason for such failure;

 

(ii)                                  a failure by Tenant duly to perform and
observe, or a violation or breach of, any other provision hereof not otherwise
specifically mentioned in this Paragraph 22(a);

 

(iii)                               any representation or warranty made by
Tenant herein or in any certificate, demand or request made pursuant hereto
proves to be incorrect, now or hereafter, in any material respect;

 

(iv)                              a default beyond any applicable cure period or
at maturity by Tenant or Guarantor in any payment of principal or interest on
any obligations for borrowed money having an original principal balance of
$10,000,000 or more in the aggregate, or in the performance of any other
provision contained in any instrument under which any such obligation is created
or secured (including the breach of any covenant thereunder), (x) if, with
respect to a payment default, such payment is a payment at maturity or a final
payment, or (y) if, with respect to any other default, an effect of such default
is to cause, or permit any Person to cause, such obligation to become due prior
to its stated maturity;

 

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(v)                                 a default by Tenant or Guarantor beyond any
applicable cure period in the payment of rent under, or in the performance of
any other material provision of, any other lease or leases that have, in the
aggregate, rental obligations over the terms thereof of $5,000,000 or more;
provided that the foregoing shall not be an Event of Default hereunder so long
as Tenant or Guarantor, as applicable, is in good faith contesting any such
default;

 

(vi)                              a final, non-appealable judgment or judgments
for the payment of money in excess of $5,000,000 in the aggregate shall be
rendered against Tenant or Guarantor and the same shall remain undischarged for
a period of sixty (60) consecutive days;

 

(vii)                           Tenant shall (A) voluntarily be adjudicated a
bankrupt or insolvent, (B) seek or consent to the appointment of a receiver or
trustee for itself or for any of the Related Premises, (C) file a petition
seeking relief under the bankruptcy or other similar laws of the United States,
any state or any jurisdiction, (D) make a general assignment for the benefit of
creditors, or (E) be unable to pay its debts as they mature;

 

(viii)                        a court shall enter an order, judgment or decree
appointing, without the consent of Tenant, a receiver or trustee for it or for
any of the Leased Premises or approving a petition filed against Tenant which
seeks relief under the bankruptcy or other similar laws of the United States,
any state or any jurisdiction, and such order, judgment or decree shall remain
undischarged or unstayed sixty (60) days after it is entered;

 

(ix)                              any Related Premises shall have been
substantially vacated or abandoned;

 

(x)                                 Tenant shall be liquidated or dissolved or
shall begin proceedings towards its liquidation or dissolution;

 

(xi)                              the estate or interest of Tenant in any of the
Leased Premises shall be levied upon or attached in any proceeding and such
estate or interest is about to be sold or transferred or such process shall not
be vacated or discharged within sixty (60) days after it is made;

 

(xii)                           [intentionally omitted];

 

(xiii)                        a failure by Tenant to maintain in effect any
license or permit necessary for the use or occupancy of any of the Related
Premises or necessary for the operation of the Related Premises, to the extent
that the failure to maintain any such operational permit shall have a material
adverse effect;

 

(xiv)                       Tenant shall fail to deliver the estoppel described
in Paragraph 25 within five (5) days of the giving of a second notice from
Landlord requesting the same;

 

(xv)                          an Event of Default (as defined in the Guaranty)
beyond any applicable cure period shall occur under the Guaranty;

 

(xvi)                       Tenant shall enter into an Asset Transfer in
violation of Paragraph 21(k);

 

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(xvii)                    Tenant’s failure to timely comply with any of Tenant’s
Post Closing Obligations.

 

(b)                                 No notice or cure period shall be required
in any one or more of the following events: (A) the occurrence of an Event of
Default under (iii), (iv), (v), (vi), (vii), (viii), (ix), (x), (xi), (xii),
(xiii), (xiv), (xv), and (xvi) of Paragraph 22(a); or (B) the default consists
of a failure to provide any insurance required by Paragraph 16 or an assignment
or sublease entered into in violation of Paragraph 21.  If the default consists
of the failure to pay Basic Rent under clause (i) of Paragraph 22(a), the
applicable cure period shall be three (3) days from the date on which notice is
given, but Landlord shall not be obligated to give notice of, or allow any cure
period for, any such default more than one (1) time within any Lease Year.  If
the default consists of a default under clause (ii) of Paragraph 22(a), other
than the events specified in clause (B) of the first sentence of this
Paragraph 22(b), or a default under clause (xvii) of Paragraph 22(a), the
applicable cure period shall be twenty (20) days from the date on which notice
is given or, if the default cannot be cured within such twenty (20) day period
and delay in the exercise of a remedy would not (in Landlord’s reasonable
judgment) cause any material adverse harm to Landlord or any of the Leased
Premises, the cure period shall be extended for the period required to cure the
default (but such cure period, including any extension, shall not in the
aggregate exceed sixty (60) days), provided that Tenant shall commence to cure
the default within the said twenty-day period and shall actively, diligently and
in good faith proceed with and continue the curing of the default until it shall
be fully cured.

 

23.                               Remedies and Damages Upon Default.

 

(a)                                 If an Event of Default shall have occurred
and be continuing beyond the expiration of any applicable notice and/or cure
period, then Landlord shall have the right, at its sole option, then or at any
time thereafter, to exercise its remedies and to collect damages from Tenant in
accordance with this Paragraph 23 without further demand upon or notice to
Tenant, except as otherwise expressly provided below in this Paragraph 23 and,
subject in all events, to any conditions and limitations (including any
additional notice requirements) of applicable Law.

 

(i)                                     Landlord may terminate this Lease by
giving Tenant written notice thereof; such termination to be effective as of the
date specified in such notice unless a longer notice period is prescribed by
applicable Law (in which event, such longer period shall deemed set forth in
such notice and shall control).  Upon such date, this Lease, the estate hereby
granted and all rights of Tenant hereunder shall expire and terminate and Tenant
shall immediately surrender and deliver possession of the Leased Premises to
Landlord in accordance with and in the condition required by Paragraph 26 hereof
.  If Tenant does not so surrender and deliver possession of all of the Leased
Premises, Landlord may re-enter and repossess any of the Leased Premises not
surrendered, with or without legal process, by peaceably entering any of the
Leased Premises and changing locks or by summary proceedings, ejectment or any
other lawful means or procedure.

 

(ii)                                  Landlord may terminate Tenant’s right of
possession (but not this Lease) and may repossess the Leased Premises by any
available legal process without thereby releasing Tenant from any liability
hereunder and without demand or notice of any kind to Tenant and without
terminating this Lease.

 

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(iii)                               Upon or at any time after taking possession
of any of the Leased Premises pursuant to Paragraph 23(a)(i) or 23(a)(ii),
Landlord may, by peaceable means or legal process, remove any Persons or
property therefrom.  Landlord shall be under no liability for or by reason of
any such entry, repossession or removal.  Notwithstanding such entry or
repossession, Landlord may collect the damages set forth in Paragraph
23(b)(i) or 23(b)(ii).

 

(iv)                              After repossession of any of the Leased
Premises pursuant to clause (i) or (ii) above, Landlord shall have the right to
relet any of the Leased Premises to such tenant or tenants, for such term or
terms, for such rent, on such conditions and for such uses as Landlord in its
sole discretion may determine, and collect and receive any rents payable by
reason of such reletting.  Landlord may make such Alterations in connection with
such reletting as it may deem advisable in its sole discretion.  Notwithstanding
any such reletting, Landlord may collect the damages set forth in Paragraph
23(b)(ii).

 

(v)                                 [Intentionally Omitted].

 

(vi)                              Landlord may declare by notice to Tenant the
entire Basic Rent (in the amount of Basic Rent then in effect) for the remainder
of the then current Term to be immediately due and payable.  Tenant shall
immediately pay to Landlord all such Basic Rent discounted to its Present Value,
all accrued Rent then due to Landlord and unpaid, all other Monetary Obligations
which are then due and unpaid and all Monetary Obligations which arise or become
due by reason of such Event of Default (including any Costs of Landlord).  Upon
receipt by Landlord of all such accelerated Basic Rent and Monetary Obligations,
this Lease shall remain in full force and effect and Tenant shall have the right
to possession of the Leased Premises from the date of such receipt by Landlord
to the end of the Term, and subject to all the provisions of this Lease,
including the obligation to pay all increases in Basic Rent and all Monetary
Obligations that subsequently become due, except that (A) no Basic Rent which
has been prepaid hereunder shall be due thereafter during the said Term, and
(B) Tenant shall have no option to extend or renew the Term.

 

(b)                                 The following constitute damages to which
Landlord shall be entitled if Landlord exercises its remedies under
Paragraph 23(a), but not subparagraph (vi) thereof:

 

(i)                                     If Landlord exercises its remedy under
Paragraphs 23(a)(i) or (ii) but not its remedy under Paragraph 23(a)(iv) (or
attempts to exercise such remedy and is unsuccessful in reletting the Leased
Premises) then, upon written demand from Landlord, Tenant shall pay to Landlord,
as liquidated and agreed final damages for Tenant’s default and in lieu of all
current damages (including damages under subparagraph 23(b)(ii) below) beyond
the date of such demand (it being agreed that it would be impracticable or
extremely difficult to fix the actual damages), an amount equal to the Present
Value of the excess, if any, of (A) all Basic Rent from the date of such demand
to the date on which the Term is scheduled to expire hereunder in the absence of
any earlier termination, re-entry or repossession over (B) the then fair market
rental value of the Leased Premises for the same period.  Tenant shall also pay
to Landlord all of Landlord’s Costs in connection with the repossession of the
Leased Premises and any attempted reletting thereof, including all brokerage
commissions, legal expenses, reasonable attorneys’ fees, employees’ expenses,
costs of Alterations and expenses and preparation for reletting.

 

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(ii)                                  If Landlord exercises its remedy or
remedies under Paragraphs 23(a)(i), (ii), (iii) or (iv), then Tenant shall,
until the end of what would have been the Term in the absence of the termination
of the Lease, and whether or not any of the Leased Premises shall have been
relet, be liable to Landlord for, and shall pay to Landlord, as liquidated and
agreed current damages, on the due dates therefor,  all Monetary Obligations
which would be payable under this Lease by Tenant in the absence of such
termination less the net proceeds, if any, of any reletting pursuant to
Paragraph 23(a)(iv), after deducting from such proceeds all of Landlord’s Costs
(including the items listed in the last sentence of Paragraph 23(b)(i) hereof)
incurred in connection with such repossessing and reletting; provided, that if
Landlord has not relet the Leased Premises, such Costs of Landlord shall be
considered to be Monetary Obligations payable by Tenant.  Tenant shall be and
remain liable for all sums aforesaid, and Landlord may recover such damages from
Tenant and institute and maintain successive actions or legal proceedings
against Tenant for the recovery of such damages.  Nothing herein contained shall
be deemed to require Landlord to wait to begin such action or other legal
proceedings until the date when the Term would have expired by its own terms had
there been no such Event of Default.

 

(iii)                               Tenant shall be and remain liable for all
sums aforesaid, and Landlord may recover such damages from Tenant and institute
and maintain successive actions or legal proceedings against Tenant for the
recovery of such damages.  Nothing herein contained shall be deemed to require
Landlord to wait to begin such action or other legal proceedings until the date
when the Term would have expired by its own terms had there been no such Event
of Default.

 

(c)                                  Notwithstanding anything to the contrary
herein contained, in lieu of or in addition to any of the foregoing remedies and
damages, Landlord may exercise any remedies and collect any damages available to
it at law or in equity.  If Landlord is unable to obtain full satisfaction
pursuant to the exercise of any remedy, it may pursue any other remedy which it
has hereunder or at law or in equity.

 

(d)                                 Landlord shall not be required to mitigate
any of its damages hereunder unless required to by applicable Law.  If any Law
shall validly limit the amount of any damages provided for herein to an amount
which is less than the amount agreed to herein, Landlord shall be entitled to
the maximum amount available under such Law.

 

(e)                                  No termination of this Lease, repossession
or reletting of any of the Leased Premises, exercise of any remedy or collection
of any damages pursuant to this Paragraph 23 shall relieve Tenant of any
Surviving Obligations.

 

(f)                                   LANDLORD AND TENANT EACH HEREBY WAIVES ANY
RIGHT TO A TRIAL BY JURY.

 

(g)                                  Upon the occurrence of any Event of
Default, Landlord shall have the right (but no obligation) to perform any act
required of Tenant hereunder and, if performance of such act requires that
Landlord enter the Leased Premises, Landlord may enter the Leased Premises for
such purpose

 

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(h)                                 No failure of Landlord (i) to insist at any
time upon the strict performance of any provision of this Lease or (ii) to
exercise any option, right, power or remedy contained in this Lease shall be
construed as a waiver, modification or relinquishment thereof.  A receipt by
Landlord of any sum in satisfaction of any Monetary Obligation with knowledge of
the breach of any provision hereof shall not be deemed a waiver of such breach,
and no waiver by Landlord of any provision hereof shall be deemed to have been
made unless expressed in a writing signed by Landlord.

 

(i)                                     Tenant hereby waives and surrenders, for
itself and all those claiming under it, including creditors of all kinds,
(i) any right and privilege which it or any of them may have under any present
or future Law to redeem any of the Leased Premises or to have a continuance of
this Lease after termination of this Lease or of Tenant’s right of occupancy or
possession pursuant to any court order or any provision hereof, and (ii) the
benefits of any present or future Law which exempts property from liability for
debt or for distress for rent.

 

(j)                                    Except as otherwise provided herein, all
remedies are cumulative and concurrent and no remedy is exclusive of any other
remedy.  Each remedy may be exercised at any time an Event of Default has
occurred and is continuing and may be exercised from time to time.  No remedy
shall be exhausted by any exercise thereof.

 

24.                               Notices

 

All notices, demands, requests, consents, approvals, offers, statements and
other instruments or communications required or permitted to be given pursuant
to the provisions of this Lease shall be in writing and shall be deemed to have
been given and received for all purposes when delivered in person or by Federal
Express or other reliable 24-hour delivery service or five (5) business days
after being deposited in the United States mail, by registered or certified
mail, return receipt requested, postage prepaid, addressed to the other party at
its address stated on page one of this Lease or when delivery is refused. 
Notices sent to Landlord shall be to the attention of Director, Asset
Management, and notices sent to Tenant shall be to the attention of General
Counsel.  A copy of any notice given by Tenant to Landlord shall simultaneously
be given by Tenant to W.P. Carey Inc., 50 Rockefeller Plaza, 2nd Floor, New
York, New York, 10020, Attention: Legal Transaction Department .  A copy of any
notice given by Landlord to Tenant shall simultaneously be given by Landlord to
Paul, Weiss, Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New
York, NY 10019-6064, Attention: Harris B. Freidus.  Notices sent to Lender under
the initial Loan shall be addressed to UBS Real Estate Securities Inc., 1285
Avenue of the Americas, New York, New York 10019, Attention:   Transaction
Management - Henry Chung, Esq., with a copy to:Kaye Scholer LLP 250 West 55th
Street, New York. NY 10019-9710, Attention:  Stephen Gliatta, Esq.  For the
purposes of this Paragraph, any party may substitute another address stated
above (or substituted by a previous notice) for its address by giving
fifteen (15) days’ notice of the new address to the other party, in the manner
provided above.  If Lender’s notice information shall at any time change from
such information herein set forth, Tenant’s obligation to deliver any notice to
Lender as required hereunder shall be conditioned upon Lender providing to
Tenant an updated address in the manner provided above.  Rent payment
instructions shall be provided from time to time as described in Paragraph 6 of
this Lease.

 

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25.                               Estoppel Certificate.

 

At any time upon not less than fifteen (15) days’ prior written request by
either Landlord or Tenant (the “Requesting Party”) to the other party (the
“Responding Party”), the Responding Party shall deliver to the Requesting Party
a statement in writing, executed by an authorized officer of the Responding
Party, certifying (a) that, except as otherwise specified, this Lease is
unmodified and in full force and effect, (b) the date to which Basic Rent has
been paid, (c) that, to the knowledge of the signer of such certificate and
except as otherwise specified, no default by either Landlord or Tenant exists
hereunder, (d) such other matters as the Requesting Party may reasonably
request, and (e) if Tenant is the Responding Party that, except as otherwise
specified, there are no proceedings pending or, to the knowledge of the signer,
threatened in writing, against Tenant before or by a court or administrative
agency which, if adversely decided, would materially and adversely affect the
financial condition and operations of Tenant.  Any such statements by the
Responding Party may be relied upon by the Requesting Party, any Person whom the
Requesting Party notifies the Responding Party in its request for the
Certificate is an intended recipient or beneficiary of the Certificate, any
Lender or their assignees and by any prospective purchaser or mortgagee of any
of the Leased Premises.  Any certificate required under this Paragraph 25 and
delivered by Tenant shall state that, in the opinion of each person signing the
same, he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to the subject matter of such certificate,
and shall briefly state the nature of such examination or investigation.

 

26.                               Surrender.

 

Upon the expiration or earlier termination of this Lease, Tenant shall peaceably
leave and surrender the Leased Premises to Landlord in the same condition in
which the Leased Premises was at the commencement of this Lease, except as
repaired, rebuilt, restored, altered, replaced or added to as permitted or
required by any provision of this Lease, ordinary wear and tear excepted.  Upon
such surrender, Tenant shall (a) remove from the Leased Premises all property
which is owned by Tenant or third parties other than Landlord and (b) repair any
damage caused by such removal.  Property not so removed shall become the
property of Landlord, and Landlord may thereafter cause such property to be
removed from the Leased Premises.  The cost of removing and disposing of such
property and repairing any damage to any of the Leased Premises, if applicable,
caused by such removal shall be paid by Tenant to Landlord upon demand. 
Landlord shall not in any manner or to any extent be obligated to reimburse
Tenant for any such property which becomes the property of Landlord pursuant to
this Paragraph 26.

 

27.                               No Merger of Title.

 

There shall be no merger of the leasehold estate created by this Lease with the
fee estate in any of the Leased Premises by reason of the fact that the same
Person may acquire or hold or own, directly or indirectly, (a) the leasehold
estate created hereby or any part thereof or interest therein and (b) the fee
estate in any of the Leased Premises or any part thereof or interest therein,
unless and until all Persons having any interest in the interests described
in (a) and (b) above which are sought to be merged shall join in a written
instrument effecting such merger and shall duly record the same.

 

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28.                               Books and Records.

 

(a)                                 Tenant shall keep adequate records and books
of account with respect to the finances and business of Tenant generally and
separately with respect to each of the Related Premises, and shall permit
Landlord and Lender by their respective agents, accountants and attorneys, upon
reasonable notice to Tenant, to examine (and make copies of) the records and
books of account and to discuss the finances and business with the officers of
Tenant, at such reasonable times as may be requested by Landlord.  Upon the
request of Lender or Landlord (either telephonically or in writing), Tenant
shall provide the requesting party with copies of any information to which such
party would be entitled in the course of a personal visit.

 

(b)                                 For so long as Tenant is a wholly-owned
subsidiary of BONT, Tenant shall deliver to Landlord and to Lender within
ninety (90) days of the close of each fiscal year of BONT, annual audited
financial statements of the Tenant Group certified by a nationally recognized
firm of independent certified public accountants.  If, at any time during the
Term Tenant is not a wholly-owned subsidiary of BONT, Tenant shall deliver to
Landlord and Lender within ninety (90) days of the close of each fiscal year of
Tenant annual audited financial statements of Tenant certified by a nationally
recognized firm of independent certified public accountants.  Tenant shall also
furnish to Landlord (i) for so long as Tenant is a wholly-owned subsidiary of
BONT within forty-five (45) days after the end of each of the three remaining
quarters unaudited financial statements and all other quarterly reports of the
Tenant Group, certified by BONT’s chief financial officer, and all filings of
BONT, if any, of Form 10-K, Form 10-Q and other required filings with the
Securities and Exchange Commission (the “SEC”) pursuant to the provisions of the
Securities Exchange Act of 1934, as amended, or any other Law and (ii) within
ten (10) days following receipt of Landlord’s request any other information
regarding Tenant, Guarantor, or Tenant’s Group which Landlord (or any direct or
indirect parent of Landlord is required to provide to the SEC or any other
regulatory agency.  In addition, Tenant shall furnish to Landlord (x) within
ninety (90) days of the close of each fiscal year of Tenant, annual unaudited
store- level income statements of each of the Related Premises, along with a
schedule of capital improvements performed at each Related Premises during each
such fiscal year, (y) within ninety (90) days of the close of each fiscal year
of Tenant (but only to the extent in the possession of Tenant), mall-wide sales
statistics for each so-called “mall” or other shopping center for which each
Related Premises is considered a part (whether or not the sales statistics of
each Related Premises is included within such mall-wide statistics), and
(z) within ninety (90) days of each fiscal year of Tenant, “store scorecards”
substantially in the form attached hereto as Schedule 28(b) for each Related
Premises.  All financial statements of the Tenant Group shall be prepared in
accordance with generally accepted accounting principles, consistently applied. 
All annual audited financial statements shall be accompanied (i) by an opinion
of said accounting firm which (A) contains no qualifications as to the scope of
the audit and (B) states that the audit was performed in accordance with the
standards set by the Public Company Accounting Oversight Board (United States)
and (ii) by the affidavit of the president or a vice president of Tenant,
Guarantor, or Tenant Group, as applicable, dated within five (5) days of the
delivery of such statement, stating that (C) the affiant knows of no Event of
Default, or event which, upon notice or the passage of time or both, would
become an Event of Default which has occurred and is continuing hereunder or, if
any such event has occurred and is continuing, specifying the nature and period
of existence thereof and what action Tenant has taken or proposes to take with
respect thereto and (D) except as otherwise specified in such

 

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affidavit, that Tenant has fulfilled all of its obligations under this Lease
which are required to be fulfilled on or prior to the date of such affidavit. 
Notwithstanding any of the foregoing to the contrary, so long as BONT is a
public company and the consolidated quarterly and annual financials and other
required filings of Tenant Group (which must include Tenant as a part of the
Tenant Group)  which Tenant would be otherwise required to cause to be delivered
hereinabove are available to Landlord via EDGAR or other online service at no
material cost to Landlord, then Landlord agrees that it shall obtain such
quarterly and annual financials through such service and neither Tenant nor
Guarantor shall be required to make the physical deliveries required
hereinabove.  In the event that Landlord (or any direct or indirect parent
company) is required to disclose Tenant’s or Guarantor’s financial statements,
as the case may be (in whole or in summary form), in order to comply with its
public filing and disclosure requirements under the rules or regulations
promulgated by the Securities & Exchange Commission (“SEC”), then Tenant or
Guarantor, as the case may be, shall cause the certified public accountants that
audited its financial statements to provide Landlord with written consent to
allow such auditor’s report to be disclosed and/or incorporated by reference
into Landlord’s or its ultimate parent company’s SEC filings.

 

29.                               Determination of Value.

 

(a)                                 Whenever a determination of Fair Market
Value is required pursuant to any provision of this Lease, such Fair Market
Value shall be determined in accordance with the following procedure:

 

(i)                                     Landlord and Tenant shall endeavor to
agree upon such Fair Market Value within thirty (30) days after the date (the
“Applicable Initial Date”) on which (A) Tenant provides Landlord with notice of
its intention to terminate this Lease and purchase the Affected Premises
pursuant to Paragraph 18, or (B) Landlord provides Tenant with notice of its
intention to redetermine Fair Market Value pursuant to Paragraph 20(c).  Upon
reaching such agreement, the parties shall execute an agreement setting forth
the amount of such Fair Market Value.

 

(ii)                                  If the parties shall not have signed such
agreement within thirty (30) days after the Applicable Initial Date, Tenant
shall within fifty (50) days after the Applicable Initial Date select an
appraiser and notify Landlord in writing of the name, address and qualifications
of such appraiser.  Within twenty (20) days following Landlord’s receipt of
Tenant’s notice of the appraiser selected by Tenant, Landlord shall select an
appraiser and notify Tenant of the name, address and qualifications of such
appraiser.  Such two appraisers shall endeavor to agree upon Fair Market Value
based on a written appraisal made by each of them as of the Relevant Date.  If
such two appraisers shall agree upon a Fair Market Value, the amount of such
Fair Market Value as so agreed shall be binding and conclusive upon Landlord and
Tenant.

 

(iii)                               If such two appraisers shall be unable to
agree upon a Fair Market Value within twenty (20) days after the selection of an
appraiser by Landlord, then such appraisers shall advise Landlord and Tenant of
their respective determination of Fair Market Value and shall select a third
appraiser to make the determination of Fair Market Value.  The selection of the
third appraiser shall be binding and conclusive upon Landlord and Tenant.

 

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(iv)                              If such two appraisers shall be unable to
agree upon the designation of a third appraiser within ten (10) days after the
expiration of the twenty (20) day period referred to in clause (iii) above, or
if such third appraiser does not make a determination of Fair Market Value
within thirty (30) days after his selection, then such third appraiser or a
substituted third appraiser, as applicable, shall, at the request of either
party hereto (with respect to the other party), be appointed by the President or
Chairman of the American Arbitration Association in New York, New York.  The
determination of Fair Market Value made by the third appraiser appointed
pursuant hereto shall be made within twenty (20) days after such appointment.

 

(v)                                 If a third appraiser is selected, Fair
Market Value shall be the average of the determination of Fair Market Value made
by the third appraiser and the determination of Fair Market Value made by the
appraiser (selected pursuant to Paragraph 29(a)(ii) hereof) whose determination
of Fair Market Value is nearest to that of the third appraiser.  Such average
shall be binding and conclusive upon Landlord and Tenant.

 

(vi)                              All appraisers selected or appointed pursuant
to this Paragraph 29(a) shall (A) be independent qualified MAI appraisers,
(B) have no right, power or authority to alter or modify the provisions of this
Lease, (C) utilize the definition of Fair Market Value set forth above, and
(D) be registered in the State where the applicable Related Premises is located
if such State provides for or requires such registration.

 

(vii)                           The Cost of the procedure described in this
Paragraph 29(a) above shall be borne by Tenant.

 

(b)                                 If, by virtue of any delay, Fair Market
Value is not determined by the expiration or termination of the then current
Term, then the date on which the Term would otherwise expire or terminate shall
be extended with respect to the Leased Premises or the Affected Premises, as
applicable, to the date specified for termination in the particular provision of
this Lease pursuant to which the determination of Fair Market Value is being
made.

 

(c)                                  In determining Fair Market Value as defined
in clause (b) of the definition of Fair Market Value, the appraisers shall add
(i) the present value of the Rent for the remaining Term, assuming the Term has
been extended for all extension periods provided herein (with assumed increases
in the CPI to be determined by the appraisers) using a discount rate (which may
be determined by an investment banker retained by each appraiser) based on the
creditworthiness of Tenant and Guarantor and (ii) the present value of the
Leased Premises or applicable Related Premises as of the end of such Term
(having assumed the Term has been extended for all extension periods provided
herein).  The appraisers shall further assume that no default then exists under
the Lease, that Tenant has complied (and will comply) with all provisions of the
Lease, and that no Event of Default exists under the Guaranty.

 

30.                               Non-Recourse as to Landlord.

 

Anything contained herein to the contrary notwithstanding, any claim based on or
in respect of any liability of Landlord under this Lease shall be limited to
actual damages and shall be enforced only against the Leased Premises and not
against any other assets, properties or

 

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funds of (a) Landlord, (b) any director, member, officer, general partner,
limited partner, employee or agent of Landlord, or any general partners or
shareholders of Landlord (or any legal representative, heir, estate, successor
or assign of any thereof), (c) any predecessor or successor partnership or
corporation (or other entity) of Landlord, or any of its general partners,
either directly or through Landlord or its general partners or any predecessor
or successor partnership or corporation or their shareholders, officers,
directors, employees or agents (or other entity), or (d) any other Affiliate of
Landlord (including Carey Property Advisors, Carey Asset Management Corp., W.
P. Carey Inc., Carey Management Securities, Inc. and any Person affiliated with
any of the foregoing, or any director, officer, employee or agent of any
thereof).

 

31.                               Financing.

 

If Landlord desires to obtain or refinance any Loan, Tenant shall negotiate in
good faith with Landlord concerning any request made by any Lender or proposed
Lender for changes or modifications in this Lease.  In particular, Tenant shall
agree, upon request of Landlord, to supply any such Lender with such notices and
information as Tenant is required to give to Landlord hereunder and to consent
to such financing if such consent is requested by such Lender.  Tenant shall
provide any other consent or statement and shall execute any and all other
documents that such Lender reasonably requires in connection with such financing
(other than an environmental indemnity agreement) and including a subordination,
non-disturbance and attornment agreement, so long as the same do not materially
adversely affect any right, benefit or privilege of Tenant under this Lease or
materially increase Tenant’s obligations under this Lease.  Such subordination,
nondisturbance and attornment agreement may require Tenant to confirm that
(i) Lender and its assigns will not be liable for any misrepresentation, act or
omission of Landlord and (ii) Lender and its assigns will not be subject to any
counterclaim, demand or offsets which Tenant may have against Landlord.

 

32.                               Subordination, Non-Disturbance and Attornment.

 

This Lease and Tenant’s interest hereunder shall be subordinate to any Mortgage
or other security instrument hereafter placed upon the Leased Premises by
Landlord, and to any and all advances made or to be made thereunder, to the
interest thereon, and all renewals, replacements and extensions thereof,
provided that any such Mortgage or other security instrument (or a separate
instrument in recordable form duly executed by the holder of any such Mortgage
or other security instrument and delivered to Tenant) shall provide for the
recognition of this Lease and all Tenant’s rights hereunder unless and until an
Event of Default exists or Landlord shall have the right to terminate this Lease
pursuant to any applicable provision hereof.

 

33.                               Tax Treatment; Reporting.

 

Landlord and Tenant each acknowledge that each shall treat this transaction as a
true lease for state law purposes and shall report this transaction as a lease
for Federal income tax purposes.  For Federal income tax purposes each shall
report this Lease as a true lease with Landlord as the owner of the Leased
Premises and Equipment and Tenant as the lessee of such Leased Premises and
Equipment including: (i) treating Landlord as the owner of the property eligible
to claim depreciation deductions under Section 167 or 168 of the Internal
Revenue Code of 1986 (the “Code”) with respect to the Leased Premises and
Equipment, (ii) Tenant reporting

 

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its Basic Rent payments as rent expense under Section 162 of the Code, and
(iii) Landlord reporting the Basic Rent payments as rental income.  For the
avoidance of doubt, nothing in this Lease shall be deemed to constitute a
guaranty, warranty or representation by either Landlord or Tenant as to the
actual treatment of this transaction for state law purposes and for federal law
purposes.

 

34.                               Miscellaneous.

 

(a)                                 The Paragraph headings in this Lease are
used only for convenience in finding the subject matters and are not part of
this Lease or to be used in determining the intent of the parties or otherwise
interpreting this Lease.

 

(b)                                 As used in this Lease, the singular shall
include the plural and any gender shall include all genders as the context
requires and the following words and phrases shall have the following meanings:
(i) “including” shall mean “including without limitation”; (ii) “provisions”
shall mean “provisions, terms, agreements, covenants and/or conditions”;
(iii) “lien” shall mean “lien, charge, encumbrance, title retention agreement,
pledge, security interest, mortgage and/or deed of trust”; (iv) “obligation”
shall mean “obligation, duty, agreement, liability, covenant and/or condition”;
(v) “any of the Leased Premises” shall mean “the Leased Premises or any part
thereof or interest therein”; (vi) “any of the Land” shall mean “the Land or any
part thereof or interest therein”; (vii) “any of the Improvements” shall mean
“the Improvements or any part thereof or interest therein”; and (viii) “any of
the Equipment” shall mean “the Equipment or any part thereof or interest
therein”; provided that, in furtherance of Paragraphs 3(e) and 3(f) hereof, the
singular term “Lease” shall not be deemed to include or interpreted as including
the plural “Leases”.

 

(c)                                  Any act which Landlord is permitted to
perform under this Lease may be performed at any time and from time to time by
Landlord or any person or entity designated by Landlord.  Each appointment of
Landlord as attorney in fact for Tenant hereunder is irrevocable and coupled
with an interest.  Except as otherwise specifically provided herein, Landlord
shall have the right, at its sole option, to withhold or delay its consent
whenever such consent is required under Paragraph 21 of this Lease for any
reason or no reason.  In all other cases, Landlord shall not unreasonably
withhold or delay its consent.  Time is of the essence with respect to the
performance by Tenant of its obligations under this Lease.

 

(d)                                 Landlord shall in no event be construed for
any purpose to be a partner, joint venturer or associate of Tenant or of any
subtenant, operator, concessionaire or licensee of Tenant with respect to any of
the Leased Premises or otherwise in the conduct of their respective businesses.

 

(e)                                  This Lease and any documents which may be
executed by Tenant on or about the effective date hereof at Landlord’s request
constitute the entire agreement between the parties and supersede all prior
understandings and agreements, whether written or oral, between the parties
hereto relating to the Leased Premises and the transactions provided for
herein.  Landlord and Tenant are business entities having substantial experience
with the subject matter of this Lease and have each fully participated in the
negotiation and drafting of this Lease.

 

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Accordingly, this Lease shall be construed without regard to the rule that
ambiguities in a document are to be construed against the drafter.

 

(f)                                   This Lease may be modified, amended,
discharged or waived only by an agreement in writing signed by the party against
whom enforcement of any such modification, amendment, discharge or waiver is
sought.

 

(g)                                  The covenants of this Lease shall run with
the land and bind Tenant, its successors and assigns and all present and
subsequent encumbrancers and subtenants of any of the Leased Premises, and shall
inure to the benefit of Landlord, its successors and assigns.  If there is more
than one Tenant, the obligations of each shall be joint and several.

 

(h)                                 Notwithstanding any provision in this Lease
to the contrary, all Surviving Obligations of Tenant shall survive the
expiration or termination of this Lease with respect to any Related Premises.

 

(i)                                     If any one or more of the provisions
contained in this Lease shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Lease, but this Lease shall be
construed as if such invalid, illegal or unenforceable provision had never been
contained herein.

 

(j)                                    If Landlord or its direct or indirect
parent shall desire to mention Tenant or any entity in the Tenant Group in its
marketing materials or use Tenant’s and/or Tenant’s Group’s logo in its
marketing materials, Landlord shall provide to Tenant a copy of the proposed
marketing materials at least fifteen (15) days prior to the publication or
dissemination thereof, and Tenant shall have the right to prohibit Landlord or
its parent from publishing or disseminating such materials if, in the reasonable
opinion of Tenant, such materials are derogatory or adverse to Tenant or the
Tenant Group or do not correctly describe the transactions contemplated by this
Lease.

 

(k)                                 All exhibits attached hereto are
incorporated herein as if fully set forth.

 

(l)                                     Tenant is not, nor will Tenant become a
Person with whom U.S. persons or entities are restricted from doing business
under regulations of the Office of Foreign Asset Control (“OFAC”) of the
Department of the Treasury (including those named on OFAC’s Specially Designated
and Blocked Persons list) or under any statute, executive order (including 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.  In the event that any officer, director, employee
or any Person acting on Tenant’s behalf violates the U.S. Foreign Corrupt
Practices Act 15 U.S.C. §§78dd-1, 78dd-2 and 78dd-3, or the U.K. Bribery Act
2010 (c.23) (both, as amended from time to time) or any other similar Law or
Legal Requirement, Tenant shall promptly take such actions as may be reasonably
necessary to disassociate Tenant from such officer, director, employee or other
Person, including terminating the employment of any such Person.

 

(m)                             Each of Landlord and Tenant hereby agree that
the State of Wisconsin has a substantial relationship to the parties and to the
underlying transaction embodied hereby, and in all respects (including, without
limiting the generality of the foregoing, matters of construction,

 

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validity and performance) this Lease and the obligations arising hereunder shall
be governed by, and construed in accordance with, the laws of the State of
Wisconsin applicable to contracts made and performed therein and all applicable
law of the United States of America; except that, at all times, the provisions
for the creation of the leasehold estate, enforcement of Landlord’s rights and
remedies with respect to right of re-entry and repossession, surrender,
delivery, ejectment, dispossession, eviction or other in-rem proceeding or
action regarding any Related Premises pursuant to Paragraph 23 hereof shall be
governed by and construed according to the Laws of the State in which the
applicable Related Premises is located, it being understood that, to the fullest
extent permitted by law of such State, the law of the State of Wisconsin shall
govern the validity and the enforceability of the Lease, and the obligations
arising hereunder.  To the fullest extent permitted by law, Tenant hereby
unconditionally and irrevocably waives any claim to assert that the law of any
other jurisdiction governs this Lease.  Any legal suit, action or proceeding
against Tenant arising out of or relating to this Lease may be instituted in any
federal or state court sitting in the County of Milwaukee, State of Wisconsin,
and Tenant waives any objection which it may now or hereafter have to the laying
of venue of any such suit, action or proceeding in such County and State, and
Tenant hereby expressly and irrevocably submits to the jurisdiction of any such
court in any suit, action or proceeding.  Notwithstanding the foregoing, nothing
herein shall prevent or prohibit Landlord from instituting any suit, action or
proceeding in any other proper venue or jurisdiction in which Tenant is located
or where service of process can be effectuated.

 

(n)                                 This Lease may be executed in a number of
counterparts and by different parties hereto in separate counterparts each of
which, when so executed, shall be deemed to be an original and all of which
taken together shall constitute but one and the same agreement.

 

35.                               State Specific Provisions.

 

Notwithstanding anything to the contrary contained in this Lease, the following
provisions shall be applicable solely to the extent the Laws of the jurisdiction
in which a corresponding Related Premises is located are determined to be
applicable to this Lease, and Tenant hereby expressly acknowledges and agrees to
the application of same; provided that, (i) nothing herein is intended or shall
be deemed to supersede or diminish the provisions of Paragraph 34(m) hereof with
the respect to the parties choice of law governing this Lease, and (ii) nothing
herein is intended to or shall be construed as superseding or diminishing any
express waiver by Tenant contained in this Lease, each of which shall be
enforced to the fullest extent permitted by the Laws of the applicable
jurisdiction:

 

(a)                                 Illinois Provisions:

 

(i)                                     Without limiting the generality of the
provisions in Paragraph 23, Landlord shall have all remedies and rights set
forth tin 735 ILCS 5/9-101 et seq., including without limitation, the rights
under Section 735 ILCS 5/9-301 et seq. To the fullest extent permitted by Law,
(i) Tenant waives all rights under Section 735 ILCS 5/9-213.1, 735 ILCS
5/9-310,  and  735 ILCS 5/9-311. Tenant acknowledges that any notice delivered
pursuant to Paragraph 22 shall be in lieu of and not in addition to any notice
required pursuant to 735 ILCS 5/9-101.

 

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(ii)                                  As required under Section 24(e) of that
certain Operating Agreement dated as of December 7, 1977, by and between
STAR-WEST LOUIS JOLIET, LLC, as successor in interest to HOMART DEVELOPMENT CO.,
a Delaware corporation BONSTORES REALTY ONE, LLC, a Delaware limited liability
company, as successor-in-interest to P.A. BERGNER & CO., OF ILLINOIS, an
Illinois corporation, SEARS, ROEBUCK AND CO., a New York corporation, MARSHALL
FIELD & COMPANY, a Delaware corporation, and J. C. PENNEY PROPERTIES, INC., a
Delaware corporation, with respect to the Joliet, IL Premises,  Landlord hereby
agrees as follows:  if and when title to the Joliet, IL Premises becomes vested
in Landlord as a result of a default under this Lease by Tenant then Landlord
shall become liable for the performance of any such term, covenant or condition
thereafter to be performed by Tenant thereunder and Landlord shall remain so
liable so long as such title is vested in Landlord.

 

(b)                                 North Dakota Provisions:

 

(i)                                     Landlord and Tenant acknowledge and
agree that the provisions in Paragraph 3 hereof constitute (i) the statement
required by North Dakota Century Code §47-16-07.2, and (ii) prima facie proof of
the condition of the Fargo, ND Premises as of the Commencement Date.

 

(ii)                                  Tenant acknowledges and agrees that if
Tenant elects not to give a Casualty/Condemnation Termination Notice pursuant to
Paragraph 18(a), Tenant shall have no right and hereby waives all rights which
it may have to terminate this Lease pursuant to North Dakota Century Code
§§47-16-14(4) and 47-16-17(2).

 

(iii)                               Except as provided in Paragraph 18(a),
Tenant shall have no right and hereby waives all rights which it may have
pursuant to North Dakota Century Code §§47-16-13 and 47-16-17(1).

 

(c)                                  Wisconsin Provisions:

 

(i)                                     Paragraph 26 hereof is hereby modified
by the insertion of the following with respect to the Ashwaubenon, WI Premises,
Brookfield, WI Premises, Greendale, WI Premises, and the Wauwatosa, WI Premises:
Landlord hereby notifies Tenant, pursuant to Wisconsin Statutes
Section 704.05(5)(bf) that Landlord does not intend to store personal property
left behind when Tenant removes from, or is evicted from, the Premises for any
reason.

 

(ii)                                  As of the date hereof, Landlord (pursuant
to that certain Assignment and Assumption of Lease entered into by and between
Bonstores Realty One, LLC, a Delaware limited liability company, as assignor,
and Landlord, as assignee) and Tenant (pursuant to that certain Assignment and
Assumption of Lease entered into by and between The Bon-Ton Department
Stores, Inc., as assignor, and Tenant, as assignee) became parties to that
certain Amended and Restated Master Lease Agreement for the Brookfield, WI
Premises (the “A&R Brookfield Lease”) dated as of the date hereof.  Landlord and
Tenant hereby agree that upon execution of this Lease, the A&R Brookfield Lease
shall be deemed to be amended and restated in its entirety in accordance with
the terms set forth in this Lease, except that, notwithstanding the foregoing,
Section 34.15 of the A&R Brookfield Lease (Subordination),

 

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shall survive and be deemed to be incorporated herein by reference for purposes
of the Brookfield, WI Premises.

 

36.                               Right of First Offer.

 

(a)                                 If Landlord decides to offer the Leased
Premises (or, subject to (e) below,  if all or a majority of the controlling
direct or indirect equity interests of the Landlord are to be offered for sale
(any of the foregoing interests being hereinafter referred to as “Equity
Interests”)) to any third party, Landlord shall first offer by written notice
(the “Offer”) to sell the Leased Premises (or the Equity Interests, as
applicable) to Tenant for a specific purchase price (the “ROFO Purchase Price”)
and, upon such terms and conditions as Landlord, in Landlord’s sole discretion,
would otherwise intend to offer to sell the Leased Premises (or the Equity
Interests, as applicable), prior to Landlord’s offering to sell the Leased
Premises (or the Equity Interests, as applicable) to any such third party except
that the terms and conditions of any such sale to Tenant shall be (i) consistent
with the terms and provisions of this Paragraph 36 and (ii) the sale to Tenant
shall be “AS IS”, “WHERE IS”, without representation or warranty by Landlord,
other than representations as to ownership of equity interests, if applicable. 
If Landlord shall make the Offer, then, whether or not Tenant has accepted the
Offer, Landlord shall have the unilateral right, in Landlord’s sole discretion,
to revoke the Offer if an Event of Default exists under this Lease on the date
on which Landlord shall give, or would otherwise be required to give, Tenant the
Offer.

 

(b)                                 Tenant shall have the right to accept the
Offer only by giving Landlord written notice of such acceptance (the “ROFO
Notice”) within thirty (30) days after delivery by Landlord to Tenant of the
Offer.  Time shall be of the essence with respect to said thirty (30) day period
and delivery of the ROFO Notice by Tenant.  If Tenant shall accept the Offer,
Tenant shall execute any documentation reasonably required by Landlord to
reflect Tenant’s acceptance of the Offer.  Notwithstanding anything to the
contrary contained in this Lease, upon the delivery of the ROFO Notice by
Tenant, no event or circumstances affecting the Leased Premises including, but
not limited to, a Condemnation or Casualty, shall give Tenant any right or
option of Tenant to cancel, surrender or otherwise terminate this Lease, and any
other right or option of Tenant under the Lease to acquire the Leased Premises
(or the Equity Interests, as applicable), shall automatically be deemed to have
been waived by Tenant for all purposes under this Lease; provided that if the
Offer, and corresponding ROFO Notice delivered by Tenant, include a right by
Tenant to cancel the ROFO Notice in the event of a Condemnation, Casualty, or
otherwise, and thereafter, a Condemnation, Casualty, or other event identified
in the ROFO Notice giving rise to a right to terminate the ROFO Notice shall
occur, and Tenant cancels the ROFO Notice in connection therewith, then this
Lease shall remain in full force and effect and the provisions of the Lease with
respect to such matters shall control.

 

(c)                                  If Tenant does not accept, or fails to
accept, the Offer in accordance with the provisions herein, Landlord shall be
under no further obligation with respect to such Offer pursuant to the terms
contained herein and Tenant shall have forever waived and relinquished its right
to such Offer, and Landlord shall at any and all times thereafter be entitled to
market the Leased Premises (or the Equity Interests, as applicable) to others
upon such terms and conditions as Landlord in its sole discretion may determine,
except that if the price (“Third Party Price”) for which Landlord enters into a
binding contract (“Third Party Contract”) to sell the Leased

 

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Premises (or the Equity Interests, as applicable)  is less than ninety-five
percent (95%) of the ROFO Purchase Price, Tenant shall have fifteen (15) days in
which to accept the Third Party Price.  Tenant shall, within five (5) days after
Landlord’s request therefor, deliver an instrument in form reasonably
satisfactory to Landlord confirming the aforesaid waiver, but no such instrument
shall be necessary to make the provisions hereof effective.  Notwithstanding the
foregoing, if Landlord does not close on a sale to a third party within 180 days
from the date that is the later of the date upon which Tenant would have been
required to accept an Offer contained in a ROFO Notice delivered to Tenant or
the date Tenant affirmatively waives its right to accept the Offer, then if
Landlord later decides to sell the Leased Premises (or the Equity Interests, as
applicable), Landlord shall be obligated to deliver an Offer to Tenant in
accordance with the terms set forth in Paragraph (a) above and thereafter the
remaining provisions set forth in Paragraph 36 shall apply.

 

(d)                                 If Tenant does not timely deliver the ROFO
Notice and the Leased Premises are directly (or indirectly, pursuant to a sale
of the Equity Interests) transferred to a third party , Tenant will attorn to
such third party as Landlord so long as such third party and Landlord notify
Tenant in writing of such transfer.  At the request of Landlord, Tenant will
execute such documents confirming the agreement referred to above and such other
agreements as Landlord may reasonably request, provided that such agreements do
not increase the liabilities and obligations of Tenant hereunder.

 

(e)                                  Notwithstanding anything to the contrary
contained herein, the provisions of this Paragraph 36 shall not apply to or
prohibit (i) any mortgaging, subjection to deed of trust or other hypothecation
of Landlord’s interest in the Leased Premises, (ii) any sale of the Leased
Premises pursuant to a private power of sale under or judicial foreclosure of
any Mortgage or other security instrument or device to which Landlord’s interest
in the Leased Premises is now or hereafter subject (or the first transfer that
occurs after any occurrence described in the foregoing), (iii) any transfer of
Landlord’s interest in the Leased Premises to a Lender, beneficiary under deed
of trust or other hold of a security interest therein or their designees by deed
in lieu of foreclosure (or the first transfer that occurs after any occurrence
described in the foregoing), (iv) any transfer of the Leased Premises to any
governmental or quasi-governmental agency with power of condemnation, (v) any
transfer of the Leased Premises or any interest therein or in Landlord to any
affiliate of Corporate Property Associates 17 Incorporated (“CPA:17”) Corporate
Property Associates 18 Incorporated (“CPA: 18”),  W.P. Carey  Inc., or to any
entity for whom W.P. Carey Inc. or any of its affiliates or subsidiaries
provides management or advisory services or investment advice, (vi) a transfer
to any person or entity to whom any of the foregoing sells all or substantially
all of its assets, (vii) any transfer among or between the foregoing; (viii) any
transfer of the Leased Premises to any of the successors or assigns of any of
the persons or entities referred to in the foregoing clauses; or (ix) sale of
the direct or indirect interests in the Landlord entity in connection with a
“portfolio”-type transaction, which includes the sale of the Landlord entity
along with other entities and/or properties owned or controlled by any Landlord
affiliate (provided that occurrence of any of the foregoing identified in this
clause (ix) would not in any way act to invalidate or forfeit Tenant’s rights
under this Paragraph 36 in the event that any successor-in-interest pursuant to
the foregoing clause (ix) decides to at any time offer the Leased Premises to a
third party).

 

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(f)                                   If the Leased Premises (or the Equity
Interests) are purchased by Tenant pursuant to this Paragraph 36, Landlord need
not convey any better title thereto than that which was conveyed to Landlord,
and Tenant shall accept such title, subject, however, to the Permitted
Encumbrances and to all other liens, exceptions and restrictions on, against or
relating to any of the Leased Premises and to all applicable Laws, but free of
the lien of and security interest created by any Mortgage or assignment of
leases and rents and liens, exceptions and restrictions on, against or relating
to the Leased Premises which have been created by or resulted solely from acts
of Landlord after the date of this Lease, unless the same are Permitted
Encumbrances or customary utility easements benefiting the Leased Premises or
were created with the consent of Tenant or as a result of a default by Tenant
under this Lease.

 

(g)                                  Upon the date fixed for a purchase of the
Leased Premises (or Equity Interests, as applicable) pursuant to this Paragraph
36 which shall be a date mutually acceptable to Landlord and Tenant which shall
be no later than either sixty (60) days following acceptance of the Offer or the
date specified in the Third Party Contract, if applicable, (the “Purchase
Date”), Tenant shall pay to Landlord, or to any Person or entity to whom
Landlord directs payment, the ROFO Purchase Price and all other sums payable by
Tenant under the Offer, in Federal Funds, and Landlord shall deliver to Tenant
or its designee (i) special warranty deeds or their equivalent which describe
the Leased Premises being conveyed and conveys the title thereto as provided in
Paragraph 36(f) above (or an assignment of membership interest, if applicable)
and (ii) such other instruments as shall be necessary to transfer the Leased
Premises (or the Equity Interests, if applicable)  to Tenant or its designee. 
Upon the completion of such purchase by Tenant or its designee, this Lease and
all obligations and liabilities of Tenant hereunder shall terminate, except any
obligations of Tenant under this Lease, actual or contingent, which arise on or
prior to the expiration or termination of this Lease or which survive such
expiration or termination by their own terms.  Any prepaid Monetary Obligations
paid to Landlord shall be prorated as of the Purchase Date, and the prorated
unapplied balance shall be deducted from the ROFO Purchase Price due to
Landlord; provided, that no apportionment of any Impositions shall be made upon
any such purchase.

 

(h)                                 If the completion of the purchase by Tenant
or its designee pursuant to this Paragraph 36 shall be delayed after the date
scheduled for such purchase, Basic Rent and Additional Rent shall continue to be
due and payable until completion of such purchase.

 

(i)                                     Notwithstanding anything to the contrary
set forth herein, the provisions of Paragraph 22(i) shall continue to apply with
respect to any sale to a Tenant Competitor.

 

37.                               Post-Closing Obligations.

 

(a)                                 Pursuant to that certain environmental audit
report of the Wauwatosa, WI Premises dated March 16, 2015 performed by the
Vertex Companies, Inc. (“Vertex”) and those certain property condition report s,
also performed Vertex, and dated with respect to the Brookfield, WI Premises,
the Ashwaubenon, WI Premises, the Greendale, WI Premises, and the Wauwatosa, WI
Premises, April 29, 2015; with respect to the Fargo, ND Premises, April 28,
2015; and with respect to the Joliet, IL Premises, June 17, 2015, Tenant shall
complete, remediate or obtain or caused to be completed, remediated or obtained,
the Post-Closing Obligations identified on Exhibit “H”.  Bon-Ton shall complete
the Post- Closing Obligations

 

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within 365 days of the date hereof, or such earlier date if completion is
necessary to comply with Law, to avoid loss of insurance coverage, or to comply
with any Easement Agreement.

 

(b)                                 On the date hereof, Tenant has deposited
with Landlord the amount of $512,738.50, representing 125% of the cost to
complete all Post-Closing Obligations (the “Post-Closing Escrow”) which shall be
allocated to each of the Post-Closing Obligations in the amounts shown on
Exhibit “H”, shall secure the obligation of Tenant to complete the Post-Closing
Obligations, and shall be held and disbursed in accordance with this Paragraph
(b) and Paragraph (d) below.  Landlord shall disburse the Post-Closing Escrow in
up to three (3) installments, provided that, the balance of the Post-Closing
Escrow shall at all times be equal to an amount not less than 125% of the total
costs necessary to complete the remaining Post-Closing Obligations.  The
applicable installment of the Post-Closing Escrow shall be released to Tenant
within thirty (30) days following the date on which Landlord receives written
and photographic evidence reasonably satisfactory to Landlord that each
Post-Closing Obligation for which reimbursement is being sought, has been
completed (which shall include written and photographic evidence and evidence of
payment of all amounts owed).

 

(c)                                  If, at any time prior to the release of the
Post-Closing Escrow, an Event of Default shall have occurred and be continuing,
Landlord shall use the proceeds of the Post-Closing Escrow to the extent
required to satisfy the Post-Closing Obligations, and be entitled, at its sole
discretion, to apply any remaining balance in payment of any Rent or other
charges which have not been made pursuant to this Lease and any other sums due
to Landlord in connection with any default or the curing thereof, including,
without limitation, any damages incurred by Landlord by reason of such default. 
Tenant acknowledges and agrees that such proceeds shall not constitute assets or
funds of Tenant or its estate, or be deemed to be held in trust for Tenant, but
shall be, for all purposes, the property of Landlord (or Lender, to the extent
assigned).  Tenant further acknowledges and agrees that Landlord’s application
of the proceeds of the Post-Closing Escrow towards the payment of Basic Rent,
Additional Rent or the reduction of any damages due Landlord in accordance with
Paragraph 23 of this Lease, constitute a fair and reasonable use of such
proceeds, and the application of such proceeds by Landlord towards the payment
of Basic Rent, Additional Rent or any other sums due to Landlord under this
Lease shall not constitute a cure by Tenant of the applicable default, provided
that an Event of Default shall not exist if Tenant restores the Post-Closing
Escrow to its full amount within three (3) days and in accordance with the
requirements of this Paragraph 37, so that the applicable amount of the
Post-Closing Escrow shall be again on deposit with Landlord.

 

(d)                                 Landlord shall have the right to designate
Lender or any other holder of a Mortgage as the holder of the Post-Closing
Escrow during the term of the applicable Loan who shall have all of the rights
of Landlord under this Paragraph 37; notwithstanding such designation, Landlord
shall remain obligated to provide the Post-Closing Escrow to Tenant in
accordance with the terms set forth herein.  Tenant covenants and agrees to
execute such agreements, consents and acknowledgments as may be requested by
Landlord from time to time to change the holder of the Post-Closing Escrow as
hereinabove provided.

 

(e)                                  Tenant shall provide all communications
regarding the Post-Closing Obligations specified in Exhibit “H”, including
Tenant’s proof of satisfactory completion of these obligations, to Landlord at
the following address:

 

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BT (MULTI) LLC

c/o W. P. Carey Inc.

50 Rockefeller Plaza, 2nd Floor

Attn: Nicolas Isham

E-mail: nisham@wpcarey.com.

 

(f)                                   In addition to the above, all Post-Closing
Obligation specified in Section 2 of Exhibit “H” (i.e., the environmental
obligations), including Tenant’s proof of satisfactory completion of these
obligations, shall be addressed to:

 

Louis A. Naugle, Esquire

Reed Smith LLP

435 Sixth Avenue

Pittsburgh, PA  15219

Telephone:  412-288-8586

Fax:  412-288-3063

E-mail:  lnaugle@reedsmith.com

 

Tenant’s contact for Environmental Post-Closing Obligations is:

 

William J. O’Brien

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, NY 10019

Phone:  (212) 373-3404

Fax:        (212) 492-0404

Email:    wobrien@paulweiss.com

 

(g)                                  If any sum remains in the Post-Closing
Escrow after completion of all Post-Closing Obligations, such sum shall be
released to Tenant.

 

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IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be duly
executed under seal as of the day and year first above written.

 

 

LANDLORD:

 

 

 

BT (MULTI) LLC, a Delaware limited liability company

 

 

 

CPA: 17 Limited Partnership, a Delaware limited partnership, its Sole Member

 

 

 

By: Corporate Property Associates 17 — Global Incorporated, a Maryland
corporation, its General Partner

 

 

 

 

 

 

By:

/s/ Gino Sabatini

 

Name:

Gino Sabatini

 

Title:

Managing Director

 

 

 

ATTEST:

TENANT:

 

 

 

MCRIL, LLC,

 

a Virginia limited liability company

 

 

 

 

 

 

 

 

 

 

By:

/s/ J. Gregory Yawman

 

By:

/s/ H. Todd Dissinger

 

 

 

Name: J. Gregory Yawman

 

Name: H. Todd Dissinger

 

 

 

Title: Vice President — General Counsel & Secretary

 

Title: Senior Vice President — Treasurer & Credit

 

[Corporate Seal]

 

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EXHIBIT A

 

PREMISES

 

Ashwaubenon, WI Premises

 

Parcel I:

 

Lot One (1), Volume 44 Certified Survey Maps, page 140, Map No. 6612, said map
being part of Private  Claim 21, West side of Fox River; part of Lot One (1),
Volume 42 Certified Survey Maps, page 329, Map  No. 6415 and part of Lots A, B
and C, Volume 2 Certified Survey Maps, page 185, Map No. 442, in the  Village of
Ashwaubenon, Brown County, Wisconsin.

 

Parcel II:

 

A non-exclusive easement for the benefit of Parcel I as granted in an instrument
entitled Reciprocal  Easement and Operating Agreement executed by and between
Bay Park Associates, a Joint Venture, a  Wisconsin Corporation and Montgomery
Ward Properties Corporation, a Delaware Corporation; Shopko  Stores, Inc., a
Minnesota Corporation and Seventh Mont Corporation, a Delaware corporation and 
Montgomery Ward & Co., Incorporated, an Illinois corporation, dated October 1,
1979 and recorded  October 30, 1979 in Jacket 3637 Records Image 42, as Document
No. 929681; and as amended by an  Amended and Restated Reciprocal Easement and
Operating Agreement in an instrument executed by and  between Bay Park
Associates, a Joint Venture, a Wisconsin Corporation and Montgomery Ward
Properties  Corporation, a Delaware Corporation; Shopko Stores, Inc., a
Minnesota Corporation and Seventh Mont  Corporation, a Delaware corporation and
Montgomery Ward & Co., Incorporated, an Illinois corporation  and The Kohl
Corporation, a Wisconsin Corporation dated July 20, 1981 and recorded
October 13, 1981  in Jacket 5054 Records Image 34, as Document No. 967921; and
as amended by a First Amendment to  Amended and Restated Reciprocal Easement and
Operating Agreement in an instrument executed by and between DeBartolo Capital
Partnership, a Delaware general partnership; Shopko Stores, Inc., a Minnesota
corporation; Seventh Mont Corporation, a Delaware corporation; Montgomery Ward &
Co., Incorporated, an Illinois corporation; and Kohl’s Department Stores, Inc.,
a Delaware Corporation dated September 26, 1994 and recorded September 27, 1994
in Jacket 24079 Records Image 07, as Document No. 1426015; and as amended by a
Second Amendment to Amended and Restated Reciprocal Easement and Operating
Agreement in an instrument executed by and between Simon Capital Limited
Partnership, a Delaware limited partnership, successor to DeBartolo Capital
Partnership, a Delaware general partnership, successor to Bay Park, Inc., a
Wisconsin corporation and Bay Park Associates, a Joint Venture; Shopko
Stores, Inc., a Wisconsin corporation; Seventh Mont Corporation, a Delaware
corporation; Montgomery Ward & Co., Incorporated, Illinois Corporation and
Kohl’s Department Stores, Inc., a Delaware Corporation, dated October 2, 1998
and recorded January 18, 1999, as Document No. 1669972 and as further amended by
a Third Amendment to Amended and Restated Reciprocal Easement and Operating
Agreement in an instrument exploited by and between Simon Capital Limited
Partnership, a Delaware limited partnership, Shopko Stores, Inc., a Wisconsin
corporation; Parisian, Inc., an Alabama corporation and Kohl’s Department
Stores, Inc., a Delaware corporation, dated April 2, 2002 and

 

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recorded October 14, 2002 as Document No. 1939053; as assigned by Simon Capital
Limited Partnership to Parisian, Inc., by an Assignment and Assumption
Agreement, dated October 18, 2002 and recorded December 12, 2002 as Document
No. 1962236; said Third Amendment was further amended by a Third Amendment to
Amended and Restated Reciprocal Easement and Operating Agreement in an
instrument executed by and between Simon Capital Limited Partnership, a Delaware
limited partnership; Shopko Stores, Inc., a Wisconsin corporation;
Parisian, Inc., an Alabama corporation and Kohl Department Stores, Inc., a
Delaware corporation, dated April 2, 2002 and recorded April 16, 2003, as
Document No. 2002101.

 

Property Address:  2485 S. Oneida Street a/k/a, 101 Bay Park Square, Green Bay,
WI

 

Brookfield WI Premises

 

Parcel 1:

 

Lot 1 of Certified Survey Map No. 10226 recorded in the office of the Register
of Deeds for Waukesha County, Wisconsin, on June 26, 2006 in Volume 96 of
Certified Survey Maps, Pages 242 through 245, inclusive, as Document
No. 3398248, being a division of Lot 1 of Certified Survey Map No. 10225, being 
part of the Southeast 1/4 and the Northeast 1/4 of Section 27, Town 7 North,
Range 20 East, in the City  of Brookfield, Waukesha County, Wisconsin.

 

EXCEPTING THEREFROM those lands conveyed to the State of Wisconsin, Department
of Transportation in Warranty Deed dated November 16, 2011 and recorded on
January 9, 2012, as Document No. 3884586.

 

Parcel 2:

 

Together with the non-exclusive easements created in that certain Easement,
Restriction and Operating  Agreement by and between Federated Department
Stores, Inc., Sears Roebuck and Co. and Brookfield  Square, Inc. recorded on
July 21, 1966, in Volume 1056 of Deeds, Page 5, as Document No. 666763; as 
amended by Amendments recorded as Document No.’s 666765, 683600, 782430, 1097201
and 1108470

 

Parcel 3:

 

Together with the non-exclusive easements for pedestrian and vehicular traffic
created in that certain  Cross Easement agreement dated August 23, 1966 and
recorded on August 30, 1996, in Reel 2298,  Image 811, as Document No. 2153522.

 

Property Address:  15875 West Bluemound Road and 15795 West Bluemound Road,
Brookfield, WI

 

2

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Fargo ND Premises

 

Lot 17, in Block 1, West Acres Mall Addition, City of Fargo, County of Cass and
the State of North Dakota, TOGETHER WITH the rights and easements in the
Development and Operating Agreement dated February 4, 1971 and recorded
August 12, 1971 as Document No. 450595, in Book 0-5 of Misc., Page 500, as
amended by Amendment to Development and Operating Agreement dated November 3,
1972 and recorded November 24, 1972 as Document No. 464657, in Book X-5 of
Misc., Page 599.

 

Property Address:  3902 13th Avenue (West Acres Mall) a/k/a 3940 13th Avenue S,
Fargo, ND 58103

 

3

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Greendale WI Premises

 

Parcel 1

 

Lot 1, Certified Survey Map No. 8067, recorded in the office of the Register of
Deeds for Milwaukee County, Wisconsin on July 9, 2008, as Document No. 9622931,
being part of the Southwest 1/4 of Section 27, Township 6 North, Range 21 East,
in the Village of Greendale, Milwaukee County, State of Wisconsin.

 

Parcel 2:

 

Non-exclusive easements, rights and privileges created in that certain Operating
Agreement among Southridge Company, Sears, Roebuck and Co., Federated Department
Stores, Inc., Gimbel Brothers, Inc. and J.C. Penney Company, Inc., dated
October 31, 1968 and recorded October 31, 1968 on Reel 448, Image 603, as
Document No. 4426795; as amended by First Amendment to Operating Agreement dated
June 2, 1969 and recorded August 29, 1969 on Reel 496, Image 374, as Document
No. 4484509; and as further amended by Second Amendment to Operating Agreement
dated December 12, 1969 and recorded March 31, 1970 on Reel 524, Image 714, as
Document No. 4517460; and as further amended by Third Amendment to Operating
Agreement dated December 23, 1970 and recorded May 6, 1971 on Reel 584, Image
1871, as Document No. 4589576; as assigned by Assignment and Assumption of
Operating Agreement dated March 17, 1986 and recorded March 25, 1986 on Reel
1860, Image 666, as Document No. 5898793; as amended by Supplements to Operating
Agreement by and between Southridge Company and Federated Department
Stores, Inc. dated October 31, 1968 and recorded October 31, 1968 on Reel
448, Image 700, as Document No. 4426797; Southridge Company and J.C. Penney
Company, Inc., dated October 31, 1968 and recorded October 31, 1968 on Reel
448, Image 712, as Document No. 4426800; Southridge Company and Sears, Roebuck
and Co., dated September 4, 1970 and recorded October 13, 1970 on Reel
554, Image 223, as Document No. 4553024; and as amended by Memorandum of
Agreement by and between Southridge Company and Gimbel Brothers, Inc., dated
October 31, 1968 and recorded February 6, 1969 on Reel 463, Image 764, as
Document No. 4444432.

 

Property Address: 5300 S. 76th Street, Greendale, WI

 

4

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Joliet IL Premises

 

PARCEL 1:

 

THAT PART OF THE NORTHEAST 1/4 OF SECTION 26, TOWNSHIP 36 NORTH, RANGE 9 EAST OF
THE THIRD PRINCIPAL MERIDIAN, IN WILL COUNTY, ILLINOIS DESCRIBED AS FOLLOWS:

 

COMMENCING AT THE SOUTHWEST CORNER OF THE SAID NORTHEAST 1/4 OF SECTION 26;
THENCE EASTERLY ALONG THE SOUTH LINE OF THE NORTHEAST 1/4 OF SAID SECTION 26 A
DISTANCE OF 1,403.84 FEET; THENCE NORTH 1 DEGREE 22 MINUTES 07 SECONDS WEST A
DISTANCE OF 135.10 FEET TO THE POINT OF BEGINNING; THENCE NORTH 88 DEGREES, 41
MINUTES, 54 SECONDS EAST A DISTANCE OF 94.00 FEET TO A POINT OF CURVATURE;
THENCE NORTHWESTERLY 23.56 FEET ALONG THE ARC OF A CIRCLE CONVEX TO THE
SOUTHWEST, AND HAVING A RADIUS OF 15.00 FEET; THENCE NORTH 1 DEGREE 22 MINUTES
07 SECONDS WEST A DISTANCE OF 50.49 FEET TO A POINT OF CURVATURE; THENCE
NORTHEASTERLY 122.12 FEET ALONG THE ARC OF A CIRCLE CONVEX TO THE NORTHWEST, AND
HAVING A RADIUS OF 265.00 FEET TO A POINT OF TANGENCY; THENCE NORTH 25 DEGREES,
02 MINUTES, 08 SECONDS EAST A DISTANCE OF 18.04 FEET TO A POINT OF CURVATURE;
THENCE NORTHEASTERLY 68.42 FEET ALONG THE ARC OF A CIRCLE CONVEX TO THE
NORTHWEST, AND HAVING A RADIUS OF 45.00 FEET TO A POINT OF REVERSE CURVE; THENCE
SOUTHEASTERLY 130.81 FEET ALONG THE ARC OF A CIRCLE CONVEX TO THE SOUTHWEST AND
HAVING A RADIUS OF 1,550.00 FEET TO A POINT; THENCE NORTH 1 DEGREE 32 MINUTES 20
SECONDS WEST A DISTANCE OF 515.66 FEET; THENCE NORTH 5 DEGREES, 36 MINUTES, 29
SECONDS EAST A DISTANCE OF 71.90 FEET TO A POINT; THENCE NORTH 43 DEGREES, 27
MINUTES, 31 SECONDS EAST A DISTANCE OF 80.00 FEET TO A POINT; THENCE NORTH 46
DEGREES, 32 MINUTES, 29 SECONDS WEST A DISTANCE OF 282.00 FEET TO A POINT;
THENCE SOUTH 43 DEGREES, 27 MINUTES, 31 SECONDS WEST A DISTANCE OF 54.08 FEET TO
A POINT; THENCE SOUTH 80 DEGREES, 18 MINUTES, 30 SECONDS WEST A DISTANCE OF
81.23 FEET TO A POINT; THENCE SOUTH 88 DEGREES, 27 MINUTES, 31 SECONDS WEST A
DISTANCE OF 430.32 FEET TO A POINT ON A CURVE; THENCE SOUTHEASTERLY 132.99 FEET
ALONG THE ARC OF A CIRCLE CONVEX TO THE NORTHEAST AND HAVING A RADIUS OF 700.00
FEET TO A POINT OF REVERSE CURVE; THENCE SOUTHEASTERLY 428.66 FEET ALONG THE ARC
OF A CIRCLE CONVEX TO THE SOUTHWEST AND HAVING A RADIUS OF 700.00 FEET TO A
POINT; THENCE SOUTH 41 DEGREES, 19 MINUTES, 37 SECONDS WEST A DISTANCE OF 59.00
FEET TO A POINT ON A CURVE; THENCE SOUTHEASTERLY 101.97 FEET ALONG THE ARC OF A
CIRCLE CONVEX TO THE SOUTHWEST AND HAVING A RADIUS OF 759.00 FEET TO A POINT OF
COMPOUND CURVATURE; THENCE SOUTHEASTERLY 161.22 FEET ALONG THE ARC OF A CIRCLE
CONVEX TO THE SOUTHWEST, AND HAVING A RADIUS OF 1,559.00 FEET TO A POINT OF
REVERSE CURVE; THENCE SOUTHERLY 45.73 FEET ALONG THE ARC OF A CIRCLE CONVEX TO
THE EAST AND HAVING A RADIUS OF 30.00 FEET TO A RADIUS OF 30.00 FEET TO A POINT
OF TANGENCY; THENCE SOUTH 25 DEGREES, 02 MINUTES, 08

 

5

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SECONDS WEST A DISTANCE OF 23.76 FEET TO A POINT OF CURVATURE; THENCE SOUTHERLY
158.53 FEET ALONG THE ARC OF A CIRCLE CONVEX TO THE NORTHWEST AND HAVING A
RADIUS OF 344.00 FEET TO A POINT OF TANGENCY; THENCE SOUTH 1 DEGREE 22 MINUTES
07 SECONDS EAST A DISTANCE OF 65.49 FEET TO THE HEREINABOVE DESIGNATED POINT OF
BEGINNING, ALL IN WILL COUNTY, ILLINOIS.

 

PARCEL 2:

 

ALL RIGHTS, PRIVILEGES AND BENEFITS OF P. A. BERGNER AND COMPANY OF
ILLINOIS, ITS SUCCESSORS, LEGAL REPRESENTATIVES AND ASSIGNS, ARISING UNDER THE
OPERATING AGREEMENT DATED DECEMBER 7, 1977 AND RECORDED DECEMBER 9, 1977 IN THE
OFFICE OF THE RECORDER OF DEEDS OF WILL COUNTY, ILLINOIS AS DOCUMENT NO.
R77-48631 AS AMENDED BY THE FIRST AMENDMENT TO THE OPERATING AGREEMENT DATED
SEPTEMBER 7, 1978 AND NOVEMBER 10, 1978 IN THE OFFICE OF THE RECORDER OF DEEDS
OF WILL COUNTY, ILLINOIS AS DOCUMENT NO. R78-45043, AND THE 2ND AMENDMENT TO
OPERATING AGREEMENT DATED OCTOBER 10, 1979 OF RECORDED NOVEMBER 8, 1979 IN THE
OFFICE OF THE RECORDER OF DEEDS OF WILL COUNTY AS DOCUMENT NO. R79-41766, BY AND
AMONG HOMART DEVELOPMENT COMPANY A DELAWARE CORPORATION; SEARS ROEBUCK AND
COMPANY, A NEW YORK CORPORATION; J. C. PENNEY PROPERTIES, INC. A DELAWARE
CORPORATION; MARSHALL FIELD AND COMPANY, A DELAWARE CORPORATION; AND P. A.
BERGNER AND COMPANY. NOW KNOWN AS P. A. BERGNER AND COMPANY OF ILLINOIS, AND
ILLINOIS CORP. AND ALL EASEMENTS, RIGHTS AND PRIVILEGES CREATED BY OR ARISING
THEREUNDER.

 

Property Address:  3940 Mall Loop Drive a/k/a 3340 Mall Loop Drive, Joliet, IL

 

6

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Wauwatosa WI Premises

 

Parcel 1:

 

Parcel 1 of Certified Survey Map No. 4827, recorded October 14, 1986, Reel
1974, Image I, as Document  No. 5973150, being a Redivision of Parcel 2 of
Certified Survey Map No. 4004, being a part of the SW 1/4  of Section 17, T 7
IN, R 21 E, in the City of Wauwatosa, County of Milwaukee, State of Wisconsin.

 

Except that portion conveyed in Quit Claim Deed recorded as Document
No. 9482190.

 

Tax Key No: 335-9998-16

 

Parcel 2:

 

Together with the non-exclusive easements, rights and privileges created and
amended by the following instruments:

 

Reciprocal Easements and Operating Agreement executed by and among S. D. Realty
Company, Froedtert-Mayfair, Inc. and First Mayfair Tower, Inc., a memorandum of
which was dated November 30, 1973 and recorded on December 6, 1973 on Reel
759, Image 726 as Document No. 4809625; Reciprocal Easements and Operating
Agreement executed by and between S. D. Realty Company and
Froedtert-Mayfair, Inc., a memorandum of which was dated November 15, 1977 and
recorded November 17, 1977 on Reel 1067, Image 770 as Document No. 5163153;
Reciprocal Easements and Operating Agreement executed by and among S. D. Realty,
Froedtert-Mayfair, Inc. and Mayfair Atrium Building, a joint venture, a
memorandum of which was dated August 3, 1981 and recorded September 9, 1981 on
Reel 1401, Image 595 as Document No. 5499614; Reciprocal Easements and Operating
Agreement entered into by and between Froedtert-Mayfair, Inc. and P. A.
Bergner & Co. of Illinois, dated October 17, 1986 and recorded October 17, 1986
on Reel 1977, Image 781 as Document No. 5975279; Covenants, conditions and
restrictions set forth in Warranty Deed executed by Froedtert-Mayfair, Inc., a
Wisconsin corporation, and S. D. Realty Company, a Wisconsin corporation,
collectively, to P. A. Bergner & Co. of Illinois, an Illinois Corporation, dated
October 14, 1986 and recorded October 17, 1986 on Reel 1977, Image 776 as
Document No. 5975277 and Amendment recorded December 23, 1993, on Reel
3189, Image 666, as Document No. 6876387.

 

Property Address:

 

2400 North Mayfair Road, Wauwatosa, WI

 

7

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EXHIBIT B

 

MACHINERY AND EQUIPMENT

 

All fixtures, machinery, apparatus, equipment, fittings and appliances of every
kind and nature whatsoever now or hereafter affixed or attached to or installed
in any of the Leased Premises (except as hereafter provided), including all
electrical, anti-pollution, heating, lighting (including hanging fluorescent
lighting), incinerating, power, air cooling, air conditioning, humidification,
sprinkling, plumbing, lifting, cleaning, fire prevention, fire extinguishing and
ventilating systems, devices and machinery and all engines, pipes, pumps, tanks
(including exchange tanks and fuel storage tanks), motors, conduits, ducts,
steam circulation coils, blowers, steam lines, compressors, oil burners,
boilers, doors, windows, loading platforms, lavatory facilities, stairwells,
fencing (including cyclone fencing), passenger and freight elevators, overhead
cranes and garage units, together with all additions thereto, substitutions
therefor and replacements thereof required or permitted by this Lease, but
excluding all personal property (including all merchandise for sale) and all
trade fixtures, machinery, office, manufacturing and warehouse equipment which
are not necessary to the operation of the buildings which constitute part of the
Leased Premises for the uses permitted under Paragraph 4(a) of this Lease.

 

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EXHIBIT C

 

PERMITTED ENCUMBRANCES

 

Ashwaubenon WI Premises

 

1.                                      Postponed taxes for the year 2014 in the
amount of $137,359.85, which are due and payable on or before July 31, 2015.

 

2.                                      Restrictions, easements, building
setback lines and other matters shown on the recorded plat or Certified Survey
Map No. 6612; and as approximately located and shown on an ALTA/ACSM Land Title
Survey prepared by Sherrill Associates, Inc., dated March 6, 2015 and last
revised March 24, 2015, Job No. 20150016-04 (the “Survey”).

 

3.                                      Reciprocal Easement and Operating
Agreement executed by and between Bay Park Associates, a Joint Venture, a
Wisconsin Corporation and Montgomery Ward Properties Corporation, a Delaware
Corporation; Shopko Stores, Inc., a Minnesota Corporation and Seventh Mont
Corporation, a Delaware corporation and Montgomery Ward & Co., Incorporated, an
Illinois corporation, dated October 1, 1979 and recorded October 30, 1979 in
Jacket 3637 Records Image 42, as Document No. 929681; and as amended by an
Amended and Restated Reciprocal Easement and Operating Agreement in an
instrument executed by and between Bay Park Associates, a Joint Venture, a
Wisconsin Corporation and Montgomery Ward Properties Corporation, a Delaware
Corporation; Shopko Stores, Inc., a Minnesota Corporation and Seventh Mont
Corporation, a Delaware corporation and Montgomery Ward & Co., Incorporated, an
Illinois corporation and The Kohl Corporation, a Wisconsin Corporation dated
July 20, 1981 and recorded October 13, 1981 in Jacket 5054 Records Image 34, as
Document No. 967921; and as amended by a First Amendment to Amended and Restated
Reciprocal Easement and Operating Agreement in an instrument executed by and
between DeBartolo Capital Partnership, a Delaware general partnership; Shopko
Stores, Inc., a Minnesota corporation; Seventh Mont Corporation, a Delaware
corporation; Montgomery Ward & Co., Incorporated, an Illinois corporation; and
Kohl’s Department Stores, Inc., a Delaware Corporation dated September 26, 1994
and recorded September 27, 1994 in Jacket 24079 Records Image 07, as Document
No. 1426015; and as amended by a Second Amendment to Amended and Restated
Reciprocal Easement and Operating Agreement in an instrument executed by and
between Simon Capital Limited Partnership, a Delaware limited partnership,
successor to DeBartolo Capital Partnership, a Delaware general partnership,
successor to Bay Park, Inc., a Wisconsin corporation and Bay Park Associates, a
Joint Venture; Shopko Stores, Inc., a Wisconsin corporation; Seventh Mont
Corporation, a Delaware corporation; Montgomery Ward &
Co., Incorporated, Illinois Corporation and Kohl’s Department Stores, Inc., a
Delaware Corporation, dated October 2, 1998 and recorded January 18, 1999, as
Document No. 1669972 and as further amended by a Third Amendment to Amended and
Restated Reciprocal Easement and Operating Agreement in an instrument executed
by and between Simon Capital Limited Partnership, a Delaware limited
partnership, Shopko Stores, Inc., a Wisconsin corporation; Parisian, Inc., an
Alabama corporation and Kohl’s Department Stores, Inc., a Delaware corporation,
dated April 2, 2002 and recorded October 14, 2002 as Document No. 1939053 and
recorded

 

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April 16, 2003, as Document No. 2002101; as assigned by Simon Capital Limited
Partnership to Parisian, Inc., by an Assignment and Assumption Agreement, dated
October 18, 2002 and recorded December 12, 2002 as Document No. 1962236; and as
approximately located and shown on the Survey.

 

4.                                      Affidavit of Correction recorded
September 10, 2002 as Document No. 1928012 in connection with Volume 44
Certified Survey Maps, Page 140, Map No. 6612.

 

5.                                      Terms, covenants, conditions and
restrictions set forth and described in an Ordinance Approving a Planned Unit
Development recorded June 4, 2002 as Document No. 1903831.

 

6.                                      Terms, covenants, conditions and
restrictions contained in the Redevelopment Plans recorded July 14, 2004 as
Document No. 2133850 and recorded May 26, 2005 as Document No. 2191926.

 

2

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Brookfield WI Premises

 

1.                                      Taxes, general and special for the year
2015, not now due and payable.

 

2.                                      Taxes for the year 2014 are being paid
on the installment basis, none now delinquent.

 

3.                                      Easements granted to the City of
Brookfield by instrument recorded in Reel 19, Image 1386, as Document
No. 831701; and by instrument recorded in Reel 35, Image 702, as Document
No. 846573; and by instrument recorded in Reel 469, Image 747, as Document
No. 1168475, and as approximately located and shown on an ALTA/ACSM Land Title
Survey prepared by Sherrill Associates, Inc., dated March 16, 2015 and last
revised March 25, 2015, Job No. 20150016-07 (the “Survey”). Partial release of
easements set forth in Quit Claim Deed dated February 26, 2007 and recorded on
March 6, 2007, as Document No. 3463110; and reconveyance of easements set forth
in Quit Claim Deed dated April 10, 2008 and recorded on April 16, 2008, as
Document No. 3564247.

 

4.                                      Easement granted to Wisconsin Electric
Power Company in instrument recorded on October 17, 1966, in Volume 1064 of
Deeds, Page 320, as Document No. 672545.  Conveyance of Rights in Land by
Wisconsin Electric Power Company d/b/a We Energies recorded on February 6, 2012,
as Document No. 3892006.

 

5.                                      Easement granted to Wisconsin Telephone
Company in instrument recorded on December 21, 1966, in Volume 1070 of Deeds,
Page 327, as Document No. 675880.Conveyance of Rights in Land by Wisconsin
Bell, Inc. d/b/a AT&T Wisconsin recorded on December 5, 2011, as Document
No. 3876779.

 

6.                                      Covenants, conditions, restrictions,
easements and charges and assessments, none now due and payable, set forth in
Easement, Restriction and Operating Agreement by and between Federated
Department Stores, Inc., Sears Roebuck and Co. and Brookfield Square, Inc.
recorded on July 21, 1966, in Volume 1056 of Deeds, Page 5, as Document
No. 666763; as amended by Amendments recorded as Document No.’s 666765, 683600,
782430, 1097201 and 1108470; as assigned to P.A. Bergner & Co. by instrument
recorded on March 28, 1985, in Reel 663, Image 961, as Document No. 1290666; and
as amended by Amendment recorded as Document No. 4125958.

 

7.                                      Restrictions on access imposed by
Covenant and Agreement executed by Milwaukee Boston Store Division of Federated
Department Stores, Inc., recorded on December 21, 1966, in Volume 1070 of Deeds,
Page 322, as Document No. 675875.

 

8.                                      Easements granted to the City of
Brookfield in Dedication and Easement Agreement dated August 15, 1974 and
recorded on December 31, 1974, in Reel 104, Image 1028, as Document No. 900879,
and as approximately located and shown on the Survey.

 

9.                                      Terms, provisions, conditions and
easements set forth in Cross Easement Agreement dated August 23, 1966 and
recorded on August 30, 1996, in Reel 2298, Image 811, as Document No. 2153522,
and as approximately located and shown on the Survey.

 

3

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10.                               Easements as set forth on Certified Survey Map
No. 10225 recorded as Document No. 3398247, and as approximately located and
shown on the Survey.

 

11.                               Easements as set forth on Certified Survey Map
No. 10226 recorded as Document No. 3398248, and as approximately located and
shown on the Survey.

 

12.                               Easement granted to Wisconsin Electric Power
Company dba We Energies in instrument recorded on September 29, 2006, as
Document No. 3423917, and as approximately located and shown on the Survey.

 

13.                               Perpetual Municipal Utility Easement granted
to the City of Brookfield in instrument dated November 22, 2006 and recorded on
December 4, 2006, as Document No. 3440099, and as approximately located and
shown on the Survey. Partial release of easements set forth in Quit Claim Deed
dated February 26, 2007 and recorded on March 6, 2007, as Document No. 3463110;
and reconveyance of easements set forth in Quit Claim Deed dated April 10, 2008
and recorded on April 16, 2008, as Document No. 3564247.

 

14.                               Rights of Brookfield Square Parcel, LLC under
Ground Lease dated April 28, 2006 as set forth in Short Form Ground Lease dated
February 27, 2008 and recorded on March 10, 2008, as Document No. 3552456, and
as Document No. 3552468.

 

15.                               Distribution Easement Underground Joint
granted to Wisconsin Electric Power Company dba We Energies and Wisconsin
Bell, Inc. dba AT&T Wisconsin in instrument recorded on September 5, 2008, as
Document No. 3597129, and as approximately located and shown on the Survey.

 

16.                               Distribution Easement Underground granted to
Wisconsin Electric Power Company in instrument recorded on November 11, 2011, as
Document No. 3871128, and as approximately located and shown on the Survey.

 

17.                               Terms, provisions and conditions set forth in
Development Agreement 2014-2018 Brookfield Square Expansion Development dated
December 8, 2014 and recorded on December 12, 2014, as Document No. 4114690.

 

4

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Fargo ND Premises

 

1.                                      Real estate taxes and special
assessments, if any, for the current year and subsequent years, a lien not yet
due and payable.

 

2.                                      Development and Operating Agreement
recorded: August 12, 1971 at 1:45 p.m. in Book O-5 of Misc., Page 500 Document
#: 450595; Amendment to Development and Operating Agreement Recorded:
November 24, 1972 at 2:05 p.m. in Book X-5 of Misc., Page 599 Document #:
464567.

 

3.                                      Easements as may be contained on the
recorded Plat of West acres Mall Addition Recorded: April 3, 2002 at 8:00
a.m. in Book S1 of Plats, Page 91 Document #: 1011788.

 

5

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Greendale WI Premises

 

1.                                      Taxes, general and special for the year
2015, not now due and payable, and taxes, general and special, for the second
installment for the year 2014, not yet due and payable.

 

2.                                      Mineral rights of the U.S. Government
set forth in Quit Claim Deed dated November 19, 1952 and recorded November 21,
1952 in Volume 3090 of Deeds on Page 516, as Document No. 3158499 and in Quit
Claim Deed recorded in Volume 3090 of Deeds on Page 519, as Document
No. 3158501.

 

3.                                      Terms, conditions and provisions of
Operating Agreement among Southridge Company, Sears, Roebuck and Co., Federated
Department Stores, Inc., Gimbel Brothers, Inc. and J.C. Penney Company, Inc.,
dated October 31, 1968 and recorded October 31, 1968 on Reel 448, Image 603, as
Document No. 4426795; as amended by First Amendment to Operating Agreement dated
June 2, 1969 and recorded August 29, 1969 on Reel 496, Image 374, as Document
No. 4484509; and as further amended by Second Amendment to Operating Agreement
dated December 12, 1969 and recorded March 31, 1970 on Reel 524, Image 714, as
Document No. 4517460; and as further amended by Third Amendment to Operating
Agreement dated December 23, 1970 and recorded May 6, 1971 on Reel 584, Image
1871, as Document No. 4589576; as assigned by Assignment and Assumption of
Operating Agreement dated March 17, 1986 and recorded March 25, 1986 on Reel
1860, Image 666, as Document No. 5898793; as amended by Supplements to Operating
Agreement by and between Southridge Company and Federated Department
Stores, Inc. dated October 31, 1968 and recorded October 31, 1968 on Reel
448, Image 700, as Document No. 4426797; Southridge Company and J.C. Penney
Company, Inc., dated October 31, 1968 and recorded October 31, 1968 on Reel
448, Image 712, as Document No. 4426800; Southridge Company and Sears, Roebuck
and Co., dated September 4, 1970 and recorded October 13, 1970 on Reel
554, Image 223, as Document No. 4553024; and as amended by Memorandum of
Agreement by and between Southridge Company and Gimbel Brothers, Inc. dated
October 31, 1968 and recorded February 6, 1969 on Reel 463, Image 764, as
Document No. 4444432.

 

4.                                      Utility easement granted to Wisconsin
Electric Power Company, its successors and assigns, recorded August 6, 1971 on
Reel 602, Image 1846, as Document No. 4612748, and as approximately located and
shown on an ALTA/ACSM Land Title Survey prepared by Gregory S. McVicar on behalf
of The Edge Group LLC, dated March 13, 2015 and last revised March 31, 2015,
Project No. 20150016-03 (the “Survey”).

 

5.                                      Utility easement granted to Wisconsin
Electric Power Company, its successors and assigns, recorded September 16, 1971
on Reel 610, Image 1033, as Document No. 4622564, and as approximately located
and shown on the Survey. 14. Easements, Setbacks and other matters as shown on
Certified Survey Map No. 8067, as Document No. 9622931, and as approximately
located and shown on the Survey.

 

6.                                      Terms and conditions of Redevelopment
Agreement dated December 16, 2011, filed September 5, 2012, as Document
No. 10156991.

 

6

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7.                                      Terms and conditions of Distribution
Easement Underground, granted to Wisconsin Electric Power Company, filed
January 8, 2013, as Document No. 10202382, and as approximately located and
shown on the Survey.

 

7

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Joliet IL Premises

 

1.                                      General Real Estate Taxes for years
2014, 2015 and subsequent years, not yet ascertainable or payable.

 

2.                                      Operating Agreement, dated December 7,
1977 and recorded December 9, 1977 as document R77-48631, as amended by First
Amendment to Operating Agreement recorded November 10, 1978 as document
R78-45043 and by the Second Amendment to the Operating Agreement as document 
R79-41766 made by Sears, Roebuck and Company etal and Homart Development
Corporation.

 

3.                                      Easement in favor of Commonwealth Edison
Company and Illinois Bell Telephone Company, their respective successors and
assigns, to install, operate and maintain all equipment necessary for the
purpose of serving the land and other property, together with right of access to
said equipment, and the provisions relating thereto, contained in the grant
recorded November 13, 1980 as document R80-30899; and as approximately located
and shown on an ALTA/ACSM Land Title Survey prepared by Sherrill
Associates, Inc., dated March 6, 2015 and last revised March 25, 2015, Job
No. 20150016-04 (the “Survey”).

Note: Plat of Vacation recorded November 3, 2011 as document R2011103773.

 

4.                                      Ordinance No. 15874, amending and
approving an amended planned unit development for the Westfield Louis Joliet
Mall, recorded May 4, 2007 as document R2007070031, and the terms and provisions
contained therein.

 

5.                                      Plat of Easement, recorded November 3,
2011 as document R2011103774, and the terms and provisions contained therein;
and as approximately located and shown on the Survey.

 

8

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Wauwatosa WI Premises

 

1.                                      Taxes, general and special for the year
2015, not now due and payable.

 

2.                                      Easements, licenses and other rights of
ingress and egress affecting the subject premises contained in lease of premises
other than subject premises executed by and between Froedtert Enterprises, Inc.,
as lessor and Marshall Field & Company, as lessee dated December 27, 1954 a
short form of which was recorded on December 29, 1954 in Volume 3381 of Deeds on
Page 109 as Document No. 3356848.

 

3.                                      Reciprocal Easements and Operating
Agreement entered into by and between Froedtert-Mayfair, Inc. and P. A.
Bergner & Co. of Illinois, dated October 17, 1986 and recorded October 17, 1986
on Reel 1977, Image 781 as Document No. 5975279.  The rights of
Froedtert-Mayfair under said instrument are now held of record by Mayfair
Property, Inc. as described by Affidavit recorded November 12, 1991 on Reel
2650, Image 528 as Document No. 6541362.  Covenants, conditions and restrictions
set forth in Warranty Deed executed by Froedtert-Mayfair, Inc., a Wisconsin
corporation, and S. D. Realty Company, a Wisconsin corporation, collectively, to
P. A. Bergner & Co. of Illinois, an Illinois Corporation, dated October 14, 1986
and recorded October 17, 1986 on Reel 1977, Image 776 as Document No. 5975277. 
Agreement To (I) Amend Reciprocal Easements and Operating Agreement, and
(II) Grant Option to Purchase Real Estate made and entered into by and between
Mayfair Property Inc., an Illinois corporation, and P.A. Bergner & Co., an
Illinois corporation, dated June 11, 1993 and recorded December 23, 1993, on
Reel 3189, Image 666, as Document No. 6876387. Option to purchase as contained
therein has expired by its terms.

 

4.                                      Utility easement granted by K. Evelyn
Gilbert to Wisconsin Electric Power Company, its successors and assigns by an
instrument dated September 22, 1943 and recorded October 13, 1943 in Volume 1950
of Deeds on Page 329 as Document No. 2451697.

 

5.                                      Utility Easement granted by S. D. Realty
Company to Wisconsin Telephone Company, its successors and assigns by an
instrument dated March 7, 1957 and recorded March 1, 1957 in Volume 3678 of
Deeds on Page 169 as Document No. 3563582, and as approximately located and
shown on an ALTA/ACSM Land Title Survey prepared by Sherrill Associates, Inc.,
dated March 6, 2015 and last revised March 23, 2015, Job No. 20150016-04 (the
“Survey”).

 

6.                                      Utility Easement granted by S. D. Realty
Company, et al, to Wisconsin Electric Power Company, its successors and assigns
by an instrument dated April 30, 1957 and recorded May 23, 1957 in Volume 3702
of Deeds on Page 186 as Document No. 3580282; and as approximately located and
shown on the Survey.

 

7.                                      Utility Easement granted by S. D. Realty
Company, et al to Milwaukee Gas Light Co., its successors and assigns by an
instrument dated May 24, 1957 and recorded June 4, 1957 in Volume 3705 of Deeds
on Page 583 as Document No. 3582768; and as approximately located and shown on
the Survey.

 

9

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8.                                      Indenture to encroach into West North
Avenue right-of-way for the purpose of installing lighting fixtures, executed by
Froedtert-Mayfair, Inc., dated July 9, 1980 and recorded August 11, 1980 on Reel
1314, Image 180 as Document No. 5415966.

 

9.                                      Distribution Easement Underground
granted to Wisconsin Electric Power Company dba We Energies recorded on
October 7, 2004, as Document No. 8879354; and as approximately located and shown
on the Survey.

 

10.                               Watermain Easement Agreement recorded as
Document No. 9014490; and as approximately located and shown on the Survey.

 

11.                               Sanitary Sewer Easement Agreement recorded as
Document No. 9014491; and as approximately located and shown on the Survey.

 

12.                               Utility Easement granted to Wisconsin Electric
Power Company d/b/a WE Energies, Wisconsin Bell, Inc., d/b/a AT&T Wisconsin and
Time Warner Entertainment Company, L.P. recorded as Document No. 9245376; and as
approximately located and shown on the Survey.

 

13.                               Utility Easement granted to Wisconsin Electric
Power Company d/b/a WE Energies, Wisconsin Bell, Inc., d/b/a SBC Wisconsin and
Time Warner Entertainment Company L.P. recorded as Document No. 9245377; and as
approximately located and shown on the Survey.

 

14.                               Permanent Maintenance Access and Temporary
Construction Easement recorded April 20, 2007 as Document No. 9420749; and as
approximately located and shown on the Survey.

 

15.                               Water Utility Easement by and between
Bonstores Realty One, LLC, a Delaware limited liability company and Mayfair
Mall, LLC, dated May 12, 2014, filed May 20, 2014, and recorded as Document
No. 10360674; and as approximately located and shown on the Survey.

 

16.                               Mayfair Mall Improvements Agreement by and
between Mayfair Mall, LLC and Bonstores Realty One, LLC dated as of May 12, 2014
and recorded on August 19, 2014, as Document No. 10386893. Affects the 2 level
garage, a portion of which is located in the northeasterly section of the
subject property shown on the Survey.

 

17.                               Distribution Easement Gas granted to Wisconsin
Gas LLC dba We Energies recorded on August 26, 2014, as Document No. 10389321
and as tied into Distribution Easement Gas recorded on August 26, 2014, as
Document No. 10389322; and as approximately located and shown on the Survey.

 

18.                               Real estate taxes for the year 2014 being paid
on the installment basis, none now delinquent.

 

10

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EXHIBIT D

 

BASIC RENT PAYMENTS

 

1.                                      Basic Rent.

 

(a)                                 Initial Term.  Subject to the adjustments
provided for in Paragraphs 2, 3 and 4 below, Basic Rent payable in respect of
the Term shall be $6,888,000 per annum, payable monthly in advance on each Basic
Rent Payment Date, in equal installments of $574,000 each.  Pro rata Basic Rent
for the period from the date hereof through the last day of July, 2015 shall be
paid on the date hereof.

 

(b)                                 Renewal Term.  Annual Basic Rent for the
first Lease Year of each Renewal Term shall be equal to the then escalated Basic
Rent in effect for the Lease Year immediately preceding the commencement of such
Renewal Term and shall be subject each year (including the first Lease Year of
each Renewal Term) to the annual adjustments provided for in Paragraphs 2, 3,
and 4 below.

 

2.                                      CPI Adjustments to Basic Rent.  The
Basic Rent shall be subject to adjustment, in the manner hereinafter set forth,
for increases in the index known as United States Department of Labor, Bureau of
Labor Statistics, Consumer Price Index, All Urban Consumers, United States City
Average, All Items, (1982-84=100) (“CPI”) or the successor index that most
closely approximates the CPI.  If the CPI shall be discontinued with no
successor or comparable successor index, Landlord and Tenant shall attempt to
agree upon a substitute index or formula, but if they are unable to so agree,
then the matter shall be determined by arbitration in accordance with the
rules of the American Arbitration Association then prevailing in New York City. 
Any decision or award resulting from such arbitration shall be final and binding
upon Landlord and Tenant and judgment thereon may be entered in any court of
competent jurisdiction.

 

3.                                      Effective Dates of CPI Adjustments. 
Basic Rent shall not be adjusted to reflect changes in the CPI until the first
(1st ) anniversary of the Basic Rent Payment Date occurring on the date in which
the first full monthly installment of Basic Rent shall be due and payable (the
“First Full Basic Rent Payment Date”).  As of the first (1st ) anniversary of
the First Full Basic Rent Payment Date and thereafter, annually, on each and
every anniversary of the First Full Basic Rent Payment Date during the Term (as
the same may be extended), Basic Rent shall be adjusted to reflect increases in
the CPI during the most recent one (1) year period immediately preceding each of
the foregoing dates (each such date being hereinafter referred to as the “Basic
Rent Adjustment Date”).

 

4.                                      Method of Adjustment for CPI Adjustment.

 

(a)                                 As of each Basic Rent Adjustment Date when
the average CPI determined in clause (i) below exceeds the Beginning CPI (as
defined in this Paragraph 4(a)), the Basic Rent in effect immediately prior to
the applicable Basic Rent Adjustment Date shall be multiplied by a fraction, the
numerator of which shall be the difference between (i) the average CPI for the
three (3) most recent calendar months (the “Prior Months”) ending prior to such
Basic Rent Adjustment Date for which the CPI has been published on or before the
forty-fifth (45th) day

 

--------------------------------------------------------------------------------

 

preceding such Basic Rent Adjustment Date and (ii) the Beginning CPI, and the
denominator of which shall be the Beginning CPI.  The product of such
multiplication (the “Product”) shall be added to the Basic Rent in effect
immediately prior to such Basic Rent Adjustment Date except as set forth to the
contrary in the following sentence.  Notwithstanding anything to the contrary
set forth herein, (1)if the sum of the Product and the Basic Rent in effect
immediately prior to such Basic Rent Adjustment Date results in an increase of
less than two percent (2%) in annual Basic Rent (or if there is no positive
difference), then Basic Rent shall be deemed to increase by two percent (2%)
until the next succeeding Basic Rent Adjustment Date and (2) if the sum of the
Product and the Basic Rent in effect immediately prior to such Basic Rent
Adjustment Date results in an increase of greater than four percent (4%) in
annual Basic Rent, then Basic Rent shall be deemed to increase by four percent
(4%) until the next succeeding Basic Rent Adjustment Date.  As used herein,
“Beginning CPI” shall mean the average CPI for the three (3) calendar months
corresponding to the Prior Months, but occurring one (1) year earlier. For the
avoidance of doubt, on each Basic Rent Adjustment Date, Basic Rent will increase
by not less than 2% and by not more than 4%.

 

(b)                                 Effective as of a given Basic Rent
Adjustment Date, Basic Rent payable under this Lease until the next succeeding
Basic Rent Adjustment Date shall be the Basic Rent in effect after the
adjustment provided for as of such Basic Rent Adjustment Date.

 

(c)                                  Notice of the new annual Basic Rent shall
be delivered to Tenant on or before the fifteenth (15th) day preceding each
Basic Rent Adjustment Date, but any failure to do so by Landlord shall not be or
be deemed to be a waiver by Landlord of Landlord’s rights to collect such sums. 
Tenant shall pay to Landlord, within ten (10) days after a notice of the new
annual Basic Rent is delivered to Tenant, all amounts due from Tenant, but
unpaid, because the stated amount as set forth above was not delivered to Tenant
at least fifteen (15) days preceding the Basic Rent Adjustment Date in question.

 

2

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EXHIBIT E

 

CASUALTY/CONDEMNATION PREMISES PERCENTAGE ALLOCATION OF BASIC RENT(1)

 

Joliet, IL Premises

 

10.6

%

Fargo, ND Premises

 

9.5

%

Ashwaubenon, WI Premises

 

14.3

%

Brookfield, WI Premises

 

23.8

%

Greendale, WI Premises

 

20.0

%

Wauwatosa, WI Premises

 

21.8

%

 

 

 

 

Total

 

100

%

 

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(1)  If any Related Premises ceases to be subject to this Lease due to a
casualty or condemnation event, the percentage shown on this Exhibit E for each
of the Related Premises which remains subject to this Lease shall be adjusted
proportionately so that the total of such percentages shall be 100%.

 

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EXHIBIT F

 

APPROVED SUBLEASES

 

1.              Fargo, ND Premises - Sublease dated as of the date hereof by and
between Tenant and Carson Pirie Scott II, Inc. for the Fargo, ND Premises.

 

2.              Ashwaubenon, WI Premises - Sublease dated as of the date hereof
by and between Tenant and The Bon-Ton Department Stores, Inc. for the
Ashwaubenon, WI Premises.

 

3.              Brookfield, WI Premises - Sublease dated as of the date hereof
by and between Tenant and The Bon-Ton Department Stores, Inc. for the
Brookfield, WI Premises.

 

4.              Greendale, WI Premises - Sublease dated as of the date hereof by
and between Tenant and The Bon-Ton Department Stores, Inc. for the Greendale, WI
Premises.

 

5.              Wauwatosa, WI Premises - Sublease dated as of the date hereof by
and between Tenant and The Bon-Ton Department Stores, Inc. for the Wauwatosa, WI
Premises.

 

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EXHIBIT G

 

EXISTING SUBLEASES

 

Brookfield, WI Premises

 

1.             Ground Lease dated April 28, 2006, between The Bon-Ton Department
Stores, Inc. (successor-in-interest to Carson Pirie Scott, Inc.), as landlord,
and Brookfield Square Parcel, LLC (“Brookfield”), as tenant, as amended by that
certain First Amendment to Ground Lease dated February 27, 2008.

 

2.             Ground Lease dated February 27, 2008, to be effective as of
April 28, 2006, between The Bon-Ton Department Stores, Inc
(successor-in-interest to Carson Pirie Scott, Inc.), as landlord, and
Brookfield, as tenant.

 

3.             License Agreement dated November 2, 2008 by and between The
Bon-Ton Department Stores, Inc. and USJesco International, Ltd., as amended by
that certain letter agreement dated December 4, 2008, as further amended by that
certain Amendment to License Agreement dated May 29, 2009 (“US Jesco License”).

 

4.             License Agreement dated January 6, 2010 by and between The
Bon-Ton Department Stores, Inc. and Feizy Import and Export Company, Ltd.
(“Feizy”), whereby Feizy assigned the same to Shemiran Rugs, Inc. pursuant to
that certain Assignment, Assumption and Consent Agreement dated August 5, 2014
(“Shemiran Rugs License”).

 

Greendale, WI Premises

 

1.             USJesco License.

 

2.             Shemiran Rugs License.

 

3.             License Agreement dated May 5, 2009 by and between The Bon-Ton
Department Stores, Inc. and TM Apparel, LLC, as amended by that certain First
Amendment to License Agreement dated May 13, 2009, as further amended by that
certain Second Amendment to License Agreement dated January 4, 2010 (“TM Apparel
License”).

 

Wauwatosa, WI Premises

 

1.             USJesco License.

 

2.             TM Apparel License.

 

Ashwaubenon, WI Premises

 

1.             USJesco License.

 

2.             TM Apparel License.

 

3.             Shemiran Rugs License.

 

--------------------------------------------------------------------------------

 

Fargo, ND Premises

 

1.             USJesco License.

 

2.             TM Apparel License.

 

2

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EXHIBIT H

 

POST-CLOSING OBLIGATIONS

 

Section 1

 

Site

 

Cost

 

Description

Brookfield, WI Premises

 

$

1,078

 

Repair sidewalks

 

 

$

1,750

 

inspect fire protection system

Fargo, ND Premises

 

$

1,641

 

Replace circuit breaker panel

 

 

$

65,550

 

Install elevator hydraulic unit

Ashwaubenon, WI Premises

 

$

24,200

 

Repair asphalt

Greendale, WI Premises

 

$

249

 

Repair concrete pillar

 

 

$

105

 

Repair ceiling tiles

 

 

$

151,350

 

Install elevator hydraulic unit

 

 

$

850

 

Replace sprinkler heads

Joliet, IL Premises

 

$

384

 

Replace ceiling tiles

 

 

$

1,200

 

Extend HVAC condensate pipe drain to roof drain

Wauwatosa, WI Premises

 

$

2,500

 

Repair roof leak

 

 

$

2,798

 

Replace drywall

 

 

$

535

 

Replace ceiling tiles

 

 

$

1,500

 

Repair malfunctioning ejector pipe

 

 

$

3,000

 

Test and inspect electrical systems

 

 

$

1,500

 

Inspect elevator

 

 

$

150,000

 

Repair expansion joint and structural column

Total

 

$

410,190

 

 

 

Section 2

 

Site

 

 

 

 

 

Wauwatosa, WI Premises

 

Remove seven empty 35-gallon drums in poor condition stored on roof

 

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SCHEDULE 28(b)

 

[Insert Store Scorecards]

 

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