Document:

Exhibit
10.64

 

L E A S E  C O N T R A C T

 

THIS LEASE CONTRACT entered into by and between “Landlord” and
“Tenant”
on date set forth hereinbelow, in accordance with the terms and conditions
hereinafter set forth.

 

W I T N
E S S E T H:

 

ARTICLE I

 

Summary of Basic Lease
Provisions

and Certain Defined Terms

 

	
   

  	
   

  	
  Section
  1.01  Basic Terms.  When used herein, the
  following terms shall have the indicated meanings:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  “LANDLORD”

  	
   

  	
  HIGHLAND VILLAGE
  HOLDING, INC.

  
	
   

  	
   

  	
  “NOTICE ADDRESS”

  	
   

  	
  4001 WESTHEIMER,

  HOUSTON, TEXAS 77027

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  “TENANT”

  	
   

  	
  HOUSTON S&W,
  L.P., a Texas limited partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TENANT’S TRADE
  NAME”

  	
   

  	
  (d/b/a) SMITH
  & WOLLENSKY RESTAURANT (or such other trade name as may be applicable to
  another restaurant concept which Tenant is allowed to operate pursuant to the
  Permitted Use [hereinafter defined]).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  State Where
  Formed

  	
   

  	
  Texas

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Employer I.D. #

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “NOTICE ADDRESS”

  	
   

  	
  c/o SMITH &
  WOLLENSKY OF HOUSTON, LLC

  1114 First Avenue

  New York, New York 10021

  Attention:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “GUARANTOR”

  	
   

  	
  THE SMITH &
  WOLLENSKY RESTAURANT GROUP,
 a Delaware corporation (A publicly
  traded company on the Nasdaq.)

  
	
   

  	
   

  	
  Address &
  Phone Number

  	
   

  	
  1114 First
  Avenue

  New York, New York 10021

  (212) 838-2061

  Attention:  Jim Dunn

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Employer I.D. #

  	
   

  	
   

  

 

1

 

Landlord and Tenant agree that the “Guaranty” as outlined as Exhibit “H” shall
expire not later than the end of the fifteen year primary term.

 

	
  4

  	
   

  	
  “LEASED
  PREMISES”

  	
   

  	
  Approximately 12,300 square feet (two-story building
  to include approximately 10,700 square feet with an approximately 1,600
  square foot balcony) constituting part of the Shopping Center as shown on Exhibit
  “A” also known as 4007 Westheimer.  The parties have agreed Tenant shall construct the balcony;
  however, Landlord shall contribute One Hundred and Fifty Thousand Dollars
  ($150,000.00) towards the cost of said balcony.  The balcony shall hold a minimum live load of 150 pounds per
  square foot.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5

  	
   

  	
  “LEASE
  TERM”

  	
   

  	
  A primary term of fifteen (15) years, together with
  all renewal terms.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TENDER”

  	
   

  	
  The act whereby Landlord delivers the Leased
  Premises to Tenant, free and clear of all rights and claims of prior tenants
  or other parties in possession and empty.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TENDER
  DATE”

  	
   

  	
  The date on which Landlord actually tenders the
  Leased Premises to Tenant, which shall occur no later than May 31, 2003.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “INSPECTION”

  	
   

  	
  Tenant shall have the right, within fifteen (15)
  days following the Tender Date, to cause the Leased Premises to be inspected
  for structural soundness.  If the
  results of such inspection are 
  unsatisfactory to Tenant, then Tenant shall have the right, by written
  notice given to Landlord prior to the end of such fifteen (15) day period, to
  terminate this Lease in which event Landlord shall return all prepaid rent to
  Tenant following which neither party shall have any further liability to the
  other under this Lease.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “COMMENCEMENT
  DATE”

  	
   

  	
  The date on which the Lease Term commences, which
  date shall be the earlier of (i) the date on which Tenant opens its
  restaurant to the public or (ii) (a) in the event the Tender Date occurs
  prior to January 1, 2003, the date which is three hundred days after the
  Tender Date; or (b) in the event the Tender Date occurs after January 1, 2003,
  the date which is two hundred and forty days after the Tender Date.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TERMINATION
  DATE”

  	
   

  	
  Last day of the one hundred eightieth full calendar
  month after Commencement Date.

  

 

2

 

6.                                                                                                                                                                                                                                       “MINIMUM
RENT”

 

	
  Years

  	
   

  	
  Monthly Rent

  	
   

  	
  Annual Rent

  	
   

  
	
  1 - 5

  	
   

  	
  $

  	
  40,000.00

  	
   

  	
  $

  	
  480,000.00

  	
   

  
	
  6 - 10

  	
   

  	
  $

  	
  43,333.33

  	
   

  	
  $

  	
  520,000.00

  	
   

  
	
  11-15

  	
   

  	
  $

  	
  47,500.00

  	
   

  	
  $

  	
  570,000.00

  	
   

  

 

Upon the execution hereof, in lieu of a “Security Deposit”, Tenant
shall tender a check in the amount of Fifteen Thousand & No/100 Dollars
($15,000.00) to be applied against the first month’s Minimum Rent payment.

 

	
   

  	
   

  	
  “ABATED RENT”

  	
   

  	
  Minimum Rent, in
  the amount of Three Hundred Thousand ($300,000) per Lease Year, shall be
  abated for a period of two (2) years. 
  Such abatement shall be applied against Tenant’s monthly minimum rent
  obligation at the rate of $25,000.00 per month so that Tenant shall only be
  obligated to pay monthly minimum rent at the rate of $15,000.00 per month for
  the first two (2) years.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  “PERCENTAGE RENT”

  	
   

  	
  A sum equal to
  Eight percent (8%) of all “Gross Sales” (as defined in Article IV)
  in excess of the applicable “Breakpoint” (as hereinafter defined)
  each “Lease
  Year” (as defined in Article IV).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “BREAKPOINT”

  	
   

  	
  Means the point,
  during any Lease Year, at which the Gross Sales achieved during such Lease
  Year are at a level which is sufficient to cause Percentage Rent to
  accrue.  As used in this Lease,
  Breakpoint shall mean either the “Natural 
  Breakpoint” or the “Unnatural Breakpoint” whichever is then
  applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “NATURAL BREAKPOINT”

  	
   

  	
  That amount of
  Gross Sales (hereinafter defined) which, when multiplied by the Percentage
  Rent (which for the purposes of this Lease is eight percent [8%]), produces a
  product equal to the Minimum Rent which is then applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “UNNATURAL BREAKPOINT”

  	
   

  	
  The applicable
  of the following levels of Gross Sales:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Lease Years 1 - 5

  	
  $7,000,000 per Lease Year

  
	
   

  	
   

  	
   

  	
   

  	
  Lease Years 6 - 10

  	
  $7,500,000 per Lease Year

  
	
   

  	
   

  	
   

  	
   

  	
  Lease Years 11 - 15

  	
  $8,000,000 per
  Lease Year

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  “PERMITTED
  USE”

  	
   

  	
  A high-end
  first-class white tablecloth restaurant or grill similar any one or more
  combinations of those existing

  

 

3

 

	
   

  	
   

  	
   

  	
   

  	
   Smith & Wollensky Restaurant Group,
  Inc. concepts known as (i) Smith & Wollensky, (ii) The Manhattan Ocean
  Club, (iii) Cite’ or (iv) Park Avenue Café. 
  During the first sixty (60) days following the Commencement Date,
  Tenant shall not be obligated to open for lunch.  Thereafter, Tenant will open the restaurant on the basis of 14
  meal periods per week during the balance of the initial Lease Year.  After the initial Lease Year, Tenant shall
  be permitted to reduce opening to a minimum of twelve (12) meal periods per
  week if Tenant does not average a minimum of sixty (60) covers per day for
  lunch on both Saturday and Sunday.  In
  the event that Tenant elects to close for lunch on either Saturdays or
  Sundays, or both, then in each subsequent Lease Year there shall be added to
  Tenant’s Gross Sales the actual amount of Gross Sales which were achieved by
  Tenant for the closed lunch shifts during either (i) the Lease Year
  immediately preceding such closing or (ii) the average of three (3) years
  preceding such closing, whichever is greater.

   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Tenant’s grill
  menu or Tenant’s combined restaurant and grill menu, as the same may be
  changed by Tenant from time to time, (Exhibit “I”) will be available for both
  lunch and dinner during all meal periods.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  No more than
  forty percent (40%) of total “Gross Sales” shall be from alcohol sales.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  “SECURITY DEPOSIT”

  	
   

  	
  Not Applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  “ADDITIONAL CHARGES”

  	
   

  	
  Not Applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “COMMON
  AREA PAYMENT”

  	
   

  	
  Not Applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TAX PAYMENT”

  	
   

  	
  Not Applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “INSURANCE
  PAYMENT”

  	
   

  	
  Not Applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “WATER COSTS”

  	
   

  	
  Responsibility
  of Tenant.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TRASH”

  	
   

  	
  Responsibility
  of Tenant.  Trash shall be maintained
  in a walk-in cooler.

  

 

4

 

	
   

  	
   

  	
  “RENEWAL OPTION”

  	
   

  	
  Two (2) Five (5)
  Year Options pursuant to the terms of the attached Renewal Option Rider.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
   

  	
  “TENANT ALLOWANCE”

  	
   

  	
  Seven Hundred
  Fifty Thousand Dollars ($750,000.00) pursuant to the terms of the attached
  Construction Rider, which amount includes the One Hundred Fifty Thousand
  Dollar ($150,000) Landlord contribution to the cost of the balcony.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
   

  	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit A: 
  Site Plan with Premises Crosshatched

   

  Exhibit B: 
  Highland Village Shopping Center Survey

   

  Exhibit C: 
  Final construction plans and specifications (working drawings) which
  need not be attached to Lease

   

  Exhibit C-1: 
  Tenant’s Affidavit

   

  Exhibit C-2: 
  General Contractor’s Affidavit and Lien Waiver

   

  Exhibit C-3: 
  Subcontractor’s Lien Waiver

   

  Exhibit D: 
  Subordination, Non-Disturbance and Attornment Agreement in favor of
  John Hancock Mutual Life Insurance Company

   

  Exhibit E: 
  Sign Renderings

   

  Exhibit F: 
  Tenant’s Parking Area

   

  Exhibit G: 
  Valet Parking Stand at the Leased Premises

   

  Exhibit H 
  Guaranty

   

  Exhibit I: 
  Grill Menu and Combined Restaurant and Grill Menu

   

  Exhibit J: 
  Eminent Domain Designation

   

  Exhibit K:  Employee Parking Areas

  

 

ARTICLE
II

 

Premises

 

Section 2.01  Leased
Premises.  Landlord
hereby leases to Tenant, and Tenant hereby leases from Landlord the Leased
Premises being the crosshatched portion of the building shown on the site plan
attached hereto as EXHIBIT “A”  and
made a part hereof for all purposes, such

 

5

 

building being located within the shopping center shown on the survey
attached hereto as EXHIBIT “B.” 
EXHIBIT “A,” EXHIBIT “B,” any additional land from time to
time designated by Landlord, existing and future buildings, parking area,
sidewalks, service area and other improvements now existing or hereafter
erected thereon are sometimes herein referred to as the “SHOPPING CENTER.”  Landlord reserves the right to
place in, under, over or through the Leased Premises pipes, wires, lines, and
facilities serving other areas of the Shopping Center provided such right is exercised
in a manner which does not unreasonably interfere with Tenant’s conduct of its
business at the Leased Premises.

 

Section 2.02  Intentionally
omitted.

 

Section 2.03  The
Leased Premises shall be improved in accordance with the Construction Rider attached
hereto and incorporated by reference herein for all purposes.

 

ARTICLE
III

 

Term

 

Section 3.01  Lease
Term.  The Lease Term
shall commence on the Commencement Date and shall terminate on the Termination
Date, unless sooner terminated in accordance with the terms and conditions
hereinafter set forth.  At the request
of Landlord from time to time made, Tenant will execute one or more memoranda
or letters stating the commencement and termination dates of the Lease.

 

Section 3.02  Lease
Rights Vested.  Notwithstanding
the fact that the Lease Term will commence at a date subsequent to the
execution of this instrument by Landlord and Tenant, such parties intend that
each shall have vested rights immediately upon the signing of this instrument
and that this instrument shall be fully binding and in full force and effect
from and after execution hereof by Landlord and Tenant.

 

ARTICLE
IV

 

Rental

 

Section 4.01  Minimum
Rent.  Tenant
covenants and agrees to pay to Landlord the Minimum Rent, in monthly
installments, in Houston, Harris County, Texas, at 4001 Westheimer, Houston,
Texas 77027 or at such other address as Landlord may from time to time
designate in writing.  All such Minimum
Rent payments shall be delivered to Landlord at Landlord’s designated address
on or before the first day of each calendar month, monthly in advance, for each
and every month in the Lease Term.  Upon
execution of this Lease, Tenant will pay Landlord Minimum Rent for the first
full calendar month of the Lease Term; but, if the Lease Term does not commence
on the first day of a calendar month, the Minimum Rent for such month shall be
prorated and the excess which was paid by Tenant shall be applied as a credit
against the next accruing installment of Minimum Rent.

 

Section 4.02 
Percentage Rent.  In
addition to Minimum Rent, Tenant agrees to pay to Landlord the Percentage Rent.

 

6

 

Percentage Rent due for each Lease Year shall be
payable commencing on the fifteenth (15th) day of the month immediately
following the first month of such Lease Year in which the aggregate amount of
Gross Sales for such Lease Year exceeds the Breakpoint applicable to such Lease
Year and thereafter on the fifteenth (15th) day of each succeeding month during
the remainder of such Lease Year on all additional Gross Sales.

 

In the event that the Minimum Rent for any Lease Year
shall be reduced or abated for any reason whatsoever, other than by reason of
the Abated Rent provided for during the first two (2) Lease Years as set forth
in Paragraph 6 of Section 1.01 of this Lease, the Breakpoint for such Lease
Year shall be reduced by a percentage thereof equal to the percentage decrease
in the Minimum Rent payable for said Lease Year.  In the event that any Lease Year contains more or less than
twelve (12) full Fiscal Months (hereafter defined), the Breakpoint shall be
proportionately increased or decreased, as the case may be, for any such Lease
Year.

 

The term “GROSS SALES” includes all moneys or things
of value received or receivable, including lease or rental revenue (without
deductions for uncollectibles), by Tenant, its sublessees, licensees or
concessionaires or others, for merchandise sold or services performed or
equipment, merchandise or other inventory items leased or rented or business
conducted (including interest, time-price differential, finance charges and
service charges on time-payment sales, credit sales or lay-a-way sales) in,
about or from the Leased Premises (including, without limitation, orders
received in person or by mail, telephone or telegraph, and services performed
by Tenant away from the Leased Premises), including transactions in which
delivery is made to the customer at the Leased Premises but the order is taken
elsewhere, transactions in which the order is taken at the Leased Premises but
delivery is made elsewhere, receipts from mechanical and other vending
machines, and deposits not refunded to purchasers.

 

The term “GROSS
SALES” SHALL NOT INCLUDE:

 

(1)                                  governmental
excise or sales taxes added to the selling price of the item and paid by the
Tenant directly to the Government, or

 

(2)                                  refunds
or allowances to customers not in excess of the original selling price of the
item, or

 

(3)                                  transfers
or exchanges of merchandise to another of Tenant’s stores made in the regular
course of Tenant’s business and not for the purpose of avoiding consummation of
a sale in the Leased Premises, or

 

(4)                                  returns
to shippers or manufacturers, or

 

(5)                                  sales
from promotions, discounts and employee meals with a maximum cap of four
percent (4%) of all Gross Sales; or

 

(6)                                  sales
of Tenant’s “REMOVABLE TRADE FIXTURES” (as hereinafter defined) after use
by Tenant in the Leased Premises; or

 

(7)                                  credit
card fees.

 

7

 

Under no circumstances shall there be any deduction
from Gross Sales by reason of Tenant’s being liable to pay any franchise tax,
capital stock tax, income tax or similar or dissimilar tax based upon Tenant’s
income, capital structure, or profits.

 

All Gross Sales will be recorded either (i) through
modern cash registers from which a cash receipt shall be given to each customer
for each purchase or (ii) in such other manner as may be approved in writing by
Landlord.  Full and adequate records and
books of account shall be accurately maintained by Tenant of all its business
operations in or about the Leased Premises.

 

All books of account, records, daily cash register
total slips, sales slips and Federal income tax returns relating to Tenant’s
operation in or about the Leased Premises will be retained by Tenant for a
period of three (3) years after preparation, and will be open to inspection by
Landlord (or its representative) at Tenant’s corporate offices at all
reasonable times.  Tenant shall also
furnish Landlord, upon request, copies of any publicly recorded financial
statements of Guarantor which are prepared during the Lease Term.

 

Landlord acknowledges that Tenant maintains its Gross
Sales records based on fiscal reporting periods consisting of two (2)
sequential four (4) week periods followed by one (1) five (5) week period (each
such reporting period being herein called a “Fiscal Month”).

 

The term “LEASE YEAR,” as used herein, shall, in the
case of the first Lease Year, mean the period which commences with the Commencement
Date and terminates on the last day of the twelfth (12th) Fiscal Month
following the Commencement Date.  Such
first lease Year shall include the partial month, if any, at the commencement
of the Lease Term if the Lease Term does not commence on the first day of a
Fiscal Month.

 

Each subsequent “LEASE YEAR” shall mean a period of twelve
(12) full Fiscal Months commencing with the date following the last day of the
preceding Lease Year.

 

The last Lease Year of the Lease Term shall be the
period which commences on the day immediately following the last day of the
preceding Lease Year and terminates on the last day of the Lease Term, and the
parties recognize that such last Lease Year may be less than twelve (12) full
Fiscal Months depending upon the date of termination of the Lease Term.

 

Within fifteen (15) days after the end of each Fiscal
Month in the Lease Term, Tenant will deliver to Landlord a statement signed by
an officer of the general partner of Tenant accurately setting forth the amount
of Gross Sales made during the preceding Fiscal Month itemized in reasonable
detail and will contemporaneously therewith pay any Percentage Rent due.  Within thirty (30) days after the end of
each Lease Year, Tenant will furnish to Landlord a statement signed and sworn
to by an officer of the general partner of Tenant accurately showing Gross
Sales for the preceding Lease Year itemized in reasonable detail and will
contemporaneously therewith pay any additional Percentage Rent due for such
Lease Year.

 

Landlord may, at any reasonable time or times during
the hours of 8:00 a.m. to 5:00 p.m., Monday through Friday, have an audit made
of any such statement, may examine Tenant’s sales tax reports, Tenant’s
inventory movement sheets, and other relevant records for such period, and
acceptance of the Percentage Rent tendered by Tenant shall not prejudice these
rights.  So long

 

8

 

as Tenant is not under an Event of Monetary Default more than one time
during any Lease Year, then and only in that event, Landlord shall have the
right to inspect or audit Tenant’s books and records only one time during such
Lease Year.  Except as provided in the
following paragraph, the cost of the audit shall be borne by Landlord unless
such audit shows that Tenant’s statement was understated by three percent (3%)
or more of the Gross Sales of Tenant for the relevant Lease Year, in which
event Tenant will pay the cost of such audit. 
Any audit by Landlord may be required by Landlord upon three (3) days
prior written notice to Tenant.

 

In the event Tenant fails to submit to Landlord its
statement of Gross Sales in accordance with the terms and conditions contained
herein, Percentage Rent shall be payable by Tenant based upon Gross Sales
generated by Tenant in the Leased Premises during the same period of the
immediately preceding Lease Year and such sum shall be immediately due and
payable by Tenant to Landlord.  At any
time after the date upon which such statement should have been submitted, Landlord
shall have the right to audit Tenant’s books and records at Tenant’s sole cost
and expense and Tenant shall pay to Landlord upon demand the cost of such
audit.  Any additional Percentage Rent
due or any refund due Tenant following such audit shall be immediately due and
payable.

 

Computation of the Percentage Rent shall be made
separately and independently for each Lease Year of the Lease Term, without
regard to the Gross Sales made during or rental paid for any other Lease Year.

 

Section 4.03  Rent Due
and Payable.  All rent
(including both Minimum Rent and Percentage Rent) and other sums hereunder
provided to be paid by Tenant shall be due and payable by Tenant without
demand, deduction, abatement or off-set except as expressly provided herein.  Past due rent and other past due payments
shall bear interest from maturity at the rate of fifteen percent (15%) per
annum from the date due until paid.

 

All other sums and charges of whatsoever nature
required to be paid by Tenant to Landlord pursuant to the terms of this Lease
(including, without limitation, all payments set forth in Article XXII, below
entitled “ADDITIONAL
RENT”) constitute additional rent (whether or not same be designated
“ADDITIONAL
RENT”) and failure by Tenant to timely pay such other sums or
charges may be treated by Landlord as a failure by Tenant to pay Minimum Rent.

 

ARTICLE
V

 

Utilities

 

Section 5.01  Cost of
Utilities.  Tenant
will at its own cost and expense pay for all water, sanitary sewer, gas,
electricity and other utilities used in the Leased Premises and will save and
hold Landlord harmless from any charge or liability for same.  Such payments shall be made directly to the
supplier of any utility separately metered (or submetered) to the Leased
Premises and on such equitable basis as may be determined by Landlord with
respect to any such utilities which are metered to Tenant in common with other
occupants of the Shopping Center.

 

Section 5.02 
Interruption of Utilities.  No
interruption or malfunction of any utility services shall constitute an
eviction or disturbance of Tenant’s use and possession of the Leased

 

9

 

Premises or a breach by Landlord of any of its obligations hereunder or
render Landlord liable for any damages or entitle Tenant to be relieved from
any of its obligations hereunder or grant Tenant any right of off-set or
recoupment.  In the event of any such
interruption of any such services, Landlord shall use reasonable diligence to
restore such service in any circumstances in which such interruption is caused
by Landlord’s fault.

 

ARTICLE
VI

 

Use

 

Section 6.01 
Permitted Use.  Tenant
will use the Leased Premises solely for the Permitted Use.  Tenant will not use or permit use of the
Leased Premises for any other purpose without the written consent of
Landlord.  Such business will be
advertised as and operated under the Tenant’s Trade Name or such other trade
name as may be applicable to the other restaurant concepts which are included
in the Permitted Use.  Tenant, at its
own expense: will comply with all Federal, State, municipal and other laws,
codes, ordinances, rules and regulations applicable to the Leased Premises and
the business conducted therein by Tenant; will comply with such regulations as
Landlord may reasonably promulgate regarding sanitation, cleanliness and other
matters at the Leased Premises or within the Shopping Center, including without
limitation removal of garbage, trash and other waste.  Tenant will not conduct any auction or bankruptcy or fire or
“lost-our-lease” or “going-out-of-business” or similar sale or make any
unlawful use of the Leased Premises or permit any unlawful use thereof.

 

Section 6.02  Merchants’
Association.  Intentionally omitted.

 

Section 6.03 
Continuous Use and Hours of Operation. 
Tenant binds and obligates itself to occupy and use
the entire Leased Premises continuously during the entire  Lease Term during at least the business
hours set forth hereinbelow for the purpose provided above and will operate
such business during such period with diligence, in accordance with the best
standards of operation of such business, and in a manner reasonably calculated
to produce maximum Gross Sales as defined above.

 

Tenant’s minimum hours of operation during the Lease
Term shall be as follows:

 

	
  Monday - Friday:

  	
   

  	
  12:00 noon through 11: 00 p.m.

  
	
   

  	
   

  	
   

  
	
  Saturday:

  	
   

  	
  12:00 noon through 11:00 p.m.

  
	
   

  	
   

  	
   

  
	
  Sunday:

  	
   

  	
  12:00 noon through 9:00 p.m.

  

 

10

 

Tenant may close
on the following holidays:

 

New Year’s Day

Easter Sunday

Memorial Day

Independence Day

Labor Day

Thanksgiving Day

Christmas Day

 

Section 6.04  Trash
Removal.  Tenant shall
be responsible, at its sole cost and expense, for the removal of its trash and
rubbish.  In the event Landlord has
established or should establish a common trash and rubbish removal or disposal
program at the Shopping Center, Tenant may participate in such program at
Tenant’s discretion.

 

Section 6.05  Locking
System.   Intentionally omitted.

 

ARTICLE
VII

 

Common Area

 

Section 7.01  A.
Common Area.  Landlord
will provide a “COMMON AREA” (as hereinafter defined) in the Shopping Center
and make necessary repairs thereto and, except when prevented from doing so by
causes beyond its control, Landlord will also provide lighting in the immediate
area of Tenant’s parking area as outlined on EXHIBIT “F” in the Shopping
Center from dusk until the later of (i) 11:00 o’clock P.M., or (ii) one hour
after the closing hour of Tenant.

 

Landlord shall have the right in its sole discretion
to increase said hours in which it provides lighting in the parking area.  Tenant, its employees, customers and
invitees shall have the non-exclusive use, along with others, of the Common
Area.  Landlord shall have the right,
from time to time, to change the arrangement, layout and/or size of the Common
Area, and designate employee parking spaces and tenant truck loading zones, and
to do and perform such other acts in the Common Area as Landlord shall, in its
good faith judgment, determine to be advisable.  Landlord shall have the right, from time to time, to establish,
modify and enforce rules and regulations with respect to the Common Area and to
police same.  Tenant shall have the duty
to furnish Landlord, upon written request, a written description of the make
and model and the license plate number for every automobile owned or used by
Tenant, its agents and employees in the Shopping Center, together with such
other information as Landlord may reasonably request pertaining to the
establishment, modification and enforcement of rules and regulations concerning
the Common Area.

 

B.            For
purposes of this Lease, the phrase “COMMON AREA” includes the aforesaid
customer’s parking area, employees’ parking area, service drives and service
roads, traffic islands, landscaped areas, loading and service areas, sidewalks,
roofs, gutters and downspouts, sprinkler risers serving all or any buildings
located in the Shopping Center, electrical gutters serving all or any buildings
located in the Shopping Center, and such other portion or portions of

 

11

 

the Shopping Center (not leased or rented or held by Landlord for the
purposes of being leased or rented to other tenants) as may from time to time
be designated or treated by Landlord as part of the Common Area, as well as
drainage facilities and lighting facilities servicing any one or more of the
aforesaid areas.

 

C.            Throughout
the Lease Term, Landlord shall provide Tenant with 158 parking spaces in the
Shopping Center for Tenant’s customers during the hours of 11:00 AM to 2:30 PM
and from 5:30 PM until Tenant’s closing each day that Tenant is open for
business.  Attached hereto and
incorporated herein is EXHIBIT “G” which depicts the “TENANT’S
PARKING AREA.”  The Tenant’s
Parking Area will include the primary parking field in front of the demised
premises and additional parking areas as depicted on EXHIBIT “G”.  Landlord shall provide such additional
parking areas as it may designate from time to time.  The Tenant’s Parking Area will be coned and controlled by the
valet service provided by Landlord during the said hours of operation of Tenant
so that self parking in the Tenant’s Parking Area will not be allowed by
patrons of the Shopping Center or Tenant’s customers unless otherwise agreed to
by Landlord and Tenant.  If the Tenant’s
parking needs exceed the 158 parking spaces contained in Tenant’s Parking
Areas, then Landlord will use its best efforts to provide additional parking
for the Tenant’s customers elsewhere. 
Landlord will provide an integrated valet service for the Shopping
Center so customers can drop off and pick up at any valet stand (of which there
will be a minimum of three, one of which shall be located at the Leased
Premises in the area shown on Exhibit “G”) within the Shopping Center.

 

Section 7.02  Display
of Merchandise.  Not
Applicable.

 

Section 7.03  Leased
Premises not Common Area.  Nothing
in this Article or elsewhere in this Lease shall be construed as constituting
the Common Area, or any part thereof, as part of the Leased Premises.

 

Section 7.04  Employee
Parking.  Tenant
acknowledges Landlord’s desire to provide retail customers of the Shopping
Center with sufficient parking reasonably close to the retail stores.  Accordingly, Tenant and Tenant’s employees may
park only in the areas designated by Landlord as employee parking areas which
areas are those which are shown by crosshatching on EXHIBIT “K” attached hereto
and made a part hereof.  Tenant shall
furnish Landlord with a complete list of license numbers of all automobiles
operated by Tenant and its employees; however, Landlord cannot make such a
request more often than once each quarter plus once in connection with the
Christmas shopping season.  Tenant
agrees that if any automobile or other vehicle owned by Tenant or any of its
employees is parked in any part of the Shopping Center other than the areas
designated by Landlord for employee parking or in any public street in
residential subdivisions within a one mile proximity of the Shopping Center,
Landlord has the right to remove the vehicle and Landlord is not responsible
for any towing or storage fees regarding such vehicle; and Tenant must
reimburse Landlord, upon demand and as additional rent, for all costs and
expenses Landlord incurs in taking such action.  In addition, Tenant agrees that if any automobile or other
vehicle owned by Tenant or any of its employees shall be parked in any part of
the Shopping Center other than the specified areas designated for employee
parking or in any public street in residential subdivisions within a one mile
proximity of the Shopping Center, Tenant shall pay to Landlord as additional
rent upon demand, a parking fee of $25.00 per day for each day, or part
thereof, that such automobile or other vehicle is so parked.

 

12

 

Attached hereto and incorporated herein is EXHIBIT “K” which depicts the
“TENANT’S
EMPLOYEES’ PARKING AREA” as of the Commencement Date.  However, Landlord retains the right
described in Section 7.01 A of this Lease, including but not limited to the
right to change the arrangement of the Common Area and the designation of
employee parking spaces as Landlord, in its good faith judgment, determines to
be advisable.

 

ARTICLE
VIII

 

Assignment and Subletting

 

Section 8.01  No
Assignment or Subletting.  Subject
to the exceptions set forth in Section 8.02 hereinbelow, Tenant shall not
assign this Lease or sublease the Leased Premises or any part thereof or
mortgage, pledge or hypothecate its leasehold interest or grant any concession
or license within the Leased Premises or sublease any operating department
therein without Landlord’s prior written consent, which such consent shall,
except as hereinafter set forth in Section 8.03, be in Landlord’s sole and
absolute discretion, and any attempt to do any of the foregoing shall be void
and of no effect.

 

The prohibition against assigning or subletting shall
be construed to include a prohibition against any assignment or subletting by
operation of law.

 

Section 8.02  Change
of Ownership of Tenant.   Anything to the contrary notwithstanding in this Article, Tenant
shall have the right to assign or sublet its leasehold interest without
Landlord’s consent or approval in the three following circumstances only:

 

(i)                                     any
merger, consolidation or reorganization or sale of assets or stock of or
involving Tenant or Guarantor, provided that the surviving, resulting or
reorganized entity has a net worth of at least equal to that of Tenant or
Guarantor, respectively, immediately prior to the consummation of such
transaction;

 

(ii)                                  any
transfer of all or any of Tenant’s partnership interests or assets to any
entity affiliated with Tenant or Guarantor provided that such entity has a net
worth of at least equal to that of Tenant or Guarantor, respectively,
immediately prior to the consummation of such transaction; or

 

(iii)                               any public offering,
listing, redemption, hypothecation, conversion, exchange or other similar
disposition of all any portion of Tenant’s partnership interest.

 

Tenant shall give Landlord written notice of any such
assignment within thirty (30) days after such occurrence.

 

Section 8.03 
Qualified Restaurant.   Notwithstanding
the provisions of Section 8.01, Landlord agrees that it will not unreasonably
withhold, condition or delay its consent to the sublease of the Leased
Premises, or the assignment of the Lease, to a restaurant entity which meets
the following criteria (a “QUALIFIED RESTAURANT”):

 

(i)                                     The
net worth of such Qualified Restaurant is, when taken together with the net
worth of any affiliate of such Qualified Restaurant which is then willing  to and

 

13

 

actually executes a guaranty of such Qualified
Restaurant’s obligations to Landlord, at least equal to the net worth of
Guarantor as it then exists;

 

(ii)                                  The
Qualified Restaurant is a high end, first class, white tablecloth restaurant;
and

 

(iii)                               The theme or concept of
the Qualified Restaurant is not the same or substantially similar to that of
any other restaurant then operating in the Shopping Center.

 

Landlord shall be entitled to unreasonably withhold
its consent to the sublease or assignment of the Leased Premises to a Qualified
Restaurant provided it releases, in writing, Guarantor from Guarantor’s
liability on the Guaranty.

 

Section 8.04  No
Waiver by Landlord.  If
this Lease be assigned or if the Leased Premises be subleased (whether in whole
or in part) or in the event of the mortgage, pledge or hypothecation of the
leasehold interest or grant of any concession or license within the Leased
Premises or if the Leased Premises be occupied in whole or in part by anyone
other than Tenant, Landlord may nevertheless collect rent from the assignee,
sublessee, mortgagee, pledgee, party to whom the leasehold interest was
hypothecated, concessionee or licensee or other occupant and apply the net
amount collected to the rent payable hereunder, but no such transaction or
collection of rent or application thereof by Landlord shall be deemed a waiver
of these provisions or a release of Tenant from the further performance by
Tenant of its covenants, duties and obligations hereunder unless contained in a
written document executed by Landlord specifically acknowledging such waiver.

 

ARTICLE
IX

 

Repair and Maintenance

 

Section 9.01 
Landlord’s Repairs.  Upon
the condition precedent that Tenant shall have given Landlord prior written
notice of the item damaged, Landlord will repair the following damage to the
Leased Premises but none other:

 

(i)                                     damage
to the roof (exclusive of flashing around the rooftop air conditioning unit)
and damage to structural portions of the Leased Premises (said “STRUCTURAL
PORTIONS” consisting only of the foundation and members supporting
the roof but excluding, by way of example, but not limitation, any exterior
wall at which there is an entrance to or exit from the Leased Premises, all
interior partition walls and the interior side of building perimeter walls
enclosing the Leased Premises, all doors, moldings, trim, window frames, door
frames, closure devices, and hardware); and

 

(ii)                                  damage
to any utility lines (sewer, water, gas or electrical) located outside the
boundaries of the Leased Premises;

 

provided, however, in the event any of the foregoing
damage is caused by one or more acts or omissions of Tenant, its agents,
employees, customers or invitees, or any burglar or unauthorized entrant, or
any other person (with the exception of Landlord itself), or if a damaged
utility line exclusively serves the Leased Premises, then (in either of such events)
the Tenant shall bear the

 

14

 

cost of such repairs; however, Tenant shall be permitted to pursue
recovery from any person or entity who was responsible for damaging a utility
line which exclusively serves the Leased Premises.

 

Section 9.02  Tenant’s
Repairs.  All damage,
other than that which Landlord undertakes to repair in Section 9.01 or Articles
XI or XIX will be repaired and all maintenance will be performed and
replacements and renewals will be made by Tenant at Tenant’s cost and expense
including without limitation all other maintenance and repairs necessary or
appropriate to cause the Leased Premises to be suitable for Tenant’s intended
commercial purpose and occupancy; and Tenant will make all repairs, perform all
maintenance and provide all renewals and replacements at the Leased Premises,
including but not limited to heating and air conditioning equipment (whether
any such equipment is roof mounted or otherwise affixed outside the Leased
Premises), electrical equipment and fixtures, plumbing fixtures and equipment,
elevators, wiring (including that within walls or ceiling or under flooring or
floor covering), and plumbing lines (including water lines and gas lines)
within walls or ceilings and under flooring or floor covering.

 

Tenant will replace all broken or cracked plate glass
and glass windows.  Tenant shall not
make, or permit to be made, any penetration in the roof of the building of
which the Leased Premises are a part, but except to the extent such
penetrations are necessary or desirable in connection with Tenant’s heating,
ventilating, air conditioning or extraction systems.  All such penetrations (and subsequent closures and flashings) (“TENANT’S
PERMITTED ROOF REPAIR”) shall be done at Tenant’s sole cost and
expense and in a manner which complies with applicable building codes and in a
manner which is reasonably satisfactory to Landlord.  Tenant shall be responsible for all rooftop flashing around the
rooftop air conditioning unit.   As a
condition precedent to Tenant’s right to perform Tenant’s Permitted Roof
Repair, Tenant shall take out and maintain ( or cause the contractor under its
construction contract to take out and maintain) public liability insurance,
builder’s risk and such other insurance required under the attached
Construction Rider in such amounts and with such conditions as set forth in the
Construction Rider and shall provide evidence of the existence of such policies
to Landlord prior to the commencement of any such roof penetration.  Tenant shall indemnify, defend and hold
Landlord harmless from any liability, claims, actions, causes of action, loss
or damage of any kind whatsoever, directly or indirectly resulting from
Tenant’s Permitted Roof Repair.

 

If Landlord considers necessary any repairs,
maintenance, renewals or replacements required by the provisions of this Lease
to be made or provided by Tenant and Tenant refuses or neglects to make same
after reasonable notice (except in the event of an emergency in which event no
prior notice shall be required), Landlord shall have the right (but shall not
be obligated), to make such repair, perform such maintenance or provide such
renewal or replacement.  Tenant will, on
demand pay the actual cost thereof incurred by Landlord.

 

In the event that Tenant elects to use the roof for
outdoor dining in any manner, then Tenant shall be responsible for the roof and
deck thereto.

 

Section 9.03  No
Waste.  Tenant will
not commit waste and will not injure the Leased Premises or the building of
which they are a part, but will maintain the Leased Premises in a clean,
attractive condition and in good repair, ordinary wear and tear excepted, and
shall also

 

15

 

keep sidewalks which are immediately adjacent to the Leased Premises
clean.  Upon termination of this Lease,
Tenant will surrender and deliver up the Leased Premises to Landlord
broom-clean, excepting only ordinary wear and tear and casualty damage and
excepting also any damage required hereunder to be repaired by Landlord.   Upon termination of this Lease, Tenant
shall have no responsibility to remove initial or subsequent improvements to
the Leased Premises provided such improvements were made in accordance with the
terms of the Lease.  Upon termination of
this Lease, Tenant will also surrender to Landlord all keys to the Leased
Premises at the place stated herein for the payment of rent and inform
Landlord, in writing, of all combinations on locks, safes and vaults, if any,
at the Leased Premises.

 

Section 9.04 
Landlord’s Right to Enter.  Landlord
will have a right to enter the Leased Premises at any reasonable time during
Tenant’s business hours or in the event of an emergency at any time, to inspect
the condition thereof, to make necessary repairs and improvements, or to repair
or maintain pipes, wires, and other facilities serving its nearby property and
for other lawful purposes.  Landlord
shall use its best efforts not to unreasonably interfere with the conduct of
Tenant’s business.

 

Section 9.05 
Mechanic’s Liens.  Should
any mechanic’s liens or other liens or affidavits claiming liens be filed
against the Leased Premises or any portion thereof or interest therein for any
reason whatsoever incident to the acts or omissions of Tenant, its agents or
contractors, Tenant shall cause the same to be canceled and discharged of
record by payment, bonding or otherwise, within fifteen (15) days after notice
by Landlord.

 

ARTICLE
X

 

Additions and Fixtures

 

Section 10.01  No
Alterations without Landlord’s Consent.  
Tenant will make no alterations or additions to the
exterior of the Leased Premises, nor any alterations or additions to the
interior of the Leased Premises which affect either the structural points or
the exterior of the Leased Premises, without the prior written consent of
Landlord, in its absolute and sole discretion.

 

Tenant may make alterations or additions to the
interior of the Leased Premises which do not affect either the structural
points or exterior of the Leased Premises without Landlord’s prior written
approval.

 

Section 10.02 
Removable Trade Fixtures.  Subject
to the lien and security interest and other rights of Landlord referred to in
Article XV, Tenant shall remove only “REMOVABLE TRADE FIXTURES,” as hereinafter
defined, (excluding all components of the HVAC system, pipes, paneling or other
wall covering or floor covering), and, in addition to other applicable
provisions of this Lease regarding such removal, the following shall apply:

 

(1)                                  such
removal must be made prior to the termination of the Lease Term;

 

(2)                                  Tenant
must not be in default of any obligation or covenant under this Lease at the
time of such removal; and

 

16

 

(3)                                  such
removal must be effected without damage to the Leased Premises or the building
of which the Leased Premises are a part and Tenant must promptly repair all
damage caused by such removal.

 

For the purposes hereof, the phrase “REMOVABLE
TRADE FIXTURES” means the following:  all of Tenant’s signs, counters, tables, chairs, desks, racks,
merchandisers and displayers, standards, wall brackets, hang-rods, shelves,
mirrors, marking equipment, kitchen equipment, cash registers, other business
machines and all other furniture, inventory, supplies and equipment used in the
ordinary course of Tenant’s business.

 

All plumbing or electrical wiring connections exposed
as a result of the removal of Tenant’s Removable Trade Fixtures, or other
alterations, additions, fixtures, equipment and property installed or placed by
it in the Leased Premises shall be capped by Tenant in a safe and workmanlike
manner.

 

Section 10.03  Taxes
and Assessments. 
Tenant shall timely pay the full amount of all taxes, assessments,
impositions, levies, charges, excises, fees, licenses and other sums levied,
assessed, charged or imposed by any governmental authority or other taxing
authority upon Tenant’s leasehold interest under this Lease and all
alterations, additions, fixtures (including Removable Trade Fixtures),
inventory and other property installed or placed or permitted at the Leased
Premises by Tenant.  Within thirty (30)
days after notice from Landlord, Tenant shall furnish Landlord a true copy of
receipts evidencing such payment received by Tenant from the governmental
authority or other taxing authority assessing such charge.

 

ARTICLE
XI

 

Fire and Destruction of
Premises

 

Section 11.01 
Landlord’s Election to Repair.  If
at any time during the Lease Term, the Leased Premises or any portion of the
Shopping Center which is reasonably necessary to the viable operation of
Tenant’s business in the Leased Premises should be totally destroyed or damaged
to the extent of fifty (50%) percent or more of its replacement value by fire
or other casualty, Landlord shall have the election to repair and reconstruct
the damaged portion of the Leased Premises and/or the Shopping Center to
substantially the condition which existed at the time of Landlord’s tender of
possession of the Leased Premises to Tenant or alternatively, to cancel this Lease.  Landlord will notify Tenant of its election
within sixty (60) days after receipt of written notice from Tenant of such
damage or destruction.

 

In the event that the Lease Term has a period of at
least two (2) years remaining and Landlord has provided notice of its election
not to repair or reconstruct the damaged portion of the Leased Premises,
Tenant, at Tenant’s sole cost, shall have a right to repair or reconstruct the
Leased Premises damaged, subject to Landlord’s approval which approval shall
not be unreasonably withheld, delayed or conditioned, as to the plans and
specifications for such repair or reconstruction.  Tenant shall provide written notice to Landlord of its election
within thirty (30) days after receipt of Landlord’s notice.

 

17

 

Section 11.02  Lease
to Continue in Effect.  In
any circumstances described above where Landlord is either obligated to repair
and restore the Leased Premises, or where Landlord or Tenant elects to repair
and restore the Leased Premises, this Lease shall continue in full force and
effect, and such repairs will be made by Landlord within a reasonable time
thereafter, subject to delays caused by governmental restrictions, strikes,
lockouts, shortages of labor or material, acts of God, war or civil commotion,
fire, unavoidable casualty, inclement weather or any other cause beyond the
control of Landlord (all of the aforesaid causes for delay being herein
sometimes referred to as “FORCE MAJEURE”).

 

Minimum Rent shall abate equitably during the period
to reflect the extent to which the Leased Premises are unfit for use by Tenant
and not actually used by Tenant in the ordinary conduct of its business.  For purposes of computing the Percentage
Rent due hereunder during any such period, the Breakpoint shall be reduced by
the same percentage that the Minimum Rent is reduced as provided for in the
preceding sentence.

 

Section 11.03 
Tenant’s Election to Terminate.  In
the event any casualty damage occurs to the Leased Premises to the extent of
fifty (50%) percent or more of replacement value and such damage either (i)
occurs during the last three (3) years of the Lease Term or (ii) will take more
than one hundred eighty (180) days to repair, then Tenant shall be entitled to
terminate this Lease by giving Landlord written notice of such election within
sixty (60) days from the date of the casualty.

 

ARTICLE
XII

 

Liability and Indemnity

 

Section 12.01 
Tenant’s Indemnification of Landlord. 
Tenant agrees to indemnify and hold Landlord and
Landlord’s employees harmless from all claims (including costs and expenses of
defending against all of the aforesaid) arising (or alleged to arise) from any
act or omission of Tenant or Tenant’s agents, employees, assignees, sublessees,
contractors, customers or invitees, or arising from any injury to or death of
any person or persons or damage to or destruction of the property of any person
or persons occurring in or about the Leased Premises or on the sidewalks
adjacent thereto, and Tenant assumes responsibility for the condition of the
Leased Premises and agrees to give Landlord written notice in the event of any
damage, defect or disrepair therein.

 

Section 12.02 
Landlord’s Indemnification of Tenant.  Landlord shall indemnify and hold Tenant and
Tenant’s employees harmless from all claims (including costs and expenses of
defending against all of the aforesaid) arising (or alleged to arise) from any
negligent act or omission of Landlord or Landlord’s agents, employees or
contractors in, on or about the Shopping Center during the Lease Term.

 

Section 12.03 
Tenant’s Casualty Insurance.  Tenant
agrees to take out and maintain at all times during the Lease Term a policy of
fire and extended coverage insurance on its alterations, additions, fixtures, equipment,
merchandise and other personal property placed at the Leased Premises
(including, but not limited to the rooftop HVAC).  Such policy shall contain a replacement cost endorsement.

 

18

 

In the event that Tenant sustains a loss by reason of
fire or other casualty, and such fire or casualty is caused in whole or in part
by acts or omissions of Landlord, its agents, servants or employees, then
Tenant agrees to look solely to its insurance proceeds (if any); and Tenant
shall have no claim or right of recovery against Landlord, or the agents,
servants or employees of Landlord; and no third party shall have any claim or
right of recovery by way of subrogation or assignment or otherwise.  Such insurance policy shall contain a loss
payable clause designating Tenant and Landlord as loss payees as their
respective interests may appear.

 

Tenant shall be responsible for the safety and
personal well being of Tenant’s employees, both within the Leased Premises and
in the Common Area.  Tenant agrees that
Landlord shall not, except as set forth in Section 12.02, be responsible or
liable to Tenant or those claiming under Tenant (including, without limitation,
Tenant’s agents, servants, employees, customers and invitees) for injury, death
or damage or loss occasioned by the acts or omissions of persons occupying any
other part of the Shopping Center or occasioned by the condition of the
Shopping Center or property of any other occupant of any part of the Shopping
Center or the acts or omissions of any other person or persons present at the
Shopping Center who are not occupants of any part thereof, whether or not such
persons are present with the knowledge or consent of Landlord.

 

Section 12.04 
Tenant’s Liability Insurance.  Tenant
will take out and maintain, at its own cost and expense, comprehensive general
liability insurance coverage in a minimum amount of $1,000,000.00 combined
single limit, which comprehensive general liability policy shall include (i)
coverage for bodily injury and death, property damage and products liability
coverage; (ii) contractual liability coverage insuring the obligations of
Tenant under the terms of this Lease; and (iii) fire legal liability coverage
with respect to the Leased Premises and the building of which they are a part
in the amount of at least $25,000.00. 
Such policy shall name Landlord (and any of its affiliates,
subsidiaries, successors and assigns designated by Landlord as an additional
insured.  Such policy shall contain a
contractual liability endorsement.

 

If Tenant is engaged in any way in the sale of
alcoholic beverages, either for consumption of alcoholic beverages on the
premises or off the premises, Tenant will also maintain liquor liability
insurance with the limits of not less than $1,000,000.00 each common cause and
$1,000,000.00 aggregate.  If written on
a separate policy from the comprehensive general liability policy, such policy
shall name Landlord (and any of its affiliates, subsidiaries, successors and
assigns designated by Landlord) as an additional insured.  Such policy shall contain a cross liability
endorsement or severability provision.

 

Section 12.05 
Tenant’s Required Insurance Policies. 
The policies of insurance required to be maintained by
Tenant under the terms of this Lease are referred to in this Section 12.05 in
the singular as a “REQUIRED POLICY” and in the plural as “REQUIRED
POLICIES.”  All Required
Policies shall be in a form and with a company reasonably acceptable to
Landlord and shall be endorsed so as to be non-cancelable with respect to
Landlord and not subject to material change except upon thirty (30) days prior
written notice to Landlord given in the manner set forth in Article XXIII,
below.  Tenant agrees to initially
deliver to Landlord a duplicate original or certificate of each Required Policy
upon tender of possession of the Leased Premises to Tenant and at all times
during the Lease Term, to maintain a duplicate original or a certificate of

 

19

 

all Required Policies on deposit with Landlord.  Tenant shall be entitled to satisfy all
Required Policies through blanket coverage policies.

 

Section 12.06 
Landlord Insurance Requirements.  Landlord shall, at all times during the
Lease Term, insure the Building and Common Areas for not less than eighty
percent (80%) of their replacement value under fire and extended coverage
insurance policies.  Landlord shall
maintain commercial liability insurance, with contractual liability coverage,
with limits which are at least as much as are required to be carried by
Tenant.  ANYTHING IN THIS LEASE TO THE CONTRARY
NOTWITHSTANDING, LANDLORD WAIVES ANY AND ALL RIGHTS OF RECOVERY, CLAIM, ACTION
OR CAUSE OF ACTION, AGAINST TENANT, ITS AGENTS, OFFICERS AND EMPLOYEES, FOR ANY
LOSS OR DAMAGE THAT MAY OCCUR TO THE BUILDING OR SHOPPING CENTER, OR ANY
IMPROVEMENTS THERETO OR ANY PERSONALTY OR IMPROVEMENTS CONTAINED THEREIN, BY
REASON OF FIRE, THE ELEMENTS, OR ANY OTHER CAUSE WHICH COULD BE INSURED AGAINST
UNDER THE TERMS OF STANDARD FIRE AND EXTENDED COVERAGE INSURANCE POLICIES,
REGARDLESS OF CAUSE OR ORIGIN, INCLUDING NEGLIGENCE OF THE TENANT, THEIR
AGENTS, OFFICERS AND EMPLOYEES, BUT EXCLUDING ANY OF THE FOREGOING TO THE
EXTENT SAME ARISE OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF TENANT
OR ITS AGENTS, OFFICERS OR EMPLOYEES.

 

ARTICLE
XIII

 

Diversion of Sales

 

Section 13.01  Radius
Clause.  Tenant agrees
that during the first five (5) years of the Lease Term, neither Tenant nor any
officer of Guarantor nor any person, corporation, partnership, joint stock
association, trust or other firm or entity which controls Tenant or is
controlled by Tenant or is under common control with either Tenant or Guarantor
(herein a “TENANT
AFFILIATE”) shall either directly or indirectly, commence operation
of any restaurant which in any manner competes with the restaurant which is to
be operated at the Leased Premises within six (6) miles of the Leased Premises,
which Tenant acknowledges is a reasonable radius for the purpose of this
provision.  Landlord shall be entitled
to enforce the foregoing prohibition by all legal and equitable means
including, without limitation, the obtaining of injunctive relief.

 

Following the first five
(5) years of the Lease Term, a Tenant Affiliate shall be permitted to open
another restaurant within a six (6) mile radius of the Leased Premises provided
that (i) such other restaurant operates under a name other than the Trade Name
under which Tenant is then operating, (ii) has a different decor and theme than
the restaurant then operated at the Leased Premises and (iii) there are not
more than two (2) steak dishes on the menu of such other restaurant.  Further, if a Tenant Affiliate opens such
other restaurant within a six (6) mile radius of the Leased Premises, then
Tenant also covenants that the Percentage Rent which it will pay to Landlord
under this Lease will not, for any subsequent Lease Year, be less than the
greater of (i) the Percentage Rent payable for the Lease Year preceding the
Lease Year in which the other restaurant opened, or (ii) the average Floor
Percentage Rent payable for the three (3) Lease Years

 

20

 

preceding the Lease Year in which the other restaurant opened (such
greater amount being herein called the “Floor Percentage Rent”), and that the
Percentage Rent will increase every Lease Year thereafter by an amount equal to
two and one-half percent (2 1⁄2%) of the Floor Percentage Rent.

 

ARTICLE
XIV

 

Security Deposit

 

Section 14.01  Security
Deposit.  Not Applicable.

 

ARTICLE
XV

 

Landlord’s Lien

 

Section 15.01 
Landlord’s Lien.  To
secure the payment of all rent due and to become due hereunder and the faithful
performance of this Lease by Tenant and to secure all other indebtedness and
liabilities of Tenant to Landlord now existing or hereafter incurred, Tenant
hereby gives to Landlord an express contractual lien and security interest on
all property (including fixtures, equipment, chattels and merchandise) which
may be placed in the Leased Premises. 
All exemption laws are hereby waived in favor of said lien and security
interest and in favor of Landlord’s statutory lien.

 

Section 15.02 
Subordination of Landlord’s Lien. 
 Notwithstanding the language of Section 15.01 granting Landlord a
contractual lien and security interest on Tenant’s personal property, Landlord
agrees that, upon the written request of Tenant, Landlord shall execute a
written agreement to subordinate its liens and security interest on Tenant’s
personal property to any lien and security interest in favor of Tenant’s
institutional lenders or for one or more purchase money liens against personal
property purchased by Tenant for its use in, on or about the Leased Premises.

 

This lien and security
interest may be foreclosed with or without court proceedings by public or
private sale provided Landlord gives Tenant at least ten (10) days’ notice of
the time and place of said sale, and Landlord shall have the right to become
the purchaser, upon being the highest bidder at such sale.  Contemporaneously with the execution of this
Lease (or at any time if requested by Landlord), Landlord shall be authorized
to file Financing Statements in sufficient form so that when properly filed,
the security interest hereby given shall hereunder, also have all of the rights
and remedies of a secured party under the Texas Uniform Commercial Code (the
Texas Business and Commerce Code).

 

ARTICLE
XVI

 

Default, Remedies and
Determination of Damages

 

Section 16.01  Events
of Default.  Each of
the following acts or omissions of Tenant or occurrences shall constitute an “EVENT OF
DEFAULT”:

 

21

 

(a)                                  Failure
or refusal by Tenant to timely pay Minimum Rent or Percentage Rent or
Additional Rent or any other sum when due hereunder and the continuation of
such failure following the expiration of the fifth (5th) day after
notice of such failure has been given to Tenant (provided, however, that
Landlord shall not be required to give written notice to Tenant more than two
times during any single Lease Year); or

 

(b)                                 Failure
or refusal by Tenant to comply with the obligations of Tenant pertaining to
Permitted Use set forth in Article VI of this Lease; or

 

(c)                                  Failure
or refusal by Tenant to timely perform or observe any other covenant, duty or
obligation of Tenant under this Lease including the Construction Rider;
provided, however, notwithstanding the occurrence of such Event of Default,
Landlord shall not be entitled to exercise any of the remedies provided for in
this Lease or by law unless such Event of Default continues beyond the
expiration of thirty (30) days following notice to Tenant of such Event of
Default; however, if such failure is not of a nature which is reasonably
susceptible of being cured within a thirty (30) day period, then Tenant shall,
provided it has commenced such cure prior to the end of such thirty (30) day
period and is diligently pursuing same, have such additional time as may be
reasonably necessary in order to complete such cure; or

 

(d)                                 Abandonment
or vacating of the Leased Premises or any significant portion thereof; or

 

(e)                                  The
entry of a decree or order for relief by a court having jurisdiction over
Tenant or any guarantor of Tenant’s obligations hereunder in an involuntary
case under the federal bankruptcy laws, as now or hereafter constituted, or any
other applicable federal or state bankruptcy, insolvency or other similar law,
or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of Tenant or any guarantor of Tenant’s
obligations hereunder or for any substantial part of either of said parties’
property, or ordering the winding-up or liquidation of either of said parties’
affairs and the failure by Tenant to obtain a dismissal of such decree or order
within sixty (60) days; or

 

(f)                                    The
commencement by Tenant or any guarantor of Tenant’s obligations hereunder of a
voluntary case under the federal bankruptcy laws, as now constituted or
hereafter amended, or any other applicable federal or state bankruptcy,
insolvency or other similar law.

 

Section 16.02 
Landlord’s Remedies.  This
lease and the term and estate hereby granted and the demise hereby made are
subject to the limitation that if and whenever any Event of Default shall
occur, after such notice, if any, as is provided in Section 16.01, Landlord
may, at its option, in addition to all other rights and remedies given
hereunder or by law or equity, do any one or more of the following:

 

(a)                                  Terminate
this Lease, in which event, Tenant shall immediately surrender possession of
the Leased Premises to Landlord;

 

(b)                                 Enter
upon and take possession of the Leased Premises and expel or remove Tenant and
any other occupant therefrom, with or without having terminated the Lease; or

 

22

 

(c)                                  Alter
locks and other security devices at the Leased Premises.

 

Exercise by Landlord of any one or more remedies set
forth in Subsection 16.02(b) or (c) shall not be deemed to be an acceptance of
surrender of the Leased Premises by Tenant, whether by agreement or by
operation of law, it being understood that such surrender can be effected only
by the written agreement of Landlord and Tenant.

 

Upon the occurrence of an Event of Default, Landlord
shall not be obligated to give any notice (written or oral) regarding
alteration of locks or other security devices at the Leased Premises, prior to
Landlord’s alteration of such locks or security devices.  In the event Landlord exercises its rights
to alter the locks at the Leased Premises, Landlord shall only be required to
provide Tenant with a new key during Landlord’s regular business hours,
provided that in no event shall Landlord be required to provide Tenant with a
key until such time as Tenant cures all defaults under the Lease and, if
required by Landlord, Tenant increases the amount of the Security Deposit being
held under the terms of Section 14.01 hereof by an amount equal to twice the
monthly Minimum Rent and Additional Charges due hereunder.

 

To the extent of any inconsistency between this Lease
and the provisions of Section 93.002 of the Texas Property Code (as it may be
hereafter amended), it is the agreement of the parties that this Lease shall
govern and control.  Upon the occurrence
of an Event of Default, Landlord shall give Tenant three (3) days written
notice to vacate the premises prior to instituting proceedings in forcible
detainer against Tenant.  Tenant hereby
waives (to the extent legally permissible) any and all notices otherwise
required at common law or by the Texas Property Code, as same presently exist
or may be hereafter amended (or any subsequent similar statutes relating to
notice prior to instituting such an action or proceeding).  Landlord shall otherwise have all of the
rights and remedies of a Landlord under Chapters 24 and 93 of the Texas
Property Code now in effect or as may be hereafter revised.

 

If Tenant should fail to make any payment or cure any
Event of Default hereunder within the time herein permitted, Landlord, without
being under any obligation to do so and without thereby waiving such Event of
Default, may make such payment and/or remedy such other Event of Default for
the account of Tenant (and enter the Leased Premises for such purpose), and
thereupon Tenant shall be obligated to, and hereby agrees to pay Landlord, upon
demand, all costs, expenses and disbursements incurred by Landlord in taking
such remedial action.

 

In the event of termination of this Lease or of
Tenant’s right to possession of the Leased Premises or repossession of the Leased
Premises for an Event of Default, Landlord shall comply with the provisions of
Section 91.006 of the Texas Property Code.

 

Section 16.03  Post
Default Rent.  In the
event Landlord elects to terminate Tenant’s right to possession of the Leased
Premises without terminating this Lease, Landlord may hold Tenant liable for
all rent and other indebtedness accrued to the date of such termination, plus
such rent and other indebtedness as would otherwise have been required to be
paid by Tenant to Landlord during the period following termination of the Lease
Term (or Tenant’s right to possession of the Leased Premises, as the case may
be) measured from the date of such termination by Landlord until the date which
would have been the date of expiration of the term as stated in Article III
(had Landlord not elected to terminate Tenant’s right to possession on

 

23

 

account of such Event of Default) diminished by any net sums thereafter
received by Landlord through reletting the Leased Premises during said period
(after deducting expenses incurred by Landlord as provided in the succeeding
paragraph).

 

Actions to collect amounts due by Tenant provided for
in this paragraph of Section 16.03 may be brought from time to time by Landlord
during the aforesaid period, on one or more occasions, without the necessity of
Landlord’s waiting until expiration of such period; and in no event shall
Tenant be entitled to receive any excess of rent (or rent plus other sums)
obtained by reletting over and above the rent herein reserved; however, all
such excess sums shall be credited against Tenant’s liability to Landlord.

 

In case of an Event of Default, Tenant shall also be
liable for and shall pay to Landlord at Houston, Harris County, Texas, in
addition to any sum provided to be paid above: broker’s fees actually incurred
by Landlord in connection with reletting the whole or any part of the Leased
Premises provided such fees are reasonable within the market context taking
into consideration the time and circumstances then in existence; the reasonable
and necessary costs of removing and storing Tenant’s or other occupant’s
property; the reasonable and necessary costs of repairing, altering, remodeling
or otherwise putting the Leased Premises into condition acceptable to a new
tenant or tenants, and all reasonable expenses incurred by Landlord in
enforcing Landlord’s remedies, including reasonable attorney’s fees.

 

Section 16.04 
Tenant’s Remedy.  In
the event of any Event of Default by Landlord, Tenant’s exclusive remedy shall
bring an action for damages (Tenant hereby waiving the benefit of any laws
granting it a lien upon the property of Landlord and/or upon rent due
Landlord), but prior to any such action Tenant will give Landlord written
notice specifying such default with particularity, and Landlord shall thereupon
have a reasonable period, but in no event less than thirty (30) days (except in
an emergency to prevent loss or damage to property or life)  in which to cure any such default; however,
if such failure is not of a nature which is reasonably susceptible of being
cured within a thirty (30) day period, then Landlord shall, provided it has
commenced such cure prior to the end of such thirty (30) day period and is
diligently pursuing same, have such additional time as may be reasonably
necessary in order to complete such cure.

 

Unless and until Landlord fails so to cure any Event
of Default after such notice or having so commenced thereafter fails to
exercise reasonable diligence to complete such curing, Tenant shall not have
any remedy or cause of action by reason thereof except in the case of an
emergency to prevent loss or damage to property or life in which event Tenant
shall be entitled to resort to self-help remedies.  All obligations of Landlord hereunder will be construed as
independent covenants, not conditions; and all such obligations will be binding
upon Landlord only to the extent such obligations accrued during the period of
its ownership of the Shopping Center and not thereafter.

 

Section 16.05 
Reasonable Attorney’s Fees.  In
the event that Landlord institutes any action or proceeding to enforce payment
of a monetary sum due hereunder and is the prevailing party in such action
then, in such event, Tenant will pay to Landlord all reasonable costs incurred
by Landlord in attempting to collect such sum, including reasonable attorneys’
fees, which shall not be less than ten percent (10%) of all such sums owing by
Tenant to Landlord.  In all other

 

24

 

litigation matters in connection with this Lease, the prevailing party
shall be entitled to receive reasonable attorney fees.

 

Section 16.06 
Cross-Default.  Intentionally omitted.

 

ARTICLE
XVII

 

Non-Waiver

 

Section 17.01  Non
Waiver.  Neither
acceptance of rent (or any portion thereof) or any other sums payable by Tenant
hereunder (or any portion thereof) by Landlord nor failure by Landlord to
complain of any action, non-action or default of Tenant shall constitute a
waiver as to any breach of any covenant or condition of Tenant contained herein
nor a waiver of any of Landlord’s rights hereunder.  Waiver by Landlord of any right for any default of Tenant shall
not constitute a waiver of any right for either a prior or subsequent default
of the same obligation or for any prior or subsequent default of any other
obligation.  No right or remedy of
Landlord hereunder or covenant, duty or obligation hereunder shall be deemed
waived by Landlord unless such waiver be in writing, signed by Landlord.

 

ARTICLE
XVIII

 

Landlord-Tenant Relation

 

Section 18.01  No
Venture or Partnership.  The
relation created by this Lease Contract is that of landlord and tenant.  Neither the provisions for Percentage Rent
nor any other provision of this Lease shall be construed in such a way as to
constitute Landlord and Tenant joint venturers or co-partners to make Tenant
the agent of Landlord or to make Landlord liable for the debts of Tenant.

 

ARTICLE
XIX

 

Eminent Domain

 

Section 19.01  Taking
of Leased Premises.  If
there shall be taken during the Lease Term any portion of the Leased Premises,
which renders the remaining portion unsuitable for Tenant’s operations, or that
portion of the Common Area designated on EXHIBIT “J”  attached
hereto, by any authority having the power of eminent domain, then and in that
event, the term of this Lease shall cease and terminate, and the date of such
termination shall be, at Landlord’s election, the earlier of either the date
upon which possession shall be tendered to such authority by Landlord or the
date upon which possession is taken by such authority.

 

Section 19.02  Eminent
Domain Award.  All
sums awarded or agreed upon between Landlord and the condemning authority for
the taking of the fee or the leasehold estate, whether as damages or as
compensation, will be the property of Landlord.  Tenant hereby assigns to Landlord all proceeds, whether by way of
compensation or damages, otherwise payable to Tenant for the leasehold estate
by reason of such taking; however, Tenant reserves the right to its

 

25

 

separate award for the loss of its improvements, business interruption
and relocation costs provided such award does not reduce Landlord’s award.

 

Section 19.03  Rent
Payable Until Taking.  If
this Lease should be terminated under any provision of this Article, rental and
other sums due and payable by Tenant hereunder shall be payable up to the date
of termination and Landlord will refund to Tenant that portion of any such
rental and other sums paid in advance, but not yet earned by such date.

 

Section 19.04 
Voluntary Conveyance by Landlord. 
In the event that any authority having the power of
eminent domain requests that Landlord convey to such authority all or any
portion of the Shopping Center or all or any portion of the Leased Premises,
Landlord shall have the right to make a voluntary conveyance to such authority
of all or any portion of the Shopping Center or all or any portion of the
Leased Premises whether or not proceedings have been filed by such authority;
and in the event of any such voluntary conveyance, it shall nevertheless for
all purposes hereunder be deemed that there has been a taking by such authority
of the property voluntarily conveyed by Landlord.  Accordingly, all of the provisions of Sections 19.01, 19.02, and
19.03 hereof shall be applicable notwithstanding such voluntary conveyance.

 

ARTICLE
XX

 

Holding Over

 

Section 20.01 
Month-to-Month Tenancy.  If
Tenant should remain in possession of the Leased Premises after the expiration
of the term of this Lease, without the execution of a new Lease or the written
consent of Landlord, then Tenant shall be deemed to be occupying the Leased
Premises as a tenant from month-to-month, subject to all the covenants and obligations
of this Lease, except that as liquidated damages by reason of such holding
over, the monthly amounts payable by Tenant under this Lease shall be increased
to two hundred percent (200%) of the monthly amounts payable in the last month
of the stated term.

 

Section 20.02  Notice
of Termination.  The
above described tenancy from month-to-month may be terminated by either party
upon thirty (30) days notice to the other.

 

Section 20.03  Rent
after Notice of Termination.  Any
rent due after notice has been given is to be calculated according to Section
20.01 on a pro-rata basis.  If upon
notice of termination by Landlord, Tenant tenders rent in excess of the amount
due and payable pursuant to the formula in Section 20.01, and Landlord accepts
such payment, the acceptance of such payment will not operate as a waiver by
Landlord of the notice of termination, unless such waiver is in writing and
signed by Landlord.  Any such excess
amounts tendered and accepted shall be promptly refunded by Landlord, after
deducting therefrom any amounts owed Landlord.

 

ARTICLE
XXI

 

Landlord’s Mortgage

 

Section 21.01  Tenant
Shall Subordinate Leasehold Interest.  Landlord
covenants and agrees that it will, not later than sixty (60) days after the
execution of this Lease, obtain and

 

26

 

deliver to Tenant at Tenant’s sole cost and expense a Subordination,
Non-Disturbance and Attornment Agreement in the form of Exhibit “D” attached
hereto and made a part hereof (“SNDA”) from John Hancock Mutual Life Insurance
Company (“Current Lender”).  Landlord
represents and warrants that Current Lender holds the only lien (other than the
inchoate lien for taxes not yet due and payable) on the Building and Shopping
Center.  If Landlord does not timely
obtain and deliver the SNDA then Tenant shall be permitted, at any time within
one hundred eighty (180) days after the execution of this Lease and prior to
the delivery of the SNDA, to terminate this Lease, in which event all rent paid
by Tenant shall be refunded by Landlord to Tenant.  If Tenant fails to exercise its termination right within such
time period then Tenant shall be deemed to have waived such termination
right.  Subject to Landlord’s obligation
to deliver the SNDA from Current Lender and provided that Landlord delivers an
SNDA from all future lenders, Tenant agrees that its interest under this Lease
shall be subordinate to any mortgage, deed of trust or similar device now or
hereafter placed upon the Leased Premises or all or any portion of the Shopping
Center by Landlord if the mortgagee or beneficiary under said deed of trust or
lender for whose benefit any other security device is created so elects, and,
upon notice to Tenant of such election, Tenant will execute any instruments
required to evidence such subordination. 
Likewise, such mortgagee or beneficiary under said deed of trust or
lender for whose benefit any other security device is created may elect, by
notice to Tenant, to make this Lease superior to such mortgage or deed of trust
or other security device; and in the event of such election, Tenant will
execute any instruments required to evidence such superiority.

 

Section 21.02 
Certificates Concerning Lease.  Landlord
and Tenant shall execute and deliver to each other, at such time or times as
either Landlord or Tenant may request, a certificate stating:

 

(a)                                  Whether
or not the Lease is in full force and effect;

 

(b)                                 Whether
or not the Lease has been modified or amended in any respect, and submitting
copies of such modifications or amendments, if any;

 

(c)                                  Whether
or not there are any existing Events of Default under this Lease to the
knowledge of the party executing the certificate, and specifying the nature of
such Events of Default, if any; and

 

(d)                                 Such
other information as may be reasonably requested.

 

The aforesaid certificate(s) shall be delivered to
Landlord or Tenant, as the case may be, promptly upon receipt of a written
request therefor, but in no event more than ten business (10) days following
receipt of such request.

 

ARTICLE
XXII

 

Additional Rent

 

Section 22.01  Additional
Rent.  Not Applicable.

 

27

 

ARTICLE
XXIII

 

Notice

 

Section 23.01  Written
Notice.  Any notice
which may or shall be given under the terms of this Lease shall be in writing
and shall be either delivered to the Notice Address of either Landlord or
Tenant, by hand or sent by United States Registered Certified Mail, adequate
postage prepaid.  Either party’s address
may be changed from time to time by such party by giving notice as provided
above, except that the Leased Premises may not be used by Tenant as the sole
Notice Address.  No change of address of
either party shall be binding on the other party until notice of such change of
address is given as herein provided.  A
post office receipt for registration of such notice or signed return receipt
shall be conclusive that such notice was delivered in due course of mail if
mailed as provided above.

 

For purposes of the calculation of various time
periods referred to herein, notice delivered by hand shall be deemed received
when delivered to the place for giving notice to a party referred to above and
notice mailed in the manner provided above shall be deemed completed upon the
earlier to occur of (i) actual receipt as indicated on the signed return
receipt, or (ii) three (3) days after posting as herein provided.  Finally, any written notice addressed as
provided above and actually received by the addressee shall constitute
sufficient notice for all purposes under this Lease.

 

ARTICLE
XXIV

 

Tenant’s Signs

 

Section 24.01  Cost
and Installation.  Tenant
shall be responsible for the costs and installation of a building fascia sign
on the Building.  The signage and
canopies to be installed by Tenant are depicted on EXHIBIT “E” attached
hereto.  Except as shown on EXHIBIT “E” or
otherwise approved by Landlord in writing, which such approval will not be
unreasonably withheld, conditioned or delayed, no sign, placard or
advertisement, or exterior or interior window sign, placard or advertisement
shall be painted, erected or displayed and no awnings shall be erected.  If Tenant has a lighted sign Tenant shall
cause Tenant’s exterior sign to be placed on a time clock and photoelectric
cell device such that the electricity illuminating such sign shall keep
Tenant’s electric sign on from dusk until at least 11:00 o’clock P.M., every
night during the Lease Term (except that such lighting may be extinguished at
10:00 o’clock p.m. on Sunday nights).

 

ARTICLE
XXV

 

Hazardous Waste

 

Section 25.01 
Environmental Compliance.  Tenant
shall not allow the Leased Premises, or any construction, operation of any
business, or any other activity thereon, or any occupancy or use thereof, to
violate any applicable law, statute, ordinance, rule, regulation, order or
determination of any federal, state, or local governmental authority or any
board of fire underwriters (or other body exercising similar function), or any
restrictive covenant or deed

 

28

 

restriction (recorded or otherwise) affecting the Leased Premises,
including without limitation, all applicable zoning ordinances and building
codes, flood disaster laws and health, industrial hygiene, and environmental
laws, statutes, ordinances, rules and regulations, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C.
Section 9601 et seq., as amended from time to time, and regulations promulgated
thereunder (“CERCLA”), the Resource Conservation and Recovery Act of 1976,
42 U.S.C. Section 6901 et seq., as amended from time to time and regulations
promulgated thereunder (“RCRA”), the Texas Water Code, as amended
from time to time, and regulations promulgated thereunder, and the Texas Solid
Waste Disposal Act, as amended from time to time, and regulations promulgated
thereunder (hereinafter sometimes collectively called “APPLICABLE LAWS”); and
Tenant shall cause to be obtained any permits, licenses or similar
authorizations to occupy, operate or use any buildings, improvements, fixtures
and equipment now or hereafter located on the Leased Premises by reason of any
Applicable Laws.

 

Tenant shall not allow the Leased Premises to become
affected by any Hazardous Materials Contamination (as hereinafter defined), and
shall not allow any Hazardous Materials (as hereinafter defined) to be
installed, used, incorporated into, or disposed of on or under any of the
Leased Premises.  No underground storage
tanks, wells, pits, surface impoundments, or catch basins shall be installed by
Tenant on or under the Leased Premises without Landlord’s prior written
consent.

 

Tenant shall inform Landlord of any pending or
threatened investigation, administrative order, or litigation with respect to
Hazardous Materials or Hazardous Materials Contamination, and promptly notify
Landlord if Tenant shall receive any communication from or on behalf of any
governmental authority regarding an environment condition which violates any
Applicable Laws.

 

Tenant agrees to (i) not use, manage, handle, generate,
manufacture, produce, store, release, discharge, or dispose of, on, under, or
about the Leased Premises or transport to or from the Leased Premises any
Hazardous Materials or allow any other person or entity to do so, except to the
extent such Hazardous Materials are lawfully used in customary quantities in
connection with the Permitted Use, (ii) keep and maintain the Leased Premises
in compliance with, and shall not cause or permit the Leased Premises to be in
violation of, any Applicable Laws, (iii) give prompt written notice to Landlord
immediately upon Tenant’s acquiring knowledge of:

 

(A)          the
presence of any Hazardous Materials on or under the Leased Premises, or any
Hazardous Materials Contamination with respect to the Leased Premises, with a
full description thereof,

 

(B)           any
proceeding or inquiry by any governmental authority with respect to the
presence of any Hazardous Materials on or under the Leased Premises or the
migration thereof from the Leased Premises to other property or from other property
to the Leased Premises,

 

29

 

(C)           all
claims made or threatened by any third party against Tenant or the Leased
Premises relating to any loss or injury resulting from any Hazardous Material
or Hazardous Materials Contamination, and

 

(D)          any
occurrence or condition on any property adjoining or in the vicinity of the
Leased Premises that could cause the Leased Premises or any part thereof to be
subject to any restrictions on the ownership, occupancy, transferability or use
of the Leased Premises under any Applicable Laws;

 

(iv) promptly comply with any governmental
requirements or Applicable Laws requiring the removal, treatment or disposal of
Hazardous Materials or Hazardous Materials Contamination if caused by or
attributable to Tenant or any of Tenant’s employees, servants, agents,
partners, directors, officers, shareholders, customers, visitors, invitees,
licensees, concessionaires, sublessees, contractors, subcontractors,
successors, or assigns (herein collectively referred to as a “TENANT
RESPONSIBLE PARTY”).

 

In the event that the Leased Premises is affected by
any Hazardous Materials Contamination occurring from and after the date of this
Lease caused by or attributable to, or relating to or arising out of, in whole
or in part, the use, release, deposit, discharge, collection storage, handling,
management, generation, treatment, manufacturing off-site, placement,
processing transportation, or disposal of, at, on, under from or near the
Leased Premises, of any Hazardous Substance by a Tenant Responsible Party, then
Tenant shall immediately provide Landlord with a bond, letter of credit or
similar financial assurance evidencing to Landlord’s satisfaction that the
necessary funds are available to pay the cost of removing, treating and
disposing of such Hazardous Materials or Hazardous Materials Contamination and
discharging any assessments which may be established on the Leased Premises as
a result thereof.

 

Tenant shall also within thirty (30) days after
written demand for performance thereof by Landlord (or such shorter period of
time as may be required under any Applicable Laws, order or agreement),
commence and thereafter diligently prosecute to completion, all remedial work
that may be required to remove such Hazardous Material Contamination, and all
such remedial work shall be performed by contractors approved in advance by
Landlord, and under the supervision of a consulting engineer approved by
Landlord, with all costs and expenses of such remedial work being paid by
Tenant including, without limitation, Landlord’s reasonable attorneys’ fees and
costs incurred in connection with monitoring or reviewing such remedial work,
all of which shall be payable on demand, and shall accrue interest at the Default
Rate from the date of demand until paid in full.

 

In the event Tenant shall fail to timely commence, or
cause to be commenced, or fail to diligently prosecute to completion, such
remedial work, Landlord may, but shall not be obligated to, cause such remedial
work to be performed and all costs and expenses thereof, incurred by Landlord
in connection therewith, shall be payable on demand, shall accrue interest at
the Default Rate from the date the same are incurred by Landlord until repaid
in full.  Landlord shall have the right
to join and participate in, as a party if it so elects, any legal proceedings
or action initiated with respect to the Leased Premises in connection with any
Applicable Laws, and have its attorneys’ fees in connection therewith paid by
Tenant on demand, if so caused by a Tenant Responsible Party.

 

30

 

Nothing contained herein shall cause Tenant to be
liable or responsible for any costs of any nature associated with Hazardous
Materials which (i) exist on or about the Leased Premises on the Tender Date;
or (ii) migrate onto the Leased Premises from offsite through no act or
omission of a Tenant Responsible Party.

 

Section 25.02  Site
Assessments.  Landlord
(by its officers, partners, employees and agents) at any time and from time to
time, either prior to or after the occurrence of an Event of Default, may
contract for the services of persons (the “SITE REVIEWERS”) to perform environmental
site assessments (“Site Assessments”) on the Leased Premises for the purpose of
determining whether there exists on the Leased Premises any environmental
condition which could reasonably be expected to result in any liability, cost,
or expense to the owner, occupier or operator of the Leased Premises arising
under any Applicable Laws.

 

The Site Assessments may be performed at any time or
times, upon reasonable notice to Tenant, and under reasonable conditions
established by Tenant which do not impede the performance of the Site
Reviewers.  The Site Reviewers are
authorized to enter upon the Leased Premises for such purposes.  The Site Reviewers are further authorized to
perform both above and below the ground testing for environmental damage or the
presence of Hazardous Materials on or under the Leased Premises and such other
tests on the Leased Premises as may be necessary to conduct the Site
assessments in the reasonable opinion of the Site Reviewers.

 

Tenant will supply to the Site Reviewers such
historical and operational information regarding the use of the Leased Premises
by Tenant as may be reasonably requested by the Site Reviewers to facilitate
the Site Assessments and will make available for meeting with the Site
Reviewers appropriate personnel having knowledge of such matters.  On request, Landlord shall make the results
of such Site Assessments fully available to Tenant.  Prior to an Event of Default, Tenant may at its election
participate under reasonable procedures in the direction of such Site
Assessments and the description of tasks of the Site Reviewers.

 

The cost of performing such Site Assessments shall be
paid by Tenant upon demand by Landlord if it is determined by the Site
Reviewers that any Hazardous Materials Contamination has been caused by a
Tenant Responsible Party, and such amounts shall accrue interest at the Default
Rate from the date of demand until paid in full.    Tenant shall have the right to reimbursement of the cost of
performing such Site Assessments in the event a court of competent jurisdiction
makes a final adjudication that such contamination was not caused by a Tenant
Responsible Party.

 

Landlord shall have the right, but not the obligation,
prior or subsequent to an Event of Default, without in any way limiting
Landlord’s other rights and remedies under this Lease, to enter onto the Leased
Premises or to take such other action as it deems necessary or advisable to
clean up, remove, resolve, or minimize the impact of, or otherwise deal with,
any Hazardous Materials, or Hazardous Materials Contamination on or under the
Leased Premises following receipt of any notice from any person or entity
asserting the existence of any Hazardous Materials or Hazardous Materials
Contamination pertaining to the Leased Premises or any part thereof, which, if
true, could result in an order, suit, imposition or a lien on the Leased
Premises, or potential environmental liability.

 

31

 

If any Hazardous Materials Contamination has been
caused by or is attributable to a Tenant Responsible Party, all costs and
expenses paid or incurred by Landlord in the exercise of any such rights shall
be payable upon demand by Landlord, and shall accrue interest at the Default
Rate from the date of demand until paid in full.

 

Defined Terms. 
The term “Hazardous Materials” shall mean (a) any “hazardous waste,”
“hazardous materials,” “toxic substances,” “solid waste” and/or “hazardous
substances” as those terms are defined by RCRA, CERCLA, the Hazardous Material
Transportation Act, 49 U.S.C. Section 1801 et seq., as amended from time to
time and the regulations promulgated thereunder, and the Clean Water Act, 33
U.S.C. Sections 1251 et seq., as amended from time to time and the regulations
promulgated thereunder, (b) those substances listed in the United States
Department of Transportation Table, 49 CFR 172.101 and amendments thereto, or
by the Environmental Protection Agency (or any successor agency) as hazardous
substances, (c) asbestos, (d) petroleum products, (e) polychlorinated biphenyls
(PCB’s), (f) explosives, (g) radioactive materials, (h) underground storage
tanks, wells, pits, catch basins, or surface impoundments, whether empty,
filled or partially filled with any substance, (i) any other substances,
materials, and wastes which become regulated under Applicable Laws or which are
classified as hazardous or toxic under Applicable Laws, (j) any substance the
presence of which on the Leased Premises is prohibited by any governmental
requirements, regulations, or Applicable Laws, and (k) any other substance
which by any governmental requirements, regulations, or Applicable Law requires
special handling or notification of any federal, state or local governmental
entity in its collection, storage, treatment or disposal.

 

The terms “RELEASE,” “DISPOSAL,” AND “DISPOSED” shall
have the meanings specified in RCRA and CERCLA.  The term “HAZARDOUS MATERIALS CONTAMINATION” shall
mean the contamination (whether presently existing or hereafter occurring) of
any improvements, facilities, soil, ground water, air or other elements on,
under or of the Leased Premises by Hazardous Materials, or the contamination of
the improvements, facilities, soil, ground water, air or other elements on,
under or of any other property as a result of Hazardous Materials at any time
(whether before or after the Effective Date of this Lease) emanating from the
Leased Premises.

 

Notwithstanding the foregoing to the extent the laws
of the State of Texas establish a meaning for “HAZARDOUS WASTE,” “HAZARDOUS
MATERIALS,” “TOXIC SUBSTANCES,” “SOLID WASTE,” “HAZARDOUS SUBSTANCE,”
“RELEASE,” “DISPOSAL,” or “DISPOSED” which is broader than that
specified in either CERCLA or RCRA, such broader meaning shall apply.

 

Section 25.04  Hold Harmless.  The parties hereto agree to indemnify, hold
harmless, and defend each other 
and  their officers, directors,
shareholders, partners, employees, agents, successors and assigns, from and
against, any and all claims, demands, causes of action, suits, losses, damages,
liabilities (including strict liability), penalties, costs and expenses
(including attorneys’ fees, court costs and remedial costs), and costs of any
settlement or judgement, of any and every kind or character, known or unknown,
fixed or contingent, asserted against, incurred, suffered or paid by any of the
foregoing parties, at any time and from time to time now or in the future, (and
whether before or after the expiration or sooner termination of this Lease), by
any person, entity, or governmental agency, by reason of, arising out of, with
respect to, or as a direct or indirect result of the leasehold interest,
construction, occupancy, operation, use and

 

32

 

maintenance of the Leased Premises by a  Responsible Party, (including without limitation, the presence on
or under, or the use, generation, manufacture, production, storage, escape,
seepage, leakage, spillage, discharge, disposal, emission or release on, under
or from the Leased Premises of any Hazardous Materials or any Hazardous
Materials Contamination, or the existence of any environmental conditions on or
under the Leased Premises, or the applicability of any governmental
requirement, regulation, or Applicable Laws relating to Hazardous Materials, to
the extent caused by or attributable to a 
Responsible Party, including all foreseeable consequential damages, and
the costs of any required or necessary repair, clean-up or detoxification of
the Leased Premises and the preparation and implementation of any closure,
remedial or other required plans).

 

This indemnity applies, without limitation, to any
violation of any Applicable Laws by a 
Responsible Party, and any and all matters arising out of any act,
omission, event or circumstance existing or occurring in connection with the
use of the Leased Premises by a  Responsible
Party (including without limitation the presence on the Leased Premises or
release from the Leased Premises of hazardous substances or solid waste
disposed of or otherwise released by a 
Responsible Party), regardless of whether the act, omission, event or
circumstance constituted a violation of any Applicable Laws at the time of its
existence or occurrence; except to the extent such matters are caused by or
arise out of the gross negligence or willful misconduct of Landlord or Tenant.

 

ARTICLE
XXVI

 

Terminology and
Miscellaneous

 

Section 26.01 
Terminology.  With
respect to terminology in this Lease, each number (singular or plural) shall
include all numbers, and each gender (male, female or neuter) shall include all
genders.  If any provision of this Lease
shall ever be held to be invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provisions of the Lease, but such
other provisions shall continue in full force and effect.

 

The titles of the Articles in this Lease shall have no
effect and shall neither limit nor amplify the provisions of the Lease
itself.  This Lease shall be binding
upon and shall accrue to the benefit of Landlord, its successors and assigns.

 

Section 26.02  Time of
Essence.  In all
instances where either party is required hereunder to pay any sum or do any act
at a particular indicated time or within an indicated period, it is understood
that time is of the essence.

 

Section 26.03 
Independent Obligations.  The
obligation of Tenant to pay all rent and other sums hereunder provided to be
paid by Tenant and the obligation of Tenant to perform Tenant’s other covenants
and duties hereunder constitute independent, unconditional obligations to be
performed at all times provided for hereunder. 
Tenant waives and relinquishes all rights which Tenant might have to
claim any nature of lien against or withhold, or deduct from or off-set against
any rent and other sums provided hereunder to be paid Landlord by Tenant.

 

33

 

Section 26.04  No
Consequential or Special Damages.  Under
no circumstances whatsoever shall either Landlord or Tenant ever be liable
hereunder for consequential damages or special damages.  All liability of Landlord for damages for
breach of any covenant, duty or obligation of Landlord hereunder may be
satisfied only out of the interest of Landlord in the Shopping Center existing
at the time any such liability is adjudicated in a proceeding as to which the
judgment adjudicating such liability is non-appealable and not subject to
further review.  The term “LANDLORD” shall
mean only the owner, for the time being of the Shopping Center, such owner
shall thereupon be released and discharged from all covenants and obligations
of Landlord thereafter accruing, but such covenants and obligations shall be
binding during the Lease Term upon each new owner for the duration of such
owner’s ownership.

 

Section 26.05 
Venue.  All
monetary obligations of Landlord and Tenant (including, without limitation, any
monetary obligation of Landlord or Tenant for damages for any breach of the
respective covenants, duties or obligations of Landlord or Tenant hereunder)
are performable exclusively in Houston, Harris County, Texas.

 

Section 26.06  Late
Payment.  Tenant hereby
acknowledges that late payment by Tenant to Landlord of rent or any other sums
due under this Lease will cause Landlord to incur various expenses not
contemplated by this Lease, the exact amount of which are presently difficult
to ascertain.  Accordingly, if any
payment of Minimum Rent, Percentage Rent or any other sum due from Tenant under
this Lease shall not be received by Landlord within five (5) business days
after the same is due, then, in addition to such required payment, Tenant shall
also pay to Landlord a “LATE CHARGE” equal to five cents ($0.05)
for each One Dollar ($1.00) so past due.

 

Landlord and Tenant agree
that such Late Charge represents a fair and reasonable estimate of the expenses
that Landlord will incur by reason of such late payment by Tenant.  Acceptance of such Late Charge by Landlord
shall not constitute a waiver of Tenant’s default with respect to any such past
due amounts, nor prevent Landlord from exercising any other rights and remedies
granted to Landlord under this Lease or at law or in equity.  Such Late Charge shall constitute additional
rental payable by Tenant under this Lease and is in addition to, and separate
from, the Minimum Rent, Percentage Rent and other charges payable under this
Lease by Tenant.

 

Section 26.07  Independent
Covenants.  So long as
Tenant has not been wrongfully or constructively evicted from the Leased
Premises, the doctrine of independent covenants will apply in all matters
relating to this Lease including, without limitation, all obligations of Landlord
and Tenant to perform their respective obligations under this Lease.  The preceding sentence shall apply
notwithstanding that Landlord may defaulted in fulfilling a covenant to
maintain or repair the Leased Premises even if such default results in the
unsuitability of the Leased Premises for Tenant’s intended commercial use.

 

Section 26.08  As Is
Basis.  Subject to
Tenant’s right to terminate this Lease if its structural inspection is not
satisfactory, Tenant will accept the Leased Premises in their existing
condition, on an “AS-IS” basis, subject to performance by Landlord of its
obligations under the Construction Rider, if any, attached hereto.  Tenant hereby waives and relinquishes any
right to assert, as either a claim or a defense, that Landlord is bound to
perform or is liable for the non-performance of any implied covenant or implied
duty of Landlord not expressly set forth herein.

 

34

 

Tenant waives any implied warranty of Landlord that the Leased Premises
are suitable for their intended commercial purpose.  Tenant agrees to perform all of its Lease obligations (including
without limitation, the obligation to pay rent), notwithstanding an alleged
breach by Landlord of any such implied warranty.  Tenant agrees that Landlord shall incur no liability to Tenant by
reason of any defect in the Leased Premises, whether apparent or latent, unless
such defect was known to Landlord as of the date of this Lease and not
disclosed to Tenant.

 

Section 26.09  Evidence
of Authority.  Within
not more than fifteen (15) days after the date of this Lease, Landlord shall
furnish to Tenant a certified resolution of Landlord’s Board of Directors, with
a certificate of incumbency from Landlord’s secretary, authorizing the
execution and delivery of this Lease. 
If Landlord fails to timely perform the foregoing, then Tenant shall be
permitted to terminate this Lease, at any time prior to the date on which the
foregoing certificates are furnished, in which event all prepaid rent shall be
refunded by Landlord.

 

ARTICLE
XXVII

 

Arbitration

 

Section 27.01 
Arbitration.   Any
controversy between the parties involving the construction or application of
any of the terms, covenants, or conditions of this Lease shall, on the written
request of one party served on the other, be submitted to arbitration, which
shall comply with and be governed by the provisions of the American Arbitration
Association

 

Each of the parties to this agreement shall appoint
one person as an arbitrator to hear and determine the dispute, and each party
shall attempt in good faith to agree with the other as to a third arbitrator;
if the parties should prove unable to agree in this way, then the two
arbitrators already chosen shall select a third impartial arbitrator whose
decision shall be final and conclusive. 
The expenses of arbitration shall be borne by the losing party or in
such proportion as the arbitrators shall decide.

 

ARTICLE
XXVIII

 

Entire Agreement

 

Section 28.01  Entire
Agreement.  This
instrument (including all Riders, Exhibits and Guaranty, if any), constitutes
the entire agreement between Landlord and Tenant; no prior written or prior or
contemporaneous oral promises or representations shall be binding.  This Lease shall not be amended, changed or
extended except by written instrument signed by both parties hereto.

 

THE
SUBMISSION OF THIS LEASE FOR EXAMINATION BY TENANT AND/OR EXECUTION THEREOF BY
TENANT DOES NOT CONSTITUTE A RESERVATION OF OR OPTION FOR THE LEASED PREMISES
AND THIS LEASE SHALL BECOME EFFECTIVE ONLY UPON EXECUTION BY ALL PARTIES HERETO
AND DELIVERY OF A FULLY EXECUTED COUNTERPART HEREOF BY LANDLORD TO TENANT.

 

35

 

EXECUTED in multiple counterparts, each of which shall
have the force and effect of an original, on the day and year first written
above.

 

	
   

  	
  HIGHLAND VILLAGE
  HOLDING, INC.,

  	
   

  
	
   

  	
  A Delaware corporation

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Haidar Barbouti

  	
   

  
	
   

  	
  Haidar Barbouti,
  Director of Leasing

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:                                   ,
  2003

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  “LANDLORD”

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HOUSTON S&W, L.P.,

  	
   

  
	
   

  	
  a Texas limited
  partnership

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  SMITH & WOLLENSKY
  OF

  HOUSTON, LLC,

  
	
   

  	
   

  	
  a Delaware limited
  liability company,

  its sole General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ James M. Dunn

  	
   

  
	
   

  	
   

  	
  Name:  James
  M. Dunn

  
	
   

  	
   

  	
  Title:    President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date: January 30, 2003

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TENANT”

  
							

 

36

 

CONSTRUCTION RIDER

 

This Construction Rider is attached to and forms a
part of that certain Lease Contract dated January 30, 2003, (the “LEASE”), between
HIGHLAND VILLAGE HOLDING INC., as “LANDLORD” and HOUSTON S&W, L.P., a
Texas limited partnership, as “TENANT.”

 

Section
1.01         A.            Landlord hereby consents to Tenant’s
construction of improvements at the Leased Premises upon the following conditions
precedent:

 

(i)                                     that
Landlord and Tenant shall have mutually agreed in writing upon plans and
specifications for such construction utilizing the procedure hereinafter set
forth;

 

(ii)                                  that
Landlord and Tenant shall have mutually agreed in writing upon one or more
general contractors (herein sometimes referred to in the singular as “CONTRACTOR”
and the plural as “CONTRACTORS”) to be utilized by Tenant in
erecting such improvements and Landlord has been provided with a copy of the
contract (A.I.A. form) between Tenant and general contractor; provided,
however, that if Tenant provides Landlord with a payment and performance bond
as provided under the Texas Property Code, Section 53.201 et seq., prior to the
commencement of improvements (which 
Landlord, at the expense of Tenant, shall file in the office of the
County Clerk of the county where the Leased Premises are located), then
Landlord shall be deemed to have approved Tenant’s Contractors and Landlord
shall be deemed to have waived its right to withhold ten (10%) percent of the
sum payable by Landlord to Tenant pursuant to Section 1.04.A for the thirty day
period following satisfaction of all requirements of Section 1.04.A. as set
forth hereinbelow.

 

(iii)                               that Tenant has tendered
to Landlord a true copy of a “BUILDING PERMIT” (meaning all required
governmental, quasi-governmental, regulatory authority and other permits,
consents, letters of utility availability and Permissions) for the work of
Tenant and its contractors to be performed under the Lease and certificates of
all insurance required to be obtained by Tenant pursuant to the Lease;

 

(iv)                              that
the Lease has not been terminated for any reason permitted under the Lease.

 

Upon any such cancellation and termination by
Landlord, Landlord and Tenant shall each respectively be released from all
further liability under the Lease, irrespective of what costs or expenses
either of such parties shall have incurred prior to any such cancellation and
termination.  Tenant shall have no right
to construct or permit any improvements at the Leased Premises unless Tenant
shall have satisfied all of the aforesaid conditions precedent and Landlord
shall have tendered possession of the Leased Premises to Tenant.

 

B.            In
connection with Tenant’s erection of improvements at the Leased Premises, if
Landlord and Tenant have not prior to (or contemporaneous with) the execution
of the Lease by Landlord and Tenant agreed in writing upon said plans and
specifications or have not agreed in writing upon one or more general contractors
to be utilized by Tenant in erecting such

 

37

 

improvements, then within sixty (60) days after the Tender Date, Tenant
shall cause complete plans and specifications (working drawings) to be prepared
and at least three (3) counterparts thereof to be submitted to Landlord for
examination along with a list of two (2) or more contractors, any of which
Tenant would be willing to enter into a contract with for the construction of
such improvements, provided that the bid of such contractor or price negotiated
with such contractor was satisfactory to Tenant.

 

Landlord shall examine the aforesaid plans and
specifications and list of contractors submitted by Tenant and notify Tenant as
to any changes desired by Landlord in such plans and specifications and as to
whether Landlord approves or disapproves of each contractor named on such list
of contractors.  Tenant shall have no
obligation to modify the plans and specifications in the manner indicated by
Landlord, but, as heretofore provided, shall have no right to construct
improvements unless Landlord and Tenant shall have mutually agreed in writing
upon the plans and specifications therefore (as evidenced by Landlord’s and
Tenant’s signing and dating such plans and specifications) and unless Landlord
and Tenant further shall have mutually agreed in writing upon the contractor to
be utilized by Tenant.

 

Notwithstanding any other term or provision of this
instrument, if by the expiration of one hundred twenty (120) days after the
Tender Date Landlord and Tenant shall not have agreed in writing upon said
completed plans and specifications (working drawings) and one or more
contractors to be utilized by Tenant the construction provided for under such
plans and specifications, then either Landlord or Tenant shall have the right
to terminate the Lease at any time thereafter, upon which termination neither
party shall have any claim against the other under the Lease Contract
irrespective of what cost or expenses, if any, either party shall have incurred
in connection with the Lease prior to such cancellation.

 

If such final plans and specifications (working
drawings) are mutually approved by Landlord and Tenant in writing, and such
plans and specifications (working drawings) shall be initialed or signed by
Landlord and Tenant and dated and designated EXHIBIT “C,” but need not be
attached to the Lease.

 

C.            Tenant
shall enter the Leased Premises and Tenant will perform such construction work
and provide and install such materials as are provided in EXHIBIT “C” and the Lease to
be constructed or performed and installed by Tenant.  Tenant will also provide and install all other interior work,
trade equipment, furniture, fixtures, and effects of every description
necessary or appropriate for Tenant’s business and all such items to be
provided and installed by Tenant shall be new and modern and of first-class
quality.

 

In the event Tenant fails to satisfy the conditions
set forth in Section 1.01.A of this Construction Rider and also commence
construction on or before the expiration of ninety (90) days from the date
Landlord and Tenant mutually approve the aforesaid plans and specifications for
any reason other than cause of Force Majeure, then such failure shall
constitute an Event of Default under the Lease, and without further notice
Landlord shall have the right, if exercised prior to the commencement of the
approved construction but not thereafter, to terminate the Lease at any time
thereafter and/or exercise such other remedies as may be available to Landlord
pursuant to the terms of the Lease.

 

38

 

D.            In
connection with the installation of the electrical system at the Leased
Premises, Tenant hereby agrees to notify Landlord in writing to inspect
Tenant’s “IN
THE WALL” or underground electrical installations at least five (5)
business days prior to the installation of sheetrock walls or the pouring of a
concrete floor.  Upon such notice,
Landlord shall, at its expense, cause its consulting engineer to make
electrical inspection in Landlord’s behalf; however, Tenant shall not be
required to delay its work if such consulting engineer does not make his
inspection within such five (5) business day period.

 

Tenant shall also notify Landlord in writing at least
three (3) business days prior to the date Tenant desires the commencement of
electrical service so as to allow Landlord to make a final inspection of all
electrical connections in the gutter. 
Such connections shall be inspected by Landlord’s consulting engineer
prior to tape-up, and Tenant acknowledges that all connectors used shall be
copper; however, Tenant shall not be required to delay its work if such
consulting engineer does not make his inspection within such three (3) business
day period.

 

Tenant acknowledges that the above described
electrical inspection procedures must be adhered to and such adherence shall be
a condition precedent to Tenant’s receipt of a construction allowance, if any
as provided in Section 1.04.A herein.

 

E.             At
all times while Tenant is constructing the improvements at the Leased Premises
and installing its trade equipment, furniture and fixtures, Tenant shall not
interfere with the conducting of business at the Shopping Center.  Tenant shall comply with said reasonable
requests of Landlord as Landlord might make for the purpose of avoiding such
interference.  If at any time during the
course of Tenant’s work at the Leased Premises the storefront of the Leased
Premises is not fully secure, Tenant shall construct a barricade of plywood or
other material approved by Landlord to secure the Leased Premises and adjoining
lease spaces.

 

Section
1.02         With
respect to any labor performed or materials furnished by Tenant at the Leased
Premises, the following shall apply: 
All such labor shall be performed and materials furnished at Tenant’s
own cost, expense and risk.  Labor and
materials used in the installation of Tenant’s furniture and fixtures, and in
any other work on the Leased Premises performed by Tenant, will be subject to
Landlord’s prior written approval. 
Landlord’s current summary of criteria for Tenant Design and
Construction is attached hereto as EXHIBIT “F.”

 

Any such approval of Tenant’s labor shall constitute a
license authorizing Tenant to permit such labor to enter upon the Shopping
Center and Leased Premises prior to the commencement of the Lease Term;
however, the continued effectiveness of such license is conditioned upon
Tenant’s aforesaid labor working in harmony with and not interfering with labor
utilized by Landlord and Landlord’s mechanics or contractors and not
interfering with labor utilized by any other tenant or such tenant’s mechanics
or contractors.  Accordingly, if at any
time such entry of Tenant’s labor shall cause disharmony or interference therewith,
this license may be withdrawn by Landlord upon forty-eight (48) hours written
notice to Tenant, upon expiration of which Tenant shall have caused all of
Tenant’s labor (as to whom Landlord shall have given such notice) to have been
removed from the Leased Premises and from the Shopping Center.

 

39

 

With respect to any contract for any such labor or
materials, Tenant acts as a principal and not as the agent of Landlord.  The parties agree to indemnify and hold each
other  harmless from all claims
(including costs and expenses of defending against such claims) arising or
alleged to arise from any act or omission of Landlord or Tenant or their
agents, employees, contractors, subcontractors, laborers, materialmen or
invitees or arising from any bodily injury or property damage occurring or
alleged to have occurred incident to the 
work at the Leased Premises.

 

Tenant shall have no authority to place any lien upon
the Leased Premises or any interest therein nor in any way to bind Landlord;
and any attempt to do so shall be void and of no effect.  Landlord expressly disclaims liability for
the cost of labor performed or materials furnished by Tenant.  If, because of any actual or alleged act or
omission of Tenant, any lien, affidavit, charge or order for the payment of
money shall be filed against Landlord, the Leased Premises or any portion
thereof or interest therein, whether or not such lien, affidavit, charge or
order is valid or enforceable, Tenant shall, at its own cost and expense, cause
same to be discharged of record by payment, bonding or otherwise no later that
fifteen (15) days after notice to Tenant of the filing thereof, but in all
events, prior to the foreclosure thereof. 
Tenant’s failure to cause same to be discharged of record within such 15
day period shall constitute an Event of Default under the Lease.

 

All of Tenant’s construction at the Leased Premises
shall be performed in strict compliance with EXHIBIT “C” in a good and
workmanlike manner which is reasonably satisfactory to Landlord’s
Architect.  All such work shall be
performed by Tenant in strict compliance with all applicable building codes,
regulations and all other legal requirements and shall be performed in such
manner as to not cause Landlord’s fire and extended coverage insurance to be
canceled or the rate therefor increased (or at Landlord’s option, will upon
demand pay any such increase).  In the
performance of such work, Tenant shall not interfere with or delay any work
being done by Landlord’s contractors.

 

Section
1.03         Tenant
agrees that its construction at the Leased Premises will be completed in
accordance with EXHIBIT “C” within one hundred eighty (180) days after the
date Landlord and Tenant mutually approve the aforesaid plans and
specifications.  If Tenant shall not
have so completed such construction by the expiration of said one hundred
eighty (180) day period as the same may be extended by causes of Force Majeure
(the “CONSTRUCTION
PERIOD”), then Landlord shall have the right to terminate the Lease
at any time before the earlier of : (i) achievement of completion; or (ii)
thirty (30) days after such Construction Period by giving written notice of
such termination within such time to Tenant; upon the giving of such notice,
all obligations of all parties under the Lease shall cease except Tenant’s duty
to indemnify Landlord as set forth in Section 12.01 of the Lease for acts or
omissions occurring prior to Lease termination which such duty shall continue.

 

No expenditure of any sum by Tenant or incurring of
any liability for merchandise, fixtures, equipment or labor or material or
otherwise, shall alter or affect the rights of said parties as set forth in
this Section 1.03.  In the event that
Landlord exercises the aforesaid right to cancel and terminate the Lease,
Tenant shall have no right or claim against Landlord on account of improvements
constructed by Tenant at the Leased Premises.

 

40

 

Section
1.04.        A.   Construction Draws.

 

Landlord shall pay to Tenant (or, at Landlord’s
option, Landlord may pay Tenant and the general contractor and/or one or more
subcontractors) as an “ALLOWANCE,” the  sum of Seven Hundred Fifty Thousand & No Dollars ($750,000)
toward Building Improvement Costs with respect to the Leased Premises.

 

(i)                                     1⁄4
of the Allowance shall be paid by Landlord to Tenant within five (5) business
days after Tenant has provided Landlord satisfactory evidence that Tenant has
obtained applicable building permits to construct tenant’s improvements in
accordance with Exhibit “C;”

 

(ii)                                  1⁄4
of the Allowance shall be paid by Landlord to Tenant within five (5) business
days after Tenant has provided Landlord satisfactory evidence that Tenant has
completed one-half of construction of its improvements in accordance with
Exhibit “C;” and

 

(iii)                               1/2 of the Allowance
shall be paid by Landlord to Tenant within five (5) business days after Tenant
has completed construction of its improvements in accordance with Exhibit “C”
and further provided that Tenant has furnished to Landlord the following (on
forms to be furnished by Landlord where applicable )

 

(iv)                              A
certificate of occupancy (or other certificates evidencing inspection and
acceptance of all of Tenant’s construction by appropriate government
authorities);

 

(v)                                 A
copy of Tenant’s contract with the general contractor performing such work,
which contract shall contain a schedule of values totaling the full amount of
the contract.  In the event that Tenant
has acted as its own general contractor, Tenant must have entered into written
subcontracts with all parties who furnished labor and/or materials totaling
more than Five Hundred and No/100 Dollars ($500.00) and copies of such
subcontracts must be furnished to Landlord;

 

(vi)                              Tenant’s
affidavit, in the form attached hereto as EXHIBIT “C-1,” that such construction has
been completed to its satisfaction and in strict accordance with EXHIBIT “C,”
which affidavit shall also state the total Building Improvement
Costs itemized in reasonable detail;

 

(vii)                           General Contractor’s
Affidavit and Lien Waiver with respect to the Leased Premises and Shopping
Center, in the form attached hereto as EXHIBIT “C-2,” executed by the general
contractor(s) performing such work stating that construction has been fully
completed in accordance with EXHIBIT “C” and that all subcontractors,
laborers and material suppliers engaged in or supplying materials for such work
have been paid in full (in the event, however, that Tenant has acted as its own
general contractor, Tenant, itself, will execute EXHIBIT “C-2”);

 

(viii)                        Subcontractor’s Lien Waiver
with respect to the Leased Premises and Shopping Center, in the form attached
hereto as EXHIBIT
“C-3,” executed by all

 

41

 

subcontractors and materialmen who shall have
furnished labor and/or materials for the work;

 

(ix)                                Certificate
of substantial completion from Tenant’s architect or engineer certifying that
such construction work has been fully completed in accordance with EXHIBIT “C”;

 

(x)                                   Notice
from Tenant to Landlord that Tenant has opened for business at the Leased
Premises and execution by Tenant and delivery to Landlord of a commencement
letter indicating the commencement and termination dates of the Lease Term;

 

(xi)                                Delivery
to Landlord of certificates or duplicate originals of all insurance which
Tenant is required to carry under the terms of the Lease;

 

(xii)                             Execution by Tenant and
delivery to Landlord of any Uniform Commercial Code (UCC) Financing Statements
required under the Lease;

 

(xiii)                          Payment by Tenant to Landlord
of such Minimum Rent and other sums as shall have come due between the
Commencement Date of the Lease Term and the date upon which Tenant makes
application for payment of its Allowance (but in all events, not less than
Minimum Rent for the first month of the Lease Term); and

 

(xiv)                         Delivery to Landlord of one
(1) set of as-built plans for the Leased Premises.

 

B.            The
phrase “BUILDING
IMPROVEMENT COSTS,” as used herein, means the total reasonable costs
paid by Tenant to all architects, engineers, contractors and suppliers
furnishing labor and materials for erection and improvement of those items
identified and constructed in accordance with EXHIBIT “C.”

 

C.            The
phrase “BUILDING
IMPROVEMENT COSTS,” as used herein, shall not include any sum paid
or liability incurred by Tenant for:

 

(1)                                  Any
brokerage commission, finder’s fee or other fee of similar nature;

 

(2)                                  Any
sum which is paid pursuant to a liability incurred prior to the date of the
Lease Agreement; or

 

(3)                                  Any
item of “REMOVABLE
TRADE FIXTURES” (as defined in Article X of the Lease), furniture,
equipment (not to include kitchen equipment) or supplies.

 

D.            Unless
Tenant has provided Landlord with a payment and performance bond as set forth
in this Construction Rider and Tenant has provided Landlord with a copy of such
bonds, Landlord may, if Landlord elects, withhold ten percent (10%) of the sum
payable by Landlord to Tenant pursuant to Section 1.04.A. hereof for a period
of thirty (30) days following the satisfaction of all requirements of Section
1.04.A    If Landlord itself shall have
constructed for Tenant any improvements at the Leased Premises beyond the
improvements heretofore provided to be constructed by Landlord, Landlord may
withhold from the sum payable by Landlord to

 

42

 

Tenant pursuant to Section 1.04.A. hereof the amount owing to Landlord
by Tenant for all such work.  Landlord
may likewise withhold from the sum payable by Landlord pursuant to Section
1.04.A. hereof any other amount for which Tenant is then indebted to
Landlord.  If Landlord fails to pay any
portion of the Allowance to Tenant within thirty (30) days after the same is
due, then such unpaid portion shall accrue interest at the rate of ten (10%)
percent per annum and such interest shall be payable on demand.

 

Section
1.05.        In
connection with any construction of improvements at the Leased Premises by
Tenant, the following shall apply:

 

Tenant shall take out and maintain (or cause the
contractor under its construction contract (s) to take out and maintain) public
liability insurance in a minimum amount of $1,000,000.00 combined single
limit.  Said liability insurance shall
name Landlord as an additional insured with Tenant (and shall contain a
contractual liability endorsement) and shall be non-cancelable with respect to
Landlord except upon thirty (30) days’ notice to Landlord (given in the same
manner as provided in the Lease Agreement) (or, at the request of Landlord,
shall be in the form of a separate liability policy in which Landlord along is
the named insured).

 

Tenant shall also take out and maintain (or cause the
contractor under its construction contracts(s) to take out and maintain) all
builder’s risk insurance to the full insurable value of improvements
constructed and materials stored at the Leased Premises.  Said builder’s risk insurance shall name
Landlord as an additional insured and shall be non-cancelable with respect to Landlord.  Certificates of all such insurance shall be
delivered by Tenant to Landlord within five (5) days following Tenant’s
entering into any such construction contract(s) (but in all events prior to
Tenant or Tenant’s general contractor commencing construction).

 

Section
1.06         All
improvements constructed by Tenant at the Leased Premises (excepting only
Removable Trade Fixtures installed by Tenant shall, immediately upon such
construction, become and remain the property of Landlord; and Tenant shall have
no right, title or interest (including lien interest) therein, except only as
Tenant under the provisions of the Lease. 
The aforesaid improvements, if constructed by Tenant, are not intended
as any nature of rent or compensation to Landlord.

 

Section
1.07         Not
Applicable.

 

43

 

	
   

  	
  HIGHLAND VILLAGE
  HOLDING, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Haidar Barbouti

  	
   

  
	
   

  	
  Haidar Barbouti,
  Director of Leasing

  
	
   

  	
   

  
	
   

  	
  Date: January 30, 2003

  
	
   

  	
   

  
	
   

  	
  “LANDLORD”

  

 

44

 

	
   

  	
  HOUSTON S&W, L.P.,

  	
   

  
	
   

  	
  a Texas limited
  partnership

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  SMITH & WOLLENSKY
  OF

  HOUSTON, LLC,

  
	
   

  	
   

  	
  a Delaware limited
  liability company,

  its sole General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ James M. Dunn

  	
   

  
	
   

  	
   

  	
  Name:  James
  M. Dunn

  
	
   

  	
   

  	
  Title:    President

  
	
   

  	
   

  	
   

  
	
   

  	
  Date: January 30, 2003

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TENANT”

  
						

 

45

 

OPTION RIDER

 

This Option Rider is attached to and forms a part of
that certain Lease Contract (the “LEASE CONTRACT”) dated January 30, 2003,
between HIGHLAND VILLAGE HOLDING INC., as “LANDLORD,” and HOUSTON S&W, L.P., a
Texas limited partnership, as “TENANT.”

 

Contingent upon Tenant satisfying all of the following
conditions, Tenant is hereby granted an option to extend the Lease Term, as set
forth in Section 3.01 of the Lease Contract (the “PRIMARY TERM”) for two (2)
additional periods of sixty (60) full calendar months (each an “EXTENSION
TERM”), said conditions being that:

 

(i)                                     No
Event of Default shall then exist; and

 

(ii)                                  Tenant
shall not have assigned the Lease Contract or any interest therein or sublet
(or otherwise permitted occupancy by any third party of) all or any portion of
the Leased Premises during the Primary Term except as specifically permitted
pursuant to Article VIII of the Lease; and

 

(iii)                               Tenant shall have given
written notice to Landlord not less than three hundred sixty five  (365) days prior to the expiration of the
Primary Term of Tenant’s exercise of such option.

 

Time is of the essence in the exercise of this option
and should Tenant fail to exercise this option by timely written notice, this
option shall lapse and be of no further force or effect.

 

In the event that Tenant effectively exercises the
option herein granted, then all of the terms and provisions of the Lease
Contract as are applicable during the Primary Term shall likewise be applicable
during the Extension Term except:

 

(a)                                  Tenant
shall have no further right to renew or extend the Lease Term after the
expiration or other termination of the Extension Term; and

 

(b)                                 The
“MINIMUM
RENT” (as defined in Article IV of the Lease Contract) which shall
be due and payable each month during the Extension Term at the same time and
place, and in the same manner, as set forth in Section 4.01 of the Lease
Contract (relative to payment of Minimum Rent during the Primary Term), shall
be set at the greater of:  (i) Six
Hundred Forty Thousand Dollars ($640,000) per annum; or (ii) the then
prevailing Market Rate (hereinafter defined) and payable in equal monthly
installments.

 

(c)                                  The
“BREAKPOINT”
(as defined in Article IV of the Lease Contract relating to the
payment of Percentage Rent during the Primary Term) shall be a Natural
Breakpoint for each Lease Year of the Extension Term.

 

The term “MARKET RATE” shall mean the then
prevailing minimum rental rate for space in the Shopping Center which is
reasonably comparable to the Leased Premises as evidenced by leases with terms
reasonably comparable to the terms of this Lease which Landlord has actually
entered into with other tenants in the Shopping Center.  Landlord shall act reasonably and in good
faith in connection with the determination of Market Rate.

 

46

 

References in this Rider and the Lease Contract to the
“TERM” or
the “LEASE
TERM” shall be understood to refer to both the Primary Term and (if
Tenant’s option therefor is effectively exercised in accordance with the
provisions hereof) also the hereinabove stated Extension Terms unless such
interpretation is expressly negated.

 

	
   

  	
  HIGHLAND VILLAGE
  HOLDING, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Haidar Barbouti

  	
   

  
	
   

  	
   

  	
  Haidar Barbouti,
  Director of Leasing

  
	
   

  	
   

  	
   

  
	
   

  	
  Date: January 30, 2003

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “LANDLORD”

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HOUSTON S&W, L.P.,

  a Texas limited partnership

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  SMITH & WOLLENSKY
  OF

  HOUSTON, LLC,

  
	
   

  	
   

  	
  a Delaware limited
  liability company,

  its sole General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ James M. Dunn

  	
   

  
	
   

  	
   

  	
  Name:  James
  M. Dunn

  
	
   

  	
   

  	
  Title:    President

  
	
   

  	
   

  	
   

  
	
   

  	
  Date: January 30, 2003

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “TENANT”

  
							

 

47Exhibit 10.65

 

LEASE TERMINATION AGREEMENT

 

This Lease Termination
Agreement (this “Agreement”), dated as of January 31, 2002, by and between
PENNSYLVANIA PLAZA ASSOCIATES, a District of Columbia limited partnership
(“Landlord”), and M.O.C. OF MIAMI, LLC, a Delaware limited liability company
(“Tenant”).

 

W  I  T  N  E  S  S
E  T  H

 

A.            Landlord and Tenant are parties to a lease (the “Lease”)
pursuant to which Tenant leases a portion of the retail space on the ground
floor (the “Premises”) of the building located at 601 Pennsylvania Avenue,
N.W., North Building, Washington, D.C. (the “Building”).

 

B.            Landlord and Tenant have agreed to bring the Term of the
Lease to an end prior to its originally-scheduled expiration date.

 

NOW THEREFORE, in
consideration of the foregoing recitals and the mutual agreements herein
contained, Landlord and Tenant agree as follows:

 

1.             All terms contained in this Agreement shall, for the
purposes hereof, have the same meanings ascribed to them in the Lease unless
otherwise defined herein.

 

2.             The Lease is hereby modified to change the Expiration
Date to January 31, 2002 (the “New Expiration Date”).

 

3.             Tenant expressly agrees to quit and vacate the Premises,
to cause all other persons and entities in occupancy or claiming any right of
occupancy or possession in the Premises, if any, to remove themselves therefrom
and to deliver possession thereof vacant and free of tenancies or other
occupancies in broom clean condition and otherwise in accordance with the terms
of the Lease, all on the New Expiration Date.

 

4.             Tenant expressly warrants, represents and agrees that
Tenant: (i) has not sublet the Premises, (ii) has not assigned Tenant’s
interest in the Lease, (iii) has not permitted any persons except Tenant’s
employees to occupy the Premises or any portion of the Premises, and (iv)
otherwise has not encumbered the Premises or the Lease. Tenant further
expressly warrants, represents and agrees that there are no persons or entities
currently in possession or occupancy of the Premises and that delivery and
possession of the Premises shall be made to landlord pursuant to this Agreement
free of tenancies or other occupancies and all liens, encumbrances, rights or
privileges of any kind or nature whatsoever.

 

5.             Tenant hereby grants, sells, transfers and delivers to
Landlord all of Tenant’s right, title and interest in and to Tenant’s removable
property (including, but not limited to, furniture (other than antiques) and
kitchen equipment) located in the Premises,

 

 

 to
have and to hold to Landlord and Landlord’s successors and assigns to their own
use and behoof forever. Tenant expressly warrants, represents and agrees that
(i) Tenant is the lawful owner of said Property, (ii) said Property is free of
all liens, encumbrances, rights or privileges of any kind or nature whatsoever,
(iii) Tenant has the right to transfer said Property as aforesaid and (iv)
Tenant will warrant and defend said Property against the claims and demands of
all persons.

 

6.             Tenant expressly warrants, represents and agrees to pay
Fundamental Building Corp. (FBC) $35,000 for the satisfaction of certain rent
abatements and cash payments made by Landlord to Tenant (as evidenced by
certain promissory notes between the parties).

 

7.             The covenants, agreements, terms and conditions contained
in this Agreement shall bind and inure to the benefit of the parties hereto and
their respective successors, and, except as otherwise provided in the Lease as
hereby modified, their respective assigns.

 

8.             Except as modified by this Agreement, the Lease and all
covenants, agreements, terms and conditions thereof shall remain in full force
and effect and the Lease, as so modified, is hereby in all respects ratified
and confirmed.

 

9.             This Agreement may not be changed orally, but only by a
writing signed by the party against whom the enforcement thereof is sought.

 

 

2

 

IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the day and year first above written.

 

	
  M.O.C. OF MIAMI, L.L.C.,

  	 

	
  a Delaware limited
  liability company

  	 

	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Eugene Zuriff, Manager

  	 

	
   

  	
  Name:

  	
  Eugene Zuriff

  	 

	
   

  	
  Title:

  	
  Manager

  	 

	
   

  	
   

  	
   

  	 

					

 

	
  PENNSYLVANIA PLAZA
  ASSOCIATES

  
	
  a District of Columbia
  limited partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  Yorkington Limited
  Partnership

  
	
   

  	
  Its General Partner

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Lawrich Capital
  Corporation

  
	
   

  	
   

  	
  Its General Partner

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Richard Rubin

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Richard Rubin

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  President

  	
   

  
													

 

 

3

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