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EXHIBIT 10.19  

Sobrato Standard Lease—March 22, 2002  

 
 

LEASE BETWEEN    
    
    SOBRATO INTERESTS II, a California Limited Partnership    
    
    and    
    
    CHICAGO PIZZA & BREWERY, INC., a California corporation    

 
 

Table of Contents:    
  

	 
	 	 
	 	 
	 	Page No.:

	ARTICLE 1.	 	PREMISES	 	1
	1.1	 	THE PREMISES	 	1
	1.2	 	CONDITIONS TO LEASE	 	1
	1.3	 	CONSTRUCTION OF TENANT IMPROVEMENTS	 	2
	 	 	(a)	 	Delivery of Possession and Commencement of Construction	 	2
	 	 	(b)	 	Tenant's Plans and Tenant's Sign Plans	 	2
	

ARTICLE 2.	
 	

TERM	
 	

2
	2.1	 	INITIAL TERM	 	2
	 	 	(a)	 	Definition of Lease Year	 	2
	2.2	 	LANDLORD'S OPTION TO TERMINATE	 	2
	

ARTICLE 3.	
 	

RENT	
 	

3
	3.1	 	PAYMENT OF RENT	 	3
	3.2	 	RENT DURING THE TERM	 	3
	

ARTICLE 4.	
 	

TAXES	
 	

3
	4.1	 	REAL PROPERTY TAXES	 	3
	 	 	(a)	 	Payment	 	3
	 	 	(b)	 	Proration	 	4
	 	 	(c)	 	Tax Contest	 	4
	4.2	 	PERSONAL PROPERTY TAXES	 	4
	

ARTICLE 5.	
 	

USE	
 	

4
	5.1	 	USE OF THE PREMISES	 	4
	5.2	 	SUITABILITY	 	4
	5.3	 	USE PROHIBITED	 	4
	 	 	(a)	 	Use of Roof	 	4
	 	 	(b)	 	Overloading of the Premises	 	5
	 	 	(c)	 	Nuisance and Waste	 	5
	 	 	(d)	 	Compliance with Laws	 	5
	5.4	 	ENVIRONMENTAL MATTERS	 	5
	 	 	(a)	 	Tenant's Responsibility	 	5
	 	 	(b)	 	Tenant's Indemnity Regarding Hazardous Materials	 	5
	 	 	(c)	 	Actual Release by Tenant	 	6
	 	 	(d)	 	Environmental Monitoring	 	6
	

ARTICLE 6.	
 	

UTILITIES	
 	

7
	6.1	 	UTILITY SERVICES	 	7
	6.2	 	INTERRUPTION OF UTILITY SERVICE	 	7
	6.3	 	REFUSE SERVICE	 	7
	

ARTICLE 7.	
 	

MAINTENANCE AND REPAIR	
 	

7
	7.1	 	LANDLORD'S MAINTENANCE AND REPAIR	 	7
	7.2	 	TENANT'S MAINTENANCE AND REPAIR	 	7

	

ARTICLE 8.	
 	

ALTERATIONS AND ADDITIONS	
 	

8
	8.1	 	TENANT ALTERATIONS	 	8
	

ARTICLE 9.	
 	

ENTRY BY LANDLORD	
 	

8
	9.1	 	LANDLORD'S RIGHT OF ENTRY	 	8
	

ARTICLE 10.	
 	

LIENS	
 	

9
	10.1	 	MECHANICS' LIENS	 	9
	

ARTICLE 11.	
 	

INDEMNITY	
 	

9
	11.1	 	TENANT'S INDEMNITY	 	9
	11.2	 	LANDLORD'S INDEMNITY	 	10
	

ARTICLE 12.	
 	

INSURANCE	
 	

10
	12.1	 	TENANT'S POLICIES OF INSURANCE	 	10
	 	 	(a)	 	Bodily Injury and Property Damage	 	10
	 	 	(b)	 	Tenant's Property Insurance	 	10
	12.2	 	LANDLORD'S POLICIES OF INSURANCE	 	10
	12.3	 	POLICY FORM	 	11
	 	 	(a)	 	Blanket Policies	 	11
	12.4	 	PAYMENT OF LANDLORD'S INSURANCE EXPENSE	 	11
	12.5	 	WAIVER OF SUBROGATION	 	11
	12.6	 	TENANT'S USE	 	12
	

ARTICLE 13.	
 	

DAMAGE AND DESTRUCTION	
 	

12
	13.1	 	INSURED RISKS	 	12
	13.2	 	UNINSURED RISKS	 	12
	13.3	 	TENANT'S TERMINATION RIGHTS	 	12
	13.4	 	EXTENT OF OBLIGATION	 	12
	13.5	 	ABATEMENT OF RENT	 	13
	13.6	 	DAMAGE NEAR THE END OF THE TERM	 	13
	

ARTICLE 14.	
 	

EMINENT DOMAIN	
 	

13
	14.1	 	TOTAL OR SUBSTANTIAL TAKING	 	13
	14.2	 	PARTIAL TAKING	 	13
	14.3	 	ABATEMENT OF RENT	 	13
	14.4	 	COMPENSATION	 	13
	

ARTICLE 15.	
 	

OUTSIDE AREAS	
 	

14
	15.1	 	TENANT DELIVERIES	 	14
	15.2	 	OUTDOOR SEATING AREA	 	14
	

ARTICLE 16.	
 	

ASSIGNMENT AND SUBLEASE; WAIVER OF LANDLORD'S LIEN	
 	

14
	16.1	 	LANDLORD'S CONSENT REQUIRED	 	14
	 	 	(a)	 	Consent by Landlord	 	14
	 	 	(b)	 	Assignment or Subletting Consideration	 	15
	 	 	(c)	 	No Release	 	15
	 	 	(d)	 	Reorganization of Tenant	 	15
	 	 	(e)	 	Permitted Transfers	 	15
	 	 	(f)	 	Effect of Default	 	16
	 	 	(g)	 	Conveyance by Landlord	 	16
	 	 	(h)	 	Successors and Assigns	 	16
	16.2	 	NO RELEASE OF TENANT	 	16
	16.3	 	LANDLORD'S LIEN WAIVER; TENANT'S FINANCING	 	16
	

ARTICLE 17.	
 	

SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT; LANDLORD'S WARRANTIES AND REPRESENTATIONS: ESTOPPEL CERTIFICATE	
 	

17
	17.1	 	SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT	 	17
	17.2	 	ESTOPPEL CERTIFICATE	 	17

	

ARTICLE 18.	
 	

LANDLORD'S WARRANTIES, REPRESENTATIONS AND COVENANTS	
 	

18
	18.1	 	WARRANTIES AND REPRESENTATIONS	 	18
	18.2	 	COVENANT OF QUIET ENJOYMENT	 	18
	

ARTICLE 19.	
 	

SIGNS	
 	

18
	19.1	 	EXTERIOR SIGNS	 	18
	19.2	 	INTERIOR SIGNS	 	18
	

ARTICLE 20.	
 	

DEFAULT REMEDIES	
 	

18
	20.1	 	DEFAULTS BY TENANT	 	18
	 	 	(a)	 	Remedies	 	19
	 	 	(b)	 	Definition of Rent	 	20
	 	 	(c)	 	Late Payment Charge	 	21
	 	 	(d)	 	Waiver	 	21
	 	 	(e)	 	Habitual Default	 	21
	20.2	 	DEFAULT BY LANDLORD	 	21
	

ARTICLE 21.	
 	

ADDITIONAL PROVISIONS	
 	

22
	21.1	 	DISPUTE RESOLUTION	 	22
	21.2	 	TRANSFER OF LANDLORD'S INTEREST	 	23
	21.3	 	CAPTIONS; ATTACHMENTS; DEFINED TERMS	 	23
	 	 	(a)	 	Captions	 	23
	 	 	(b)	 	Attachments	 	23
	 	 	(c)	 	Defined Terms	 	23
	21.4	 	SEVERABILITY	 	23
	21.5	 	NO PARTNERSHIP	 	23
	21.6	 	TIME; JOINT AND SEVERAL LIABILITY	 	23
	21.7	 	BINDING EFFECT; CHOICE OF LAW	 	24
	21.8	 	WAIVER	 	24
	21.9	 	SURRENDER OF PREMISES	 	24
	21.10	 	HOLDING OVER	 	24
	21.11	 	FORCE MAJEURE	 	24
	21.12	 	REASONABLE CONSENT	 	24
	21.13	 	NOTICES	 	24
	21.14	 	COSTS OF SUIT	 	25
	21.15	 	INTEREST CHARGES	 	25
	21.16	 	AUTHORITY OF PARTIES	 	25
	21.17	 	BROKERS	 	25
	21.18	 	NO PRESUMPTIONS AGAINST DRAFTER	 	25
	21.19	 	RECORDING	 	25
	21.20	 	MODIFICATIONS REQUIRED BY LENDER	 	26
	21.21	 	ENTIRE AGREEMENT	 	26

  

 
 

LEASE    
  

        This Lease is made and entered into to be effective as of the January    , 2002 (the "Effective Date") by and between Chicago Pizza &
Brewery, Inc., a California corporation whose address is 16162 Beach Boulevard, Suite 100, Huntington Beach, California 92647 (hereinafter referred to as "Tenant") and Sobrato Interests II, a
California Limited Partnership, whose address is 10060 North De Anza Boulevard, Suite 200, Cupertino, California 95014 (hereinafter referred to as "Landlord"). 

 
 

ARTICLE 1.    PREMISES    
  

        1.1    THE PREMISES.    For and in consideration of the Rent and the covenants and agreements set forth in this Lease
to be kept and performed by Tenant, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord, the Premises as defined below, for the term, at the Rent, and subject to and upon all the
terms, covenants and conditions set forth in this Lease (the "Lease"). 

        The
Premises consist of approximately 8,826 square feet of rentable space located in a building (the "Building") located in the City of Cupertino (the "City"), County of Santa Clara (the
"County"), State of California commonly known as 10690 North De Anza Boulevard, Cupertino, California 95014 (Assessor's Parcel Number: 316-02-104), constructed on approximately
1.75 acres of certain real property owned by Landlord, and the adjoining parking area containing approximately 97 parking stalls. The Premises and the parking area are further described on
Exhibit A, which is attached to this Lease. As set forth below, Tenant anticipates removing the existing improvements and rebuilding improvements to meet its specific needs, subject to
Landlord's approval as outlined below. 

        In
addition, Tenant and Tenant's business invitees shall have ingress and egress rights over the adjacent parcel located at 10600 North De Anza Boulevard solely for the purpose to gain
access to Mariani Avenue from the Premises. Tenant and Tenant's invitees shall be permitted to use designated non-restricted parking on the adjacent parcel as overflow parking as is
available from time to time during the term of this Lease during the period from 6:00 pm to 11:00 pm on business workdays and at all times on Saturdays, Sundays and legal holidays. Neither Tenant nor
Tenant's invitees shall be
permitted to construct any improvements, and neither impede or interfere in any manner with access on said adjacent parcel. 

        1.2    CONDITIONS TO LEASE.    This Lease is expressly conditioned upon satisfaction or waiver by Tenant of each of
the following conditions within the time limits set forth, all of which shall be completed and prosecuted at Tenant's sole expense utilizing commercially reasonable efforts and processes: 

        (a)  Inspection
of the Building by Tenant, its agents, architects, engineers and consultants to verify that 1) the Premises and the Building do not contain Hazardous
Materials, and 2) the Premises are suitable in all respects for Tenant's purposes; such inspection to be completed within thirty (30) days from the Effective Date; 

        (b)  Written
approval by the City, issuance of a use permit, or obtaining of other evidence satisfactory to Tenant that Tenant will be permitted to conduct its business
activities in the Premises as set forth in Article 5.1 below of this Lease, during days and hours acceptable to Tenant in its reasonable discretion with a slight increase in existing building
size and modification to permit Tenant's pro-typical silo design to be incorporated into said design and Tenant's obtaining from the County an approved on-site liquor license,
all of which shall occur within one hundred twenty (120) days from the Effective Date. Both Landlord and Tenant understand that Tenant intends to remove and replace at its sole cost and expense
the existing improvements on the Premises; 

        (c)  Written
approval by Landlord and the City of Tenant's Plans and Tenant's Sign Plans as defined in Article 1.3(b) below of this Lease within ninety
(90) days from the Effective Date; and 

1

 

        (d)  Issuance
of a Building Permit by the Building Department or other appropriate City governmental authority for the construction of Tenant Plan's and Tenant's Sign Plans
and interior improvements within the Premises within one hundred twenty (120) days from the Effective Date. 

        Tenant
agrees to notify Landlord in writing promptly upon waiver or satisfaction of the foregoing conditions. If no notice regarding waiver or satisfaction is received within the
specific time limits described above, such conditions shall be deemed to have been satisfied or waived without further act on the part of Tenant, unless within five business (5) days after the
expiration of the applicable time period Tenant elects to terminate and cancel this Lease by written notice to Landlord, in which event Landlord shall return all sums, if any, advanced by Tenant to
Landlord and neither party shall have any further rights under this Lease. 

        1.3    CONSTRUCTION OF TENANT IMPROVEMENTS.    

        (a)    Delivery of Possession and Commencement of Construction.    Upon waiver of the conditions set forth in
Article 1.2 above Landlord shall deliver possession of the Premises to Tenant in its current "as is" condition and Tenant shall enter and pursue construction of its Tenant Improvements in the
Premises with all reasonable diligence. If Landlord has not delivered possession of the Premises to Tenant on or before the date which is One hundred eighty (180) days from the Effective Date,
Tenant shall have the option of cancelling this Lease by written notice to Landlord of its intent to do so. If Tenant so cancels this Lease, then Landlord shall refund sums paid by Tenant to Landlord,
if any, and Tenant shall provide to Landlord any and all documents, reports, applications, designs, permits and other written materials related to the Premises, after which delivery neither party
shall have any duty to the other. 

        (b)  Tenant's Plans and Tenant's Sign Plans. Promptly following execution of this Lease by both parties, Tenant shall cause to
be prepared by a California licensed architect and engineer as applicable, plans and specifications ("Tenant's Plans") for the following: Tenant's proposed building(s) to be placed on the Premises and
for the installation of the interior improvements of the Premises; Tenant's signs on the exterior of the Building ("Tenant's Sign Plans"); and Tenant's specifications for the interior of the Premises
related to the installation of the trade fixtures, equipment and improvements. This Lease shall refer to all of the improvements to be constructed by Tenant in the Premises as shown on Tenant's Plans,
including the signs shown on the Sign Plans, as the "Tenant Improvements." 

 
 

ARTICLE 2.    TERM    
  

        2.1    INITIAL TERM.    The Lease shall be effective as of the Effective Date. The Initial Term of the Lease shall be
Twenty (20) full Lease Years, plus any partial month prior to the commencement of the first full Lease Year, said twenty (20) full Lease Years to be measured from the first of the month
following the Commencement Date, as defined below. As used in this Lease, the term "Commencement Date" shall mean the date upon which Tenant has waived the conditions to Lease set forth in
Article 1.2 above, and Landlord has delivered possession of the Premises to Tenant. Upon determination of the Commencement Date, the parties, upon the request of either party, shall execute a
memorandum verifying the Commencement Date and the date upon which the Lease commences and expires and attach it to this Lease as an additional exhibit. 

        (a)  Definition of Lease Year. A Lease Year is defined as a period of twelve (12) full months with the first Lease Year
to commence on the first of the month following the Commencement Date, and each subsequent sequential twelve (12) full calendar month thereafter. 

        2.2    LANDLORD'S OPTION TO TERMINATE.    Landlord is hereby granted the option to terminate the term of the Lease
(the "Termination Option") upon and subject that upon the commencement of the
ninth Lease Year, Landlord can provide written notice to terminate the lease upon a date certain that is at least twenty four (24) months from the notice date. Upon Landlord's 

2

 

exercising its rights of early termination of Lease herein, and Tenant's completion of its obligations pursuant to the termination of lease rights set forth below, and subject to Tenant's not being
in material default under the Lease and any of the terms or conditions therein, Landlord shall pay to Tenant within thirty (30) days after Tenant surrenders possession of the Premises the sum
of Two Million Dollars ($ 2,000.000.00) as consideration for such early termination. As additional consideration for this Termination Option, Landlord agrees that if it exercises such Termination
Option, Landlord will not lease or otherwise transfer the Premises to another restaurant/liquor type of use for a period of at least thirty-six (36) months. 

 
 

ARTICLE 3.    RENT    
  

        3.1    PAYMENT OF RENT.    Tenant shall pay as Rent for the Premises the sums set forth in this Article 3 in
lawful money of the United States in advance by deposit in the U.S. Mail addressed to Landlord at the address for notices prior to the first (1st) day of each calendar month throughout the term of
this Lease. The obligation to pay Rent and other charges under this Lease shall commence on the date which is one hundred fifty (150) days following the Commencement Date, or the date on which
Tenant opens for business, if such date is earlier ("Rent Commencement Date"). If the Rent Commencement Date occurs on a day other than the first (1st) day of the month, then the Rent and other
charges shall be prorated for the period in an amount equal to one-thirtieth (1/30th) of the monthly amount of the Rent and other charges for each such day from the Rent Commencement Date
to the last day of the month. 

        3.2    RENT DURING THE TERM.    Commencing on the Rent Commencement Date Tenant shall pay as Rent the following
amounts: 

	Period
 
	 	Monthly Rent

	Months 1 through 60	 	$	22,000.00
	Months 61 through 120	 	$	25,300.00
	Months 121 through 180	 	$	29,095.00
	Months 181 through 240	 	$	33,459.25

 
 

ARTICLE 4.    TAXES    
  

        4.1    REAL PROPERTY TAXES.    From and after the Commencement Date, Tenant shall pay to Landlord all real property
taxes and general and special assessments which have gone to bond ("Real Property Taxes") levied and assessed against the Building and the tax parcel on which the Building is located ("Parcel").
Tenant shall not be required to pay any municipal, county, state, or federal income, profits, gross receipts, renewal, or franchise tax or business license tax of Landlord or any municipal, county,
state, or federal estate, succession, inheritance, or transfer taxes of Landlord. If at anytime during the term of the Lease, the laws concerning the methods of real property taxation prevailing at
the commencement of the term are changed so that a tax or excise on Rents or any other such tax, however described, is levied or assessed against Landlord as a direct substitution in whole or in part
for any Real Property Taxes, Tenant shall pay before delinquency (but only to the extent that it can be ascertained that there has been a substitution and that as a result Tenant has been relieved
from the payment of Real Property Taxes it would otherwise been obligated to pay) the substitute tax or excise on Rents. Tenant's share of any tax or excise on Rent shall be substantially the same as,
and a substitute for, the payment of such Real Property Taxes as provided in this Lease. 

        (a)    Payment.    Tenant shall pay Real Property Taxes in two installments on the fifteenth (15th) of March and the
fifteenth (15th) of November of each Lease Year of the Lease term pursuant to a statement provided by Landlord to Tenant setting forth the amount of the installment accompanied by a copy of the Real
Property Tax bill, such statement to be provided at least ten (10) days in advance of the due date. 

3

 

        (b)    Proration.    Tenant's liability to pay any Real Property Taxes pursuant to this Article shall be prorated on
the basis of a 360-day year to account for any fractional portion of a tax fiscal year included at the commencement or expiration of the term of the Lease. With respect to any assessments
which may be levied against or upon the Premises, or which under the laws then in force may be evidenced by improvement or other bonds, or may be paid in annual installments, only the amount of such
annual installment (with appropriate proration for any partial year) and interest due on it shall be included within the computation of the Real Property Taxes to be paid by Tenant, even where
Landlord has not elected to pay such assessments in installments. 

        (c)    Tax Contest.    Tenant at its sole cost and expense shall have the right at any time to seek a reduction in the
assessed valuation of the Building or the Parcel. In such event, Tenant shall pay the Real Property Taxes under protest. Landlord shall then appoint Tenant as its agent for the purpose of obtaining
information and other data from the County Assessor or City Assessor and instituting and maintaining any proceeding or contest allowed under this Section with respect to all Real Property Taxes.
Landlord shall not be required to join in any proceeding or contest brought by Tenant unless the provisions of any law require that the proceeding or contest be brought by or in the name of Landlord
or owner of the Premises. In that case, Landlord shall join in the proceeding or contest or permit such proceeding or contest to be brought in Landlord's name as long Landlord is not required to bear
any cost. Such contest shall be conducted at Tenant's sole cost and expense unless Landlord receives a reduction in assessed value in which event Landlord shall reimburse Tenant its cost up to the
amount of the resultant tax savings, and thereafter Tenant shall be entitled to pay the Real Property Taxes based on such reduced valuation. 

        4.2    PERSONAL PROPERTY TAXES.    Tenant shall hold Landlord harmless from liability and free from liens for all
taxes, assessments, license fees, and public charges levied assessed or imposed upon its business operation, as well as upon all trade fixtures leasehold improvements merchandise, and other personal
property in, on, or upon the Premises. If any taxes on Tenant's personal property are levied against Landlord or Landlord's property, or if the assessed value of the Building or the Parcel is
increased by the inclusion of a value placed on Tenant's personal property, and if Landlord pays the taxes on any of these items or taxes based on the increased assessment of these items, Tenant shall
immediately reimburse Landlord for the sum of the taxes levied against Landlord or the proportion of the taxes resulting from the increase in Landlord's assessment plus interest at the maximum rate
permitted by law upon receipt by Tenant of a written statement for such reimbursement accompanied by supporting data showing Landlord's calculation and determination of the amount of such
reimbursement. 

 
 

ARTICLE 5.    USE    
  

        5.1    USE OF THE PREMISES.    Tenant may use the Premises for the operation of a full service restaurant with outdoor
seating serving a variety of foods, including the on-site sale of beer, wine and liquor, or for any lawful retail use directly related thereto as permitted under the laws and ordinances of
the City of
Cupertino and for no other use without Landlord's consent, which consent may be granted or withheld or delayed in Landlord's sole and absolute discretion. 

        5.2    SUITABILITY.    Landlord represents and warrants that the Premises are zoned to permit their use for the
conduct of Tenant's business pursuant to Article 5.1 of this Lease. If Tenant is unable to obtain a use permit on terms acceptable to it or otherwise, within the period described in
Article 1.2(b) above of this Lease, or if the laws of any governmental body prohibit Tenant from using the Premises for its intended purpose, Tenant may elect to terminate this Lease upon
written notice to Landlord after Tenant determines that its use of the Premises will be prohibited. 

        5.3    USE PROHIBITED.    

        (a)    Use of Roof.    Subject to Tenant's rights as set forth below, use of the roof of the Premises is reserved to
Landlord provided that no signs will be erected above Tenant's Premises 

4

 

without Tenant's prior written consent. Tenant shall make no penetration through the roof of the Premises or the Building without Landlord's prior written consent. 

        (b)    Overloading of the Premises.    Tenant shall not do anything in the Premises that will cause damage to the
Building. The Premises shall not be overloaded and no machinery, apparatus, or other appliance shall be used or operated in or on the Premises that will in any manner injure, vibrate, or shake the
Premises. 

        (c)    Nuisance and Waste.    Tenant shall not commit or suffer to be committed any waste in or upon the Premises. 

        (d)    Compliance with Laws.    Tenant shall comply with all laws concerning the Premises or Tenant's use of them,
including, without limitation, the obligation at Tenant's costs, to alter, maintain, or restore the Premises in compliance and conformity with all laws in relation to the condition, use or occupancy
of the Premises during the term of this Lease. 

        5.4    ENVIRONMENTAL MATTERS.    

        (a)    Tenant's Responsibility:    Without the prior written consent of Landlord, Tenant shall not bring, use, or
permit upon the Premises, or generate, create, release, emit, or dispose (nor permit any of the same) from the Premises any chemicals, toxic or hazardous gaseous, liquid or solid materials or waste,
including without limitation, material or substance having characteristics of ignitability, corrosivity, reactivity, or toxicity or substances or materials which are listed on any of the Environmental
Protection Agency's lists of hazardous wastes or which are identified in Division 22 Title 26 of the California Code of Regulations as the same may be amended from time to time ("Hazardous
Materials"). In order to obtain consent, Tenant shall deliver to Landlord its written proposal describing the toxic material to be brought onto the Premises, measures to be taken for storage and
disposal thereof, safety measures to be employed to prevent pollution of the air, ground, surface and ground water. Landlord's approval may be withheld in its reasonable judgment, In the event
Landlord consents to Tenant's use of Hazardous Materials on the Premises, Tenant represents and warrants that it will do the following: (I) adhere to all reporting and inspection requirements
imposed by federal, state, county or municipal laws, ordinances or regulations and will provide Landlord a copy of any such reports or agency inspections; (ii) obtain and provide Landlord
copies of all necessary permits required for the use and handling of Hazardous Materials on the Premises; (iii) enforce Hazardous Materials handling and disposal practices consistent with
industry standards; and (iv) surrender the Premises free from any Hazardous Materials arising from Tenant's bringing, using, permitting, generating, creating, releasing, emitting or disposing
of Hazardous Materials; and (v) properly close the facility with regard to Hazardous Materials including the removal or decontamination of any process piping, mechanical ducting, storage tanks,
containers, or trenches which have come into contact with Hazardous Materials and obtain a closure certificate from the local administering agency prior to the Expiration Date. 

        (b)    Tenant's Indemnity Regarding Hazardous Materials:    Tenant shall, at its sole cost, comply with all laws
pertaining to, and shall indemnify and hold Landlord harmless from, any claims, liabilities, costs or expenses incurred or suffered by Landlord arising from the bringing, using, permitting,
generating, emitting or disposing of Hazardous Materials by Tenant, its agents, contractors, authorized representatives or invitees through the surface soils of the Premises during the Lease Term.
Tenant's indemnification and hold harmless obligations include, without limitation, the following: (I) claims, liability, costs or expenses resulting from or based upon administrative, judicial
(civil or criminal) or other action, legal or equitable, brought by any private or public person under common law or under the Comprehensive Environmental Response, Compensation and Liability Act of
1980 ("CERCLA"), the Resource Conservation and Recovery Act of 1980 ("RCRA") or any other federal, state, county or municipal law, ordinance or regulation; (ii) claims, 

5

 

liabilities, costs or expenses pertaining to the identification, monitoring, cleanup, containment, or removal of Hazardous Materials from soils, riverbeds or aquifers including the provision of an
alternative public drinking water source; and (iii) all costs of defending such claims. 

        (c)    Actual Release by Tenant:    Tenant agrees to notify Landlord of any lawsuits or others which relate to the
remedying of or actual release of Hazardous Materials on or into the soils or ground water at or under the Premises. Tenant shall also provide Landlord all notices required by
Section 25359.7(b) of the Health and Safety Code and all other notices required by law to be given to Landlord in connection with Hazardous Materials. Without limiting the foregoing, Tenant
shall also deliver to Landlord, within twenty (20) days after receipt thereof, any written notices from any governmental agency alleging a material violation of, or material failure to comply
with, any federal, state or local laws, regulations ordinances or others, the violation of which or failure to comply with poses a foreseeable and material risk of contamination of the ground water or
injury to humans (other than injury solely to Tenant, its agents and employees within the Premises). 

        In
the event of any release on or into the Premises or into the soil or ground water under the Premises of any Hazardous Materials used, treated, stored or disposed of by Tenant, Tenant
agrees to comply, at its sole cost, with all laws, regulations, ordinances and orders of any federal, sate or local agency relating to the monitoring or remediation of such Hazardous Materials. In the
event of any such release of Hazardous Materials, Tenant agrees to meet and confer with Landlord and its Lender to attempt to eliminate and mitigate any financial exposure to such Lender and resultant
exposure to Landlord under California Code of Civil Procedure Section 736(b) as a result of such release, and promptly to take reasonable monitoring, cleanup and remedial steps given, inter
alia, the historical uses to which the Property has and continues to be used, the risks to public health posed by the release, the then available technology and the costs of remediation, cleanup and
monitoring, consistent with acceptable customary practices for the type and severity of such contamination and all applicable laws. Nothing in the preceding sentence shall eliminate, modify or reduce
the obligation of Tenant under Article 5.4(B) of this Lease to indemnify and hold Landlord harmless from any claims, liabilities, costs or expenses incurred or suffered by Landlord. Tenant
shall provide Landlord prompt written notice of Tenant's monitoring, cleanup and remedial steps. 

        In
the absence of an order of any federal, state or local government or quasi-government agency relating to the cleanup, remediation or other response action required by applicable law,
any dispute arising between Landlord and Tenant concerning Tenant's obligation to Landlord under this Article 5.4 8) concerning the level, method, and manner of cleanup, remediation or
response action required in connection with such a release of Hazardous Materials shall be resolved by arbitration and without a jury pursuant to the provisions of Article 21.1 below of this
Lease. 

        (d)    Environmental Monitoring:    Landlord and its agents shall have the right to inspect, investigate, sample and
monitor the Premises including any air, soil, water, ground water or other sampling or any other testing, digging, drilling or analysis to determine whether Tenant is complying with the terms of this
Article 5.4. If Landlord discovers that Tenant is not in compliance with the terms of this Article 5.4, Landlord shall provide Tenant thirty (30) days written notice of
non-compliance and an opportunity to commence compliance with the requirements of this Article 5.4. If Tenant initiates compliance with the terms and conditions of this
Article 5.4 within thirty (30) days and continues to complete compliance thereafter with reasonable diligence, Tenant shall have no further liability to the Landlord under this
Article 5.4. If Tenant fails to commence compliance within the time periods referenced above, Tenant shall be responsible for any such costs incurred by Landlord, including attorneys' and
consultants' fees, shall be due and payable by Tenant to Landlord within fifteen (15) days following Landlord's written demand therefor. 

6

  

 
 

ARTICLE 6.    UTILITIES    
  

        6.1    UTILITY SERVICES.    Landlord agrees that it will cause to be made available to Tenant upon the Premises not
later than the Commencement Date facilities for the delivery to and distribution within the Premises of water, gas, electricity, telephones and the removal of sewage. All such services shall be
separately metered at Tenant's expense. From and after the Commencement Date and thereafter throughout the term of this Lease, Tenant shall pay prior to delinquency for all water, gas, electricity,
telephone, sewage, janitorial service, and all other materials and utilities supplied to the Premises. 

        6.2    INTERRUPTION OF UTILITY SERVICE.    If utility service to the Premises is interrupted because of an intentional
act or sole neglect of Landlord, its agents contractors or employees, and such interruption continues for a period in excess of five (5) of Tenant's normal business days, Rent and other charges
shall abate from the commencement of the interruption until the service is restored. Tenant shall promptly notify Landlord in writing of any interruption upon which such a claim will be based. 

        6.3    REFUSE SERVICE.    Tenant shall store all trash and garbage within the areas approved by Landlord for such
purposes or within the Premises in good quality containers so located as not to be visible to Tenant's customers and other invitees and so as not to create or permit any health or fire hazard, and
arrange for the prompt and regular removal of such refuse. Tenant shall not allow refuse, garbage, or trash to accumulate outside the Premises, except on the date of scheduled pickup service, and then
only in areas designated by the mutual consent of Landlord and Tenant. Tenant shall fully maintain such area at its sole cost and expense. 

 
 

ARTICLE 7.    MAINTENANCE AND REPAIR    
  

        7.1    LANDLORD'S MAINTENANCE AND REPAIR.    Except as provided in Articles 13 and 14, and with the understanding that
Tenant is removing the existing improvement on the Premises and installing
Tenant Improvements to meet its specific needs, Tenant shall at its sole cost and expense maintain the Premises in good order and condition. Landlord shall have no duty to maintain the Premises under
the terms of this Lease. 

        Landlord
shall on the Commencement Date deliver the Premises to Tenant in its "as is" condition. The parking area provided by Landlord as a part of the Premises shall contain the number
of parking spaces required in City codes and regulations for Tenant's business. 

        7.2    TENANT'S MAINTENANCE AND REPAIR.    Except as provided in Articles 13 and 14, Tenant shall at all times during
the term of this Lease and at its sole cost and expense maintain the Building situated on the Premises, including the interior and the exterior of the Premises, every part of the interior and the
exterior signs, and the parking lot serving the Premises in good order, condition and repair. Upon termination of this Lease by lapse of time or otherwise, Tenant shall deliver the Premises to
Landlord in good condition and repair, ordinary wear and tear from reasonable and normal use excepted. Landlord shall have no obligation to alter, remodel, improve, repair, decorate or paint the
Premises or any part thereof and the parties hereto affirm that Landlord has made no representations to Tenant respecting the conditions of the Premises except as specifically herein set forth. 

        Tenant
hereby waives all rights under, and benefits of Subsection 1 of Sections 1932, 1941 and 1942 of the California Civil Code and under any similar law, statute or ordinance now or
hereafter in effect concerning a Landlord's obligations of tenantability and tenant's right to make repairs and deduct the cost of such repairs from rent. 

        If
Tenant after notice from Landlord fails to make with reasonable promptness any repairs which are Tenant's obligation under this Section, then Landlord may, but shall not be required
to, enter the 

7

 

Premises and put the same in good order, condition, and repair. The reasonable cost of such repairs shall become due and payable by Tenant to Landlord upon written demand. When Landlord makes such
demand for payment, Landlord shall furnish Tenant an itemized statement accompanied by invoices for the repairs and charges. 

 
 

ARTICLE 8.    ALTERATIONS AND ADDITIONS    
  

        8.1    TENANT ALTERATIONS.    Tenant shall make no significant alterations, decorations, additions or improvements in
or to the Premises without Landlord's prior written consent, and then only by contractors or materialmen approved by Landlord. Landlord's approval herein when requested shall not be unreasonably
withheld or delayed. Tenant agrees that there shall be no construction or partitions or
other obstructions which might interfere with Landlord's free access to mechanical installations or service facilities of the Premises or interfere with the moving of Landlord's equipment to or from
the enclosures containing said installations or facilities. All such work shall be done at such times and in such manner as Landlord may from time to time designate in a manner to avoid interference
with Tenant's business. Tenant covenants and agrees that all work done by Tenant shall be performed in full compliance with all laws, rules, orders, ordinances, directions, regulations and
requirements of all governmental agencies, offices, departments, bureaus and boards having jurisdiction. Before commencing any work, Tenant shall give Landlord at least five (5) days' written
notice of the proposed commencement of such work and shall, if required by Landlord, secure at Tenant's own cost and expense a completion and lien indemnity bond for such work in excess of $50,000.00,
satisfactory to Landlord, for such work. Tenant further covenants and agrees that any mechanic's lien filed against the Premises for work claimed to have been done for, or materials claimed to have
been furnished to, Tenant, will be discharged by Tenant, by bond or otherwise, within thirty (30) days after the filing thereof, at the cost and expense of Tenant. All alterations, decorations,
additions or improvements upon the Premises made by either party, including (without limiting the generality of the foregoing) all wall coverings, built-in cabinet work, paneling and the
like, shall, unless Landlord elects otherwise, become the property of Landlord and shall remain upon, and be surrendered with, the Premises, as a part thereof, at the end of the term hereof, except
that Landlord may, by written notice to Tenant, require Tenant to remove all partitions, counters, railings and the like installed by Tenant, and Tenant shall repair or, at Landlord's option, shall
pay to the Landlord all costs arising from such removal. 

        All
personal property, office machinery and equipment, furniture and moveable partitions owned by Tenant or installed by Tenant at its expense in the Premises shall be and remain the
property of Tenant and may be removed by Tenant at any time during the Lease Term when Tenant is not in default hereunder. If Tenant shall fail to remove all of its effects from said Premises upon
termination of this Lease for any cause whatsoever, Landlord may, at its option, remove the same in any manner that Landlord shall choose, and store said effects without liability to Tenant for loss
thereof, and Tenant agrees to pay Landlord upon demand any and all expenses incurred in such removal, including court costs and attorneys' fees and storage charges on such effects for any length of
time that the same shall be in Landlord's possession; or Landlord may, at its option, with ten (10) days written notice to Tenant, sell said effects, or any of the same, at private sale and
without legal process, for such price as Landlord may obtain and apply the proceeds of such sale upon any amounts due under this Lease from Tenant to Landlord and upon the expenses incident to the
removal and sale of said effects. 

 
 

ARTICLE 9.    ENTRY BY LANDLORD    
  

        9.1    LANDLORD'S RIGHT OF ENTRY.    Landlord reserves and shall at any and all times have the right to enter the
Premises at reasonable business times upon giving twenty four (24) hours written or oral notice to Tenant, if Tenant is not otherwise in default hereunder; to inspect the same, to submit said
Premises to prospective purchasers or tenants, to post notices of nonresponsibility, to alter, improve or repair the Premises, except in the event of an emergency for which notice will not be 

8

 

required, all without being deemed guilty of an eviction of Tenant and without abatement of rent, and may erect scaffolding and other necessary structures where reasonably required by the character
of the work to be performed, provided that the business of the Tenant shall be interfered with as little as is reasonably practicable. Tenant hereby waives any claim for damages for any injury or
inconvenience to or interference with Tenant's business, any loss of occupancy or quiet enjoyment of the Premises, and any other loss occasioned thereby. For each of the aforesaid purposes, Landlord
shall at all times have and retain a key with which to unlock all of the doors in, upon and about the Premises, excluding Tenant's vaults and safes, and Landlord shall have the right to use any and
all means which Landlord may deem proper to open said door in an emergency in order to obtain entry to the Premises, and any entry to the Premises obtained by Landlord in the event of an emergency by
any of said means, or otherwise, shall not under any circumstances be construed or deemed to be a forcible or unlawful entry into, or a detainer of, the Premises, or an eviction of Tenant from the
Premises or any portion thereof, and any damages caused on account thereof shall be paid by Tenant. 

 
 

ARTICLE 10.    LIENS    
  

        10.1    MECHANICS' LIENS.    Tenant shall keep the Building and the Premises free from any liens arising out of work
performed, materials furnished, or obligations incurred by Tenant, and shall indemnify, hold harmless, and defend Landlord from any liens and encumbrances arising out of any work performed or
materials furnished by or at the direction of Tenant. If Tenant does not, within twenty (20) days following Landlord's notice to Tenant and the expiration of ten (10) days after such
notice, cause such lien to be released of record by payment or posting of a proper bond or other legal and lawful means, Landlord shall have, in addition to all other remedies provided in this Lease
and by law, the right, but no obligation, to cause the same to be released by such means as it deems proper, including payment of the claim giving rise to such lien after written notice to Tenant
pursuant to this Lease. All such sums paid by Landlord and all expenses incurred by it in connection with them, including attorneys' fees and costs, shall be payable to Landlord by Tenant within
thirty (30) days with interest thereon at the rate calculated pursuant to Article 21.15 below of this Lease, Landlord shall have the right at all times to post and keep posted on the
Premises any notices permitted or required by law, or that Landlord shall deem proper, for the protection of Landlord and the Premises, and any other party having an interest in the Premises, from
mechanics' and materialmen's liens; Tenant shall give to Landlord at least fifteen (15) days= prior written notice of the expected date of commencement of any work relating to alterations or
additions to the Premises. 

 
 

ARTICLE 11.    INDEMNITY    
  

        11.1    TENANT'S INDEMNITY.    Tenant shall indemnify and save Landlord and Landlord's agents, contractors and
employees harmless from all costs and expenses, liabilities, obligations, damages, penalties, claims, or actions (including without limitation, any and all sums paid for investigation costs,
settlement of claims, consultant and expert fees, reasonable attorneys' fees and costs, and expenses of
litigation and appeal, from the first notice any claim or demand has been or may be made), payable in connection with or resulting from the following: 

        (a)  loss
of life, personal injury or damage to property, occurring in, on or about the Premises resulting from the acts or omissions of Tenant, its agents, contractors, or
authorized representatives; 

        (b)  the
use or occupancy of the Premises by Tenant, its agents, contractors, authorized representatives, or invitees; 

        (c)  any
breach or other failure to perform any covenant or agreement under this Lease, subject to the provisions of Article 20.1; 

9

 

        (d)  the
presence of Hazardous Substances in, on or about the Premises as the result of the acts or omissions of Tenant or Tenant's agents, contractors, or authorized
representatives; or 

        (e)  violations
of or noncompliance with any governmental requirements pertaining to or resulting from conduct of Tenant's business in the Premises. 

        If
any action or proceeding is brought against Landlord or Landlord's agents, contractors or employees by reason of any such matter, Tenant, upon written notice from Landlord, will
resist or defend such action or proceeding at Tenant's expense by counsel reasonably satisfactory to Landlord. In no event shall Tenant be liable for damage or injury occasioned by any act or omission
of Landlord or Landlord's agents, contractors, or authorized representatives. 

        11.2    LANDLORD'S INDEMNITY.    Landlord shall indemnify and save Tenant and Tenant's agents, contractors and
employees harmless from all costs and liabilities, obligations, damages, penalties, claims, or actions (including without limitation, any and all sums paid for investigation costs, settlement of
claims, consultant and expert fees, and reasonable attorneys' fees, and costs and expenses of litigation and appeal, from the first notice any claim or demand has been or may be made) payable in
connection with or resulting from the following: 

        (a)  a
breach of any of Landlord's representations and warranties contained in this Lease; 

        (b)  any
breach or other failure to perform any covenant or agreement under this Lease, subject to the provisions of Article 20.2 of this Lease; or 

        (c)  the
presence of Hazardous Substances in, on or under the Premises or the Building at any time prior to the Commencement Date. 

        If
any action or proceeding is brought against Tenant or Tenant's agents, contractors or employees by reason of any such matters, Landlord upon notice from Tenant shall defend same at
Landlord's expense by counsel reasonably satisfactory to Tenant. In no event shall Landlord be liable for damage or injury occasioned by any act or omission of Tenant or Tenant's agents or authorized
representatives. 

 
 

ARTICLE 12.    INSURANCE    
  

        12.1    TENANT'S POLICIES OF INSURANCE.    Tenant covenants and agrees that from and after the date Tenant enters the
Premises to commence construction of its Tenant Improvements and thereafter throughout the Lease term as it may be extended, Tenant will carry and maintain at its sole cost and expense, the types of
insurance in the amounts and forms specified in this Article. 

        (a)    Bodily Injury and Property Damage.    Bodily Injury and Property Damage Insurance with coverage limits of not
less than Three Million Dollars ($1,000,000.00) combined each occurrence and in the aggregate insuring against any and all liability of the insured with respect to the Premises or arising out of the
maintenance, use, or occupancy of the Premises naming Landlord and Landlord's property manager and, if requested in writing by Landlord, any mortgagee or any party having an interest, as additional
insureds. 

        (b)    Tenant's Property Insurance.    Insurance covering all of Tenant's trade fixtures, merchandise, equipment,
leasehold improvements, and personal property in or on the Premises in the full amount of the replacement value from time to time during the term of the Lease providing protection against direct
physical loss of or damage to property. 

        Tenant
agrees to carry such insurance, it being expressly understood and agreed that none of the items to be insured by Tenant under this Section shall be insured by Landlord, nor shall
Landlord be required to reinstall, reconstruct, or repair any of such items. 

        12.2    LANDLORD'S POLICIES OF INSURANCE.    Landlord covenants and agrees that throughout the term of this Lease as
it may be extended, Landlord will carry and maintain insurance 

10

 

covering the Premises in an amount not less than one hundred percent (100%) of the replacement value (exclusive of the cost of excavations, foundations, and footings) from time to time during the
term of this Lease providing protection against direct physical loss or damage to property ("Landlord's Property Insurance"), and including flood insurance, earthquake coverage and rental income
insurance with a limit equal to one hundred percent (100%) of the Rent and other sums due under the Lease for a period not to exceed two (2) years from the date of the damage or destruction. 

        12.3    POLICY FORM.    All policies of insurance provided for in this Article shall be issued by insurance companies
qualified to do business in the State of California and rated A 10 or better in Best's Insurance Guide. All Bodily Injury and Property Damage Insurance maintained by either party shall name the other
party as an additional insured. Executed copies of such policies of insurance as either party is required to carry under this Article or certificates of insurance shall be delivered to the other party
at least ten (10) days prior to Tenant's occupancy of the Premises and otherwise within ten (10) days of receipt of a written request for it. As often as any such policy shall expire or
terminate, renewal or additional policies shall be procured and maintained in like manner and to like extent. All policies of insurance delivered to either party under this Article must contain a
provision that the company writing said policy will give to the other party to this Lease thirty (30) days= notice in writing in advance of any cancellation or lapse or the effective date of
any reduction in the amounts of insurance. If either party fails to provide insurance as required under this Article following ten (10) days= written notice of such failure, the other party may
acquire such insurance at the expense of the defaulting party who shall reimburse such expense with interest pursuant to Article 21.15 below of this Lease within fifteen (15) days of
receipt of a bill for it. 

        (a)    Blanket Policies.    Notwithstanding anything to the contrary contained in this Article 12, either
party's obligations to carry the insurance provided for in this Article may be brought within the coverage of a so-called blanket policy or policies of insurance carried and maintained by
them, provided, however, that Landlord and Tenant shall be named as an additional loss payees under such policies as their interest may appear and that the coverage afforded Landlord and Tenant will
not be reduced or diminished by reason of the use of such blanket policy of insurance, and provided further that the requirements set forth in this Article are otherwise satisfied. Each party agrees
to permit the other at all reasonable times to inspect the policies of insurance covering risks upon the Premises for which policies or copies of them are not required to be delivered to the other. 

        12.4    PAYMENT OF LANDLORD'S INSURANCE EXPENSE.    In addition to all other sums due under this Article, from and
after the Commencement Date Tenant shall pay to Landlord the cost of Landlord's insurance as set forth in Section 12.2. Payment shall be made annually within twenty (20) days after
Tenant's receipt of Landlord's written statement for it accompanied by a copy of the premium statement together with a calculation showing Landlord's method of determining Tenant's share of such cost. 

        12.5    WAIVER OF SUBROGATION.    Landlord and Tenant hereby waive any rights each may have against the other in
connection with any of the damage occasioned to Landlord or Tenant, as the case may be, their respective property, the Building or the Premises or its contents, arising from covered causes of loss for
which Property Insurance is carried or required to be carried pursuant to this Lease. Each party on behalf of its respective insurance companies insuring its respective property against any such loss,
waives any right of subrogation that it may have against the other party. Because the foregoing waivers will precludes the assignment of any claim by way of subrogation to an insurance company or any
other person, each party agrees immediately to give to its insurer written notice of the terms of these mutual waivers and shall have its insurance policies endorsed to prevent the invalidation of the
insurance coverage because of its waiver. 

11

  

        12.6    TENANT'S USE.    Tenant shall not use or permit the Premises, or any part thereof, to be used for any
purpose
other than that for which the Premises are hereby leased; and no use of the Premises shall be made or permitted, nor acts done, which will cause an increase in premiums or cancellations of any
insurance policy covering the Premises or any part thereof, nor shall Tenant sell or permit to be sold, kept, or used in or about the Premises, any article prohibited by the standard form of fire
insurance policies. Tenant shall, at its sole cost, comply with all requirements of any insurance company or organization necessary for the maintenance of reasonable fire and public liability
insurance covering the Premises and appurtenances. The minimum limits of the Commercial General Liability policy of insurance shall be subject to increase at any time, and from time to time, after the
second (2nd) full Lease Year to an amount equal to the aggregate increase in the amount of the San Francisco-Oakland Consumer Price Index (CPI) between the Commence Date of this Lease and the Lease
Year then in effect, if Landlord shall deem same necessary for adequate protection. 

 
 

ARTICLE 13.    DAMAGE AND DESTRUCTION    
  

        13.1    INSURED RISKS.    If during the term of this Lease the Premises are damaged, destroyed by fire, or by any
other risk required to be insured by Landlord under Landlord's Property Insurance, Landlord, shall forthwith proceed to repair or rebuild the same, including any additions or improvements made by
Landlord or Tenant, on the same plans and design that existed immediately before such damage or destruction occurred. Materials used in repair and rebuilding shall be as nearly like original materials
as may then may reasonably procured through regular channels of supply. 

        13.2    UNINSURED RISKS.    If the Premises are damaged as a result of any casualty not covered or required to be
covered by Landlord's Property Insurance to an extent not greater than twenty-five percent (25%) of the replacement cost of the Premises, and proceeds are available from the insurance
carrier, Landlord shall within sixty (60) days following the date of such damage, commence repair, reconstruction, or restoration of the Premises and prosecute the same diligently to
completion, in which event this Lease shall continue in full force. If the damage or destruction exceeds twenty-five percent (25%) of the replacement cost, or insufficent insurance is
available to restore the Premises, Landlord shall notify Tenant within said sixty (60) day period of the total cost of restoration and repair of the Premises. Landlord may, within said sixty
(60) day period, elect not so to repair, reconstruct, or restore the Premises, in which event this Lease shall cease and terminate except as otherwise provided in this Lease. 

        13.3    TENANT'S TERMINATION RIGHTS.    Tenant shall have the right to terminate this Lease, if the Premises cannot,
with reasonable diligence, be fully repaired within two hundred seventy (270) days from the date of damage or destruction. The determination of the estimated repair period shall be made by
Landlord in its good faith business judgment within sixty (60) days after such damage or destruction. Landlord shall deliver written notice of the estimated repair period to Tenant after such
determination has been made, and Tenant shall exercise its right to terminate this Lease, if at all, within ten (10) days of receipt of such notice from Landlord. In addition, if Landlord has
not obtained a building permit for any repairs, rebuilding or restoration required under this Article within ninety (90) days from the date of such damage or destruction or if Landlord has not
completed all repairs, rebuilding or restoration within two hundred seventy (270) days from the date of damage or destruction, Tenant may at any time thereafter prior to delivery of the
restored Premises to Tenant terminate this Lease by giving Landlord ten (10) days written notice. 

        13.4    EXTENT OF OBLIGATION.    Notwithstanding the provisions of this Article to the contrary, neither Landlord nor
its agents or employees shall be liable for any damage to Tenant's property, nor for loss of or damage to any property by theft or otherwise, nor for any injury or damage to persons or property
resulting from fire, explosion, falling plaster, steam, gas, electricity, water or rain which may leak from any part of the Premises or Building(s) or from the pipes, appliances or plumbing works
therein or from the roof, street or sub-surface or from any other place or resulting from dampness or 

12

 

any other cause whatsoever, unless the same is caused by the active negligence or willful misconduct of the Landlord. Landlord or its agents shall not be liable for interference with the light or
other intangible properties, nor shall Landlord be liable for any latent defect in the Premises or in the adjoining properties. Tenant shall give prompt notice to Landlord in case of fire or accidents
in the Premises or of defects therein or in the fixtures or equipment. 

        13.5    ABATEMENT OF RENT.    In the event of repair, reconstruction, and restoration as provided in this Article, the
Rent and all other charges under this Lease shall be abated proportionately with the degree to which Tenant's use of the Premises is impaired, commencing from the date of destruction and continuing
during the period of such repair, reconstruction, or restoration. Tenant shall continue the operation of its business on the Premises during any such period to the extent reasonably practicable from
the standpoint of prudent business management. 

        Upon
any termination of the Lease under any provision of this Article, the parties shall be released by such termination without further obligation to the other party coincident with the
surrender of possession of the Premises to Landlord, except for items that accrued before such termination and remain unpaid. 

        13.6    DAMAGE NEAR THE END OF THE TERM.    If the Premises are destroyed or damaged from any cause during the last
twelve (12) months of the term of this Lease as it may have been extended, Landlord or Tenant may cancel and terminate this Lease unless Tenant exercises its option to renew (if any remain) in
which event Landlord shall proceed to repair and restore in accordance with the terms of this Article. 

 
 

ARTICLE 14.    EMINENT DOMAIN    
  

        14.1    TOTAL OR SUBSTANTIAL TAKING.    If title to all of the Premises is taken for any public or quasi-public use
under any statute or by right of eminent domain, or by purchase in lieu of eminent domain, or if title to so much of the Premises is so taken that a reasonable amount of reconstruction of the Premises
will not result in the Premises being a practical improvement and reasonably suitable for Tenant's continued occupancy for the uses and purposes for which the Premises are leased, or if any of the
parking area serving the Premises is taken, then, in either event, at Tenant's election this Lease shall terminate on the date that such possession of the Premises or parking area are taken. 

        14.2    PARTIAL TAKING.    If any part of the Premises shall be so taken and the remaining part of the Premises (after
reconstruction of the then-existing buildings of which the Premises are a part) is reasonably suitable for Tenant's continued occupancy for the purposes and uses for which the Premises are
leased, this Lease shall, as to the part so taken, terminate on the date that possession of such part is taken, and the Rent and all other charges under this Lease shall be reduced in the same
proportion that the net rentable area of the Premises so taken, less any addition to the Premises by reconstruction, bears to the original net rentable area of the Premises. Landlord shall, at its own
cost and expense, make all necessary repairs or alterations to the Building of which the Premises are a part so as to constitute the portion of the Building not taken a complete architectural unit and
the remaining Premises a complete merchandising unit. 

        14.3    ABATEMENT OF RENT.    If the continued occupancy of Tenant is interfered with for any time during the partial
taking, notwithstanding the partial taking does not terminate this Lease as to the part not so taken, the Rent and all other charges under this Lease shall proportionately abate so long as Tenant is
not able continuously to conduct its business in the part remaining and not so taken. 

        14.4    COMPENSATION.    All compensation awarded or paid upon a total or partial taking of the fee title shall belong
to Landlord. Notwithstanding the aforementioned, Tenant shall retain and have a claim for the unamortized value computed over the remaining useful life of Tenant's leasehold improvements (to the
extent Landlord has not contributed to the cost of such improvements); that 

13

 

portion, if any, of the award made to Landlord for the taking that results in the enhancement of the award to Landlord as a result of equipment or removable fixtures, removable by Tenant under the
terms of this Lease, but that are required to be taken by the condemnor or are so acquired by the condemnor; and (iii) all relocation assistance, moving and relocation expenses to the extent,
if any, provided by the condemning authority. 

 
 

ARTICLE 15.    OUTSIDE AREAS    
  

        15.1    TENANT DELIVERIES.    Notwithstanding any provision of this Lease to the contrary, the parties understand that
Tenant receives merchandise by common carrier deliveries. Tenant cannot control delivery schedules of such common carriers and thus, cannot be bound by specific delivery time restrictions. Tenant
agrees to request common carriers to cooperate with any reasonable delivery schedule restrictions should the same be enacted by Landlord. 

        15.2    OUTDOOR SEATING AREA.    Tenant shall be permitted to use the storefront sidewalk area adjacent to the
Premises for outdoor seating for its customers, subject to compliance by Tenant at its sole cost and expense with applicable municipal codes and ordinances regulating the use of such area. Tenant
shall at all times, at Tenant's sole cost and expense, keep and maintain the outdoor seating area in a first-class, neat, clean and presentable condition. 

 
 

ARTICLE 16.    ASSIGNMENT AND SUBLEASE; WAIVER OF LANDLORD'S LIEN    
  

        16.1    LANDLORD'S CONSENT REQUIRED.    

        (a)    Consent by Landlord:    Except as specifically provided in this Article 16, Tenant may not assign,
sublet, hypothecate, or allow a third party to use the Premises without the express written consent of Landlord, which will not be unreasonably withheld or delayed subject to the conditions set forth
below. In the event Tenant desires to assign this Lease or any interest herein including, without limitation, a pledge, mortgage or other hypothecation, or sublet the Premises or any part thereof,
Tenant shall deliver to Landlord (I) executed counterparts of any agreement and of all ancillary agreements with the proposed assignee/subtenant, (ii) current financial statements of the
transferee covering the preceding three years, (iii) the nature of the proposed transferee's business to be carried on in the Premises, (v) all consideration to be given on account of
the Transfer, and (vi) a current financial statement of Tenant. Landlord may condition its approval of any Transfer to a certification from both Tenant and the proposed transferee of all
consideration to be paid to Tenant in connection with such Transfer. At Landlord's request, Tenant shall also provide additional information reasonably required by Landlord to determine whether it
will consent to the proposed assignment or sublease. Landlord shall have a thirty (30) day period following receipt of all the foregoing within which to notify Tenant in writing that Landlord
elects to: (I) permit Tenant to assign or sublet such space to the named assignee/subtenant on the terms and conditions set forth in the notice; or (ii) refuse consent. If Landlord
should fail to notify Tenant in writing of such election within the 30-day period, Landlord shall be deemed to have elected option (ii) above. In the event Landlord elects option
(I) above, Landlord's written consent to the proposed assignment or sublease shall not be unreasonably withheld, provided and upon the condition
that: (I) the proposed assignee or subtenant is engaged in a business that is limited to the use expressly permitted under this Lease; (ii) the proposed assignee or subtenant is a
company with sufficient financial worth and management ability to undertake the financial obligation of this Lease and Landlord has been furnished with reasonable proof thereof; (iii) the
proposed assignment or sublease is in form reasonably satisfactory to Landlord; (iv) the amount of the aggregate rent to be paid by the proposed subtenant is not less than the then current fair
market rental; (v) Tenant reimburses Landlord on demand for any costs that may be incurred by Landlord in connection with said assignment or sublease, including the costs of making
investigations as to the acceptability of the proposed assignee or subtenant and legal costs incurred in connection with 

14

 

the granting of any requested consent; and (vi) Tenant shall not have advertised or publicized in any way the availability of the Premises without prior notice to Landlord. In the event all or
any one of the foregoing conditions are not satisfied, Landlord shall be considered to have acted reasonably if it withholds its consent. 

        (b)    Assignment or Subletting Consideration:    Any rent or other economic consideration realized by Tenant under
any sublease and assignment, in excess of the rent payable hereunder and reasonable subletting and assignment costs, shall be divided and paid sixty-seven percent (67%) to Landlord and thirty-three
percent (33%) to Tenant. Tenant's obligation to pay over Landlord's portion of the consideration constitutes an obligation for additional rent hereunder. The above provisions relating to Landlord's
right to terminate the Lease and relating to the allocation of bonus rent are independently negotiated terms of the Lease which constitute a material inducement for the Landlord to enter into the
Lease, and are agreed by the parties to be commercially reasonable. No assignment or subletting by Tenant shall relieve it of any obligation under this Lease. Any assignment or subletting which
conflicts with the provisions hereof shall be void. 

        (c)    No Release:    Any assignment or sublease shall be made only if and shall not be effective until the assignee
or subtenant shall execute, acknowledge, and deliver to Landlord an agreement, in form and substance satisfactory to Landlord, whereby the assignee or subtenant shall assume all the obligations of
this Lease on the part of Tenant to be performed or observed and shall be subject to all the covenants, agreements, terms, provisions and conditions in this Lease. Notwithstanding any such sublease or
assignment and the acceptance of rent by Landlord from any subtenant or assignee, Tenant and any guarantor shall remain fully liable for the payment of Monthly Rent and additional rent due, and to
become due hereunder, for the performance of all the covenants, agreements, terms, provisions and conditions contained in this Lease on the part of Tenant to be performed and for all acts and
omissions of any licensee, subtenant, assignee or any other person claiming under or through any subtenant or assignee that shall be in violation of any of the terms and conditions of this Lease, and
any such violation shall be deemed a violation by Tenant. Tenant shall indemnify, defend and hold Landlord harmless from and against all losses, liabilities, damages, costs and expenses (including
reasonable attorney fees) resulting from any claims that may be made against Landlord by the proposed assignee or subtenant or by any real estate brokers or other persons claiming compensation in
connection with the proposed assignment or sublease. 

        (d)    Reorganization of Tenant:    If Tenant is a corporation, the following shall be deemed an assignment of
Tenant's interest in this Lease governed by the provisions of this Article 16: (I) any dissolution, merger, consolidation, or other reorganization of or affecting Tenant, whether or not
Tenant is the surviving
corporation, or (ii) the sale or transfer to one person or entity (or to any group of related persons or entities) stock possessing more than 50% of the total combined voting power of all
classes of Tenant's capital stock issued, outstanding and entitled to vote for the election of directors. 

        (e)    Permitted Transfers:    Notwithstanding anything contained in this Article 16, so long as Tenant
otherwise complies with the provisions of this Article, Tenant may enter into any of the following transfers (a "Permitted Transfer") without Landlord's prior consent, and Landlord shall not be
entitled to terminate the Lease or to receive any part of any subrent resulting therefrom that would otherwise be due pursuant to Articles 17(A) and 17(B). Tenant may sublease all or part of the
Premises or assign its interest in this Lease to (I) any corporation which controls, is controlled by, or is under common control with the original Tenant to this Lease by means of an ownership
interest of more than 50%; (ii) a corporation which results from a merger, consolidation or other reorganization in which Tenant is not the surviving corporation, so long as the surviving
corporation has a net worth at the time as such assignment that is equal to or greater than the net 

15

 

worth of Tenant immediately prior to such transaction; and (iii) a corporation which purchases or otherwise acquires all or substantially all of the assets of Tenant so long as such acquiring
corporation has a net worth at the time of such assignment that is equal to or greater than the net worth of Tenant immediately prior to such transaction. 

        (f)    Effect of Default:    In the event of Tenant's default, Tenant hereby assigns all rents due from any assignment
or subletting to Landlord as security for performance of its obligations under this Lease, and Landlord may collect such rents as Tenant's Attorney-in-Fact, except that Tenant
may collect such rents unless a default occurs as described in Article 20 below. A Lease termination due to Tenant's default shall not automatically terminate an assignment or sublease then in
existence; rather at Landlord's election, such assignment or sublease shall survive the Lease termination, the assignee or subtenant shall attorn to Landlord, and Landlord shall undertake the
obligations of Tenant under the sublease or assignment; except that Landlord shall not be liable for prepaid rent, security deposits or other defaults of Tenant to the subtenant or assignee, or for
any acts or omissions of Tenant and Tenant's Agents. 

        (g)    Conveyance by Landlord:    As used in this Lease, the term "Landlord" is defined only as the owner for the time
being of the Premises, so that in the event of any sale or other conveyance of the Premises or in the event of a master lease of the Premises, Landlord shall be entirely freed and relieved of all its
covenants and obligations hereunder after the date of such conveyance, and it shall be deemed and construed, without further agreement between the parties and the purchaser at any such sale or the
master tenant of the Premises, that the purchaser or master tenant of the Premises has assumed and agreed to carry out any and all covenants and obligations of Landlord hereunder. Such transferor
shall transfer and deliver Tenant's security deposit to the purchaser at any such sale or the master tenant of the Premises, and thereupon the transferor shall be discharged from any further liability
in reference thereto. 

        (h)    Successors and Assigns:    Subject to the provisions in this Article 16, the covenants and conditions of
this Lease shall apply to and bind the heirs, successors, executors, administrators and assigns of all parties hereto; and all parties hereto shall be jointly and severally liable hereunder. 

        16.2    NO RELEASE OF TENANT.    No consent by Landlord to any assignment of this Lease or subletting of the Premises
by Tenant shall relieve Tenant of any obligation to be performed by Tenant under this Lease, whether occurring before or after such consent to assignment or subletting of the Premises. The consent by
Landlord to any such assignment or subletting shall not relieve Tenant from the obligation to obtain Landlord's express written consent to any other such assignment or subletting. The acceptance of
Rent by Landlord from any other person shall not be deemed to be a waiver by Landlord of any provision of this Lease or to be a consent to any other assignment or subletting. Consent to one assignment
or subletting shall not be deemed to constitute consent to any subsequent assignment or subletting. 

        16.3    LANDLORD'S LIEN WAIVER; TENANT'S FINANCING.    Landlord agrees that upon the request of Tenant, Landlord will
execute and deliver to Tenant on a form satisfactory to Tenant's lender, a waiver of right to levy upon or distrain personal property, furniture, trade fixtures, equipment, and inventory from time to
time placed in, on or about the Premises by Tenant (collectively "Personalty"), which property may have a secured party with rights superior to Landlord's. 

16

  

        Tenant may, from time to time secure financing or general credit lines, and grant lenders as security for it, a security interest in such Personalty and the right to enter and
re-enter the Premises to realize upon the security covered by the security interest, and a collateral assignment of Tenant's leasehold interest in the Premises, with rights of
reassignment; provided, however, such collateral assignment may be made solely for the purpose of securing Tenant's indebtedness. Upon written request by Tenant, Landlord agrees to evidence Landlord's
consent in writing to such security interest and assignment, and give such lenders the same right to notice of and time to cure any default of Tenant as is provided for Tenant under the provisions of
this Lease. Landlord hereby acknowledges that Landlord does not have a lien on any of Tenant's Personalty, and Landlord hereby waives its lien or related rights, if any, granted or conferred upon
Landlord, by statute or otherwise, on any of Tenant's Personalty. To the extent any such lien is nevertheless imposed upon Tenant's Personalty, Landlord hereby subordinates such lien to the lien of
any holder of indebtedness of Tenant. In addition, Landlord agrees to cause any mortgagee respecting the Premises specifically to acknowledge the rights of any lender to which this Section refers. 

 
 

ARTICLE 17.    SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT;
  LANDLORD'S WARRANTIES AND REPRESENTATIONS:
  ESTOPPEL CERTIFICATE    
  

        17.1    SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT.    This Lease shall be subject and subordinate to
the lien of any and all Mortgages (as defined below) now or hereafter encumbering the Premises and placed on them by Landlord and to all renewals, modifications, replacements and extensions of such
Mortgages; provided, however, that the subordination contained in this Section shall not be effective with respect to any Mortgage executed after the date of this Lease unless the holder of such
Mortgage (the "Mortgagee") executes and delivers a subordination, non-disturbance and attornment agreement, in form satisfactory to Tenant, providing that, if the Mortgage is foreclosed or
the Mortgagee accepts a deed in lieu foreclosure (either of which events shall be a "Foreclosure"), so long as Tenant is not then in default beyond the period of notice and opportunity to cure
provided in this Lease and so long as Tenant attorns to the Mortgagee or purchaser upon Foreclosure: the Lease shall not terminate by reason of such Foreclosure; Tenant's possession of the Premises
shall not be disturbed; the Mortgagee or purchaser upon such Foreclosure, its or his successors or assigns, shall recognize Tenant and all of Tenant's rights under this Lease and shall be obligated to
perform fully and completely Landlord's duties and obligations under this Lease arising from and after the date of such Foreclosure; the Mortgagee, whether or not the Mortgage is foreclosed, shall
make all net proceeds arising from casualty or condemnation loss to the Premises available to Tenant for restoration of the Improvements in accordance with the terms of this Lease; and the Mortgagee
shall not name Tenant in any foreclosure proceeding. As used in this paragraph, the term "Mortgage" shall mean any mortgage,
deed to secure debt, deed of trust, trust deed or other collateral conveyance of, or lien or encumbrance against, the Premises. 

        As
part of such subordination, non-disturbance and attornment agreement which Tenant agrees to execute from time to time during the Term, if requested by any Mortgagee,
Tenant agrees to provide to such Mortgagee (simultaneously with notice to Landlord) notice of Landlord's defaults and the same periods for such Mortgagee to cure such defaults as those provided
Landlord in this Lease, together with such agreements as are typically found in non-disturbance and attornment agreements with institutional lenders as may be reasonably satisfactory to
Tenant, provided that, Tenant shall not be required to alter its rights and entitlements or increase its obligations under this Lease except as set forth in this Article 17.1. 

        17.2    ESTOPPEL CERTIFICATE.    Each party within fifteen (15) days after receipt of written notice from the
other party shall execute and deliver to the other party, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the
modifications and that there are no defaults under the Lease, or stating the default and its nature if 

17

 

defaults are claimed. The certificate also shall state the amount of Rent and the dates to which the Rent has been paid in advance. Failure to deliver the certificate within fifteen (15) days
shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease
is in full force and effect and has not been modified except as may be represented by the party requesting the certificate. 

 
 

ARTICLE 18.    LANDLORD'S WARRANTIES, REPRESENTATIONS AND COVENANTS    
  

        18.1    WARRANTIES AND REPRESENTATIONS.    Landlord represents and warrants: (I) that the Premises are free of
any limitation or restriction which would restrict Tenant's use of the Premises for the sale of the items specifically referred to in Article 5.1 of this Lease or would restrict in any respect
the right of Tenant, its employees, customers, and invitees to use the Premises in accordance with the provisions of this Lease; (ii) that as of the date of this Lease, the roof and exterior
walls of the Premises are structurally sound and in good repair; (iii) that to the best of Landlord's knowledge with respect to the Premises, there are no impact, development, service contract,
hook-up, connection (other than utility service contract, hook-up, connection (other than utility service charges), installation, fixture, tap-in, or similar fees
or charges, regardless of the nature of them and to whomsoever payable; and (iv) that to the best of Landlord's knowledge, there are no judicial, quasi-judicial, administrative or other orders,
injunctions, moratoria or pending proceedings against Landlord or the Building which preclude or interfere with, or would preclude or materially interfere with, the construction contemplated in
Article 1.3 above of this Lease or the occupancy and use of the Premises for the purposes contemplated in this Lease. 

        18.2    COVENANT OF QUIET ENJOYMENT.    So long as Tenant shall perform each and every term, condition and covenant to
be performed by Tenant hereunder, Tenant shall have the absolute peaceful quiet use and possession of the Premises without interference or hindrance on the part of Landlord until the termination of
this Lease and the end of the Lease term herein, including any option period, and Landlord shall warrant and defend Tenant in such peaceful and quiet use and possession under Landlord. Tenant's rights
under this Lease shall be provided by Landlord to any lender, ground lessor or any other individual or entity claiming a security interest on the Premises now or hereafter placed relating to the
Premises or any part or parts thereof by the Landlord as an affirmative obligation of Landlord. 

 
 

ARTICLE 19.    SIGNS    
  

        19.1    EXTERIOR SIGNS.    Tenant shall, in conformity with applicable laws and ordinances and Tenant's standard sign
criteria as amended from time to time, have the right to erect and thereafter to replace, signs on the front, side, monuments and sidewalks of the Building. Tenant shall erect, maintain and replace
all such signs at Tenant's sole cost and expense. Landlord shall not utilize the exterior of or space above the Premises or any portion of the Building for sign purposes. 

        19.2    INTERIOR SIGNS.    Tenant shall have the right, at its sole risk and expense and in conformity with applicable
laws and ordinances, to erect, maintain, place and install its usual and customary signs and fixtures in the interior of the Premises. 

 
 

ARTICLE 20.    DEFAULT REMEDIES    
  

        20.1    DEFAULTS BY TENANT.    The occurrence of any of the following shall constitute a material default and breach
of this Lease by Tenant: (I) any failure by Tenant to pay Rent or any other monetary sums required to be paid under this Lease where such failure continues for five (5) business days
after written notice has been received by Tenant; (ii) the abandonment or vacation of the Premises by Tenant; (iii) a failure by Tenant to observe and perform any other provision of this
Lease to be observed and performed by Tenant, where such failure continues for thirty (30) days after Tenant's receipt of written notice from Landlord, provided, however, that if the nature of
the default is such that the same cannot reasonably be cured within said thirty (30) day period, Tenant shall not be 

18

 

deemed to be in default if Tenant shall within such period commence such cure and thereafter diligently prosecute the same to completion. 

        If
Tenant is otherwise in material default under the terms of this Lease, the occurrence of any of the following shall constitute a material default: (A) the making by Tenant of
any general assignment or general arrangement for the benefit of creditors; or (B) the filing by or against Tenant of a petition to have Tenant adjudged a bankrupt, or a petition or
reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a petition filed against Tenant, the same is dismissed within one hundred twenty (120) days; or
8) the appointment of a trustee or a receiver to take possession of substantially all of the Tenant's assets located at the Premises or of Tenant's interest in this Lease, where possession is
not restored to Tenant within ninety (90) days; or (D) the attachment, execution or other judicial seizure of substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within ninety (90) days. 

        (a)    Remedies.    In the event of any such material default or breach by Tenant, Landlord may at any time
thereafter: 

        (1)  Maintain
this Lease in full force and effect and recover the Rent and other monetary charges as they become due, without terminating Tenant's right to possession,
pursuant to California Civil Code Section 1951.4 or as otherwise permitted under this Lease or at law. During the period Tenant is in default, Landlord shall have the right to enter the
Premises and to relet them, or any part of them, to third parties for Tenant's account. Tenant shall be liable immediately to Landlord for all costs Landlord shall incur in reletting the Premises,
including, without limitation, pro rata broker's commissions, reasonable attorneys' fees and like costs. Such reletting may be for a period shorter or longer than the remaining term of this Lease.
Tenant shall pay to Landlord the Rent and other amounts due under this Lease on the dates such amounts are due, less any such amounts received by Landlord from any reletting. No act by Landlord
allowed by this Section 20.1(a) shall terminate this Lease unless Landlord shall notify Tenant that Landlord elects to terminate this Lease. After Tenant's default and for as long as Landlord
does not terminate Tenant's right to possession of the Premises, if Tenant obtains Landlord's consent, Tenant shall have the right to assign or sublet its interest in this Lease, subject to and in
accordance with the provisions of Article 16, but Tenant shall not be released from liability under this Lease. Landlord's consent to a proposed assignment or sublease shall be given in
accordance with the provisions of Article 16. If Landlord elects to relet the Premises as provided in this Section 20.1(a) the Rent that Landlord receives from reletting shall be applied
to the payment of: 

        (A)  First,
any indebtedness from Tenant to Landlord other than Rent and other amounts due from Tenant; 

        (B)  Second,
all costs, including for maintenance, incurred by Landlord in connection with such reletting; 

        (C)  Third,
Rent and other amounts due and unpaid under this Lease. After deducting the payments referred to in this Section 20.1(a), any sum remaining from the Rent
Landlord receives from reletting shall be held by Landlord and applied in payment of future Rent and other amounts as the Rent and such other amounts become due under this Lease. In no event shall
Tenant be entitled to any excess Rent received by Landlord. If, on the date Rent or any other amount is due under this Lease, the Rent
received from the reletting is less than the Rent or other amount due on that date, Tenant shall pay to Landlord, in addition to the remaining Rent and other amounts due, all costs, including
maintenance costs incurred by Landlord in reletting that remain after applying the Rent received from the reletting as provided in this Section 20.1(a). 

        (D)  In
the event of such default by Tenant, in addition to any other remedies available to Landlord at law or in equity, Landlord shall have the option to terminate this 

19

 

Lease and all rights of Tenant hereunder. In the event that Landlord shall elect to so terminate this Lease then Landlord may recover from Tenant: 

        (E)  The
worth at the time of award of any unpaid rent which has been earned at the time of such termination; plus 

          (i)  The
worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such
rental loss Tenant proves could have been reasonably avoided; plus 

        (ii)  The
worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss Tenant
proves could reasonably be avoided; plus 

        (iii)  Any
other amount necessary to compensate the Landlord for all the detriment approximately caused by Tenant's failure to perform its obligations under this Lease or
which in the ordinary course of things would be likely to result therefrom. 

        As
used in subparagraphs (E), (i) and (ii) above, the "worth at the time of award" is computed by allowing interest at the prevailing discount rate of the Federal Reserve
Bank of San Francisco at the time of the award plus five (5%) percent, but in no event greater than the maximum amount permitted under California law. As used in subparagraph (ii) above, the
"worth at the time of award" is computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%). 

        (iv)  To
the extent not otherwise recovered by Landlord, if Landlord terminates Tenant's right to possession of the Premises, Landlord shall also be entitled to recover a pro
rata portion of leasing commissions paid by Landlord based on the balance of the Lease term, costs of recovering possession of the Premises, costs of preparing the Premises for reletting, and any
other costs and expenses in lieu
of any of the foregoing or in addition to them as may be permitted from time to time by the laws of the State of California. 

        (v)  In
the event of any such default by Tenant, Landlord shall also have the right, with or without terminating this Lease, to re-enter the Premises and remove
all persons and property from the Premises; such property may be removed and stored in a public warehouse or elsewhere at the cost of and for the account of Tenant. No re-entry or taking
possession of the Premises by Landlord pursuant to this subparagraph shall be construed as an election to terminate this Lease unless a written notice of such intention be given to Tenant or unless
the termination thereof be decreed by a court of competent jurisdiction. 

        (vi)  If
Tenant fails to perform any obligation required under this Lease or by law or governmental regulation, Landlord in its sole discretion may, upon ten (10) days
written notice to Tenant, without waiving any rights or remedies and without releasing Tenant from its obligations hereunder, perform such obligation, in which event Tenant shall pay Landlord as
additional rent all sums paid by Landlord in connection with such substitute performance, including interest as provided below within ten (10) days of Landlord's written notice for such
payment. 

        (b)    Definition of Rent.    For all purposes of this Article 20, the term "Rent" shall be deemed to be the
monthly Rent and all other sums required to be paid by Tenant pursuant to the terms of this Lease. 

20

  

        (c)    Late Payment Charge.    Tenant hereby acknowledges that late payment by Tenant to Landlord of Monthly Rent and
other sums due hereunder will cause Landlord to incur costs not contemplated by this Lease, the exact amount of which is extremely difficult to ascertain. Such costs include but are not limited to:
administrative, processing, accounting, and late charges which may be imposed on Landlord by the terms of any contract, revolving credit, mortgage, or trust deed covering the Premises. Accordingly, if
any installment of Base Rent or Additional Rent or other sum due from Tenant shall not be received by Landlord or its designee when due, Tenant shall pay to Landlord a late charge equal to One
Thousand Dollars ($ 1000.00) in addition to such overdue amount, which late charge shall be due and payable on the same date that the overdue amount was due. The Parties agree that such late charge
represents a fair and reasonable estimate of the costs Landlord will incur by reason of late payment by Tenant. If any rent remains delinquent for a period in excess of thirty (30) days, then
in addition to such late charge, Tenant shall pay to Landlord interest on any rent that is not paid when due at the Agreed Interest Rate specified in Article 21.15 following the date such
amount became due until paid. Acceptance by Landlord of such late charge shall not constitute a waiver of Tenant's default with respect to such overdue amount nor prevent Landlord from exercising any
of the other rights and remedies granted hereunder. In the event that a late charge is payable hereunder, whether or not collected, for three (3) consecutive installments of Monthly Rent, then
the Monthly Rent shall automatically become due and payable quarterly in advance, rather than monthly, notwithstanding any provision of this Lease to the contrary. 

        (d)    Waiver.    The waiver by Landlord of any breach of any term, covenant, or condition contained in this Lease
shall not be deemed to be a waiver of such term, covenant, or condition of any subsequent breach of the same or any other term, covenant, or condition contained in this Lease. The subsequent
acceptance of Rent under this Lease by Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of any term, covenant, or condition of this Lease, other than the failure of Tenant
to pay the particular Rent so accepted, regardless of Landlord's knowledge of such preceding breach at the time of acceptance of such Rent. 

        (e)    Habitual Default.    The provision of Article 20 notwithstanding, the parties agree that if Tenant shall
have defaulted in the performance of any (but not necessarily the same) term or condition of this Lease for three or more times during any 12-month period during the Lease Term, then such
conduct shall, at the election of the Landlord, represent a separate event of default which cannot be cured by Tenant. Tenant acknowledges that the purpose of this provision is to prevent repetitive
defaults by Tenant, which work a hardship upon Landlord and deprive Landlord of Tenant's timely performance under the Lease. 

        20.2    DEFAULT BY LANDLORD.    In the event Landlord fails or refuses to perform any of the provisions, covenants or
conditions of this Lease on Landlord's part to be kept or performed, Tenant, prior to
exercising any other right or remedy Tenant may have against Landlord on account of any such default, shall provide thirty (30) days written notice to Landlord of such default, specifying in
reasonable detail the alleged nature of the default and specifically referencing each paragraph and subparagraph which Tenant believes to be in default. Notwithstanding any other provision hereof,
Tenant agrees that if said default is of such a nature that the same can be rectified or cured by Landlord but cannot with reasonable diligence be rectified or cured within said thirty (30) day
period, then such default shall be deemed to be rectified or cured if Landlord within said thirty (30) day period shall have diligently commenced the rectification or curing thereof and shall
diligently continue thereafter to cause such rectification or curing to proceed to completion. In addition, upon any such failure by Landlord, Tenant shall give notice by registered or certified mail
to any person or entity with a security interest in the Premises ("Mortgagee") that has provided Tenant with notice of its interest in the Premises, and shall provide Mortgagee a reasonable
opportunity to cure such failure, including such time to obtain possession of the Premises by power of sale or judicial foreclosure, if such should prove 

21

 

necessary to effectuate a cure. Tenant agrees that each of the Mortgagees to whom this Lease has been assigned is an expressed third-party beneficiary hereof. Tenant waives any right under California
Civil Code Section 1950.7 or any other present or future law to the collection of any payment or deposit from Mortgagee or any purchaser at a foreclosure sale of Mortgagee's interest unless
Mortgagee or such purchaser shall have actually received and not refunded the applicable payment or deposit. 

        In
consideration of the benefits accruing hereunder, Tenant and all successors and assigns covenant and agree that, in the event of any actual or alleged failure, breach or default
hereunder by Landlord: 

        (a)  the
sole and exclusive remedy against Landlord shall be satisfied only out of the current rents and revenues of the Premises, net of all current operating expenses,
liabilities, reserves and debt service and that no real or personal property of Landlord, its partners or agents shall be subject to levy on any judgment obtained against Landlord; 

        (b)  no
partner of Landlord shall be sued or named as a party in any suit or action (except as may be necessary to secure jurisdiction of the partnership); 

        (c)  no
service of process shall be made against any partner of Landlord (except as may be necessary to secure jurisdiction of the partnership); 

        (d)  no
partner of Landlord shall be required to answer or otherwise plead to any service of process; 

        (e)  no
judgment will be taken against any partner of Landlord; 

        (f)    any
judgment taken against any partner of Landlord may be vacated and set aside at any time without hearing; 

        (g)  no
writ of execution will ever be levied against the assets of any partner of Landlord; 

        (h)  these
covenants and agreements are enforceable both by Landlord and also by any partner of Landlord. 

        Tenant
agrees that each of the foregoing covenants and agreements shall be applicable to any covenant or agreement either expressly contained in this Lease or imposed by statute or at
common law. 

 
 

ARTICLE 21.    ADDITIONAL PROVISIONS    
  

        21.1    DISPUTE RESOLUTION.    Landlord and Tenant and any other party that may become a party to this Lease or be
deemed a party to this Lease including any subtenants agree to and shall mediate any controversy, dispute, or claim of whatever nature arising out of, in connection with, or in relation to the
interpretation, performance or breach of this Lease, including any claim based on contract, tort, or statute,, except for any claim by Landlord for unlawful detainer, or any action within the
jurisdiction of the small claims court. The mediation shall be held prior to any court action or arbitration. The mediation shall be confidential and in accordance with California Evidence Code
Sections 1119. In the event the parties are not able to agree on a mediator within thirty days JAMS or another judicial and mediation service mutually acceptable to the parties shall appoint a
mediator. In the event the mediator determines that a second mediation session is necessary, it shall be conducted in accordance with this paragraph. Should the prevailing party attempt an arbitration
or a court action before attempting to mediate, THE PREVAILING PARTY SHALL NOT BE ENTITLED TO ATTORNEYS FEES THAT MIGHT OTHERWISE BE AVAILABLE TO THEM IN A COURT ACTION OR ARBITRATION, AND IN ADDITION
THERETO, THE PARTY WHO IS DETERMINED BY THE ARBITRATOR TO HAVE RESISTED MEDIATION SHALL BE SANCTIONED BY THE ARBITRATOR OR JUDGE. Except for any claim by Landlord for unlawful detainer or any claim
within the Jurisdiction of the small claims court (which for such claims the 

22

 

parties agree shall be the sole court of competent jurisdiction), any controversy, dispute, or claim of whatever nature arising out of, in connection with, or in relation to the interpretation,
performance or breach of this Lease, including any claim based on contract, tort, or statute, shall be resolved at the request of any party to this agreement through a two-step dispute
resolution process administered by JAMS or another judicial and mediation service mutually acceptable to the parties involving first mediation, followed, if necessary, by final and binding arbitration
administered by and in accordance with the then-existing rules and practice of the judicial and mediation service selected, and judgment upon any award rendered by the arbitrator(s) may be
entered by any State or Federal Court having
jurisdiction thereof. The parties to the arbitration shall have those rights of discovery that the arbitrator(s) deem necessary (after application to the arbitrator(s)) to a full and fair hearing of
the matter. However, in no event shall the parties be entitled to propound interrogatories or requests for admissions during the arbitration process. The arbitrator shall be a retired judge or a
licensed California Attorney. The venue for any such arbitration's or mediations shall be in Santa Clara County. 

        21.2    TRANSFER OF LANDLORD'S INTEREST.    In the event of a sale or conveyance by Landlord of Landlord's interest in
the Premises, the Building or the Parcel, other than a transfer for security purposes only, Landlord shall be relieved from and after the date specified in any such notice of transfer of all
obligations and liabilities accruing thereafter on the part of Landlord, provided all such obligations of Landlord are expressly assumed in writing by Landlord's successor in interest and provided
that any funds in the hands of Landlord at the time of transfer in which Tenant has an interest shall be delivered to the successor of Landlord. This Lease shall not be affected by any such sale and
Tenant agrees to attorn to the purchaser or assignee, provided all Landlord's obligations under this Lease are assumed in writing by the transferee. 

        21.3    CAPTIONS; ATTACHMENTS; DEFINED TERMS.    

        (a)    Captions.    The captions of the paragraphs of this Lease are for convenience only and shall not be deemed to
be relevant in resolving any question of interpretation or construction of any section of this Lease. 

        (b)  Attachments. Exhibit A attached to this Lease, and addenda and schedules initialed by the parties, are deemed by
attachment to constitute part of this Lease and are incorporated in this Lease. 

        (c)  Defined Terms. The words "Landlord" and "Tenant" as used in this Lease include the plural as well as the singular. Words
used in neuter gender include the masculine and feminine, and words in the masculine or feminine gender include the neuter. The obligations contained in this Lease to be performed by Landlord shall be
binding on Landlord's successors and assigns only during their respective periods of ownership. 

        21.4    SEVERABILITY.    If any term or provision of this Lease shall, to any extent, be determined by a court of
competent jurisdiction to be invalid or unenforceable, the remainder of this Lease shall not be affected by such determination, and each term and provision of this Lease shall be valid and enforceable
to the fullest extent permitted by law. It is the intention of the parties to this Lease that if any provision of this Lease is capable of two constructions, one of which would render the provision
void and the other of which would render the provision valid, then the provision shall have the meaning that renders it valid. 

        21.5    NO PARTNERSHIP.    It is agreed that nothing contained in this Lease shall be deemed or construed as creating
a partnership or joint venture between Landlord and Tenant or between Landlord and any other party, or cause Landlord to be responsible in any way for the debt or obligations of Tenant or any other
party. 

        21.6    TIME; JOINT AND SEVERAL LIABILITY.    Time is of the essence of this Lease and each and every provision of
this Lease applicable to both Landlord and Tenant, except as to the conditions 

23

 

relating to the delivery of possession of the Premises to Tenant. All the terms, covenants, and conditions contained in this Lease to be performed by either party, if such party shall consist of more
than one person or organization shall be deemed to be joint and several, and all rights and remedies of the parties shall be cumulative and nonexclusive of any other remedy at law or in equity. 

        21.7    BINDING EFFECT; CHOICE OF LAW.    The parties to this Lease agree that all the provisions of this Lease are to
be construed as both covenants and conditions as though the words imparting such covenants and conditions were used in each separate paragraph of this Lease. Subject to any provisions of this Lease
restricting assignment or subletting by Tenant and subject to Section 21.1 of this Lease, all of the provisions of this Lease shall bind and inure to the benefit of the parties to this Lease
and their respective heirs, legal representatives, successors, and assigns. This Lease shall be governed by and construed pursuant to the laws of the State of California, and the parties agree that
venue for all matters shall be in Santa Clara County, California. 

        21.8    WAIVER.    No covenant, term or condition, or the breach of such covenant, term or condition, shall be deemed
waived, except by written consent of the party against whom the waiver is claimed, and any waiver of the breach of any covenant, term, or condition shall not be deemed to be a waiver of other
covenant, term, or condition. Acceptance by either party of any performance by the other after the time the same shall have become due shall not constitute a waiver by the other party of the breach or
default of any covenant, term, or condition, unless otherwise expressly agreed in writing by the other party. 

        21.9    SURRENDER OF PREMISES.    The voluntary or other surrender of this Lease by Tenant or a mutual cancellation of
this Lease shall not work a merger, and shall, at the option of Landlord, terminate all or any existing subleases or subtenancies, or may, at the option of Landlord, operate as on assignment to it of
any or all such subleases or subtenancies. 

        21.10    HOLDING OVER.    Any holding over after the termination or Expiration Date with Landlord's consent, shall be
construed as a month-to-month tenancy, terminable on thirty (30) days written notice from either party, and Tenant shall pay as Base Rent to Landlord a rate equal to one
hundred fifty percent (150%) of the Base Rent or Percentage Rent whichever is greater due in the month preceding the termination or Expiration Date, plus all other amounts payable by Tenant under this
Lease. Any holding over shall otherwise be on the terms and conditions herein specified, except those provisions relating to the Lease Term and any options to extend or renew, which provisions shall
be of no further
force and effect following the expiration of the applicable exercise period. Tenant shall indemnify, defend, and hold Landlord harmless from all loss or liability (including, without limitation, any
loss or liability resulted from any claim against Landlord made by any succeeding tenant) resulting from Tenant's failure to timely surrender the Premises to Landlord and losses to Landlord due to
lost opportunities to lease the Premises to succeeding tenants. 

        21.11    FORCE MAJEURE.    Any prevention, delay, or stoppage due to strikes, lockouts, labor disputes, acts of God,
inability to obtain labor or materials or reasonable substitutes for them, governmental restrictions, governmental regulations, governmental controls, enemy or hostile governmental action, civil
commotion, fire or other casualty and other causes beyond the reasonable control of the party obligated to perform, shall excuse the performance by such party for a period equal to any such
prevention, delay, or stoppage. 

        21.12    REASONABLE CONSENT.    Except as limited elsewhere in this Lease, wherever in this Lease Landlord or Tenant
is required to give its consent or approval to any action on the part of the other, such consent or approval shall not be unreasonably withheld. 

        21.13    NOTICES    Whenever in this Lease it shall be required or permitted that notice or demand be given or served
by either party to this Lease to or on the other, such notice or demand shall be given or served, and shall not be deemed to have been duly given or served unless in writing and 

24

 

served personally or forwarded by certified mail, return receipt requested, or by guaranteed overnight mail delivery service, addressed to the addresses of the parties specified on the signature page
to this Lease. Either party may change such addresses by written notice by certified or registered mail to the other. 

        21.14    COSTS OF SUIT.    If Tenant or Landlord shall bring any action for any relief against the other, declaratory
or otherwise, arising out of this Lease, including any suit by Landlord for the recovery of Rent or possession of the Premises, the losing party shall pay the successful party a reasonable sum for
attorneys' fees that shall be deemed to have accrued on the commencement of such action and shall be paid whether or not such action is prosecuted to judgment, subject to the provisions of
Article 21.1. Attorneys' fees incurred in enforcing any judgment are recoverable as a separate item. This provision is intended to be severable from other provisions of the Lease and to survive
any judgment and is not to be deemed merged into the judgment. 

        21.15    INTEREST CHARGES.    All Rent, Additional Rent and all other charges due from Tenant to Landlord, if not paid
when due, shall bear interest at the rate of the Reference Rate published by Bank of America, San Francisco Branch, plus two percent (2%) per annum from that date until paid in full ("Agreed Interest
Rate"). This provision shall survive the expiration or sooner termination of the Lease. Despite any other provision of this Lease, the total liability for interest payments shall not exceed the
limits, if any, imposed by the usury laws of the State of California. Any interest paid in excess of those limits shall be refunded to Tenant by application of the amount of excess interest paid
against any sums outstanding in any order that Landlord requires. If the amount of excess interest paid exceeds the sums outstanding, the portion exceeding those sums shall be refunded in cash to
Tenant by Landlord. To ascertain whether any interest payable exceeds the limits imposed, any non-principal payment(including late charges) shall be considered to the extent permitted by
law to be an expense or a fee, premium, or penalty rather than interest. 

        21.16    AUTHORITY OF PARTIES.    Tenant represents and warranties that it is duly formed and in good standing, and is
duly authorized to execute and deliver this Lease on behalf of said corporation, in accordance with a duly adopted resolution of the Board of Directors of said corporation or in accordance with the
by-laws of said corporation, and that this Lease is binding upon said corporation in accordance with its terms. At Landlord's request, Tenant shall provide Landlord with corporate
resolutions or other proof in a form acceptable to Landlord, authorizing the execution of the Lease. 

        21.17    BROKERS.    Tenant represents that it has had no dealings with any real estate broker or agent in connection
with the negotiation of this Lease, other than Mark Costa of Terranomics Retail Services, representing Tenant and John Machado of Colliers= International, representing the Landlord, whose commissions
Landlord will be solely responsible for payment, and that Tenant knows of no other real estate broker or agent who is, or might be, entitled to a commission in connection with this Lease. 

        21.18    NO PRESUMPTIONS AGAINST DRAFTER.    Tenant understands, agrees and acknowledges that this Lease has been
freely negotiated by both parties; and that in any controversy, dispute, or contest over the meaning, interpretation, validity, or enforceability of this Lease or any of its terms or conditions, there
shall be no inference, presumption, or conclusion drawn whatsoever against either party by virtue of that party having drafted this Lease or any portion thereof. Submission of this instrument for
examination or signature by Tenant does not constitute a reservation of or option for a lease, and it is not effective as a lease or otherwise until execution by and delivery to both Landlord and
Tenant. 

        21.19    RECORDING.    Neither Landlord nor Tenant shall record this Lease or a short form memorandum thereof without
the consent of the other. 

25

 

        21.20    MODIFICATIONS REQUIRED BY LENDER.    If any Lender of Landlord or ground lessor of the Real Property Requires
a modification of this Lease that will not increase Tenant's cost or expense or materially or adversely change Tenant's rights and obligations, this Lease shall be so modified and Tenant shall execute
whatever documents are required and deliver them to Landlord within ten (10) days after the request. 

        21.21    ENTIRE AGREEMENT.    THIS INSTRUMENT ALONG WITH ANY EXHIBITS AND ATTACHMENTS TO THIS LEASE CONSTITUTES THE
ENTIRE AGREEMENT BETWEEN LANDLORD AND TENANT RELATIVE TO THE PREMISES AND THIS AGREEMENT, AND THE EXHIBITS AND ATTACHMENTS MAY BE ALTERED, AMENDED, OR REVOKED ONLY BY AN INSTRUMENT IN WRITING SIGNED
BY BOTH LANDLORD AND TENANT. IT IS UNDERSTOOD THAT THIS LEASE SUPERSEDES AND CANCELS ANY AND ALL PREVIOUS NEGOTIATIONS, ARRANGEMENTS, BROCHURES, AGREEMENTS, OR REPRESENTATIONS, AND UNDERSTANDINGS, IF
ANY, BETWEEN THE PARTIES TO THIS LEASE. 

	TENANT:	 	LANDLORD:
	

CHICAGO PIZZA & BREWERY, INC.

A California Corporation	
 	

SOBRATO INTERESTS II

A California Limited Partnership
	

By:	
 	

 	
 	

By:	
 	

 
	 	 	
 Paul Montenko

Co-Chief Executive Officer	 	 	 	
 John Michael Sobrato

Its authorized agent
	

Address:

16162 Beach Boulevard, Suite 100

Huntington Beach, California 92647	
 	

Address:

10060 North De Anza Boulevard, Suite 200

Cupertino, California 95014
	

Attention: Jerry Hennessy or Paul Montenko	
 	

Attention: John M. Sobrato
	

Date of Execution: January     , 2002	
 	

Date of Execution: January     , 2002

26

QuickLinks

LEASE BETWEEN SOBRATO INTERESTS II, a California Limited Partnership and CHICAGO PIZZA & BREWERY, INC., a California corporation

Table of Contents

LEASE

ARTICLE 1. PREMISES

ARTICLE 2. TERM

ARTICLE 3. RENT

ARTICLE 4. TAXES

ARTICLE 5. USE

ARTICLE 6. UTILITIES

ARTICLE 7. MAINTENANCE AND REPAIR

ARTICLE 8. ALTERATIONS AND ADDITIONS

ARTICLE 9. ENTRY BY LANDLORD

ARTICLE 10. LIENS

ARTICLE 11. INDEMNITY

ARTICLE 12. INSURANCE

ARTICLE 13. DAMAGE AND DESTRUCTION

ARTICLE 14. EMINENT DOMAIN

ARTICLE 15. OUTSIDE AREAS

ARTICLE 16. ASSIGNMENT AND SUBLEASE; WAIVER OF LANDLORD'S LIEN

ARTICLE 17. SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT; LANDLORD'S WARRANTIES AND REPRESENTATIONS: ESTOPPEL CERTIFICATE

ARTICLE 18. LANDLORD'S WARRANTIES, REPRESENTATIONS AND COVENANTS

ARTICLE 19. SIGNS

ARTICLE 20. DEFAULT REMEDIES

ARTICLE 21. ADDITIONAL PROVISIONSQuickLinks
 -- Click here to rapidly navigate through this document

EXHIBIT 10.20  

 
 

GROUND LEASE AGREEMENT    
  

	
 LANDLORD:	
 	

Centex Retail Vista Ridge I, L.P.
	TENANT:	 	Chicago Pizza and Brewery, Inc.

 
 

TABLE OF CONTENTS    
  

	ARTICLE
 
	 	TITLE
	 	PAGE

	ARTICLE 1	 	DEFINITIONS AND CERTAIN BASIC PROVISIONS	 	1
	ARTICLE 2	 	GRANTING CLAUSE	 	2
	ARTICLE 3	 	DELIVERY OF PREMISES; CONSTRUCTION OF PREMISES	 	2
	ARTICLE 4	 	RENT	 	4
	ARTICLE 5	 	SALES REPORTS, RECORDS AND FINANCIAL STATEMENTS	 	6
	ARTICLE 6	 	TENANT'S RESPONSIBILITY FOR TAXES AND OTHER REAL ESTATE CHARGES	 	6
	ARTICLE 7	 	COMMON AREA	 	7
	ARTICLE 8	 	MERCHANT'S ASSOCIATION OR PROMOTIONAL FUND	 	8
	ARTICLE 9	 	USE AND CARE OF DEMISED PREMISES	 	8
	ARTICLE 10	 	MAINTENANCE AND REPAIR OF DEMISED PREMISES AND BUILDING	 	11
	ARTICLE 11	 	ALTERATIONS	 	11
	ARTICLE 12	 	LANDLORD'S RIGHT OF ACCESS	 	12
	ARTICLE 13	 	SIGNS; STORE FRONTS	 	12
	ARTICLE 14	 	UTILITIES	 	12
	ARTICLE 15	 	INSURANCE COVERAGES	 	13
	ARTICLE 16	 	WAIVER OF LIABILITY; MUTUAL WAIVER OF SUBROGATION	 	14
	ARTICLE 17	 	DAMAGES BY CASUALTY	 	15
	ARTICLE 18	 	EMINENT DOMAIN	 	15
	ARTICLE 19	 	ASSIGNMENT AND SUBLETTING	 	16
	ARTICLE 20	 	SUBORDINATION; ATTORNMENT; ESTOPPELS	 	17
	ARTICLE 21	 	DIRECTION OF TENANT'S ENERGIES	 	18
	ARTICLE 22	 	DEFAULT BY TENANT AND REMEDIES	 	18
	ARTICLE 23	 	LANDLORD'S CONTRACTUAL SECURITY INTEREST	 	22
	ARTICLE 24	 	HOLDING OVER	 	23
	ARTICLE 25	 	NOTICES	 	23
	ARTICLE 26	 	COMMISSIONS	 	24
	ARTICLE 27	 	REGULATIONS	 	24
	ARTICLE 28	 	MISCELLANEOUS	 	25
	ARTICLE 29	 	LIQUOR LICENSE	 	27
	

EXHIBIT "A"—SITE PLAN FOR THE SHOPPING CENTER	
 	

 
	EXHIBIT "B"—SITE PLAN FOR THE DEMISED PREMISES	 	 
	EXHIBIT "C"—LANDLORD CONSTRUCTION DURING PRELIMINARY TERM	 	 
	EXHIBIT "D"—RENEWAL OPTION	 	 
	EXHIBIT "E"—SUBORDINATION OF LANDLORD'S LIEN	 	 
	EXHIBIT "F"—RESTRICTION ON SHOPPING CENTER (EXCLUSIVE)	 	 
	EXHIBIT "G"—VISTA RIDGE MARKETPLACE RULES AND REGULATIONS	 	 

  

 
 

LEASE AGREEMENT    
  

        This Lease Agreement ("Lease") is entered into by and between CENTEX RETAIL VISTA RIDGE I,
L.P., a Delaware limited partnership ("Landlord") and CHICAGO PIZZA AND BREWERY, INC., a California corporation, d/b/a BJ's Restaurant and
Brewhouse ("Tenant").

 
 

ARTICLE 1
  
    DEFINITIONS AND CERTAIN BASIC PROVISIONS    
  

        1.1  The
following list sets out certain defined terms and certain financial and other information pertaining to this Lease: 

        (a)  "Landlord": Centex Retail Vista Ridge I, L.P., a Delaware limited partnership 

        (b)  Landlord's address: c/o Centex Development Company, 2728 N. Harwood, Suite 300, Dallas, Texas 75201 

        (c)  "Tenant": Chicago Pizza and Brewery, Inc., a California corporation, d/b/a BJ's Restaurant and Brewhouse 

        (d)  Tenant's address: 16162 Beach Blvd., Suite 100, Huntington Beach, California 92647 

        (e)  Tenant's trade name: BJ's Restaurant and Brewhouse 

        (f)    Intentionally
Deleted 

        (g)  "Agents": collectively refers to Landlord's Agent and Tenant's Agent. "Landlord's Agent" means Venture Commercial Real
Estate, LLC. "Tenant's Agent" means the Weitzman Group. 

        (h)  "Shopping Center": Landlord's property located in the City of Lewisville, Denton County, Texas, which property is shown
on Exhibit "A" attached to this Lease. With regard to Exhibit "A", the parties agree that the exhibit is
attached solely for the purpose of locating the Shopping Center and the Demised Premises within the Shopping Center, and that no representation, warranty, or covenant is to be implied by any other
information shown on the exhibit (i.e., any information as to buildings, tenants or prospective tenants, etc. is subject to change at any time). 

        (i)    "Demised Premises": that certain parcel of real property located in the City of Lewisville, Denton County, Texas, as
shown cross-hatched on Exhibit "B" attached to this Lease, and being legally described on Exhibit
"B-1" attached to this Lease. The building to be erected by Tenant on the Demised Premises thereon in accordance with the Plans and Specifications described in  Section 3.1(a) below is referred to herein as the "Building." Tenant acknowledges and agrees that the maximum square footage of the Building
including the outdoor patio ("Patio") is 9,000 square feet. The Demised Premises must have sufficient area to enable Tenant to construct at least a
7,000 square foot Building. 

        (j)    "Delivery Date": The date Landlord delivers to Tenant possession of the Demised Premises with Landlord's Work
substantially completed as described on Exhibit "C". 

        (k)  Lease Term: This Lease will continue in force during a period beginning on the Effective Date of this Lease and ending on
the expiration of the Lease Term, unless this Lease is terminated early or extended to a later date pursuant to the terms of this Lease. The Lease Term will commence and rent will accrue beginning on
the Rent Commencement Date and the Lease Term will continue for twenty (20) years after the Rent Commencement Date; provided that if the Rent Commencement Date is a date other than the first
day of a calendar month, the Lease Term shall be extended for said number of years and months in addition to the remainder of the calendar month in which the Rent Commencement Date occurs. 

1

 

        (l)    Minimum guaranteed rental: 

	Lease Year
 
	 	Annual Minimum

Guaranteed Rental
	 	Monthly Minimum

Guaranteed Rental

	Years 1-10	 	$	115,000.00	 	$	9,583.33
	Years 11-15	 	$	138,000.00	 	$	11,500.00
	Years 16-20	 	$	151,000.00	 	$	12,583.33

        (m)  Intentionally
deleted. 

        (n)  Intentionally
deleted. 

        (o)  "Rent Commencement Date": The earlier to occur of: (1) Tenant's opening for business at the Demised Premises;
(2) two hundred forty (240) days after the Effective Date; or (3) one-hundred eighty (180) days after the later to occur of (a) the Delivery Date or
(b) Tenant's receipt of a final building permit for the Demised Premises. 

        (p)  Security deposit: $12,000.00 to be paid upon the execution of this Lease by Tenant. 

        (q)  Permitted use: The Demised Premises shall be used only for the operation of a full service restaurant/brewhouse including
the sale of alcohol beverages for on-premise consumption provided Tenant has obtained the necessary permits from the governing authorities. Tenant acknowledges that the above specification
of a "permitted use" means only that Landlord has no objection to the specified use and does not include any representation or warranty by Landlord as to whether or not such specified use
(i) complies with applicable laws and/or requires special governmental permits, or (ii) complies with restrictive covenants applicable to the Demised Premises. In this regard Tenant
acknowledges that this Section 1.1(q) is subject to Sections 3.1, 9.4 and 9.5 of this Lease.
Notwithstanding the foregoing, except as set forth in Section 5.2.17 of the Reciprocal Easement Agreement between Landlord and Costco Wholesale Corporation, recorded in Volume 4736, Page 00961
of the real property records of Denton County, Texas, Landlord represents and warrants that to its current actual knowledge, there are no restrictive covenants applicable to the Demised Premises that
would prevent the operation of the Demised Premises for the permitted use. 

        (r)  Effective Date: January 14, 2002. 

 
 

ARTICLE 2
  
    GRANTING CLAUSE    
  

        2.1  Landlord
leases the Demised Premises to Tenant upon the terms and conditions set forth in this Lease. 

 
 

ARTICLE 3
  
    DELIVERY OF PREMISES; CONSTRUCTION OF PREMISES    
  

        3.1  Except
to the extent modified by Landlord's express assumption of construction obligations in Exhibit "C" attached to
this Lease, and except as provided in the last sentence of this Section 3.1, the Demised Premises is being leased "AS IS," with Tenant accepting
all defects, if any; and Landlord makes no warranty of any kind, express or implied, with respect to the Demised Premises (without limitation, Landlord makes no warranty as to the habitability,
fitness or suitability of the Demised Premises for a particular purpose nor as to the absence of any toxic or otherwise hazardous substances). This  Section 3.1 is subject to any contrary
requirements under applicable law; however, in this regard Tenant acknowledges that it has been given the
opportunity to inspect the Demised Premises and to have qualified experts inspect the Demised Premises prior to the execution of this 

2

 

Lease. To Landlord's current actual knowledge, there has been no storage or disposal of any toxic or hazardous substances at the Demised Premises during Landlord's ownership of the Demised Premises. 

        (a)  Tenant
shall construct or cause to be constructed, at Tenant's sole cost and expense (except as otherwise provided in Exhibit
"C-1" attached hereto), the Building, together with the parking areas, driveways, sidewalks and other improvements to be located upon the Demised Premises (the
"Improvements"), in accordance with the final detailed plans and specifications ("Plans and
Specifications") and the detailed site plan ("Site Plan") each to be prepared forthwith by Tenant and delivered to Landlord for
Landlord's approval. Tenant covenants to deliver the Plans and Specifications and the Site Plan to Landlord for approval prior to March 1, 2002. Approval by Landlord shall not be unreasonably
withheld, provided that the Plans and Specifications and Site Plan: (i) relate to a "pizza
and brewery restaurant"; (ii) are consistent with the preliminary site plan attached as Exhibit "B" to this Lease, as well as with prototype
drawings delivered to Landlord by Tenant; (iii) provide for a building height no greater than twenty-eight (28) feet above finished grade; and (iv) provide for a building
"footprint" (i.e., ground area) of no larger than 8,349 square feet. Landlord shall promptly approve or specify in detail any deficiencies in the proposed Plans and Specifications and Site Plan; and
in the event of Landlord's disapproval, Tenant shall in good faith attempt to remedy all deficiencies reasonably specified by Landlord. If Landlord fails to specify its objections in detail by written
notice delivered to Tenant within ten (10) business days after the date of Tenant's delivery to Landlord of the proposed Plans and Specifications and Site Plan, Landlord's approval shall be
deemed to have been given. Upon approval by Landlord, two or more sets of the final approved Plans and Specifications and Site Plan shall be signed by both parties and shall be deemed incorporated
into this Lease. 

        (b)  Landlord
and Tenant acknowledge that the preliminary site plan attached as Exhibit "B" to this Lease provides for 125
parking spaces, which is approximately 10 spaces short of code requirements for the City of Lewisville ("City"). Tenant represents that any changes made
to the Site Plan will not reduce the number of parking spaces below 125. In that regard, Landlord will attempt to obtain an agreement from the City allowing the Demised Premises to have fewer parking
spaces than would otherwise be required by the applicable city code. If Landlord is successful in procuring the City's approval in the reduction of the required amount of parking spaces, Tenant agrees
to accept the Demised Premises with such fewer parking spaces. Tenant agrees to cooperate with Landlord in Landlord's attempt to obtain this agreement with the City. If Landlord is unsuccessful in
obtaining such an agreement from the City, Landlord agrees to provide up to an additional ten (10) parking spaces to Tenant by either (i) providing a non-exclusive easement
to use such additional spaces located in the Shopping Center Common Areas adjacent to the Demised Premises and entering into the written agreement allowing Tenant to "count" ten (10) of the
Shopping Center's spaces towards Tenant's parking requirements as provided in Section 2.02(a) of the OEA (as defined in Section 7.3
hereof) or (ii) reconfiguring the Demised Premises, in Landlord's reasonable discretion, to provide such additional spaces. In either event, Landlord and Tenant will cooperate with each other
in order to provide to Tenant the required parking to meet the City's parking requirements. 

        (c)  All
architects, engineers, the general contractor and others to be employed in connection with the construction shall be selected by Tenant; provided, however, that
Landlord's written approval of all engineers, architects, and contractors (which shall not be unreasonably withheld) must be obtained. Landlord agrees to provide such written approval or disapproval
of Tenant's architects, engineers, or contractors within five (5) days after receiving Tenant's request for such approval. The supervising architect shall be a member in good standing of the
American Institute of Architects or of another organization having comparable accreditation and the general contractor's financial condition and responsibility shall be such as to enable Tenant to
obtain a payment bond and performance bond. 

3

 

        (d)  Promptly
after the signing of the Plans and Specifications and Site Plan by both parties, Tenant shall request bids from general contractors for the purpose of
constructing the Improvements in accordance with such Plans and Specifications and Site Plan. Upon receipt of bids, Tenant shall approve a general contractor from the bidders, and Tenant shall execute
a construction contract with such contractor upon terms satisfactory to Tenant for construction of such Improvements on the Premises; provided, however,
that as part of the construction contract, Tenant must require that the general contractor waive and relinquish any and all mechanics lien claims which it might have against the fee simple title and
Landlord's interest in the Demised Premises as the result of the construction of Improvements. So long as the general contractor (i) is a member in good standing with the Association of General
Contractors, (ii) qualifies to obtain statutory payment bonds, and (iii) is otherwise acceptable to Landlord in its reasonable discretion, then such general contractor shall not be
required to obtain a statutory payment bond in connection with the Improvements; otherwise, such general contractor must obtain such a bond. Tenant agrees to provide to Landlord upon request such
information as Landlord may reasonably require with respect to the general contractor. 

        (e)  Tenant's
construction work shall commence no later than five (5) days after the last to occur of the following: (i) the date upon which Landlord has
obtained a platting designation for the Demised Premises from the City of Lewisville, Texas; (ii) the date upon which Tenant has obtained a building permit; (iii) the date of final
approval by Landlord of the Plans and Specifications and the Site Plan; or (iv) the date of substantial completion of Landlord's Work (as defined in Exhibit
"C"). Tenant agrees to submit any required applications for its building permit to the City of Lewisville, Texas on or before January 15, 2002, and to use its best
efforts to obtain such building permit. Tenant shall also use commercially reasonable efforts to complete the contribution of its building within 180 days after commencement of construction. 

        (f)    Landlord
and Tenant agree that although Landlord will be the owner of the Demised Premises (as well as reversion rights to the Improvements after the conclusion of this
Lease), Tenant shall nevertheless be responsible for: (i) the payment or other release of all claims by contractors and subcontractors; and (ii) all maintenance, repair and replacements
during the term of this Lease. 

        (g)  Tenant
shall retain, during the term of this Lease, the original counterparts of all warranties and guaranties pertaining to Improvements and equipment erected or
installed upon the Demised Premises; however, on the Rent Commencement Date, Tenant shall deliver to Landlord copies of all such warranties and guaranties. In the event of termination of this Lease
when any warranties or guaranties are still applicable, Tenant hereby assigns to Landlord effective as of the date of termination all such warranties and guaranties pertaining to the Improvements
(including, without limitation, all heating and air conditioning equipment installed within the Improvements). 

 
 

ARTICLE 4
  
    RENT    
  

        4.1  Rental
shall accrue from the Rent Commencement Date, and shall be payable to Landlord, at Landlord's address. 

        4.2  Tenant
shall pay to Landlord minimum guaranteed rental in monthly installments in the amount(s) specified in  Section 1.1(l) of this Lease. The first such monthly installment shall be due and payable on or
before the Rent Commencement Date, and subsequent
installments shall be due and payable on or before the first day of each succeeding calendar month during the Lease Term; provided that if the Rent Commencement Date is a date other than the first day
of a calendar month, there shall be due and payable on or before such date as minimum guaranteed rental for the balance of such calendar month a sum equal to that proportion of the rent specified for
the first full calendar month as 

4

 

herein provided, which the number of days from the Rent Commencement date to the end of the calendar month during which the Rent Commencement Date shall fall bears to the total number of days in such
month. 

        4.3  Intentionally
deleted. 

        4.4  Intentionally
deleted. 

        4.5  The
term "Gross Sales", as used in Section 5.1 below and elsewhere
in this Lease, shall be construed to include the entire amount of the sales price, whether for cash or otherwise (including the full purchase price of purchases in whole or in part by means of gift
certificates, advertising certificates or trade-ins), of all sales of merchandise and services, and other receipts whatsoever, of all business conducted in or from the Demised Premises,
including, by way of illustration (but in no way limited to), mail or telephone orders received or filled at the Demised Premises, "layaways" and other deposits (offset by such sums refunded to
purchasers), orders taken (although such orders may be filled elsewhere), sales to employees, sales through vending machines, electronic games or other devices, and sales by any sublessee,
concessionaire or licensee or otherwise (as well as licensee fees, franchise fees and similar fees) in or from the Demised Premises. Each sale upon installment or credit shall be treated as a sale for
the full price in the month during which the sale was made, irrespective of the time when Tenant receives payment from its customer. 

        4.6  It
is understood that the minimum guaranteed rental is payable on or before the first day of each calendar month (in accordance with  Section 4.2 above) without offset or deduction of any nature. In
the event any rental is not received within 10 days after its due date
for any reason whatsoever, or if any rental payment is by check which is returned for insufficient funds, then in addition to the past due amount Tenant shall pay to Landlord one of the following (the
choice to be at the sole option of the Landlord unless one of the choices is improper under applicable law, in which event the other alternative will automatically be deemed to have been selected):
(a) a late charge in an amount equal to five percent (5%) of the rental then due, in order to compensate Landlord for its administrative and other overhead expenses; or (b) interest on
the rental then due at the maximum contractual rate which could legally be charged in the event of a loan of such rental to Tenant (but in no event to exceed 11/2% per month), such
interest to accrue continuously on any unpaid balance due to Landlord by Tenant during the period commencing with the rental due date and terminating with the date on which Tenant makes full payment
of all amounts owing to Landlord at the time of said payment. Any such late charge or interest payment shall be payable as additional rental under this Lease and shall be payable
immediately on demand. If any rental is paid by a check which is returned for insufficient funds, Tenant shall immediately make the required payment to Landlord in good funds; moreover, Tenant shall
also pay to Landlord the amount specified above in this Section 4.6, plus an additional fee of $50.00 to compensate Landlord for its expense and
effort in connection with the dishonored check. 

        4.7  If
Tenant fails in two consecutive months to make rental payments within ten days after due, Landlord, in order to reduce its administrative costs, may require, by
giving written notice to Tenant (and in addition to any late charge or interest accruing pursuant to Section 4.6 above, as well as any other
rights and remedies accruing pursuant to Article 22 or Article 23 below, or any other
provision of this Lease or at law), that all future rental payments are to be made on or before the due date by cash, cashier's check or money order and that the delivery of Tenant's personal or
corporate check will no longer constitute a payment of rental as provided in this Lease. Any acceptance of a monthly rental payment or of a personal or corporate check thereafter by Landlord shall not
construed as a subsequent waiver of said rights. 

        4.8  All
amounts required to be paid by Tenant to Landlord under this Lease will be deemed to constitute additional rental for all purposes and, unless specifically provided
otherwise, Tenant must pay such amounts owing within ten (10) days after Tenant's receipt of an invoice from Landlord. 

5

  

 
 

ARTICLE 5
  
    SALES REPORTS, RECORDS AND FINANCIAL STATEMENTS    
  

        5.1  On
or before the 10th day of each calendar month during the term of this Lease, Tenant shall prepare and deliver to Landlord at the place where rental is then payable a
certified statement of Gross Sales made from the Demised Premises during the preceding calendar month. In addition, within sixty (60) days after the expiration of each calendar year and within
sixty (60) days after the termination of this Lease if this Lease should not terminate at the end of a calendar year, Tenant shall prepare and deliver to Landlord at the place where rental is
then payable a statement of Gross Sales made from the Demised Premises during the preceding calendar year (or partial calendar year), certified to be correct by an independent Certified Public
Accountant. Tenant shall furnish similar statements for its licensees, concessionaires and subtenants, if any. All such statements shall be in such form as the Landlord may require; and, if requested
by Landlord, Tenant shall also provide to Landlord copies of sales reports submitted by Tenant to the Comptroller of the State of Texas. Tenant acknowledges Landlord's concern for prompt, accurate
sales records, inasmuch as those records enable Landlord to monitor the success of the Shopping Center. Tenant also acknowledges that its failure to submit statements of Gross Sales as required above
will result in additional (although not readily ascertainable) expense to Landlord. Tenant therefore agrees that if it does not deliver to Landlord a statement of Gross Sales within ten
(10) days following delivery to Tenant of a written demand from Landlord, then notwithstanding anything to the contrary contained elsewhere in this Lease, the minimum guaranteed rental for the
particular month during which the statement was due and for each month thereafter (until the statement is delivered) shall automatically be increased by two hundred dollars ($200.00). In addition, if
Tenant fails for two consecutive months to deliver statements of Gross Sales within the times specified in the first two (2) sentences of this  Section 5.1, then for the remainder of this Lease
the prerequisite of a written demand from Landlord shall cease and the rental increase of the
immediately preceding sentence shall be applicable for any month in which the statement of Gross Sales is not delivered within ten (10) days following the prescribed due date. The rights of
Landlord under the immediately preceding sentences are cumulative with the rights prescribed in Article 22,  Article 23 and elsewhere in this
Lease or at law. 

        5.2  Tenant
shall keep in the Demised Premises or at some other location in the city where the Demised Premises is located a permanent, accurate set of books and records of
all sales of merchandise and revenue derived from business conducted in the Demised Premises, and all supporting records such as tax reports and banking records. All such books and records shall be
retained and preserved for at least twenty-four (24) months after the end of the calendar year to which they relate, and shall be subject to inspection and audit by Landlord and its
agents at all reasonable times. 

        5.3  Tenant
shall, within ten (10) days after a request from Landlord at any time thereafter, deliver to Landlord such financial statements as are reasonably required
by Landlord to verify the net worth of Tenant and any guarantor of Tenant's obligations under this Lease. 

        5.4  Landlord
shall use good faith efforts to keep confidential all sales reports, records and financial statements supplied by Tenant; however, Landlord shall have the right
to reveal such information to mortgagees, prospective purchasers and mortgagees (and agents in such regard) and to Landlord's own managerial and administrative staff. 

 
 

ARTICLE 6
  
    TENANT'S RESPONSIBILITY FOR TAXES
  AND OTHER REAL ESTATE CHARGES    
  

        6.1  Tenant
agrees that commencing on the date that the Inspection Period (as defined in Section 28.18) expires (the
"Tax Commencement Date"), Tenant shall pay as additional rent (and hold 

6

 

Landlord harmless from) all taxes (both real and personal), assessments (both general and special), and governmental charges of any nature whatsoever, levied upon or assessed against the Demised
Premises, including the Building, within fifteen (15) days after delivery to Tenant of tax invoices for the Demised Premises. Tenant's obligations under this paragraph shall be prorated for the
partial years during which the Tax Commencement Date and the termination date occur. Landlord may, in its sole discretion, elect to have the Demised Premises separately assessed; however, in the event
that the Demised Premises are not separately assessed, Tenant shall pay taxes and/or assessments within fifteen (15) days of written notice from Landlord of the amount of taxes and/or
assessments then due relating to the Demised Premises as follows: (i) on the Building and all other buildings within the area assessed for such taxes and/or assessments (the
"Tax Tract"), to be determined by using a proration based on square footage contained in the Building divided by the total square footage of all
buildings within the Tax Tract, with either Landlord's management company or a real estate tax service reasonably acceptable to Landlord and Tenant to perform such calculations; and (ii) on the
land area within the Tax Tract, to be determined by using a proration based on square footage of land area in the Demised Premises divided by the total square footage of all land area within the Tax
Tract, with Landlord's management company or a real estate tax service reasonably acceptable to Landlord and Tenant to perform such calculations. Any tax, assessment or imposition levied during the
year in which Landlord has obtained a separate tax designation either for the Demised Premises or for the Shopping Center shall be prorated between Landlord and Tenant. Tenant shall deliver to
Landlord receipts or other reasonably satisfactory evidence of payment of all such taxes, assessments and governmental charges so paid by Tenant. 

        6.2  Notwithstanding
anything hereinabove to the contrary, if at any time during the term of this Lease any assessment (either general or special) is levied upon or assessed
against the Demised Premises or the Building or any part thereof, and such assessment is payable in installments (without special hearing or legal action), Landlord shall elect whichever normally
permitted manner of payment provides for the greatest length of time to pay in installments; and in such case Tenant shall be liable only for those installments accruing during Tenant's tenancy under
this Lease. 

        6.3  If
at any time during the term of this Lease, there shall be levied, assessed or imposed a tax, charge or capital levy or otherwise (other than a general gross receipts
or income tax) on all or a portion of the rents prescribed in this Lease, then even if such tax may be imposed by the governmental authority upon Landlord, Tenant shall pay same in the same manner as
is provided above for real estate taxes. 

        6.4  Tenant
shall be liable for all taxes levied against personal property and trade fixtures placed by Tenant in the Demised Premises or the Building. If any such taxes are
levied against Landlord or Landlord's property and if Landlord elects to pay the same or if the assessed value of Landlord's property is increased by inclusion of personal property and trade fixtures
placed by Tenant in the Demised Premises and Landlord elects to pay the taxes based on such increase, Tenant shall pay to Landlord upon demand that part of such taxes for which Tenant is primarily
liable hereunder. 

 
 

ARTICLE 7
  
    COMMON AREA    
  

        7.1  The
term "Common Area" is defined for all purposes of this Lease as that part of the Shopping Center which is not under
lease to tenants, to the extent designated by Landlord from time to time for the common use of all tenants, restaurants, retailers and other businesses (hereinafter called
"Common Area Users") including among other facilities (as such may be applicable to the Shopping Center), parking areas, private drives, sidewalks and
the like, and other areas and improvements provided for the common use of all such Common Area Users (but excluding space in buildings, now or hereafter existing, designed for rental for commercial
purposes, as the same may exist from time to time, and further excluding streets and alleys maintained by a public authority), all of which shall be 

7

 

subject to Landlord's sole management and control and shall be operated and maintained in such manner as Landlord in its reasonable discretion shall determine. Landlord reserves the right to change
from time to time the dimensions or location of the Common Area as well as the location, dimensions, identity and type of any building and to construct additional buildings or additional stores on
existing buildings or other improvements in the Common Area portions of the Shopping Center. Tenant and its employees, customers, and when duly authorized pursuant to the provisions of this Lease,
sub-tenants, licensees and concessionaires shall have the non-exclusive easement to use the Common Area as constituted from time to time for parking, ingress, egress and common
access to abutting roadways, all such use to be in common with other Common Area Users and subject to such reasonable rules and
regulations governing use as Landlord from time to time may prescribe. Tenant shall not solicit business or display merchandise within the Common Area or elsewhere in the Shopping Center nor conduct
any advertising or marketing program therein, or take any action which would interfere with the rights of other persons to use the Common Area or other portions of the Shopping Center without the
prior written consent of the Landlord. Landlord may temporarily close any part of the Common Area for such periods of time as may be necessary to make repairs or alterations or to prevent the public
from obtaining prescriptive rights. Landlord shall be responsible for the operation, management and maintenance of the Common Area, the manner of maintenance and the expenditures therefor to be in the
sole discretion of Landlord, except that Landlord agrees to cause the Common Area to be maintained in good condition and repair. 

        7.2  Tenant
hereby grants to Landlord, to the other Common Area Users, their successors and assigns, and to the employees, customers, tenants, sub-tenants,
licensees and concessionaires of each, the non-exclusive right of parking, ingress, egress and common access over and across those portions of the Demised Premises which from time to time
Tenant may designate for parking areas, private drives, sidewalks and the like. Tenant further agrees that such portions of the Demised Premises shall be subject to reasonable rules and regulations
relating to access and parking, to the same extent as such rules and regulations apply to the Common Area; moreover, at Landlord's option, Landlord may aggregate all portions of the Shopping Center
for purposes of satisfying the parking and land area requirements for all improvements on the Shopping Center. 

        7.3  This
Lease will be subject and subordinate in all respects to the Operation and Easement Agreement ("OEA") to be filed of
record by Landlord, which OEA will govern the Shopping Center. Tenant shall pay to Landlord as additional rent the amount of "Common Area Costs"
allocated to the owner of the Premises pursuant to Article III of the OEA. Such Common Area Costs will be paid in equal monthly installments on the same day the minimum guaranteed rent is paid
in accordance with Section 4.2 of this Lease and will be considered additional rent for all purposes under this Lease. 

 
 

ARTICLE 8
  
    MERCHANT'S ASSOCIATION OR PROMOTIONAL FUND    
  

        8.1  Intentionally
deleted. 

        8.2  Intentionally
deleted. 

 
 

ARTICLE 9
  
    USE AND CARE OF DEMISED PREMISES    
  

        9.1  Tenant
shall commence business operations from the Demised Premises on or immediately after the Rent Commencement Date and shall operate its business in an efficient,
high class and reputable manner so as to produce the optimum amount of sales from the Demised Premises. After initially opening for business, Tenant may cease business operations in the Demised
Premises if in its sole judgment the continued operations at the Demised Premises cannot be economically justified. 

8

 

However, if Tenant does cease business operations or if it deserts or vacates the Demised Premises or any substantial portion of the Demised Premises for more than ninety (90) days, then
during the period of Tenant's absence Landlord may pursue any one or more of the following options: 

        (a)  Landlord
may insist upon Tenant's compliance with this Lease, in which event Tenant shall continue to make payments of guaranteed minimum rent and other charges as
required by this Lease, and shall otherwise comply with the terms and conditions of this Lease, except those requirements directly related to occupancy; 

        (b)  Landlord
may, after twenty (20) days' written notice to Tenant, sublease on Tenant's behalf the Demised Premises and Building, without the consent of Tenant, in
which event Tenant shall, during the occupancy of the subtenant, be relieved of all obligations under this Lease; and 

        (c)  Landlord
may, after giving twenty (20) days' written notice to Tenant, terminate this Lease at any time prior to the date on which Tenant resumes operations at
the Demised Premises, it being understood that such termination will constitute a release of Tenant from all obligations under this Lease which may otherwise have accrued subsequent to the date of
termination. 

        9.2  The
Demised Premises may be used only for the purpose or purposes specified in Section 1.1(q) above, and only
under the trade name specified in Section 1.1(e) above, and for no other purpose and under no other trade name. Landlord agrees not to
unreasonably withhold its consent to a request by Tenant to change its trade name. Tenant has the exclusive right set forth in Exhibit "F" of this Lease, subject to the conditions and exceptions in  Exhibit "F". 

        9.3  Tenant
shall not, without Landlord's prior written consent, keep anything on the Demised Premises or use the Demised Premises for any purpose which creates a risk of
toxic or otherwise hazardous
substances or which increases the insurance premium cost or invalidates any insurance policy carried on the Demised Premises or other parts of the Shopping Center. All property kept, stored or
maintained upon the Demised Premises or within the Building by Tenant shall be at Tenant's sole risk. TENANT SHALL INDEMNIFY LANDLORD AND HOLD LANDLORD HARMLESS FROM AND
AGAINST ANY AND ALL LIABILITY, LIENS, CLAIMS, DEMANDS, DAMAGES, EXPENSES, FEES, COSTS, FINES, PENALTIES, SUITS, PROCEEDINGS, ACTIONS AND CAUSES OF ACTION (INCLUDING WITHOUT LIMITATION ALL ATTORNEYS'
FEES AND EXPENSES) ARISING OUT OF OR RELATING TO, DIRECTLY OR INDIRECTLY, ANY VIOLATION OR ALLEGED VIOLATION BY TENANT OF ANY LAW, RULE, REGULATION, ORDER OR DETERMINATION OF ANY GOVERNMENT AUTHORITY
PERTAINING TO HEALTH OR THE ENVIRONMENT RELATING TO THE DEMISED PREMISES, THE BUILDING AND THE SHOPPING CENTER ("ENVIRONMENTAL LAWS"), HEREAFTER
ARISING, EXCEPT FOR VIOLATIONS OF ENVIRONMENTAL LAW CAUSED BY LANDLORD. THIS INDEMNIFICATION SHALL SURVIVE THE EXPIRATION OR TERMINATION OF THIS LEASE.

        9.4  Tenant
shall not conduct from the Demised Premises any fire, auction, bankruptcy, "going-out-of-business,"
"lost-our-lease" or similar sale; nor shall Tenant operate from the Demised Premises a "wholesale" or "factory outlet" store, a cooperative store, a "second hand" store, a
"surplus" store or a store commonly referred to as a "discount house." 

        9.5  Tenant
shall not permit any public nuisance in the form of objectionable noises or odors to emanate from the premises; nor place or permit any radio, television,
loudspeaker or amplifier on the roof or outside the Building or where the same can be seen or heard from outside the building; nor place any antenna, equipment, awning or other projection on the
exterior of the Building; nor take any other action which would constitute a public nuisance or would unreasonably disturb or endanger other tenants of the Shopping Center or unreasonably interfere
with their use of their respective premises; nor permit any unlawful or immoral practice to be carried on or committed from the Demised Premises; nor do anything which would tend to injure the
reputation of the Shopping Center. 

9

 

        9.6  Tenant
shall take good care of the Demised Premises and the Building, shall keep the Demised Premises and the Building secure (i.e., Tenant acknowledges that it is not
relying on any representation or warranty by Landlord in this regard), and shall keep the same free from waste at all times. Tenant shall not overload the floors in the Building, nor deface or injure
the Building. Tenant shall keep the Demised Premises and sidewalks, service-ways and loading areas adjacent to the premises neat, clean and free from dirt, rubbish, ice or snow at all
times. Tenant shall store all trash and garbage within the premises, or in a trash dumpster or similar container approved by Landlord as to type, location and screening; and Tenant shall arrange for
the regular pick-up of such trash and garbage at Tenant's expense (unless Landlord finds it necessary to furnish such a service, in which event Tenant shall be charged an equitable portion
of the total of charges to all tenants using the service). Receiving and deliver of goods and merchandise and removal of garbage and trash shall be made only in the manner and areas reasonably
prescribed by Landlord. Tenant shall not operate an incinerator or burn trash or garbage within the Shopping Center. 

        9.7  Tenant
shall maintain all display windows in a neat, attractive condition, and shall keep all display windows, exterior electric signs and exterior lighting under any
canopy in front of the Building lighted from dusk until 11:00 p.m., every day, including Sundays and holidays (or any other reasonable hours established by Landlord for the Shopping Center). 

        9.8  Tenant
shall include the address and identity of its business activities in the Demised Premises in all advertisements made by Tenant in which the address and identity
of any similar local business activity of Tenant is mentioned. 

        9.9  Tenant
shall procure at its sole expense any permits and licenses required for the transaction of business from the Demised Premises and otherwise comply with all
applicable laws, ordinances and governmental regulations applicable to Demised Premises or to the Building. In addition, if the nature of Tenant's business legally requires Tenant to take any extra
precautions (for example, in the case of a business which is affected by so-called "dram shop" laws, Tenant's compliance with all "dram shop" educational programs and procedures), Tenant
shall take all such extra precautions. At Landlord's request, Tenant shall deliver to Landlord copies of all such permits and licenses and proof of Tenant's compliance with all such laws, ordinances,
governmental regulations and extra precautions. 

        9.10 The
Demised Premises shall include the Patio which is depicted and shown as the "Patio" on Exhibit "B" attached hereto.
Tenant's use of the Patio shall be limited to an outdoor dining area in connection with Tenant's restaurant operations, which outdoor dining area must be operated in accordance with Landlord's rules
and regulations. Tenant must obtain, at Tenant's sole cost and expense, any necessary permits or governmental approvals required for its operations within the Patio. In connection with Tenant's use of
the Patio, Tenant agrees to (i) keep the Patio clean and free from rubbish, trash and garbage, (ii) comply with all governmental requirements applicable to such Patio, and
(iii) obtain Landlord's approval of Tenant's proposed location and configuration of the seating on the Patio (which approval shall not be unreasonably withheld, conditioned or delayed).
Landlord makes no representation or warranty that Tenant shall be able to use the Patio under applicable code requirements and Tenant shall not be entitled to a reduction in rent or any other charges
if Tenant can not use such Patio as a result of applicable code requirements. 

        9.11 Tenant
shall at all times comply with Landlord's rules and regulations for the Shopping Center and all matters of record affecting the Demised Premises, including but
not limited to, the OEA (in that regard, Tenant must, at Tenant's sole cost and expense, perform all covenants and agreements and comply with all restrictions applicable to the owner of the Demised
Premises and obtain all approvals required to be obtained by the owner of the Demised Premises, including but not limited to, with respect to the use of the Demised Premises). The rules and
regulations governing the Shopping Center are attached hereto as Exhibit "G" and made a part hereof for all purposes. 

10

  

 
 

ARTICLE 10
  
    MAINTENANCE AND REPAIR OF
  DEMISED PREMISES AND BUILDING    
  

        10.1 Tenant
shall take good care of the Building, the parking areas, private drives, sidewalks and all other Building on the Demised Premises, throughout the term of this
Lease, and shall keep them in an attractive and good condition and free from waste or nuisance of any kind. Tenant shall make repairs to such Building, parking areas, private drives, sidewalks and
improvements at its sole cost and expense; and Landlord shall not be called upon to make any improvements or repairs of any kind during the term of this Lease. Tenant shall ensure that the Demised
Premises at all times remains in compliance with all applicable laws. Tenant further agrees that it shall care for the landscaping, if any, on the Demised Premises, and between the Demised Premises
and abutting public roadways (including, to the extent applicable, the mowing of grass, care of shrubs, watering and other landscaping requirements) during the term of this Lease. The Demised Premises
shall not be maintained as, nor shall Tenant permit the Demised Premises to become, a public or private nuisance; and Tenant shall not maintain any nuisance upon the Demised Premises. At the end or
other termination of this Lease, Tenant shall deliver up the Demised Premises with the Building, parking areas, private drives, sidewalks and improvements located thereon, in reasonably good repair
and condition, ordinary wear and tear excepted. 

 
 

ARTICLE 11
  
    ALTERATIONS    
  

        11.1 Tenant
shall not make any alterations, additions or improvements to the exterior of the Building nor to the parking areas, driveways and common areas of the Demised
Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All alterations, additions, improvements and fixtures (including, without limitation, all
floor coverings and all heating and air conditioning equipment but excluding Tenant's unattached, readily movable furniture, office equipment and other trade fixtures and equipment not permanently
affixed to the Building) which may be made or installed by either party upon the Demised Premises or within the Building shall remain
upon and be surrendered with the Demised Premises and become the property of Landlord at the termination of this Lease. 

        11.2 All
construction work done by Tenant upon the Demised Premises or within the Building shall be performed in a good workmanlike manner, lien-free and in
compliance with all governmental requirements, by contractors approved by Landlord in writing and in such manner as to cause a minimum of interference with other construction in progress and with the
transaction of business in the Shopping Center. Tenant agrees to indemnify Landlord and hold Landlord harmless against any loss, liability or damage resulting from such work. 

        11.3 In
the event Tenant uses a general contractor to perform construction work upon the Demised Premises or within the Building, Tenant shall, prior to the commencement of
such work, require said general contractor to execute and deliver to Landlord a waiver and release of any and all claims against Landlord and liens against the Shopping Center to which such contractor
might at any time be entitled. The delivery of the waiver and release of lien within the time period set forth above shall be a condition precedent to Tenant's ability to enter on and begin its
construction work at the Demised Premises and, if applicable, to any reimbursement from landlord for its construction work. 

11

 

 
 

ARTICLE 12
  
    LANDLORD'S RIGHT OF ACCESS    
  

        12.1 Landlord
shall have the right to enter upon the Demised Premises and the Building at any reasonable time during normal business hours on reasonable notice for the
purpose of completing Landlord's Work and performing any road, utility, or other infrastructure work in connection with Landlord's development of the Shopping Center, and for inspecting the Demised
Premises, or of making repairs, or of showing the Demised Premises to prospective purchasers, tenants or lenders. 

        12.2 Tenant
will permit Landlord to place and maintain "For Rent" or "For Lease" signs on the Demised Premises during the last 180 days of the Lease Term, it being
understood that such signs shall in no way affect Tenant's obligations pursuant to Section 13.1 or any other provision of this Lease. 

 
 

ARTICLE 13
  
    SIGNS; STORE FRONTS    
  

        13.1 Tenant
shall not, without Landlord's prior written consent (a) install any exterior lighting, decorations, paintings, awnings, canopies or the like, or
(b) erect or install any signs, window or door lettering, placards, decorations or advertising media of any type which can be viewed from the Demised Premises, unless such signs, lettering,
placards, banners, portable signs, decorations and advertising media (including, without limitation, the sign required by Section 13.2 below)
shall conform in all respects to the sign criteria established by Landlord for the Shopping Center from time to time in the exercise of its sole discretion, and shall be subject to Landlord's
requirements as to construction, method of attachment, size, shape, height, lighting, color and general appearance. All signs shall be kept in good condition and in proper operating order at all
times. Tenant shall have the right to install one free-standing single-tenant monument sign at the location shown on Exhibit "A", provided
that (i) Tenant obtains Landlord's prior written approval of the location, materials, size, shape, height, lighting, color and general appearance, and (ii) such sign complies with all
applicable legal requirements. 

        13.2 Subject
to the restrictions of Section 13.1 above, Tenant agrees to install a first-class sign on the front of
the Building prior to the Rent Commencement Date and to maintain such sign in good condition and repair during the Lease Term. 

 
 

ARTICLE 14
  
    UTILITIES    
  

        14.1 In
accordance with Exhibit "C", Landlord agrees to cause to be provided to the boundary of the Demised Premises the
necessary mains, conduits and other facilities necessary to supply water, gas, electricity, telephone service and sewerage service to the Demised Premises. 

        14.2 Tenant
shall promptly pay all charges for electricity, water, gas, telephone service, sewerage service and other utilities furnished to the Demised Premises. 

        14.3 Landlord
shall not be liable for any interruption whatsoever in utility services not furnished by Landlord, nor for interruptions in utility services furnished by
Landlord which are due to fire, accident,
strike, acts of God or other causes beyond the control of Landlord or which are necessary or useful in connection with making any alterations, repairs or improvements. 

12

 

 
 

ARTICLE 15
  
    INSURANCE COVERAGES    
  

        15.1 Tenant
must maintain a policy or policies of special form ("all risk") property insurance on the Demised Premises (including the Building and other Improvements) and
all of its personal property located thereon, in an amount equal to the full replacement cost thereof and endorsed to provide that Tenant's insurance is primary in the event of any overlapping
coverage with the insurance carried by Landlord. Such insurance will be maintained at the expense of Tenant, and, subject to Section 15.5,
payments for losses thereunder will be made (i) with respect to the Building and other Improvements, solely to Landlord or to the mortgagees of Landlord as their interests may appear, and
(ii) with respect to Tenant's personal property, solely to Tenant. Tenant must, prior to occupancy of the Demised Premises and at Landlord's request from time to time, provide to Landlord a
current certificate of insurance evidencing Tenant's compliance with this Section 15.1. Tenant must obtain the agreement of Tenant's insurers to
notify Landlord at least thirty (30) days prior to any cancellation, modification or expiration of a property insurance policy. 

        15.2 Tenant
must maintain a policy of policies of commercial general liability insurance covering the Premises and Tenant's use thereof against claims for personal or bodily
injury or death or property damage (including contractual indemnity and liability coverage) occurring upon, in or about the Demised Premises, with the premiums thereon fully paid on or before the due
date. Such insurance must provide minimum protection of not less than $2,000,000.00 combined single limit primary coverage per occurrence of bodily injury, property damage or combination thereof.
Tenant's insurance must contain an endorsement that Tenant's insurance is primary and non-contributory for claims arising out of an incident or event occurring within the Demised Premises.
Tenant's insurance must contain a provision naming Landlord (and any mortgagee designated by Landlord) as an additional insured and include coverage for the contractual liability of Tenant to
indemnify Landlord pursuant to the terms of this Lease. Tenant must, prior to and during all times of occupancy of the Demised Premises, provide Landlord with a current certificate of insurance
evidencing Tenant's compliance with this Section 15.2. Tenant must obtain the agreement of Tenant's insurers to notify Landlord at least thirty
(30) days prior to any cancellation, modification or expiration of a liability insurance policy. 

        15.3 Tenant
also must maintain the following insurance coverages with premiums thereon fully paid on or before the due date: 

        (a)  Motor
Vehicle Liability Insurance with coverage for all owned, non-owned and hired vehicles with combined limits of not less than $500,000.00 each accident
for bodily or property damage; and 

        (b)  Worker's
Compensation Insurance providing statutory benefits to employees of Tenant in the state in which the Demised Premises are located, with a waiver or subrogation
in favor of Landlord; and 

        (c)  Employer's
Liability Insurance with limits of not less than $100,000.00 per accident or disease and $500,000.00 aggregate by disease. 

        15.4 To
the extent that Tenant is engaged in the sale of alcoholic beverages, Tenant shall maintain host liquor liability/dram shop liability insurance and other insurance
as may be required by Landlord protecting Landlord and Tenant for all liability arising out of the sale and consumption of beer, wine and other alcoholic beverages within the Premises, written on an
occurrence basis with limits of at least $3,000,000 per occurrence. 

        15.5 In
the event of any termination or expiration of this Lease, any and all insurance proceeds pertaining to a casualty affecting the Building and/or other improvements
located on the Demised 

13

 

Premises shall be allocated between Landlord and Tenant as follows: first, to Tenant to the extent of all insurance proceeds attributable to Tenant's personal property insurance; then, to Landlord. 

        15.6 If
Tenant fails to make any payments required to be paid by Tenant pursuant to either Article 6 of this Lease or
this Article 15, then, in addition to any other remedies provided herein, Landlord may, if it so elects (and after reasonable written notice to
Tenant), pay such taxes, assessments and governmental charges or insure such buildings and Building and pay the premiums therefor. Any sums so paid by Landlord shall bear interest at the lower of 15%
per annum or the maximum legal contract rate, shall be deemed to be additional rental owing by Tenant to Landlord and shall be paid with the next due installment of rent. 

        15.7 The
policy or policies required to be carried by Tenant under this Lease must be issued by and binding upon an insurance company licensed to do business in the state in
which the Demised Premises are located having an A.M. Best Rating of "A-VII" or better. 

 
 

ARTICLE 16
  
    WAIVER OF LIABILITY; MUTUAL WAIVER OF SUBROGATION    
  

        16.1 Landlord
and Landlord's agents and employees shall not be liable to Tenant, nor to Tenant's employees, agents or visitors, nor to any other person whomsoever, for any
injury to person or damage to property caused by the Demised Premises or other portions of the Shopping Center becoming out of repair or by defect or failure of any structural element of the Building
or of any equipment pipes or wiring, or broken glass, or by the backing up of drains, or by gas, water, stream, electricity or oil leaking, escaping or flowing into the Demised Premises, nor shall
Landlord be liable to Tenant, nor to Tenant's employees, agents or visitors, nor to any other person whomsoever, for any loss or damage that may be occasioned by or through the acts or omissions of
other tenants of the Shopping Center or of any other persons whomsoever, excepting only duly authorized employees and agents of Landlord, Landlord shall not be held responsible in any way on account
of any construction, repair or reconstruction (including widening) of any private or public roadways, walkways or utility lines. 

        16.2 

        (a)  Landlord
shall not be liable to Tenant or to Tenant's employees, agents, or visitors, or to any other person whomsoever, for any injury to person or damage to property
on or about the Demised Premises or the Common Area caused by the negligence or misconduct of Tenant, its employees, subtenants, licensees or concessionaires, or of any other person entering the
Shopping Center under express or implied invitation of Tenant or arising out of the use of the Demised Premises by Tenant the conduct of its business therein, or arising out of any breach or default
by Tenant in the performance of its obligations under this Lease; and Tenant hereby agrees to indemnify Landlord and hold Landlord harmless from any loss, expense or claims arising out of such damage
or injury. 

        (b)  Tenant
shall not be liable to Landlord or to Landlord's employees, agents, or visitors, or to any other person whomsoever, for any injury to person or damage to property
on or about the Common Area caused by the negligence or misconduct of Landlord or its employees or contractors, or arising out of any breach or default by Landlord in the performance of its
obligations under this Lease; and Landlord hereby agrees to indemnify Tenant and hold Tenant harmless from any loss, expense or claims arising out of such damage or injury. 

        16.3 So
long as it is permissible to do so under the laws and regulations governing the writing of insurance within the State in which the Demised Premises are located, all
insurance carried by either Landlord or Tenant will provide for a waiver of rights of subrogation against Landlord and Tenant on the part of the insurance carrier. Unless the waivers contemplated by
this sentence are not obtainable for the reasons described in this Section 16.3, Landlord waives any and all rights of recovery, claims, 

14

 

actions or causes of action against Tenant, and Tenant waives any and all rights of recovery, claims, actions or causes or action against Landlord, for any loss or damage to property or any injuries
to or death of any person which is covered or would have been covered under the insurance policies required under this Lease. The foregoing release will not apply to losses or damages in excess of
actual or required policy limits (whichever is greater) nor to any deductible (up to a maximum of $10,000) applicable under any policy obtained by the waiving party. The failure of either party (the
"Defaulting Party") to take out or maintain any insurance policy required under this Lease will be a defense to any claim asserted by the Defaulting
Party against the other party hereto by reason of any loss sustained by the Defaulting Party that would have been covered by any such required policy. The waivers set forth in the immediately
preceding sentence will be in addition to, and not in substitution for, any other waivers, indemnities, or exclusions of liabilities set forth in this Lease. 

 
 

ARTICLE 17
  
    DAMAGES BY CASUALTY    
  

        17.1 If
the Building is damaged or destroyed by fire, tornado, or other casualty, Tenant shall give prompt written notice thereof to Landlord. 

        17.2 If
during the last two (2) years of the term of this Lease, the Building is totally destroyed by fire, tornado, or other casualty, or if during such
two-year period it should be so damaged that rebuilding or repairs cannot be completed within one hundred eighty (180) days after the date of such damage, this Lease shall, at the
option of Tenant (to be exercised by written notice delivered to Landlord within forty-five (45) days after the occurrence of the casualty), terminate and the rent shall be abated
during the unexpired portion of this Lease, effective with the date of such damage. In such event, all insurance proceeds shall be allocated in the same manner as is specified in  Section 15.5
above. 

        17.3 If
the Building is damaged by fire, tornado, or other casualty but not under such circumstances as entitle Tenant to terminate pursuant to  Section 17.2 above, or if under such circumstances but Tenant
shall not have elected to terminate this Lease, this Lease shall not terminate, and
Tenant shall, at Tenant's sole cost and expense, proceed with reasonable diligence to rebuild and repair such Building to substantially the condition in which they existed prior to such damage. The
rent payable hereunder shall in no event abate during the period in which the Demised Premises or Building are untenantable. 

        17.4 Tenant
shall not, without Landlord's prior written consent, keep anything within the Demised Premises or Building for any purpose which invalidates any insurance policy
carried on the Demised Premises or Building. All property kept, stored or maintained within the Demised Premises by Tenant shall be at Tenant's sole risk. 

 
 

ARTICLE 18
  
    EMINENT DOMAIN    
  

        18.1 If
any portion of the floor area of the Building is taken for any public or quasi-public use under any governmental law, ordinance or regulation or by right of eminent
domain or by private purchase in lieu thereof, this Lease shall, at Tenant's option, terminate and the rent shall be abated during the unexpired portion of this Lease, effective on the date physical
possession is taken by the condemning authority. 

        18.2 If
a portion of the floor area of the Building is taken as aforesaid, and Tenant does not terminate this Lease, the minimum guaranteed rental payable hereunder during
the unexpired portion of this Lease shall be reduced in proportion to the area taken, effective on the date physical possession is taken by the condemning authority. Following such partial taking,
Tenant shall make all necessary 

15

 

repairs or alterations to the remaining premises as may be required, to make the remaining portions of the Building an architectural whole. 

        18.3 If
any part of the parking area of the Demised Premises is taken as aforesaid, this Lease shall not terminate, nor shall the rent payable hereunder be reduced, except
that either Landlord or Tenant may terminate this Lease if the area of the parking area of the Demised Premises remaining following such taking plus any additional parking area provided by Landlord in
reasonable proximity to the Demised Premises is less than ninety percent (90%) of the area of the parking area of the Demised Premises immediately prior to the taking. Any election to terminate this
Lease in accordance with this provision shall be evidenced by written notice of termination delivered to the other party within thirty days after date physical possession is taken by condemning
authority. 

        18.4 All
compensation awarded for any taking (or the proceeds of private sale in lieu thereof) of the Demised Premises or Building shall be the property of Landlord, and
Tenant hereby assigns its interest in any such award to Landlord; provided, however, Landlord shall have no interest in any award made to Tenant for Tenant's moving and relocation expenses or for the
loss of Tenant's fixtures and other tangible personal property or for the loss of Tenant's business goodwill, if any, if a separate award for such items is made to Tenant. 

 
 

ARTICLE 19
  
    ASSIGNMENT AND SUBLETTING    
  

        19.1 Tenant
shall not assign or in any manner transfer this Lease or any estate or interest therein, or sublet the Demised Premises or any part thereof, or grant any
license, concession or other right of occupancy of any portion of the Demised Premises without the prior written consent of Landlord. Landlord agrees that it will not withhold consent in a wholly
unreasonable and arbitrary manner (as further explained in Section 28.4 of this Lease); however, in determining whether or not to grant its
consent, Landlord shall be entitled to take into consideration factors such as Landlord's desired tenant mix, the reputation and net worth of the proposed transferee, and the then current market
conditions (including market rentals). In addition, Landlord shall also be entitled to charge Tenant a reasonable fee for processing Tenant's request. Consent by Landlord to one or more assignments or
sublettings shall not operate as a waiver of Landlord's rights as to any subsequent assignment and sublettings. 

        19.2 Notwithstanding
the provisions of Section 19.1 above, Tenant shall be permitted to assign this Lease to an
affiliate of Tenant without the prior written consent of Landlord if all of the following conditions are first satisfied: (i) Tenant shall not then be in default under this Lease; (ii) a
fully executed copy of such assignment and assumption of this Lease by the assignee and such other information regarding the assignment as Landlord may reasonably be request shall have been delivered
to Landlord; (iii) the Demised Premises shall continue to be operated solely for the permitted use specified in Section 1.1(q); and
(iv) Tenant shall pay all costs reasonably incurred by Landlord in connection with such assignment (including, without limitation, attorney's fees). Any such assignment shall be subject to the
terms of Section 19.4 below. The term "affiliate" as used in this Section 19.2 shall mean
an entity which (a) directly or indirectly controls Tenant, (b) is under the direct or indirect control of Tenant, or (c) is under common, direct or indirect control with Tenant.
The term "control" as used in this Section 19.2 shall mean ownership of fifty-one percent (51%) of the voting interest of the
controlled entity. 

        19.3 Any
assignee or sublessee of an interest in and to this Lease shall be deemed, by acceptance of such assignment or sublease or by taking actual or constructive
possession of the Demised Premises, to have assumed all of the obligations set forth in or arising under this Lease. Such assumption shall be effective as of the earlier of the date of such assignment
or sublease or the date on which the assignee or sublessee obtains possession of the Demised Premises. 

16

 

        19.4 Notwithstanding
any such assignment or subletting, Tenant and any guarantor of Tenant's obligations under this Lease shall at all times remain fully responsible and
liable for the payment of the rent herein specified and for compliance with all of its other obligations under this Lease (even if future assignments and sublettings occur subsequent to the assignment
or subletting by Tenant, and
regardless of whether or not Landlord's approval has been obtained for such future assignments and sublettings). Moreover, in the event that the rental due and payable by a sublessee (or a combination
of the rental payable under such sublease plus any bonus incident thereto) exceeds the rental payable under this Lease, or if with respect to a permitted assignment, permitted license or other
transfer by Tenant permitted by Landlord, the consideration payable for such transfer to Tenant by the assignee, licensee or other transferee exceeds the rental payable under this Lease, then Tenant
shall be bound and obligated to pay Landlord all such excess rental and other excess consideration within ten (10) days following receipt thereof by Tenant from such sublessee, assignee,
licensee or other transferee, as the case may be. In the event of an assignment or subletting, it is understood and agreed that all rentals paid to Tenant by an assignee or sublessee shall be received
by Tenant in trust for Landlord, to be forwarded immediately to Landlord without offset or reduction of any kind; and upon election by Landlord such rentals shall be paid directly to Landlord as
specified in Sections 4.1 and 4.2 of this Lease (to be applied as a credit and offset to Tenant's rental obligation). 

        19.5 Tenant
shall not mortgage, pledge or otherwise encumber its interest in this Lease or in the Demised Premises. 

        19.6 In
the event of the transfer and assignment by Landlord of its interest in this Lease and in the building containing the Demised Premises to a person expressly assuming
Landlord's obligations under this Lease, Landlord shall thereby be released from all obligations accruing after the date of the assignment, and Tenant agrees to look solely to such a successor in
interest of the Landlord for performance of such obligations. Any security given by Tenant to secure performance of Tenant's obligations hereunder may be assigned and transferred by Landlord to such
successor in interest and Landlord shall thereby be discharged of any further obligation relating thereto. 

 
 

ARTICLE 20
  
    SUBORDINATION; ATTORNMENT; ESTOPPELS    
  

        20.1 Tenant
accepts this Lease subject and subordinate to any mortgage, deed of trust or other lien presently existing or hereafter placed upon the Shopping Center or any
portion of the Shopping Center which includes the Demised Premises, and to any renewals and extensions thereof. Tenant agrees that any mortgagee shall have the right at any time to subordinate its
mortgage, deed of trust or other lien to this Lease; provided, however, notwithstanding that this Lease may be (or made to be) superior to a mortgage, deed of trust or other lien, the mortgagee shall
not be liable for prepaid rentals, security deposits and claims accruing during Landlord's ownership. Landlord is hereby irrevocably vested with full power and authority to subordinate this Lease to
any mortgage, deed of trust or other lien hereafter placed upon the Demised Premises or the Shopping Center as a whole, and Tenant agrees upon demand to execute such further instruments so
subordinating this Lease as Landlord may reasonably request; provided, however, that Landlord shall use good faith efforts to obtain from any such mortgagee a written agreement that after a
foreclosure (or a deed in lieu of foreclosure) the rights of Tenant shall remain in full force and effect during the term of this Lease so long as Tenant shall continue to recognize and perform all of
the covenants and conditions of this Lease.
Notwithstanding the foregoing provisions of this Section 20.1, Landlord agrees that this Lease may not be subordinated to any mortgage or deed of
trust unless such mortgagee executes and delivers to Tenant an agreement confirming that Tenant's possession of the Demised Premises will not be disturbed as long as Tenant is not in default under
this Lease. 

17

  

        20.2 At any time when the holder of an outstanding mortgage, deed of trust or other lien covering Landlord's interest in the Demised Premises has given Tenant written notice
of its interest in this Lease, Tenant may not exercise any remedies for default by Landlord hereunder unless and until the holder of the indebtedness secured by such mortgage, deed of trust or other
lien shall have received written notice of such default and a reasonable time (not less than thirty (30) days) shall thereafter have elapsed without the default having been cured. 

        20.3 Tenant
agrees that it will from time to time upon request by Landlord execute and deliver to Landlord a written statement addressed to Landlord (or to a party
designated by Landlord), which statement shall identify Tenant and this Lease, shall certify that this Lease is unmodified and in full force and effect (or if there have been modifications, that the
same is in full force and effect as so modified), shall confirm that Landlord is not in default as to any obligations of Landlord under this Lease (or if Landlord is in default, specifying any
default), shall confirm Tenant's agreements contained above in this Article 20, and shall contain such other information or confirmations as
Landlord may reasonably require. 

 
 

ARTICLE 21
  
    DIRECTION OF TENANT'S ENERGIES    
  

        21.1 Tenant
acknowledges that Tenant's monetary contribution to Landlord (in the form of rentals) and Tenant's general contribution to commerce within the Shopping Center
(also important in Landlord's determination to execute this Lease with Tenant) will be substantially reduced if during the term of this Lease, either Tenant or any person, firm or corporation,
directly or indirectly controlling, controlled by or under common control with Tenant shall directly or indirectly operate, manage, conduct or have any interest in any establishment within commercial
proximity of the Shopping Center. Accordingly, Tenant agrees that if during the Lease Term, either Tenant or any person, firm or corporation, directly or indirectly controlling, controlled by or under
common control with Tenant (and also, in the event Tenant is a corporation, if any officer of director thereof or shareholder owning more than ten percent (10%) of the outstanding stock thereof, or
parent, subsidiary or related or affiliated corporation) either directly or indirectly commences operation of any restaurant that competes with the business provided herein to be conducted by Tenant
at the Demised Premises, within a straight line radius of two (2) miles of the Shopping Center, which Tenant acknowledges is a reasonable area for the purpose of this provision, then in such
event, thereafter the minimum guaranteed rental shall be one hundred ten percent (110%) of the amount stipulated in Section 1.1(l) and  Section 4.1 of this Lease. The above
adjustment in rental reflects the estimate of the parties as to the damages which Landlord would be likely to incur by reason of the diversion of business and customer traffic from the Demised
Premises and Shopping Center to such other restaurant within such radius, as a proximate result of the establishment of such other restaurant. Finally, Tenant agrees that Landlord may waive, for any
reason whatsoever, all rights granted to Landlord pursuant to this Section 21.1 and may sever this section from the remainder of this Lease
(thereby keeping the remainder of this Lease unmodified and in full force and effect). 

 
 

ARTICLE 22
  
    DEFAULT BY TENANT AND REMEDIES    
  

        22.1 The
following events shall be deemed to be events of default by Tenant under this Lease: 

        (a)  Tenant
shall fail to pay any installment or rental or any other obligation under this Lease involving the payment of money and such failure shall continue for a period
of ten (10) days after written notice thereof to Tenant; provided, however, that for each calendar year during which Landlord has already given Tenant two written notices of the failure to pay
an installment of 

18

 

rental, no further notice shall be required (i.e., the event of default will automatically occur on the tenth day after the date upon which the rental was due). 

        (b)  Tenant
shall fail to comply with any provision of this Lease, other than as described in subsection (a) above, and either shall not cure such failure within
thirty (30) days after written notice thereof to Tenant, or shall cure that particular failure but shall again fail to comply with the same provision of the Lease within three months after
Landlord's written notice. Tenant's failure to perform any such obligation which may not reasonably be cured within thirty (30) days will not be considered a default if Tenant:
(i) institutes good faith efforts to cure the non-performance within the thirty (30) day period; and (ii) completes performance within sixty (60) days after
written notice thereof to Tenant. 

        (c)  Tenant
or any guarantor of Tenant's obligations under this Lease shall become insolvent, or shall make a transfer in fraud of creditors, or shall make an assignment for
the benefit of creditors. 

        (d)  Tenant
or any guarantor of Tenant's obligations under this Lease shall file a petition under any section or chapter of the federal Bankruptcy Code, as amended, or
under any similar law or statute of the United States or any state thereof ("Debtor Relief Laws"); or Tenant or any guarantor of Tenant's obligations
under this Lease shall be the subject of proceedings filed against Tenant or any guarantor of
Tenant's obligations under this Lease under Debtor Relief Laws, and such proceedings are not discharged within sixty (60) days after commencement. 

        (e)  A
receiver or trustee shall be appointed for the Demised Premises or for all or substantially all of the assets of Tenant or any guarantor of Tenant's obligation under
this Lease and such receiver or trustee is not discharged within sixty (60) days following the appointment. 

        (f)    Tenant
shall do or permit to be done anything which creates a lien upon the Demised Premises or upon all or any part of the Shopping Center, and such lien is not either
removed or fully bonded around within thirty (30) days after Tenant becomes aware of such lien. 

        22.2 Upon
the occurrence of any such events of default, Landlord shall have the option to pursue any one or more of the following remedies: 

        (a)  Without
any further notice or demand whatsoever, Tenant shall be obligated to reimburse Landlord for the damages suffered by Landlord as a result of the event of
default, plus interest on such amount at the maximum contractual rate which could legally be charged in the event of a loan of such amount to Tenant (but in no event to exceed 11/2% per
month); and Landlord may pursue a monetary recovery from Tenant. 

        (b)  Without
any further notice or demand whatsoever, Landlord may take any one or more of the actions permissible at law to insure performance by Tenant of Tenant's
covenants and obligations under this Lease. In this regard, and without limiting the generality of the immediately preceding sentence, it is agreed that if Tenant fails to open for business as
required in this Lease or, having opened for business, deserts or vacates the Demised Premises (except under the circumstances described in  Section 9.1 above), Landlord may enter upon and take
possession of such Demised Premises in order to protect them from deterioration and continue
to demand from Tenant the monthly rentals and other charges provided in this Lease, without any obligation to relet; however, if Landlord does, at its sole discretion, elect to relet the Demised
Premises, such action by Landlord shall not be deemed as an acceptance of Tenant's surrender of the Demised Premises unless Landlord expressly notifies Tenant of such acceptance in writing pursuant to
this subsection (b), Tenant hereby acknowledging that Landlord shall otherwise be reletting as Tenant's agent and Tenant furthermore hereby agreeing to pay to Landlord on demand any deficiency that
may arise between the monthly rentals and other charges provided in this Lease and that actually collected by Landlord. It is further agreed in this regard that in the event of any default described 

19

 

in subsection (b) of Section 22.1 of this Lease, Landlord shall have the right to enter upon the Demised Premises by force if necessary
without being liable for prosecution or any claim for damages therefor, and do whatever Tenant is obligated to do under the terms of this Lease; and Tenant agrees to reimburse Landlord on demand for
any expenses which Landlord may incur in thus effecting compliance with Tenant's obligations under this Lease, and Tenant further agrees that Landlord shall not be liable for any damages resulting to
the Tenant from such action. Finally, it is agreed that in the
event of any default described in subsection (f) of Section 22.1 of this Lease, Landlord may pay or bond around such lien, whether or not
contested by Tenant; and in such event Tenant agrees to reimburse Landlord on demand for all costs and expenses incurred in connection with any such action, with Tenant further agreeing that Landlord
shall in no event be liable for any damages or claims resulting from such action. 

        (c)  Landlord
may terminate this Lease by written notice to Tenant, in which event Tenant shall immediately surrender the Demised Premises to Landlord, and if Tenant fails to
do so, Landlord may, without prejudice to any other remedy which Landlord may have for possession or arrearages in rent (including any late charge or interest which may have accrued pursuant to  Section 4.6 of this Lease), enter upon and take possession of the Demised Premises and expel or remove Tenant and any other person who may be
occupying said premises or any part thereof, by force if necessary, without being liable for prosecution or any claim for damages therefor. Tenant hereby waives any statutory requirement of prior
written notice for filing eviction or damage suits for nonpayment of rent. In addition, Tenant agrees to pay to Landlord on demand the amount of all loss and damage which Landlord may suffer by reason
of any termination effected pursuant to this subsection (c), said loss and damage to be determined by either of the following alternative measures of damages: 

          (i)  Until
Landlord is able, through reasonable efforts, the nature of which efforts shall be at the sole discretion of Landlord, to relet the Demised Premises under terms
satisfactory to Landlord, in its sole discretion, Tenant shall pay to Landlord on or before the first day of each calendar month, the monthly rentals and other charges provided in this Lease. If and
after the Demised Premises have been relet by Landlord, Tenant shall pay to Landlord on the 20th day of each calendar month the difference between the monthly rentals and other charges provided in
this Lease for such calendar month and that actually collected by Landlord for such month. If it is necessary for Landlord to bring suit in order to collect any deficiency, Landlord shall have a right
to allow such deficiencies to accumulate and to bring an action on several or all of the accrued deficiencies at one time. Any such suit shall not prejudice in any way the right of Landlord to bring a
similar action for any subsequent deficiency or deficiencies. Any amount collected by Landlord from subsequent tenants for any calendar month in excess of the monthly rentals and other charges
provided in this Lease, shall be credited to Tenant in reduction of Tenant's liability for any calendar month for which the amount collected by Landlord will be less than the monthly rentals and other
charges provided in this Lease; but Tenant shall have no right to such excess other than the above-described credit. 

        (ii)  When
Landlord desires, Landlord may demand a final settlement. Upon demand for a final settlement, Landlord shall have a right to, and Tenant hereby agrees to pay, the
difference between the total of all monthly rentals and other charges provided in this Lease for the remainder of the term and the reasonable rental value of the Demised Premises for such period, such
difference to be discounted to present value at a rate equal to the rate of interest which is allowed by law in the State of Texas when the parties to a contract have not agreed on any particular rate
of interest (or, in the absence of such law, at the rate of six percent per annum). 

20

 

If
Landlord elects to exercise the remedy prescribed in Section 22.2(b) above, this election shall in no way prejudice Landlord's right at any
time thereafter to cancel said election in favor of the remedy prescribed in Section 22.2(c) above, provided that at the time of such
cancellation Tenant is still in default. Similarly, if Landlord elects to compute damages in the manner prescribed by  Section 22.2(c)(i) above, this election shall in no way prejudice
Landlord's right at any time thereafter to demand a final settlement in
accordance with Section 22.2(c)(ii) above. Pursuit of any of the above remedies shall not preclude pursuit of any other remedies
prescribed in other sections of this Lease and any other remedies provided by law. Forbearance by Landlord to enforce one or more of the remedies herein provided upon an event of default shall not be
deemed or construed to constitute a waiver of such default. 

        22.3 It
is expressly agreed that in determining "the monthly rentals and other charges provided in this Lease," as that term is used throughout  Sections 22.2(c)(i) and 22.2(c)(ii) above, there shall be
added to the minimum guaranteed rental (as specified in  Section 1.1(l) of this Lease) a sum equal to the charges for Common Area maintenance (as specified in  Section 7.3), the payments for taxes, and the real estate charges (as specified in  Article 6 of this Lease). 

        22.4 It
is further agreed that, in addition to payments required pursuant to Sections 22.2(b) and 22.2(c) above, Tenant shall
compensate Landlord for all expenses incurred by Landlord in repossession (including, among other expenses, any increase in insurance premiums caused by the vacancy of the Demised Premises), all
expenses incurred by Landlord in reletting (including, among other expenses, repairs, replacements, advertisements and brokerage fees), and a reasonable allowance for Landlord's administrative
efforts, salaries and overhead attributable directly or indirectly to Tenant's default and Landlord's pursuing the rights and remedies provided herein and under applicable law. 

        22.5 Either
party may restrain or enjoin any breach or threatened breach of any covenant, duty or obligation of the other herein contained without the necessity of proving
the inadequacy of any legal remedy or irreparable harm. The remedies of the parties hereunder shall be deemed cumulative and not exclusive of each other. 

        22.6 If
on account of any breach or default by either party in its obligations hereunder, the other shall employ an attorney to present, enforce or defend any rights or
remedies hereunder, the non-prevailing party agrees to pay any reasonable attorney's fees incurred by the prevailing party in such connection. 

        22.7 In
the event that any one or more provisions of this Article 22 authorizes Landlord to enter the Demised
Premises, Landlord is entitled and is hereby authorized, without any notice to Tenant, to enter upon the Demised Premises by use of a duplicate key, a master key, a locksmith's entry procedures or any
other means not involving personal confrontation, and to alter or change the door locks on all entry doors of the Demised Premises, thereby permanently excluding Tenant. In such event Landlord shall
not be obligated to place any written notice on the Demised Premises explaining Landlord's action; moreover, if a reason for Landlord's action is the failure of Tenant to pay any one or more rentals
when due pursuant to this Lease, Landlord shall not be required to provide the new key (if any) to Tenant until and unless all rental defaults of Tenant have been fully cured. 

        22.8 Tenant
acknowledges its obligation to deposit with Landlord the sum stated in Section 1.1(p) above, to be held by
Landlord without interest as security for the performance by Tenant of Tenant's covenants and obligations under this Lease. Tenant agrees that such deposit may be co-mingled with
Landlord's other funds and is not an advance payment of rental or a measure of Landlord's damages in case of default by Tenant. Upon the occurrence of any event of default by Tenant, Landlord may,
from time to time, without prejudice to any other remedy provided herein or provided by law, use such fund to the extent necessary to make good any arrears of rentals and any other damage, injury,
expense or liability caused to Landlord by such event of default, and Tenant shall pay to Landlord on demand the amount so applied in order to restore the security deposit to its original amount. If
Tenant is not then 

21

 

in default hereunder, any remaining balance of such deposit shall be returned by Landlord to Tenant upon termination of this Lease (subject to the provisions of  Section 19.6 above). 

        22.9 In
the event of any default described in subsection (d) of Section 22.1 of this Lease, any assumption and
assignment must conform with the requirements of the Bankruptcy Code which provides, in part, that the Landlord must be provided with adequate assurance: (i) of the source of rent and other
consideration due under this Lease; (ii) that any assumption or assignment is subject to all of the provisions of this Lease (including, but not limited to, restrictions as to use) and will not
breach any such provision contained in any other Lease, financing agreement or other agreement relating to the Shopping Center; and (iii) that any assumption or assignment will not disrupt any
tenant mix or balance in the Shopping Center. 

        (a)  In
order to provide Landlord with the assurance contemplated by the Bankruptcy Code, Tenant must fulfill the following obligations, in addition to any other reasonable
obligations that Landlord may require, before any assumption of this Lease is effective: (i) all defaults under subsection (a) of  Section 22.1 of this Lease must be cured within ten
(10) days after the date of assumption; (ii) all other defaults under  Section 22.1 of this Lease other than under subsection (d) of Section 22.1 must be
cured within fifteen (15) days after the date of assumption; and (iii) all actual expenses incurred by Landlord (including, but not limited to, reasonable attorneys fees) must be paid to
Landlord within ten (10) days after the date of assumption. 

        (b)  In
the event this Lease is assumed in accordance with the requirements of the Bankruptcy Code and this Lease, and is subsequently assigned, then, in addition to any
other reasonable obligations that Landlord may require and in order to provide Landlord with the assurances contemplated by the Bankruptcy Code, Landlord shall be provided with: (i) a financial
statement of the proposed assignee prepared in accordance with generally accepted accounting principles consistently applied, though on a cash basis, which reveals a net worth in an amount sufficient,
in Landlord's reasonable judgment, to assure the future performance by the proposed assignee of Tenant's obligations under this Lease; or (ii) a written guaranty by one or more guarantors with
financial ability sufficient to assure the future performance of Tenant's obligations under this Lease, such guaranty to be in form and content satisfactory to Landlord and to cover the performance of
all of Tenant's obligations under this Lease. 

 
 

ARTICLE 23
  
    LANDLORD'S CONTRACTUAL SECURITY INTEREST    
  

        23.1 In
addition to the statutory Landlord's lien, Landlord shall have at all times a valid security interest to secure payment of all rentals and other sums of money
becoming due hereunder from Tenant, and to secure payment of any damages or loss which Landlord may suffer by reason of the breach by Tenant of any covenant, agreement or condition contained herein,
upon all goods, wares, equipment, fixtures, furniture, improvements and other personal property of Tenant presently, or which may hereafter be, situated on the Demised Premises, and all proceeds
therefrom, and such property shall not be removed without the consent of Landlord until all arrearages in rent as well as any and all other sums of money then due to landlord or to become due to
Landlord hereunder shall first have been paid and discharged and all the covenants, agreements and conditions hereof have been fully complied with and performed by Tenant. Upon the occurrence of an
event of default by Tenant, Landlord may, in addition to any other remedies provided herein, enter upon the Demised Premises and take possession of any and all goods, wares, equipment, fixtures,
furniture, improvements and other personal property of Tenant situated on the Demised Premises not otherwise secured by third-party lienholders, and sell the same at public or private sale, with or
without having such property at the sale, after giving Tenant reasonable notice of the time and place of any public sale or of the time after which any private sale is to be made, at which sale the
Landlord or its assigns may purchase unless otherwise 

22

 

prohibited by law. Unless otherwise provided by law, and without intending to exclude any other manner of giving Tenant reasonable notice, the requirement of reasonable notice shall be met if such
notice is given in the manner prescribed in this Lease at least five (5) days before the time of sale. Any sale made pursuant to the provisions of this paragraph shall be deemed to have been a
public sale conducted in a commercially reasonable manner if held in the above-described Demised Premises or where the property is located after the time, place and method of sale and a general
description of the types of property to be sold have been advertised in a daily newspaper published in the county in which the property is located, for five (5) consecutive days before the date
of the sale. The proceeds from any such disposition, less any and all expenses connected with the taking of possession, holding and selling of the property (including reasonable attorney's fees and
legal expenses), shall be applied as a credit against the indebtedness secured by the security interest granted in this paragraph. Any surplus shall be paid to Tenant or as otherwise required by law;
the Tenant shall pay any deficiencies forthwith. Tenant agrees that it will deliver to Landlord at least fifteen (15) days' prior written notice of the granting of any security interest in
Tenant's property located at the Demised Premises. 

        23.2 Notwithstanding
Section 23.1, Landlord agrees that it will subordinate its security interest and landlord's lien
(pursuant to the form attached hereto as Exhibit "E") to the security interest in any of Tenant's personal property held by Tenant's supplier or
institutional financial source for as long as the rental account of Tenant under this Lease is current (or is brought current), provided that the subordination must be limited to a specified
transaction and specified items of the fixtures, equipment or inventory involved in the transaction. 

 
 

ARTICLE 24
  
    HOLDING OVER    
  

        24.1 In
the event Tenant remains in possession of the Demised Premises after the expiration of this Lease and without the execution of a new Lease, it shall be deemed to be
occupying said premises as a tenant-at-sufferance at a rental equal to the daily rental herein provided plus fifty percent (50%) of such amount and otherwise subject to all the
conditions, provisions and obligations of this Lease insofar as the same are applicable to a tenancy-at-sufferance. Tenant will also pay all damages suffered by Landlord as a
result of such holdover. 

 
 

ARTICLE 25
  
    NOTICES    
  

        25.1 Wherever
any notice is required or permitted hereunder, such notice shall be in writing. Any notice or document required or permitted to be delivered hereunder shall be
deemed to be delivered when actually received by the designated addressee or, if earlier and regardless of whether actually received or not, when deposited in the United States mail, postage prepaid,
certified mail, return receipt requested, addressed to the parties hereto at the respective addresses set out in Section 1.1 above (or at
Landlord's option, to Tenant at the Demised Premises), or such other addresses as they have theretofore specified by written notice. 

        25.2 If
and when included within the term "Landlord" as used in this instrument there are more than one person, firm or corporation, all shall jointly arrange among
themselves for their joint execution of such notice specifying some individual at some specific address for the receipt of notices and payments to the Landlord; if and when included within the term
"Tenant" as used in this instrument there are more than one person, firm or corporation, all shall jointly arrange among themselves for their joint execution of such a notice specifying some
individual at some specific address for the receipt of notices and payment to Tenant. All parties included within the terms "Landlord" and "Tenant," respectively, shall be bound by notices and
payments given in accordance with the provisions 

23

 

of this Article to the same effect as if each had received such notice or payment. In addition, Tenant agrees that notices to Tenant may be given by Landlord's attorney, property manager or other
agent. 

 
 

ARTICLE 26
  
    COMMISSIONS    
  

        26.1 Tenant
represents and warrants that it has not contracted with any broker or agent, and has not represented to any broker or agent that Landlord will pay such broker or
agent, in connection with the negotiation or execution of this Lease, other than Tenant's Agent (as defined in Section 1.1(g)). Landlord
acknowledges that it has agreed to pay the Agents a commission pursuant to the terms of a separate agreement. Tenant shall have no obligation or responsibility to pay a commission to the Agents, nor
any other broker's commission arising as a consequence of the negotiation and consummation of this Lease, except to the extent of any misrepresentation by Tenant in the first sentence of this
paragraph; and except to the extent of any such misrepresentation by Tenant, Landlord agrees to indemnify Tenant and hold Tenant harmless for any such claims or demands. 

 
 

ARTICLE 27
  
    REGULATIONS    
  

        27.1 Landlord
and Tenant acknowledge that there are in effect federal, state, county and municipal laws, orders, rules, directives and regulations (collectively referred to
hereinafter as the "Regulations") and that additional Regulations may hereafter be enacted or go into effect, relating to or affecting the Demised
Premises or the Shopping Center, and concerning the impact on the environment of construction, land use, maintenance and operation of structures, toxic or otherwise hazardous substances, and conduct
of business. Subject to the express rights granted to Tenant under the term of this Lease, Tenant will not cause, or permit to be caused, any act or practice, by negligence, omission or otherwise,
that would adversely affect the environment, or do anything or permit anything to be done that would violate any of said laws, regulations or guidelines. Moreover, Tenant shall have no claim against
Landlord by reason of any changes Landlord may make in the Shopping Center or the Demised Premises pursuant to said Regulations or any charges imposed upon Tenant, Tenant's customers or other invitees
pursuant to same. 

        27.2 If,
by reason of any Regulations, the payment to, or collection by, Landlord of any rental or other charge (collectively referred to hereinafter as
"Lease Payments") payable by Tenant to Landlord pursuant to the provisions of this Lease is in excess of the amount (the
"Maximum Charge") permitted thereof by the Regulations, then Tenant, during the period (the "Freeze
Period") when the Regulations shall be in force and effect shall not be required to pay, nor shall Landlord be permitted to collect, any sum in excess of the Maximum Charge.
Upon the earlier of (i) the expiration of the Freeze Period, or (ii) the issuance of a final order or judgment of a court of competent jurisdiction declaring the Regulations to be
invalid or not applicable to the provisions of this Lease, Tenant, to the extent not
then proscribed by law, and commencing with the first day of the month immediately following, shall pay to Landlord as additional rental, in equal monthly installments during the balance of the term
of this Lease, a sum equal to the cumulative difference between the Maximum Charges and the Lease Payments during the Freeze Period. If any provisions of this section, or the application thereof,
shall to any extend be declared to be invalid and unenforceable, the same shall not be deemed to affect any of the other provisions of this section or of this Lease, all of which shall be deemed valid
and enforceable to the fullest extent permitted by law. 

24

  

 
 

ARTICLE 28
  
    MISCELLANEOUS    
  

        28.1    Nothing
in this Lease shall be deemed or construed by the parties hereto, nor by any third party, as creating the relationship of principal and agent or of partnership
or of joint venture between the parties hereto, it being understood and agreed that neither the method of computation of rent, nor any other provision contained herein, nor any acts of the parties
hereto, shall be deemed to create any relationship between the parties hereto other than the relationship of landlord and tenant. 

        28.2    Tenant
shall not for any reason withhold or reduce Tenant's required payments of rentals and other charges provided in this Lease, it being agreed that the obligations
of Landlord under this Lease are independent of Tenant's obligations except as may be otherwise expressly provided. The immediately preceding sentence shall not be deemed to deny Tenant the ability of
pursuing all rights granted it under this Lease or at law; however, at the direction of Landlord, Tenant's claims in this regard shall be litigated in proceedings different from any litigation
involving rental claims or other claims by Landlord against Tenant (i.e., each party may proceed to a separate judgment without consideration, counterclaim or offset as to the claims asserted by the
other party). 

        28.3    The
liability of Landlord to Tenant for any default by Landlord under the terms of this Lease shall be limited to the proceeds of sale on execution of the interest of
Landlord in the Demised Premises; and Landlord shall not be personally liable for any deficiency, except that Landlord shall, subject to the provisions of  Section 19.6 hereof, remain personally
liable to account to Tenant for any security deposit under this Lease. This clause shall not be deemed to
limit or deny any remedies which Tenant may have in the event of default by Landlord hereunder which do not involve the personal liability of Landlord. 

        28.4    In
all circumstances under this Lease where the prior consent of one party (the "consenting party"), whether it be
Landlord or Tenant, is required before the other party (the "requesting party") is authorized to take any particular type of action, such consent shall
not be withheld in a wholly unreasonable and arbitrary manner; however, the requesting party agrees that its exclusive remedy if it believes that consent has been withheld improperly (including, but
not limited to, consent required
from Landlord pursuant to Section 9.2 or Section 19.1) shall be to institute litigation
either for a declaratory judgment or for a mandatory injunction requiring that such consent be given (with the requesting party hereby waiving any claim for damages or any other remedy unless the
consenting party refuses to comply with a court order or judgment requiring it to grant its consent). 

        28.5    One
or more waivers of any covenant, term or condition of this Lease by either party shall not be construed as a waiver of a subsequent breach of the same covenant,
term or condition. The consent or approval by either party to or of any act by the other party requiring such consent or approval shall not be deemed to waive or render unnecessary consent to or
approval of any subsequent similar act. 

        28.6    Whenever
a period of time is herein prescribed for action to be taken by either party (other than the payment of rent or other sums due hereunder), such party shall not
be liable or responsible for, and there shall be excluded from the computation of any such period of time, any delays due to strikes, riots, acts of God (other than weather related delays), shortages
of labor or materials, war, governmental laws, regulations or restrictions or any other causes of any kind whatsoever which are beyond the reasonable control of such party. 

        28.7    Intentionally
deleted. 

        28.8    It
is understood and agreed that this is a "triple net" lease in the most absolute sense. It is the intention of the parties that Landlord shall receive the rentals
herein reserved free from all taxes or charges imposed upon or by reason of the Demised Premises and all expenses and charges required to 

25

 

be paid to maintain the Demised Premises and continue the ownership of Landlord and Landlord's successors and assigns. 

        28.9    If
any provision of this Lease should be held to be invalid or unenforceable, the validity and enforceability of the remaining provisions of this Lease shall not be
affected thereby. 

        28.10    If
this Lease is in fact a sublease, Tenant accepts this Lease subject to all of the terms and conditions of the underlying lease under which Landlord holds the
Shopping Center as lessee. Tenant covenants that it will do no act or things which would constitute a violation by Landlord of his obligation under such underlying lease; provided, however, that
Tenant's agreement in this regard is premised on Landlord's assurances to the effect that the terms of this Lease do not violate such underlying Lease. 

        28.11    The
laws of the State of Texas shall govern the interpretation, validity, performance and enforcement of this Lease. Venue for any action under this Lease shall be the
county in which rentals are due pursuant to Section 4.1 and Section 1.1 of this Lease. 

        28.12    The
captions used herein are for convenience only and do not limit or amplify the provisions hereof. 

        28.13    Whenever
herein the singular number is used, the same shall include the plural, and words or any gender shall include each other gender. 

        28.14    The
terms, provisions and covenants contained in this Lease shall apply to, inure to the benefit of and be binding upon the parties hereto and their respective heirs,
successors in interest and legal representatives except as otherwise herein expressly provided. 

        28.15    This
Lease contains the entire agreement between the parties, and no rights are created in favor of either party other than as specified or expressly contemplated in
this Lease. No brochure, rendering information or correspondence shall be deemed to be a part of this agreement unless specifically incorporated herein by reference. In addition, no agreement shall be
effective to change, modify or terminate this Lease in whole or in part unless such is in writing and duly signed by the party against whom enforcement of such change, modification or termination is
sought. 

        28.16    LANDLORD AND TENANT HEREBY ACKNOWLEDGE THAT THEY ARE NOT RELYING UPON ANY BROCHURE, RENDERING, INFORMATION, REPRESENTATION OR PROMISE OF THE
OTHER, OR OF THE AGENTS OR COOPERATING AGENT, EXCEPT AS MAY BE EXPRESSLY SET FORTH IN THIS LEASE.

        28.17    This
Lease consists of twenty-eight articles and Exhibits "A" through "G". In the event any provision of an exhibit or
other attached page shall be inconsistent with a provision in the body of the Lease, the provision as set forth in the exhibit shall be deemed to control. 

        28.18    The
Inspection Period is that period of time beginning on January 14, 2002, and continuing for sixty (60) consecutive days (the
"Inspection Period"). Anything herein to the contrary notwithstanding, it is expressly understood and agreed that Tenant shall be entitled to terminate
this Lease by written notice delivered to Landlord prior to the expiration of the Inspection Period, in the event any of the following conditions remain unsatisfied: 

        (a)  Tenant
shall have received evidence reasonably satisfactory to it that the Demised Premises is or will be zoned for use as a "BJ's" restaurant. 

        (b)  The
results of a soil and engineering test to be conducted by Tenant on the Demised Premises shall be acceptable to it in light of the nature of the Building to be
constructed thereon. 

        (c)  Tenant
shall have obtained, or received evidence satisfactory to it that it will be able to obtain, from the appropriate governmental authorities all permits and
licenses necessary for the 

26

 

construction and operation of the Building including authorization to sell alcoholic beverages on the Demised Premises. 

        (d)  Landlord
shall have approved Tenant's Plans and Specifications and Site Plan. 

        (e)  Landlord
shall have delivered to Tenant copies of any environmental reports covering the Demised Premises which are currently in the possession of Landlord, and the
environmental condition of the Demised Premises shall be satisfactory to Tenant. Tenant acknowledges that any environmental reports delivered by Landlord to Tenant were prepared by third parties, and
Landlord makes no representations or warranties whatsoever with respect to the accurateness or completeness of any such reports. 

        (f)    Tenant
shall have obtained a satisfactory survey of the Demised Premises. 

        (g)  Landlord
shall have provided Tenant with a copy of its existing title insurance policy covering the Shopping Center, together with copies of any underlying documents
referred to in such title policy, and Tenant shall have approved of the status of title to the Demised Premises. 

In
the event that Tenant delivers the prescribed termination notice to Landlord within the Inspection Period, this Lease shall automatically terminate. In the event that Tenant does not deliver the
prescribed termination notice to Landlord on or prior to the expiration of the Inspection Period (time being of the essence), then Tenant shall no longer have the right to terminate this Lease
pursuant to the above provisions of this Section 28.18, and this Lease shall continue in full force and effect as if the termination right never
existed. 

        28.19    TENANT
IS HEREBY ADVISED THAT THE ENTITY COMPRISED OF LANDLORD INCLUDES CENTEX DEVELOPMENT AND/OR ITS OFFICERS. UNLESS TENANT HAS A WRITTEN AGREEMENT TO THE CONTRARY
FROM VENTURE COMMERCIAL REAL ESTATE, LLC, VENTURE COMMERCIAL REAL ESTATE, LLC IS REPRESENTING
LANDLORD IN THIS TRANSACTION AND THEREFORE HAS NO FIDUCIARY DUTIES TO TENANT. 

 
 

ARTICLE 29
  
    LIQUOR LICENSE    
  

        29.1 Notwithstanding
anything to the contrary set forth in this Lease, Landlord agrees that Tenant may sublease or grant a concession to a portion of the Demised Premises to
an affiliated entity (the "Liquor Sublessee") which will establish and operate a Private Club (as that term is defined in Chapter 32 of the
Texasd Alcoholic Beverage Code) within the Demised Premises, pursuant to a written sublease, the terms and provisions of which are subject to Landlord's prior written approval (which approval will not
be unreasonably withheld, conditioned or delayed). If Tenant elects to sublease or grant a concession to a portion of the Demised Premises to the Liquor Sublessee, then such sublease or concession
agreement will be subject to the following terms and conditions: 

        (a)  Liquor
Sublessee will be bound by and subject to, and Tenant agrees to ensure that Liquor Sublessee complies with, all of the terms and conditions of this Lease; 

        (b)  Liquor
Sublessee must be an entity established to hold the liquor license for the Demised Premises in accordance with all applicable laws, and Liquor Sublessee will
enter into a management services agreement with Tenant, the terms and provisions of which are subject to Landlord's prior written approval (which approval will not be unreasonably withheld,
conditioned, or delayed), for the sale of alcoholic beverages in the Demised Premises; 

27

 

        (c)  Tenant
will be responsible for ensuring that the sale of alcoholic beverages by Liquor Sublessee from the Demised Premises is in compliance with all applicable laws,
rules and regulations governing the sale of alcoholic beverages from the Demised Premises; 

        (d)  Landlord
will not be liable to Tenant or its agents, servants, employees, contractors, customers or invitees for any injury or damage personal property caused by any
act, omission or neglect of Liquor Sublessee or its agents, servants, employees, contractors, customers or invitees. Tenant agrees to protect, defend, indemnify and hold harmless Landlord from and
against all liabilities, claims, suits, actions and costs (including reasonable attorneys' fees and costs of suit) arising out of or in connection with such injury or damage); and 

        (e)  Either
Tenant or Liquor Sublessee must maintain at all times during the Term the insurance required under  Section 15.4 of this Lease. 

[THE
REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.] 

28

 

        EXECUTED
as of the latest date accompanying a signature by Landlord or Tenant below. 

	

 	
 	
LANDLORD:
	

 	
 	
CENTEX RETAIL VISTA RIDGE I, L.P.,
 a Delaware limited partnership
	

 	
 	

By:	
 	

Centex Retail General Partner, LLC,

a Delaware limited liability company,

its general partner
	

 	
 	

 	
 	

By:	
 	

 	
 	

 
	 	 	 	 	 	 	
 Richard C. Decker

President
	

 	
 	

Date of Signature:	
 	

 
	 	 	 	 	 	 	 	 	

	 	 	Taxpayer I.D. No.:	 	75-2747779
	

 	
 	

Address:	
 	

 	
 	

2728 North Harwood

Dallas, Texas 75201
	 	 	 	 	 	 	Attn:	 	President
	 	 	 	 	 	 	Attn:	 	General Counsel
	

 	
 	
TENANT:	
 	

 
	

 	
 	

CHICAGO PIZZA AND BREWERY, INC.
	

 	
 	

By:	
 	

 	
 	

 	
 	

 
	 	 	 	 	

	 	 	Name:	 	 	 	 	 	 
	 	 	 	 	

	 	 	Title:	 	 	 	 	 	 
	 	 	 	 	

	

 	
 	

Date of Signature:	
 	

 
	 	 	 	 	 	 	 	 	

	 	 	Taxpayer I.D. No.:	 	 
	 	 	 	 	 	 	 	 	

	

 	
 	

Address:	
 	

 	
 	

16162 Beach Boulevard

Suite 100

Huntington Beach, California 92647

29

  

 
 

EXHIBIT "A"
  
    SITE PLAN FOR THE SHOPPING CENTER    
  

1

  

 
 

EXHIBIT "B"
  
    SITE PLAN FOR THE DEMISED PREMISES    
  

         [To be supplied by Tenant prior to the end of the Inspection Period]

1

  

 
 

EXHIBIT "B-1"
  
    LEGAL DESCRIPTION FOR THE DEMISED PREMISES    
  

        Lot 3, Block A of VISTA RIDGE SHOPPING CENTER, LOTS 1-7, BLOCK A, an addition to the City of Lewisville, Denton County, Texas, according to the plat
thereof recorded in Cabinet U, Page 163 of the Plat Records of Denton County, Texas. 

1

  

 
 

EXHIBIT "C"
  
    LANDLORD CONSTRUCTION DURING PRELIMINARY TERM    
  

        Landlord, at Landlord's sole cost and expense, agrees to perform the following work (collectively, "Landlord's Work") with regard to the Demised Premises. 

        1.    Landlord
will rough grade the Demised Premises per the grading plan prepared by the Civil Engineer agreed upon by Landlord and Tenant during the Inspection Period. 

        2.    Landlord
will provide means of connection to water, fire water, storm sewer, gas and the conduits for telephone, electrical services, and sanitary sewer within five feet
of the boundary of the Demised Premises 

	Domestic Water:	 	2" line
	

Sanitary Water:	
 	

6" line
	

Storm Water:	
 	

Brockette, Davis and Drake Civil Engineering plans dated November 11, 2001.
	

Gas:	
 	

Determined by Utility Company
	

Telephone:	
 	

2" Sch 40 conduit from telephone pedestal
	

Electrical:	
 	

Landlord will provide conduit to meet Tenants criteria which will be consistent for a restaurant of similar size and use.

The
location of the point of connection of the above reference utility services (Gas, Telephone only) shall be approved by Tenant which approval shall not be unreasonably withheld delayed or
conditioned. 

1

 
 

EXHIBIT "C-1"
  
    ALLOWANCE    
  

        Landlord will pay to Tenant up to the amount of $9,000.00 (the "Allowance") as a reimbursement for Tenant's bona
fide (and verified) construction expenses paid to parties not related to Tenant for the development of the building pad ("Tenant's Pad Work"). 

        Landlord
agrees to reimburse Tenant for its actual out-of-pocket costs to third parties, not to exceed the Allowance described above, within thirty
(30) days after (i) completion of Tenant's Pad Work in accordance with Tenant's Plans and Specifications, (ii) Tenant's delivery to Landlord of a true copy of its Certificate of
Occupancy (or similar governmental occupancy permit), (iii) Tenant's delivery to Landlord of all bills from Tenant's contractors, subcontractors and professionals, proof of payment therefor and
final lien waivers relating thereto, (iv) Tenant's execution and delivery to Landlord of instruments required by Landlord to transfer ownership of Tenant's Pad Work to Landlord, (v) a
certification from Tenant's architect that Tenant's Pad Work was performed and completed in accordance with Tenant's Plans and Specifications and all applicable laws, codes and regulations, and
(vi) Tenant's commencement of business in the Premises. 

        Landlord's
disbursement of the Allowance or inspection of Tenant's Pad Work shall not constitute a representation or warranty of Landlord that the Premises are adequate for any use,
purpose or condition or that Tenant's Pad Work has been completed in a good and workmanlike manner or that the same complies with any applicable law, but shall merely be the consent of Landlord for
purposes of the disbursement of the Allowance. 

 
 

EXHIBIT "D"
  
    RENEWAL OPTION    
  

        Tenant (but not any assignee or subtenant of Tenant, even if Landlord's consent is obtained as required by this Lease) is granted the option(s) to extend the term
of this Lease for three (3) consecutive extended terms of five (5) years each, provided (a) Tenant is not in default at the time of exercise of the respective option, and
(b) Tenant gives written notice of its exercise of the respective option at least one hundred eighty (180) days prior to the expiration of the then existing Lease Term. Each extension
term shall be upon the same terms, conditions and rentals, except (i) Tenant shall have no further right of renewal after the last extension term prescribed above, and (ii) the monthly
minimum guaranteed rental will be as follows: 

	

First Option	
 	

Years 21-25	
 	

$166,000.00 per year
	

Second Option	
 	

Years 26-30	
 	

$182,000.00 per year
	

Third Option	
 	

Years 31-35	
 	

$200,000.00 per year

In
the event Tenant has not agreed in writing to accept the monthly minimum guaranteed rental before ninety (90) days prior to the expiration of the then existing term, Landlord at its option
may terminate this Lease as of the expiration of the then existing Lease Term. 

	

 	
 	

INITIALED:	
 	

 
	

 	
 	

LANDLORD:	
 	

 
	 	 	 	 	

	

 	
 	

TENANT:	
 	

 
	 	 	 	 	

  

 
 

EXHIBIT "E"
  
    SUBORDINATION OF LANDLORD'S LIEN    
  

        This Subordination Agreement is executed effective the          day of
                        ,
            , by Landlord hereinafter named and accepted and agreed to by and between Secured Party hereinafter named. 

	

"Landlord":	
 	

 	
 	

 
	 	 	
	 	 

Landlord's
address: c/o Centex Development Company, 2728 N. Harwood, Suite 300, Dallas, TX 75201 

	

"Secured Party":	
 	

 	
 	

 
	 	 	
	 	 

	

Secured Party's address:	
 	

 	
 	

 
	 	 	
	 	 

"Tenant":
Chicago Pizza and Brewery, Inc. 

Tenant's
address: 16162 Beach Blvd., Suite 100, Huntington Beach, CA 92647 

Tenant's
trade name: BJ's Restaurant and Brewhouse 

	

"Secured Property":	
 	

 	
 	

 
	 	 	
	 	 

	

"Premises":	
 	

 	
 	

 
	 	 	
	 	 

        WHEREAS, it is the intention of the parties that the Secured Property shall be mortgaged to the Secured Party to secure repayment by
Tenant of a $                        indebtedness (the "Secured Indebtedness") to the Secured Party and for no other purpose; and

        WHEREAS, it is the desire of the Secured Party, that the Secured Party's security agreement (the "Security Agreement") executed by Tenant
in favor of the Secured Party be superior to Landlord's lien on the Secured Property; 

        THEREFORE, Landlord does hereby agree with the Secured Party that as long as the rental account of Tenant is current (or is brought
current) the Security Agreement shall be superior to Landlord's lien to the extent of the Secured Indebtedness covered by the Security Agreement and that Landlord subordinates to the Secured Party its
Landlord's lien on the Secured Property only to the extent of the Secured Indebtedness. It is understood and agreed that Landlord's subordination will not be deemed applicable to, and will terminate
upon, any refinancing or extension of the Secured Indebtedness or additional financing without Landlord's prior written consent. 

        It
is further agreed that as long as the rental account of Tenant is current (or is brought current) the Secured Party, at all times until the Secured Indebtedness has been paid, shall
have the right to 

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enter and remove the Secured Property; provided, however, that the Secured Party shall promptly cause any damage to the Premises occasioned by such removal to be repaired at no expense to the
Landlord. 

	
 	
 	

LANDLORD:
	

 	
 	

	

 	
 	

By:	
 	

 	
 	

 
	 	 	 	 	
 Duly Authorized Officer
	

 	
 	

Date of Signature:
	 	 	 	 	 	 	

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EXHIBIT "F"
  
    RESTRICTION ON SHOPPING CENTER (EXCLUSIVE)    
  

        1.    The Restriction. Subject to the conditions and exceptions mentioned below, Landlord agrees that during the original term
of this Lease Landlord will not execute any lease for space within the Shopping Center with a tenant whose principal business activity is a brewery restaurant. 

        2.    Conditions. The restriction described above shall apply only as long as all of the following conditions exist: 

	a.
	Tenant
is occupying the Demised Premises doing business in the manner permitted by Section 1.1(q) of this Lease;

	b.
	Tenant
has timely paid as due all rentals and other charges prescribed in this Lease; and

	c.
	Tenant
has not been in default with regard to any obligations prescribed in this Lease. 

Upon
the failure of one or more of the above conditions, the restriction upon the Shopping Center shall automatically cease and shall thereafter be of no further force or effect. 

        3.    Exceptions. The following exceptions apply to the restriction described above: 

	a.
	The
restriction shall not apply after the conclusion of the Lease Term described in Section 1.1(k) of this Lease, notwithstanding
any renewal or extension of this Lease which would result in Tenant's continued occupancy of the Demised Premises after the conclusion of the original term.

	b.
	The
restriction shall not apply to any existing tenants in the Shopping Center, nor shall it apply to renewals or extensions of leases which pre-date the date of this
Lease.

	c.
	The
restriction shall not apply to any land located outside the present boundaries of the Shopping Center.

	d.
	If
a court of competent jurisdiction or a governmental agency should determine the restriction to be illegal or unenforceable, or if Landlord and Tenant should agree that the
restriction is illegal or unenforceable, the restriction shall automatically cease and shall thereafter be of no further force or effect; moreover, Landlord and Tenant further agree that in such event
the remainder of this Lease will continue in full force and effect.

	e.
	If
Landlord gives written notice to Tenant that a prospective tenant in violation of the restriction has requested that Landlord negotiate with it for space in the Shopping Center,
then the restriction shall automatically cease and shall thereafter be of no further force or effect unless Tenant, within ten days after the delivery of Landlord's notice, agrees in writing to
indemnify Landlord and hold Landlord harmless from all liability, legal actions (including, without limitation, court costs and attorneys' fees), expense and loss incurred by Landlord and related in
any way to Landlord's attempts to comply with the restriction. 

	

 	
 	

INITIALED:	
 	

 
	

 	
 	

LANDLORD:	
 	

 
	 	 	 	 	

	

 	
 	

TENANT:	
 	

 
	 	 	 	 	

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EXHIBIT "G"
  
    VISTA RIDGE MARKETPLACE RULES AND REGULATIONS    
  

        1.    The
sidewalks, walks, plaza entries, corridors, malls, concourses, ramps, and other Common Areas of the Shopping Center shall not be obstructed or used by Tenant for any
purpose other than ingress and egress to and from the Demised Premises. 

        2.    All
deliveries or shipments of any kind to and from the Demised Premises, including loading and unloading of goods, shall be made only by way of the rear of the Demised
Premises or at any such reasonable location designated by Landlord, and only at such reasonable times designated for such purpose by Landlord. Trailers and/or trucks servicing the Demised Premises
shall remain parked in the Shopping Center only during those periods reasonably necessary to service Tenant's operations, and then only in locations designated by Landlord. 

        3.    Tenant
shall not install any resilient tile or similar floor covering in the Demised Premises except with prior approval of the Landlord. The use of cement or other
similar adhesive material is expressly prohibited. 

        4.    No
additional locks or bolts of any kind shall be placed on any door in the Shopping Center or the Demised Premises and no lock on any door therein shall be changed or
altered in any respect without the prior written consent of Landlord not to be unreasonably withheld. Landlord shall furnish two keys for each lock on exterior doors to the Demised Premises and shall,
on Tenant's request and at Tenant's expense, provide additional duplicate keys. All keys shall be returned to Landlord upon the termination of this Lease and Tenant shall give to Landlord the
explanations of the combinations of all safes, vaults and combination locks remaining with the Demised Premises. Landlord may at all times keep a pass key to the Demised Premises. All entrance doors
to the Demised Premises shall be left closed at all times and left locked when the Demised Premises are not in use. 

        5.    Tenant
shall not place a load upon any floor of the Demised Premises which exceeds the load per square foot which such floor was designed to carry and which is allowed by
law. Mechanical and
electrical equipment belonging to Tenant which cause noise, vibration, electrical or magnetic interference, or any other nuisance that may be transmitted to the structure or other portions of the
Shopping Center or to the Demised Premises to such a degree as to be objectionable to Landlord or which interfere with the use or enjoyment by other tenants of their premises or the public portions of
the Shopping Center shall be placed and maintained by Tenant, at Tenant's expense, in settings of cork, rubber, spring type, or other vibration eliminators sufficient to eliminate the noise or
vibration. 

        6.    The
toilet rooms, urinals, wash bowls and other apparatus shall not be used for any purpose other than for which they were constructed and no foreign substance of any
kind whatsoever shall be thrown therein, and the expense of any breakage, stoppage, or damage resulting from the violation of this rule shall be borne by Tenant. 

        7.    Initial
move-in refuse from inventory, including but not limited to packing crates, shall be removed at Tenant's sole cost and expense. Any wet trash,
including but not limited to food debris, is to be placed in plastic bags and tied before being placed in trash containers. All boxes are to be broken down before being placed inside the containers.
Sidewalk containers are not for personal use. Tenant, or the employees of Tenant shall not at any time place, leave or discard any rubbish, paper, articles or objects of any kind whatsoever outside
the doors of the Demised Premises or in the corridors or walks of the Center. In the event any item is left at the rear of the Demised Premises or at the base of a refuse container and it can be
determined to which tenant it belongs, Landlord has the right to charge that tenant the cost to have it removed. Unless a container is marked by a tenant paying individually and separately for trash
collection, containers are for all Shopping Center tenants and do not belong to any one tenant. The exterior areas immediately adjoining the Demised Premises shall be kept clean and free from dirt and
rubbish by Tenant and its employees, and Tenant shall not place or permit any 

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obstructions or merchandise in such areas. No debris shall be swept or removed from the Demised Premises onto sidewalks or other Common Areas. 

        8.    All
services requests are to be reported promptly and directly to Landlord's designated agent during normal office hours, excepting emergencies which shall be reported as
soon as practicable. 

        9.    Tenant
shall not place, or cause or allow to be placed, any signs, placards, banners, flags, pictures, advertisements, notices or lettering whatsoever, in, about or on
the exterior of the Demised Premises or Shopping Center except in and at such places as may be consented to by Landlord in writing or as allowed by the Signage Criteria for the Shopping Center
promulgated by Landlord from time to time. Any such signs, placard, advertisement, picture, notice or lettering so placed may be removed by Landlord without notice to and at the expense of Tenant. All
lettering and graphics on doors shall conform to the Signage Criteria. 

        10.  No
awnings, draperies, shutters or other interior or exterior window coverings that are visible from the exterior of the Demised Premises may be installed by Tenant
without Landlord's prior written consent. 

        11.  Landlord
shall have the right to prohibit any advertising by Tenant which, in Landlord's opinion, tends to impair the reputation of the Shopping Center or its
desirability for retail use and, upon written notice from Landlord, Tenant will refrain from or discontinue such advertising. 

        12.  Tenant
shall not bring or permit to be brought or kept in or on the Demised Premises or the Shopping Center any inflammable, combustible, corrosive, caustic, poisonous,
explosive or hazardous substance (except for cleaning solutions customarily used in Tenant's business, and provided that Tenant only maintains on the Demised Premises quantities necessary for such use
and Tenant complies with all applicable laws governing the use, storage and disposal thereof) or cause or permit any odors to permeate in or emanate from the Demised Premises, or permit or suffer the
Demised Premises to be occupied or used in a manner offensive or objectionable to Landlord or other occupants of the Shopping Center by reason of light, radiation, magnetism, noise, odors and/or
vibrations, or interfere in any way with other tenants or those having business in the Shopping Center. 

        13.  Canvassing,
soliciting or peddling in the Shopping Center is prohibited and Tenant shall cooperate to prevent same. 

        14.  Tenant
shall give, as soon as practicable, notice to Landlord in case of theft, unauthorized solicitation or accident in the Demised Premises or in the Shopping Center
or of defects therein or defects in any fixtures or equipment, or of any known emergency in the Shopping Center. 

        15.  Landlord
reserves the right to deny entrance to the Shopping Center or remove any person or persons from the Shopping Center in any case where the conduct of such person
involves a hazard or nuisance to any tenant of the Shopping Center or to the public or in the event of fire or other emergency, riot, civil commotion or similar disturbance involving risk to the
Shopping Center, tenants or the general public. 

        16.  No
portion of the Demised Premises shall at any time be used or occupied as sleeping or lodging quarters. No animals or birds, with the exception of guide dogs
accompanying visually handicapped persons, shall be brought or kept in or about the Demised Premises. Unless otherwise expressly provided for in the Lease, Tenant shall not do any cooking on the
Demised Premises. Tenant may, however, for the use of its employees, operate a coffee bar and allow the use of a microwave oven. 

        17.  Tenant
shall at all times keep the Demised Premises neat and orderly. 

        18.  Tenant
shall not use or permit any portion of the Demised Premises to be used for any use other than those specifically granted in the Lease. 

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        19.  Landlord
shall have the right to designate and restrict the areas available within the Shopping Center for the parking of vehicles by Tenant, its employees, agents,
visitors and invitees. 

        20.  Tenant
shall be responsible for the compliance with these rules and regulations by the employees, agents, customers and invitees of Tenant. 

        21.  In
the event of any conflict between the terms of these rules and regulations and the express provisions of Tenant's Lease, the express, applicable provisions of the
Lease shall control. 

        22.  Landlord
reserves the right, without the approval of Tenant, to add new rules and regulations, and to waive, rescind, add to and amend any rules or regulations with
respect to any tenant or tenants, as Landlord in its sole judgment shall from time to time find necessary or appropriate in order to provide for the safety, protection, care and cleanliness of the
Shopping Center, the operation thereof, the preservation of good order therein, and the protection and comfort of tenants and their employees, agents, customers and invitees, which rules and
regulations, when made and written notice thereof is given to Tenant, shall be binding upon it in like manner as if originally herein prescribed, except to the extent such additional rules or
regulations conflict with the express provisions of this Lease. The amendment or waiver by Landlord of any rules or regulations for the benefit of any particular tenant of the Shopping Center shall
not be construed as a waiver of such rules and regulations in favor of this Tenant or any other tenant, nor prevent Landlord from thereafter enforcing any such rules and regulations against any or all
of the tenants in the Shopping Center. 

        23.  No
Tenant shall perform construction, remodeling and/or renovation projects to its premises during the period from November 1 to December 31 of each year,
without the prior written consent of Landlord. 

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QuickLinks

GROUND LEASE AGREEMENT

TABLE OF CONTENTS

LEASE AGREEMENT

ARTICLE 1 DEFINITIONS AND CERTAIN BASIC PROVISIONS

ARTICLE 2 GRANTING CLAUSE

ARTICLE 3 DELIVERY OF PREMISES; CONSTRUCTION OF PREMISES

ARTICLE 4 RENT

ARTICLE 5 SALES REPORTS, RECORDS AND FINANCIAL STATEMENTS

ARTICLE 6 TENANT'S RESPONSIBILITY FOR TAXES AND OTHER REAL ESTATE CHARGES

ARTICLE 7 COMMON AREA

ARTICLE 8 MERCHANT'S ASSOCIATION OR PROMOTIONAL FUND

ARTICLE 9 USE AND CARE OF DEMISED PREMISES

ARTICLE 10 MAINTENANCE AND REPAIR OF DEMISED PREMISES AND BUILDING

ARTICLE 11 ALTERATIONS

ARTICLE 12 LANDLORD'S RIGHT OF ACCESS

ARTICLE 13 SIGNS; STORE FRONTS

ARTICLE 14 UTILITIES

ARTICLE 15 INSURANCE COVERAGES

ARTICLE 16 WAIVER OF LIABILITY; MUTUAL WAIVER OF SUBROGATION

ARTICLE 17 DAMAGES BY CASUALTY

ARTICLE 18 EMINENT DOMAIN

ARTICLE 19 ASSIGNMENT AND SUBLETTING

ARTICLE 20 SUBORDINATION; ATTORNMENT; ESTOPPELS

ARTICLE 21 DIRECTION OF TENANT'S ENERGIES

ARTICLE 22 DEFAULT BY TENANT AND REMEDIES

ARTICLE 23 LANDLORD'S CONTRACTUAL SECURITY INTEREST

ARTICLE 24 HOLDING OVER

ARTICLE 25 NOTICES

ARTICLE 26 COMMISSIONS

ARTICLE 27 REGULATIONS

ARTICLE 28 MISCELLANEOUS

ARTICLE 29 LIQUOR LICENSE

EXHIBIT "A" SITE PLAN FOR THE SHOPPING CENTER

EXHIBIT "B" SITE PLAN FOR THE DEMISED PREMISES

EXHIBIT "B-1" LEGAL DESCRIPTION FOR THE DEMISED PREMISES

EXHIBIT "C" LANDLORD CONSTRUCTION DURING PRELIMINARY TERM

EXHIBIT "C-1" ALLOWANCE

EXHIBIT "D" RENEWAL OPTION

EXHIBIT "E" SUBORDINATION OF LANDLORD'S LIEN

EXHIBIT "F" RESTRICTION ON SHOPPING CENTER (EXCLUSIVE)

EXHIBIT "G" VISTA RIDGE MARKETPLACE RULES AND REGULATIONS

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