Document:

exv10w2

 

LTF CMBS I, LLC

Landlord

TO

LTF CLUB OPERATIONS COMPANY, INC.

Tenant

LEASE AGREEMENT

DATED AS OF JANUARY 24, 2007

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	ARTICLE 1. REFERENCE DATA; DEFINITIONS
	 	 	2	 
	 
	 	 	 	 
	ARTICLE 2. DEMISE OF PROPERTY; TERM; EXTENSIONS OF TERM
	 	 	5	 
	 
	 	 	 	 
	ARTICLE 3. RENT
	 	 	6	 
	 
	 	 	 	 
	ARTICLE 4. TAXES
	 	 	6	 
	 
	 	 	 	 
	ARTICLE 5. REPAIRS AND MAINTENANCE
	 	 	7	 
	 
	 	 	 	 
	ARTICLE 6. INSURANCE
	 	 	7	 
	 
	 	 	 	 
	ARTICLE 7. UTILITIES
	 	 	9	 
	 
	 	 	 	 
	ARTICLE 8. ALTERATIONS
	 	 	9	 
	 
	 	 	 	 
	ARTICLE 9. DAMAGE TO OR DESTRUCTION OF THE IMPROVEMENTS
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 10. CONDEMNATION
	 	 	12	 
	 
	 	 	 	 
	ARTICLE 11. DISCHARGE OF LIENS
	 	 	13	 
	 
	 	 	 	 
	ARTICLE 12. USE OF PROPERTY
	 	 	13	 
	 
	 	 	 	 
	ARTICLE 13. ENTRY ON PROPERTY BY LANDLORD
	 	 	14	 
	 
	 	 	 	 
	ARTICLE 14. WAIVER AND INDEMNIFICATION
	 	 	14	 
	 
	 	 	 	 
	ARTICLE 15. ASSIGNMENT
	 	 	15	 
	 
	 	 	 	 
	ARTICLE 16. ESTOPPEL CERTIFICATES
	 	 	17	 
	 
	 	 	 	 
	ARTICLE 17. EVENTS OF DEFAULT; TERMINATION
	 	 	17	 
	 
	 	 	 	 
	ARTICLE 18. SURRENDER OF THE PROPERTY
	 	 	19	 
	 
	 	 	 	 
	ARTICLE 19. NO MERGER OF TITLE
	 	 	19	 

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	ARTICLE 20. QUIET ENJOYMENT
	 	 	20	 
	 
	 	 	 	 
	ARTICLE 21. PERFORMANCE FOR TENANT
	 	 	20	 
	 
	 	 	 	 
	ARTICLE 22. NOTICES
	 	 	20	 
	 
	 	 	 	 
	ARTICLE 23. CONTESTS
	 	 	21	 
	 
	 	 	 	 
	ARTICLE 24. NO WARRANTIES/“AS IS”
	 	 	21	 
	 
	 	 	 	 
	ARTICLE 25. INTENTIONALLY OMITTED
	 	 	22	 
	 
	 	 	 	 
	ARTICLE 26. SUBORDINATION AND NON-DISTURBANCE
	 	 	22	 
	 
	 	 	 	 
	ARTICLE 27. FIRST OFFER RIGHT
	 	 	22	 
	 
	 	 	 	 
	ARTICLE 28. APPRAISAL
	 	 	25	 
	 
	 	 	 	 
	ARTICLE 29. TENANT’S PROPERTY
	 	 	26	 
	 
	 	 	 	 
	ARTICLE 30. MISCELLANEOUS
	 	 	27	 

EXHIBIT A — Legal Description of Land

EXHIBIT B — Permitted Exceptions

ii

 

LEASE AGREEMENT

DATED AS OF JANUARY 24, 2007

from

LTF CMBS I, LLC

to

LTF CLUB OPERATIONS COMPANY, INC.

of Property listed in Exhibit A attached hereto.

STATEMENT OF INTENT

This Lease amends, restates and replaces the separate Lease Agreements by and between Landlord’s
predecessor in interest as owner of the Property, LTF Real Estate Company, Inc., as Landlord, and
Tenant. This Lease constitutes a single, unitary, indivisible, non-severable true lease of all the
demised Property. This Lease does not constitute separate leases contained in one document each
governed by similar terms. The use of the expression “unitary lease” to describe this Lease is not
merely for convenient reference. It is the conscious choice of a substantive appellation to
express the intent of’ the parties in regard to an integral part of this transaction. To
accomplish the creation of an indivisible lease, the parties agree that from an economic point of
view the portions of the Property Locations leased pursuant to this Lease constitute one economic
unit and that the Basic Rent and all other provisions have been negotiated and agreed to based on a
demise of all the portions of the Property Locations covered by this Lease as a single, composite,
inseparable transaction. Except as expressly provided in this Lease for specific isolated purposes
(and in such cases only to the extent expressly so stated), all provisions of this Lease, including
definitions, commencement and expiration dates, rental provisions, use provisions, renewal
provisions, breach, default, enforcement and termination provisions and assignment and subletting,
shall apply equally and uniformly to all the demised Property as one unit and are not severable.
The economic terms of this Lease would have been substantially different had separate leases or a
“divisible” lease been acceptable to Landlord. A default of any of the terms or conditions of this
Lease occurring with respect to any portion of the demised Property situated on a particular
Property Location shall be a default under this Lease with respect to all the demised Property.
Except as expressly provided in this Lease for specific isolated purposes (and in such cases only
to the extent expressly so stated), Landlord and Tenant agree that the provisions of this Lease
shall at all times be construed, interpreted and applied such that the intention of Landlord and
Tenant to create a unitary lease shall be preserved and maintained. The parties agree that for the
purposes of any assumption, rejection or assignment of this Lease under 11 U.S.C. Section 365 or
any amendment or successor section thereof, this is one indivisible and non-severable lease dealing
with and covering one legal and economic unit which must be assumed, rejected or assigned as a
whole with respect to all (and not less than all)
of the demised Property covered hereby. The Lease is intended to be a true lease and not a secured
financing for Tenant.

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Article 1. REFERENCE DATA; DEFINITIONS

	 	 	 	 	 	 	 	 	 
	 

	 	 	1.1	 	 	LANDLORD:
	 	LTF CMBS I, LLC
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	ADDRESS
	 	6442 City West Parkway
	 

	 	 	 	 	 	OF LANDLORD:
	 	Eden Prairie, Minnesota 55344
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	TENANT:
	 	LTF CLUB OPERATIONS COMPANY, INC.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	ADDRESS
	 	6442 City West Parkway
	 

	 	 	 	 	 	OF TENANT:
	 	Eden Prairie, Minnesota 55344

     1.2 Each reference in this Lease to any of the titles contained in Section 1.1 shall be
construed to incorporate the data stated under that title.

     1.3 The following terms shall have the meanings set forth in this Section:

     Alteration. Any demolition, alteration, installation, improvement or expansion of or
to any of the Property Locations or any portion thereof.

     Basic Rent. The Basic Rent provided for in Section 3.2 of this Lease.

     Commencement Date. January 24, 2007.

     Environmental Activity. Any actual, suspected or threatened abatement, cleanup,
disposal, generation, handling, manufacture, possession, release, remediation, removal, storage,
transportation, treatment or use of any Hazardous Material, or the actual, suspected or threatened
presence of any Hazardous Material, or the actual, suspected or threatened noncompliance with any
Environmental Laws.

     Environmental Laws. All Legal Requirements pertaining to health, safety, protection
of the environment, natural resources, conservation, wildlife, waste management, Environmental
Activities and pollution.

     Event of Default. As defined in Section 17.1.

     Fair Market Value. The cash price which would be obtained for the Property in an
arm’s length transaction between a willing buyer and a willing seller under no compulsion to buy or
sell.

     Fair Rental Value. The annual Basic Rent which would be obtained for the Property in
an arm’s length transaction between a willing landlord and a willing tenant under no compulsion to
lease.

2

 

     First Mortgage. Any first mortgage or deed of trust (together with the notes secured
thereby and security instruments collateral thereto) of record now or hereafter placed against the
Property by Landlord, any increase, amendment, extension, refinancing or recasting of a First
Mortgage, and any provision of any other loan document which is secured by a First Mortgage. For
the purposes hereof, a First Mortgage shall be deemed to continue in effect after foreclosure
thereof and during any period of redemption therefrom.

     First Mortgagee. The holder from time to time of the First Mortgage, if any.

     First Offer Right. Tenant’s first offer right with respect to the Property granted
pursuant to Article 27.

     Fiscal Year. The 12-month period ending on December 31 of each year.

     Fiscal Quarter. The three-month period ending on March 31, June 30, September 30 and
December 31 of each year.

     Governmental Authorities. All federal, state, county, municipal and local
governments, and all departments, commissions, boards, bureaus and officers thereof, having or
claiming jurisdiction over the Property or Tenant’s use thereof.

     Hazardous Materials. Any by-product, chemical, compound, contaminant, pollutant,
product, substance, waste or other material (i) that is hazardous or toxic or (ii) the abatement,
cleanup, discharge, disposal, emission, exposure to, generation, handling, manufacture, possession,
presence, release, removal, remediation, storage, transportation, treatment or use of which is
controlled, prohibited or regulated by any Environmental Laws, including asbestos, petroleum and
petroleum products and polychlorinated biphenyls.

     Improvements. The building, fixtures and other Improvements from time to time
constructed on the Land, and all alterations and additions thereto and replacement thereof,
including by reason of Restoration, but excluding in any event Tenant’s Property. The Improvements
shall be and remain the property of Landlord, subject to this Lease.

     Land. The land, but not any Improvements thereto, legally described on Exhibit
A.

     Lease. This Lease Agreement, including the following exhibits attached hereto and
hereby made a part hereof:

          Exhibit A — Legal Description of the Land

          Exhibit B — Permitted Exceptions

     Legal Requirements. All laws, statutes, codes, acts, ordinances, orders, judgments,
decrees, injunctions, directions and requirements of all Governmental Authorities which now or at
any time hereafter may be applicable to or required in connection with the Property or any part
thereof, or any use or condition of the Property or any part thereof.

3

 

     Permitted Exceptions. The liens, documents and other matters listed on Exhibit
B attached hereto.

     Pooled Properties EBITDAR. The Earnings Before Interest, Taxes, Depreciation,
Amortization and Rent, calculated on a trailing 12 month basis and not including any allocations of
shared expenses or corporate overhead, of Tenant attributable to the Property.

     Property. The Land and the Improvements, collectively.

     Property Location or Property Locations. Any or all of those parcels of land that
collectively comprise the Land, and the improvements thereto which collectively comprise the
Improvements.

     Property Revenues. All rents, rent equivalents, moneys payable as damages pursuant to
the Lease or in lieu of rent or rent equivalents, membership fees, income, receivables, receipts,
revenues, deposits (including security, utility and other deposits), accounts, cash, issues,
profits, charges for services rendered, and other consideration of whatever form or nature received
by or paid to or for the account of or benefit of Tenant from any and all sources including any
obligations now existing or hereafter arising or created out of the sale, lease, sublease, license,
concession or other grant of the right of the use and occupancy of property or rendering of
services by Tenant and proceeds, if any, from business interruption or other loss of income
insurance.

     Remodeling. Remodeling, refurbishing, expansion, demolition and other improvement
work properly permitted under applicable law and performed by Tenant to the interior or exterior of
a Property Location including without limitation the replacement of floor coverings or wall
coverings, constructing, renovating or reconfiguring locker rooms, workout areas, and office,
retail or other spaces of the Property, upgrading mechanical systems including but not limited to
electrical, plumbing and HVAC systems, and constructing, modifying or otherwise installing
improvements customarily found in other properties owned or leased by Tenant or any affiliate of
Tenant; provided that no such work shall reduce the interior square footage of any Property
Location by more than 5% in the aggregate or shall result in a material diminution of the fair
market value of any Property Location.

     Restore or Restoration. The repair, restoration or rebuilding of the Property or any
part thereof following any Taking, damage to or destruction of the same by fire or other casualty
or cause as nearly as possible to its size, type and character immediately prior to such Taking,
damage or destruction, in accordance with all Legal Requirements, with such Alterations as may be
determined by Tenant, together with any temporary repairs and property protection pending
completion of the work.

     Taking. A taking of all or any part of the Property, or any interest therein or right
accruing thereto, including, without limitation, any right of access thereto existing on the date
of this Lease, as the result of or in lieu or in anticipation of the exercise of the right of
condemnation or eminent domain. The Taking shall be deemed to occur on the date on which the
condemning authority takes possession.

4

 

     Taxes. All real estate taxes and special assessments levied against or imposed on the
Property.

     Tenant’s Property. As defined in Section 29.1.

     Term. The initial term of this Lease as provided in Article 2, including without
limitation extensions of the initial term pursuant to Section 2.2.

     Unavoidable Delays. Acts of God, casualties, war, civil commotion, embargo, riots,
strikes, unavailability of materials (but not unavailability of funds) and any other events which
are not within the reasonable control of the party in question to prevent, control or correct.

Article 2. DEMISE OF PROPERTY; TERM; EXTENSIONS OF TERM

     2.1 Landlord, for and in consideration of the rents hereinafter reserved and the covenants and
agreements hereinafter contained on the part of Tenant to be paid, kept and performed, does hereby
demise and lease to Tenant, and Tenant does hereby take and lease from Landlord, upon and subject
to the terms and conditions of this Lease, the Property for an initial term of fifteen (15) years,
commencing on the Commencement Date and ending on February 5, 2022.

     2.2 Tenant shall have the right, subject to the provisions hereinafter provided, to renew the
Term for two (2) periods of five (5) years each (each, an “Extended Term”), such periods to
commence at the expiration of the initial Term or the first Extended Term, as applicable. The
Extended Terms shall be upon the same terms, covenants and conditions as provided in this Lease;
provided, however, the annual Basic Rent for such Extended Terms shall be ninety-five percent (95%)
of the Fair Rental Value anticipated to be in effect on the commencement of the applicable Extended
Term.

     2.3 If Tenant is not in default under this Lease beyond any applicable grace period, Tenant
may exercise each of its options to extend the Term of this Lease by giving written notice thereof
to Landlord on or before the date occurring twelve (12) months prior to the expiration of the
initial Term or preceding Extended Term, as the case may be. If Tenant fails to give such notice
within the time permitted, Tenant shall have waived its right to extend the Term.

     2.4 The exercise of an extension option as herein provided shall operate as an extension of
the Term hereof, so that this Lease and each and every covenant, agreement and
provision thereof shall be and remain in full force and effect during the Term as extended and with
the same force and effect as if the Term of this Lease were originally for such extended period.

5

 

Article 3. RENT

     3.1 Throughout the Term, Tenant covenants and agrees to pay to Landlord, without demand,
setoff or abatement except as provided in this Lease, the Basic Rent at the per annum rates set
forth in Section 3.2. The Basic Rent shall be payable in equal installments of one-twelfth
(1/12th) of said annual Basic Rent in advance on the fifth day of each calendar month
included in the Term, and at that rate payable in advance for any portion of a calendar month at
the commencement or the end of the Term.

     3.2 Basic Rent shall be $11,869,011 per year. Commencing on February 5, 2019 and on each
February 5th thereafter during the initial Term of this Lease, Basic Rent shall be
increased by two and one-half percent (2.5%) of the Basic Rent then in effect.

     3.3 All Basic Rent shall be paid by Tenant to Landlord at the address of Landlord, or to such
other address as Landlord may direct by notice to Tenant.

     3.4 It is the purpose and intent of Landlord and Tenant that Basic Rent shall be absolutely
net to Landlord and that Tenant shall pay without notice or demand and without abatement, deduction
or setoff, except as otherwise provided in this Lease.

Article 4. TAXES

     4.1 Subject to Section 4.2, Tenant shall pay, or cause to be paid, all Taxes on the Property
before any fine, penalty, interest or cost may be added thereto for the nonpayment thereof;
provided, however, that:

     4.1.1 If, by law, any Tax may, at the option of the taxpayer or party obligated, be
paid in installments, Tenant may exercise the option to pay the same (and any accrued
interest on the unpaid balance of such Tax) in installments and, in such event, subject to
the provisions of subsection 4.1.2 hereof, shall pay only such installments as may become
due during the Term as the same respectively become due in the ordinary course and before
any fine, penalty, further interest or cost may be added thereto; and

     4.1.2 Any Tax due and payable, including any installments thereof, in the year of
commencement or in the final year of the Term shall be prorated between Landlord and Tenant
as of the commencement or the expiration of the Term, as the case may be.

     4.2 Upon termination of any Contest brought by Tenant pursuant to Article 23 with respect to
the amount or validity of any Tax, or if Tenant shall so elect, at any time prior thereto, Tenant
shall pay the amount of such Tax or part thereof as finally determined in such proceeding.

Article 5. REPAIRS AND MAINTENANCE

     5.1 Throughout the Term, Tenant, at its sole cost and expense, shall take good care of the
Property, all appurtenances of the Property, all alleyways and passageways and all sidewalks, curbs
and vaults adjoining the Property, and shall at all times keep the same in a good order and
condition, ordinary wear excepted, and make all necessary repairs thereto, interior and exterior,
structural and non-structural, ordinary and extraordinary and foreseen and unforeseen.

6

 

     5.2 The term “repairs” as used in this Article shall include, but not be limited to, all
necessary or appropriate replacements. The necessity for and adequacy of the repairs to the
Property made or required to be made pursuant to Section 5.1 shall be measured by the requirements
of buildings of similar construction and age containing similar facilities which are prudently
managed and operated with due regard for both short term and long term considerations.

     5.3 All repairs by Tenant shall be effected with all due diligence and in a workmanlike manner
in compliance with all Legal Requirements and shall be promptly and fully paid for by Tenant.

Article 6. INSURANCE

     6.1 Tenant, at its expense, shall procure and maintain or cause to be procured and maintained
during the Term:

     6.1.1 Insurance with respect to the Property against loss or damage by fire,
lightning, windstorm, tornado, hail and such other casualty as is customarily covered by
extended coverage and “all risk” endorsements and such other risks as Landlord may from time
to time reasonably require, in each case in the full replacement value of the Property. The
term “full replacement value” as used in this Section and in other Sections of this Article
6 shall mean 100% of the actual replacement cost including the cost of all debris removal,
exclusive, however, of costs of excavations, foundations and footings below the lowest
floor. Whenever appropriate, while any Alterations are in the course of being made, the
aforesaid fire and extended coverage insurance shall be carried by Tenant in builder’s risk
form written on a completed value basis. Such insurance shall name Landlord, Tenant and, if
required by the First Mortgagee or Landlord, the First Mortgagee, as insureds, as their
interest may appear;

     6.1.2 Commercial general public liability insurance against claims for bodily injury,
death or property damage, occurring on, in or about the Property in a combined single limit
of not less than Two Million Dollars ($2,000,000), naming Landlord and the First Mortgagee
as additional insureds;

     6.1.3 If requested by Landlord at any time, boiler and pressure vessel and
miscellaneous equipment insurance, including pressure pipes, air conditioning systems,
electric motors, air tanks, compressors and pumps, in such amounts as Landlord may
reasonably require;

     6.1.4 If the Property is at any time determined to be in a flood hazard area, flood
insurance;

7

 

     6.1.5 During the entire period of making of any Alterations, (i) owner’s contingent or
protective liability insurance covering claims not covered by or under the terms or
provisions of the above-mentioned comprehensive general public liability insurance policy,
and (ii) adequate Worker’s Compensation Insurance covering all persons employed on or in
connection with such Alterations; and

     6.2 All insurance policies provided for in this Article 6 shall:

     6.2.1 be valid and enforceable policies, in such forms and, where not
expressly provided for above, in such amounts, as may from time to
time be reasonably satisfactory to Landlord and the First Mortgagee,
issued by financially sound and responsible insurance companies
authorized to do business in the jurisdiction where the Property is
located, reasonably satisfactory to Landlord;

     6.2.2 except for worker’s compensation insurance, name Landlord,
Tenant and, if required by the First Mortgage, the First Mortgagee as
insured as their respective interests may appear;

     6.2.3 provide that such policies shall not be changed or cancelled
without at least thirty (30) days’ prior written notice to Landlord;

     6.2.4 provide that losses shall be adjusted with the insurers and/or
underwriters by the Landlord and Tenant; and

     6.2.5 provide that, except in the case of public liability and
worker’s compensation insurance, all insurance proceeds shall be
payable to Landlord and Tenant, as their respective interests may
appear.

     6.3 On or before the Commencement Date, and thereafter prior to the expiration dates of the
expiring policies theretofore furnished pursuant to this Article 6, copies of the policies (or, in
the case of liability insurance, certificates of the insurers) shall be delivered by Tenant to
Landlord.

     6.4 If Tenant is delayed in receiving any insurance proceeds as a result of Landlord’s
unreasonable failure or refusal to approve an insurance adjustment, such delay shall be taken into
account in determining whether Tenant has fulfilled its obligations under Article 9 hereof with
reasonable diligence. All costs and expenses of collecting or recovering any insurance proceeds
under such policies shall be paid by Tenant.

     6.6 Notwithstanding anything to the contrary in this Article 6, proceeds of any insurance
carried by Tenant on Tenant’s Equipment or any other property of Tenant shall be payable directly
to Tenant and Tenant shall have the exclusive right to adjust and settle losses with respect
thereto.

8

 

     6.7 Notwithstanding anything to the contrary in this Article 6, Tenant shall maintain all
insurance required by any First Mortgage and shall otherwise comply with the insurance requirements
of any First Mortgage for so long as any such First Mortgage is outstanding.

Article 7. UTILITIES

     Tenant shall pay all charges for the use at the Property of, water, sewer, electricity,
heating, air conditioning and all other utilities consumed during the Term.

Article 8. ALTERATIONS

     8.1 General. Tenant, at its sole cost and expense, shall have the right from time to
time during the Term to perform Alterations, subject in all cases to the further provisions of this
Article 8 and to all other applicable provisions of this Lease.

     8.2 Consent Required. Tenant shall not make any material Alteration to any Property
Location without obtaining Landlord’s prior written consent which consent shall not be unreasonably
withheld or delayed. Notwithstanding anything in this Lease to the contrary, Tenant shall have the
right to perform Remodeling work without Landlord’s consent. Each Alteration which does not
require Landlord’s consent pursuant to this Section 8.2 is hereinafter called a “permitted change
or alteration”.

     8.3 Plans and Specifications, etc. Except for a permitted change or alteration, each
Alteration shall be made under the supervision of an architect or engineer selected by Tenant and
approved by Landlord, which approval shall not be unreasonably withheld; shall be made in
accordance with detailed plans and specifications prepared by such architect or engineer; and shall
be made pursuant to a contract therefor approved by Landlord between Tenant and a general
contractor engaged by Tenant which incorporates such plans and specifications. Copies of all such
plans and specifications shall be delivered by Tenant to Landlord, and shall be subject to
Landlord’s prior approval.

     8.5 FF&E Reserve. Commencing on February 5, 2007 and on each scheduled Basic Rent
payment date during the Term, Tenant shall deposit in a reserve account (the “FF&E Reserve”) with
Landlord an amount equal to the lesser of (a) the product of (i) $7,333.33, and (ii) the number of
Property Locations subject to this Lease, less any amounts expended by Tenant during the prior
month for which it would have been entitled to withdraw funds from the FF&E Reserve, or (ii) such
lesser amount as is necessary to cause the balance therein to equal the product of (x) $333,333.33,
and (y) the number of Property Locations subject to this Lease. Provided that no Event of Default
is then existing, Landlord shall reimburse Tenant from amounts available in the FF&E Reserve for
any for any and all expenses incurred by Tenant for
acquisitions, repairs to or replacements of furniture, fixtures and equipment, including fitness
and similar equipment used by Tenant in the operation of its business in the Property; provided
that Landlord shall not be required to reimburse Tenant more than one time during any calendar
month. Upon Landlord’s request, Tenant shall provide Landlord with reasonable substantiation for
any expenses reimbursed from the FF&E Reserve. Landlord shall maintain the FF&E Reserve in a
separate interest bearing account in Landlord’s name. Tenant acknowledges that Landlord will
collaterally assign the FF&E Reserve to the First Mortgagee as additional security for the First
Mortgage. Provided that no Event of Default is then existing, Landlord shall return any funds
remaining in the FF&E Reserve upon the expiration or termination of this Lease.

9

 

     8.6 Compliance with First Mortgage. No Alteration shall be made unless Tenant
complies in all respects with the terms of any First Mortgage.

     8.7 Other Requirements. No Alteration shall be made except in compliance with, and
Tenant hereby covenants that it will comply with, each of the following provisions:

     8.7.1 All Alteration shall be made with reasonable diligence and dispatch (subject to
Unavoidable Delays) in a first class manner and with first class materials and workmanship.

     8.7.2 Before any Alteration has begun, Tenant shall procure, at its expense, all
necessary licenses, permits, approvals and authorizations from all Governmental Authorities
for such Alteration and shall, on demand, deliver photocopies thereof to Landlord. Upon
Tenant’s request, Landlord shall join in the application for such licenses, permits,
approvals and authorizations whenever such action is necessary, and Tenant covenants that
Landlord will not suffer, sustain or incur any cost, expense or liability by reason thereof.

     8.7.3 All Alteration shall be made and completed in accordance with all governmental
statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions
of governmental authorities (including Environmental Laws) affecting either Borrower or any
of the Property Locations or any portion of or the construction, ownership, use, alteration
or operation of, or any portion of any Property (whether now or hereafter enacted and in
force), and all permits, licenses and authorizations and regulations relating thereto and
insurance requirements under this Lease.

     8.7.4 No Alteration shall create any encroachment upon any street, easement, setback
line or open yard requirement or upon any adjacent premises.

     8.7.5 To the extent that any Alteration materially alters the footprint of any of the
Improvements, Tenant shall, on written demand, promptly deliver to Landlord and the First
Mortgagee a copy of a final survey of the Property, certified to Landlord and the First
Mortgagee, showing the completed Alteration.

     8.7.6 No Alteration shall be made which would in the opinion of the Landlord render
title to the Property or any part thereof unmarketable.

     8.7.7 No Alteration shall be performed which would tie in or connect any building or
structure on the Property with any other building or structure located outside the boundary
lines of the Property without the prior written consent of Landlord.

10

 

     8.7.8 All Alteration shall be performed in compliance with any and all restrictive or
protective covenants affecting the Property.

     8.7.9 All expenses of Landlord in respect of the First Mortgage incurred by reason of
the Alteration in question shall be reimbursed by Tenant upon demand.

     8.8 No Request or Consent by Landlord. Nothing contained in this Lease shall
constitute any consent or request by Landlord, express or implied, for the performance of any labor
or services or the furnishing of any materials or other property in respect of the Property or any
part thereof, nor as giving Tenant any right, power or authority to contract for or permit the
performance of any labor or services or the furnishing of any materials or other property in such
fashion as would permit the making of any claim against Landlord in respect thereof.

     8.9 Notice of Non-Responsibility. Before any Alteration has begun, Landlord shall
have the right to post and maintain on the Property and to record in the County Recorder’s office
in the County in which the Property is located any notices of non-responsibility provided for under
applicable law.

Article 9. DAMAGE TO OR DESTRUCTION OF THE IMPROVEMENTS

     9.1 In case of any damage to or destruction of the Property or any part thereof, Tenant shall
give prompt notice thereof to Landlord, and, unless this Lease is amended pursuant to Section 9.4,
Tenant shall with reasonable diligence (subject to Unavoidable Delays), commence and complete
Restoration, all in accordance with plans and specifications therefor first approved by Landlord,
which approval shall not be unreasonably withheld. The replacement building(s) to be constructed
shall have an area which is not less than the area of the Improvements being replaced, and shall be
of a quality not less than the quality of the Improvements, as the same existed immediately prior
to such damage or destruction.

     9.2 Insurance proceeds received by Landlord in accordance with Section 6.2.5 on account of any
damage to or destruction of the Property or any part thereof (less the costs, fees and expenses
incurred by Tenant in the collection thereof, which shall be paid out of such proceeds) shall be
paid to Tenant as Restoration progresses, to pay for the cost of Restoration, upon written request
of Tenant accompanied by evidence satisfactory to Landlord that an amount equal to the amount
requested is then due and payable or has been paid and is properly a part of such cost and that the
net insurance proceeds not yet advanced will be sufficient for the completion of the Restoration.
Upon receipt by Landlord of evidence satisfactory to them that Restoration has been completed and
the cost thereof paid in full, and that there are no mechanic’s
or similar liens for labor or materials supplied in connection therewith, the balance, if any, of
such insurance proceeds (and any amount so made available by Landlord) shall be paid to Landlord,
without reduction in the Basic Rent. Upon the expiration or sooner termination of this Lease, any
insurance proceeds not theretofore applied to the cost of Restoration shall be paid to Landlord.

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     9.3 Except as provided in Section 9.4, no destruction of or damage to the Property, or any
part thereof, whether such damage or destruction be partial or total or otherwise, shall entitle or
permit Tenant to surrender or terminate this Lease or shall relieve Tenant from its liability to
pay in full the Basic Rent and other sums and charges payable by Tenant hereunder, or from any of
its other obligations under this Lease, and Tenant hereby waives any rights now or hereafter
conferred upon it by statute or otherwise to surrender this Lease or quit or surrender the Property
or any part thereof, or to receive any suspension, diminution, abatement or reduction of the Basic
Rent or other sums and charges payable by Tenant hereunder on account of any such destruction or
damage. Notwithstanding the foregoing, Basic Rent shall abate to the extent of business
interruption or rent loss proceeds actually received by Landlord on account of the Casualty.

     9.4 In case of any damage to or destruction of any Property Location which occurs during the
last two (2) years of the Term in respect of which the cost of Restoration is reasonably estimated
to exceed forty percent (40%) of the replacement cost of any Property Location and/or for which
substantial completion of Restoration cannot occur until more than six (6) months following such
damage or destruction, as such cost of Restoration and/or date of substantial completion is
estimated in good faith by a reputable general contractor promptly selected by Tenant and approved
by Landlord, which approval may not be unreasonably withheld or delayed, Tenant may cause this
Lease to be amended to remove such Property Location from the terms of this Lease by giving written
notice thereof to Landlord within forty-five (45) days after the date of such damage or
destruction. Such amendment shall be effective on the date such notice is given. In case of any
such amendment, Basic Rent shall be proportionately reduced based upon the number of Property
Locations prior to such amendment and Tenant shall not have any obligation to repair or restore the
Property Location, provided however Landlord shall receive insurance proceeds attributable to the
Improvements at such Property Location, including any Alterations.

Article 10. CONDEMNATION

     10.1 In the event of a Taking of the whole or substantially all of any Property Location, this
Lease shall be amended on the date of such Taking to release the Property Location from this Lease,
and the Basic Rent and all other sums and charges required to be paid by Tenant hereunder with
respect to such Property Location shall be apportioned and paid to the date of such Taking. In the
event of any such Taking and notwithstanding the amendment of this Lease, Landlord and Tenant shall
together make one claim for an award for their combined interests in the Property Location and,
subject to the requirements of the First Mortgage, the net award received (after deduction of
reasonable fees and expenses of collection, including, but not limited to, reasonable attorneys’
and experts’ fees) shall be paid as follows and in the following order:

     10.1.1 Tenant shall be entitled to the portion of the award made for the value of its
leasehold estate computed as though this Lease had not been amended, for Tenant’s Property,
and for moving expenses; and

     10.1.2 Landlord shall receive the balance of the award.

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     10.2 In the event of a Taking of less than substantially all of a Property Location, this
Lease shall continue in full force and effect with respect to such Property Location, and Tenant
shall give prompt notice thereof to Landlord and Tenant shall proceed with reasonable diligence
(subject to Unavoidable Delays) to commence and complete Restoration, except to the extent made
impossible by any reduction in area caused by such Taking. All awards payable as a result of any
Taking shall be distributed as follows and in the following order, provided that there shall first
be deducted therefrom all reasonable fees and expenses of collection, including, but not limited
to, reasonable attorneys’ and experts’ fees:

     10.2.1 Landlord shall distribute the proceeds of such award to Tenant for the purpose
of Restoration in the manner provided in Section 9.2, and subject to the terms and
conditions of such Section; and

     10.2.2 The balance of the award, if any, shall be paid to Landlord.

The Annual Rent shall be reduced by a fair and equitable amount taking into account the proportion
by which the fair rental value of a Property Location has been reduced by the Taking (if at all).

     10.3 As used herein, a Taking of “substantially all of a Property Location” shall mean a
Taking of such portion of the Property Location as renders it uneconomical or infeasible to operate
the Property Location for the purpose for which the Property Location was operated prior to such
Taking. Any dispute between the parties as to whether any particular Taking constitutes a Taking
of all or substantially all, or a Taking of less than substantially all, of a Property Location
shall be determined by arbitration in accordance with the rules of the American Arbitration
Association as then in effect and any determination therein shall be final and binding on Landlord
and Tenant.

Article 11. DISCHARGE OF LIENS

     Neither Landlord nor Tenant shall create, liens or notices of claims of liens of mechanics and
materialmen for work or materials contracted to be supplied to the Property by Landlord or Tenant,
respectively, subject to contest by Tenant in accordance with Article 23.

Article 12. USE OF PROPERTY

     12.1 The Property is to be used and occupied by Tenant solely for the operation of a health
club facility and related and ancillary purposes or such other purposes as may be approved
by Landlord and First Mortgagee, if any, which approval shall not be unreasonably withheld or
delayed.

     12.2 Tenant shall not suffer any act to be done or any condition to exist on the Property or
any part thereof which may, in law, constitute a nuisance, public or private.

     12.3 Tenant shall not permit any Environmental Activity on, about or under the Property other
than the use, storage and disposal of the minimum quantities of Hazardous Materials in the ordinary
course of business at the Property and in compliance with all Environmental Laws. Tenant shall
promptly, properly and completely remediate the effect of

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any Environmental Activity in violation
of this Section 12.3. Tenant will notify Landlord immediately upon Tenant becoming aware of (i)
any actual, suspected or threatened violation of Environmental Laws with respect to the Property or
with respect to any property in the vicinity of the Property, and (ii) any Environmental Activity
with respect to the Property or with respect to any property in the vicinity of the Property.
Tenant promptly will deliver to Landlord copies of all documents delivered to or received by Tenant
regarding the matters set forth in this subsection, including notices of any legal proceedings or
investigations concerning any Environmental Activity or concerning Landlord’s or Tenant’s status as
potentially responsible party (as defined in the Environmental Laws). Tenant’s notification to
Landlord in accordance with the provisions of this Section will not be deemed to excuse any default
under this Lease resulting from the Environmental Activity or the violation of Environmental Laws
that is the subject of the notice. Notwithstanding anything in this Section 12.3 to the contrary,
Tenant shall not have any liability for any environmental condition predating this Lease.

Article 13. ENTRY ON PROPERTY BY LANDLORD

     Upon reasonable prior written notice (except in the case of an emergency), Tenant shall permit
Landlord and its contractors, consultants, representatives and designees to enter the Property at
all reasonable times for the purpose of (a) inspecting and testing the same, (b) exercising its
rights pursuant and subject to Article 21, and (c) showing the same to prospective purchasers,
mortgagees and tenants (during the last six (6) months of the Term only with respect to prospective
tenants).

Article 14. WAIVER AND INDEMNIFICATION

     14.1 Notwithstanding anything to the contrary in this Lease, Landlord and Tenant hereby
release one another and their respective partners, officers and employees from any and all
liability (to the other or anyone claiming through or under them by way of subrogation or
otherwise) for any loss or damage coverable by the insurance described in Subsections 6.1.1, even
if such loss or damage shall have been caused by the fault or negligence of the other party, or
anyone for whom such party may be responsible.

     14.2 Landlord shall not be responsible or liable to Tenant for any loss or damage to Tenant’s
Property arising from (a) the acts or omissions of persons other than Landlord occupying premises
adjacent to the Property, or transacting any business in the area of the
Property, or (b) burst, stopped or leaking water, gas or sewer pipes or any failure of, or defect
in, any electric line, circuit or facility, or (c) any condition of the Property.

     14.3 Each party hereto shall defend, indemnify and hold the other harmless from and against
all liabilities, obligations, claims, demands, costs, charges, judgments and expenses, including,
but not limited to, reasonable attorneys’ fees, which may be imposed upon or incurred or paid by or
asserted against such other party to the extent arising by reason of or in connection with any
negligent or tortuous act on the part of such party or any of its agents, contractors, servants,
employees, licensees or invitees and accruing or occurring during the Term of this Lease.

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     14.4 Without limitation to Tenant’s obligations under Section 14.3, Tenant shall defend with
counsel approved by Landlord (which approval will not be unreasonably withheld), indemnify and save
Landlord harmless from and against all liabilities, obligations, damages, fines, penalties, claims,
demands, costs, charges, judgments and expenses, including, but not limited to, reasonable
architects’ and attorneys’ fees, which may be imposed upon or incurred or paid by or asserted
against Landlord, the Property or any interest therein by reason of or in connection with any of
the following accruing or occurring during the Term of this Lease:

     14.4.1 Any Alterations and anything done in, on or about the Property or any part
thereof in connection therewith;

     14.4.2 The use, non-use, possession, occupation, condition, operation, maintenance or
management of the Property;

     14.4.3 Any negligent or tortious act on the part of Tenant or any of its agents,
contractors, servants, employees, licensees or invitees;

     14.4.4 Any accident, injury, death or damage to any person or property occurring in or
on the Property during the Term; and

     14.4.5 Any Environmental Activity occurring during the Term on, about, to or from the
Property or any part thereof.

Nothing contained in this Section 14.4 shall be deemed to require Tenant to indemnify Landlord with
respect to any tortious act or omission of Landlord or its officers, employees, agents or
contractors, or to any extent prohibited by law.

     14.5 The provisions of this Article 14 shall survive the expiration or sooner termination of
this Lease and the purchase of the Property pursuant to the First Offer Right.

Article 15. ASSIGNMENT

     15.1 Tenant’s interest in this Lease or the Property, or any part thereof, may not be
assigned, sublet or otherwise transferred without Landlord’s prior written consent, which consent
shall not be unreasonably withheld. Notwithstanding anything contained herein to the contrary,
Tenant may, without the necessity of the consent of Landlord, at any time assign or otherwise
transfer this Lease or any portion thereof to any parent, subsidiary or affiliate corporation or
entity of Tenant; any corporation resulting from the consolidation or merger of Tenant into or with
any other entity; or any person, firm, entity or corporation acquiring a majority of Tenant’s
issued and outstanding capital stock or all or substantially all of Tenant’s assets or of the
business conducted at the Premises. As used herein, the expression “affiliate corporation or
entity” means a person or business entity, corporate or otherwise, that directly or indirectly
through one or more intermediaries, controls or is controlled by or is under control with Tenant.
The word “control” means the right and power, direct or indirect, to direct or cause the direction
of the management and policies of a business entity, corporation or otherwise.

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     15.2 No consent by Landlord pursuant to this Article 15 shall waive the requirement to obtain
consent in any subsequent instance. If Tenant assigns all its rights and interest under this
Lease, the assignee under such assignment shall expressly assume all the obligations of Tenant
hereunder which may arise on or after the date of such assignment, by a written instrument
delivered to Landlord at the time of such assignment. No assignment or sublease shall affect or
reduce any of the obligations of Tenant hereunder, and all such obligations shall continue in full
force and effect as obligations of a principal and not as obligations of a guarantor, as if no
assignment or sublease had been made. No assignment or sublease shall impose any additional
obligations on Landlord under this Lease.

     15.3 Notwithstanding anything to the contrary contained in this Lease, Tenant shall have the
right in its discretion to enter into, amend, terminate or modify from time to time subleases or
licenses with respect to thirty-five percent (35%) of the total usable square footage of each of
the Property Locations on terms acceptable to Tenant in its sole discretion. Each such sublease or
license shall be subject and subordinate to the provisions of this Lease. As security for
performance of its obligations under this Lease, Tenant hereby grants, conveys and assigns to
Landlord all right, title and interest of Tenant in and to all subleases and licenses now in
existence or hereafter entered into for any or all of the Property, any and all extensions,
modifications and renewals thereof and all rents, issues and profits therefrom. Landlord hereby
grants to Tenant a license to collect and enjoy all rents and other sums of money payable under any
sublease of any of the Property, provided, however, that Landlord shall have the absolute right at
any time while an uncured Event of Default exists upon notice to Tenant and any subtenants to
revoke said license and to collect such rents and sums of money and to retain the same.

     15.4 Tenant is hereby given the right by Landlord to mortgage its leasehold estate created
under this Lease, under one or more leasehold mortgage(s) upon the conditions that (a) all rights
acquired under such leasehold mortgage(s) shall be subject and subordinate to each and all of the
covenants, conditions and restrictions set forth in this Lease and to all rights and interests of
the Landlord in and to the Property and this Lease, none of which covenants, conditions,
restrictions, rights or interests is or shall be waived by Landlord by reason of the right given to
Tenant in this Section 15.4 to mortgage Tenant’s leasehold estate created under this Lease, and (b)
such leasehold mortgagees execute and deliver to Landlord and any Lender a subordination,
non-disturbance and attornment agreement, and any other documents, instruments
or agreements reasonably requested by Landlord to evidence such subordination and such other
matters as Landlord may reasonably request in connection therewith. Tenant’s rights under this
Section 15.4 are subject to the terms and conditions of the First Mortgage.

     15.5 Landlord agrees to accept timely performance by a leasehold mortgagee of Tenant’s
obligations under this Lease. In the event of any act or omission by Tenant which would give
Landlord the right to damages from Tenant or the right to terminate this Lease pursuant to Article
17, Landlord will not sue for such damages nor exercise any such right to terminate until (i) it
shall have given written notice of the act or omission to Tenant and to the leasehold mortgagee, if
the name and address of such leasehold mortgagee has been furnished to Landlord, and (ii) leasehold
mortgagee shall have the right to cure any default by Tenant for the same period after receiving
notice of such default from Landlord as Tenant has, plus thirty (30)

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additional days. In order to
exercise this right to cure any default by Tenant, the leasehold mortgagee, its agents or
employees, will be entitled to enter upon the Property and take whatever action may be necessary to
remedy the act or omission. Landlord shall accept a cure performed within such period by any
leasehold mortgagee as though the cure had been done or performed within a timely fashion by
Tenant.

Article 16. ESTOPPEL CERTIFICATES

     Each party hereto agrees from time to time, upon not less than ten (10) days’ prior notice
from the other, to execute, acknowledge and deliver, without charge, to the other or its designee,
a statement in writing, certifying that this Lease is unmodified and in full force and effect (or
if there have been modifications, identifying the same by the date thereof and specifying the
nature thereof), the dates to which the Basic Rent and other sums and charges payable hereunder
have been paid, the amount of the Basic Rent, that to its actual knowledge there are no claims
against the other hereunder (or if there are any such claims, specifying the same), that to its
actual knowledge the other party is not in default and there exists no circumstance which with the
giving of notice or lapse of time, or both, would constitute a default (or if such party is aware
of any such default or circumstance specifying the same), and such other matters as Landlord,
Tenant or the First Mortgagee shall reasonably request.

Article 17. EVENTS OF DEFAULT; TERMINATION

     17.1 If any one or more of the following events (“Events of Default”) shall happen, then and
in any such event, Landlord may give notice to Tenant specifying such Event or Events of Default
and stating that this Lease and the Term shall expire and terminate on the date specified in such
notice, and on such date, unless such specified Event or Events of Default shall have been cured,
this Lease shall terminate and Tenant shall remain liable as hereinafter provided:

     17.1.1 Tenant defaults in the payment of any Basic Rent payable under this Lease and
Tenant does not cure such default within ten (10) days after written notice thereof by
Landlord to Tenant; or

     17.1.2 Tenant shall fail duly to observe or perform any of the other terms,
conditions, covenants or agreements required to be observed or performed by it under this
Lease and such failure shall continue for a period of thirty (30) calendar days following
written notice of such failure by Landlord to Tenant, or, in the case of a default which
cannot with due diligence be cured within such period of thirty (30) days, the Tenant fails
to proceed with due diligence within such period of thirty (30) days to commence to cure the
same and thereafter to prosecute the curing of such default with due diligence, or fails to
complete such cure within one hundred eighty (180) days after such notice from Landlord.

     17.2 If this Lease shall have been terminated pursuant to Section 17.1, Landlord may enter
upon and repossess the Property (said repossession being hereinafter referred to as “Repossession”)
by summary proceedings or ejectment, and may remove Tenant and all other persons therefrom.

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     17.3 From time to time after the Repossession of the Property, Landlord may relet the
Property for the account of Tenant (unless Landlord has elected to collect liquidated damages
pursuant to Section 17.5 below) in the name of Landlord or otherwise, for such term or terms (which
may be greater or less than the period which would otherwise have constituted the balance of the
Term) and on such terms and for such uses as Landlord may in its reasonable business judgment
determine, and may collect and receive the rent therefor. Landlord shall not be responsible or
liable for any failure to collect any rent due upon any such reletting. Landlord shall act
reasonably to mitigate damages.

     17.4 No termination of this Lease pursuant to Section 17.1 and no Repossession of the
Property pursuant to Section 17.2 or otherwise shall relieve Tenant of its obligation to pay Basic
Rent or any of its other obligations under this Lease, all of which shall survive any such
termination or Repossession.

     17.5 In the event of any such termination or Repossession, whether or not the property shall
have been relet, Tenant shall pay to Landlord the Basic Rent and other sums and charges to be paid
by Tenant up to the time of such termination or Repossession, and thereafter Tenant, until the end
of what would have been the Term in the absence of such termination or Repossession, shall pay to
Landlord, as and for liquidated and agreed current damages for Tenant’s default, the equivalent of
the amount of the Basic Rent and such other sums and charges which would be payable under this
Lease by Tenant if this Lease were still in effect, less the net proceeds if any, of any reletting
effected pursuant to the provisions of Section 17.3, after deducting all of Landlord’s expenses in
connection with such reletting, including, without limitation, all repossession costs, brokerage
and management commissions, operating expenses legal expenses, attorneys’ fees, and reasonable,
market expenses of preparation for such reletting. Tenant shall pay such current damages to
Landlord monthly on the days on which the Basic Rent would have been payable under this Lease if
this Lease were still in effect, and Landlord shall be entitled to recover the same from Tenant on
each such day. At any time after such termination or Repossession, whether or not Landlord shall
have collected any current damages as aforesaid, Landlord shall be entitled to recover from Tenant,
and Tenant shall pay to Landlord on demand, as and for liquidated and
agreed final damages for Tenant’s default, an amount equal to the then present value of the excess
of the Basic Rent reserved under this Lease from the day of such termination or Repossession for
what would be the then unexpired Term if the same had remained in effect, over the then Fair Rental
Value for the same period, discounted at a rate equal to one percent (1.0%) plus the discount rate
at the time of liquidation of the Federal Reserve Bank for the district in which the Property is
located.

     17.6 No failure by Landlord to insist upon the strict performance of any term hereof or to
exercise any right or remedy consequent upon a breach thereof, and no acceptance of full or partial
rent during the continuance of any such breach, shall constitute a waiver of any such breach or of
any such term.

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     17.7 Tenant may exercise and continue to exercise all of its rights under this Lease upon the
occurrence and during the continuance of any default or Event of Default under this Lease up to the
point of termination of this Lease and actual Repossession, as defined in Section 17.2, including,
but not limited to, the First Offer Right.

Article 18. SURRENDER OF THE PROPERTY

     18.1 In the event Tenant does not exercise and fulfill the requirements of the First Offer
Right, upon the expiration or sooner termination of this Lease, Tenant shall quit and surrender the
Property, in the condition required to be maintained in accordance with this Lease, to Landlord
without any payment therefor by Landlord without delay, free and clear of all lettings and
occupancies. Upon such expiration or termination of this Lease, any Tenant’s Property owned by
Tenant which shall remain on the Property after the expiration or termination of this Lease may, at
the option of Landlord, be deemed to have been abandoned, and may either be retained by Landlord as
its property or be disposed at Tenant’s expense or without accountability, as Landlord may see fit,
provided that if Landlord shall store or warehouse any such property for any period of time Tenant
shall reimburse Landlord for all expenses incurred in connection therewith, which obligation shall
survive any such expiration or termination of this Lease.

     18.2 In connection with the surrender of the Property pursuant to Section 18.1, Tenant shall
be entitled to remove on or before the expiration or sooner termination of this Lease, its Tenant’s
Property and shall leave in place all Alterations.

     18.3 The provisions of this Article 18 shall survive the expiration or sooner termination of
this Lease.

Article 19. NO MERGER OF TITLE

     There shall be no merger of Tenant’s interest in this Lease nor of the leasehold estate
created by this Lease with the fee estate in the Property or any part thereof by reason of the fact
that the same person may acquire or own or hold, directly or indirectly, (a) Tenant’s interest in
this Lease or the leasehold estate created by this Lease or any interest therein and (b) the fee
estate in the Property or any part thereof or any interest therein, and no such merger shall occur
unless and until all persons, if any, then having an interest in, which interest shall have been
voluntarily created by the holders of, the ownership interests described in (a) and (b) above,
shall join in a written instrument effecting such merger and shall duly record the same.

Article 20. QUIET ENJOYMENT

     Landlord covenants that Tenant, upon paying the Basic Rent and all other sums and charges
herein provided for and observing and keeping all covenants, agreements and conditions of this
Lease on its part to be observed and kept, shall quietly have and enjoy the Property during the
Term without disturbance by anyone claiming by, through or under Landlord subject, however, to the
exceptions, reservations, and conditions of this Lease.

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Article 21. PERFORMANCE FOR TENANT

     21.1 If Tenant shall at any time fail to make any payment or perform any act on its part to be
made or performed hereunder, then Landlord, after thirty (30) days’ (or such longer period as may
be reasonably necessary to cure the same) notice to Tenant, except when other notice is expressly
provided for in this Lease, and without waiving or releasing Tenant from any obligation of Tenant
contained in this Lease, may (but shall be under no obligation to) make such payment or perform
such act, and may enter upon the Property for any such purpose, and take all such action thereon as
may be necessary therefor. Notwithstanding anything to the contrary contained in this Lease, in
the event Tenant fails to maintain insurance required pursuant to Article 6 of this Lease, Landlord
shall have the right to obtain such insurance on behalf of Tenant and Tenant shall reimburse
Landlord within five (5) days of receipt of notice of the procurement of such insurance.

     21.2 All sums so paid by Landlord and all reasonable out of pocket costs and expenses incurred
by Landlord in connection with the performance of any such act, together with interest thereon at a
rate equal to the lesser of (a) ten percent (10%) per annum and (b) the maximum rate permitted by
law, from the respective dates of Landlord’s making of each such payment or incurring of each such
cost and expense, and reasonable attorney fees incurred by Landlord in connection therewith or in
enforcing its rights hereunder, shall be paid by Tenant to Landlord on demand as additional rent
hereunder.

     21.3 The provisions of this Article 21 shall survive the expiration or sooner termination of
this Lease.

Article 22. NOTICES

     All notices, requests, demands, consents, approvals, and other communications which may or are
required to be served or given hereunder (for the purposes of this Article collectively called
“Notices”) shall be in writing and shall be delivered personally, or sent by nationally recognized
overnight delivery service, or sent by registered or certified mail, return receipt requested,
postage prepaid, addressed to the party to receive such Notice at its address first above set
forth. Either party may, by Notice given as aforesaid, change its address for all subsequent
Notices, except that neither party may require Notices to it to be sent to more than two addresses.
Mailed Notices
shall be deemed given when mailed in the manner aforesaid, provided that in the case of a notice of
default to Tenant the same shall be deemed given only upon actual receipt by Tenant. So long as a
First Mortgagee exists, both parties shall provide First Mortgagee with copies of any notices
delivered to the other with respect to requests for consent or approval or notices alleging default
under this Lease.

Article 23. CONTESTS

     23.1 After written notice to Landlord, Tenant may at its expense contest, by appropriate
proceedings conducted in good faith and with due diligence (all such proceedings together with
appeals therefrom being hereinafter referred to as “Contests”) the amount, validity or application,
in whole or in part, of any Tax, mechanics’ lien, encumbrance, charge or any other adverse claim
for which Tenant is responsible under this Lease (hereinafter collectively “claims”) provided that:

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     23.1.1 In the case of an unpaid claim, such Contest shall operate to suspend the
collection of the same from Landlord and Tenant therein; and

     23.1.2 Neither the Property nor any part thereof nor any interest therein shall be, in
the reasonable opinion of Landlord, in imminent danger of being forfeited or lost.

     23.2 During the period Tenant carries forward any such Contest in good faith, Tenant shall be
relieved from its obligations herein contained to pay the claims, or to clear the liens with
respect to which such contest is conducted. If and to the extent Tenant shall not prevail in any
such Contest, Tenant shall immediately pay and discharge the claim in question to such extent.

     23.3 All such Contests may be brought by Tenant in the name of Tenant or, if reasonably
necessary, in the name of Landlord or Tenant and Landlord, as may be appropriate. Each party
agrees to cooperate with the other in such Contests, short of the payment of money with respect
thereto, except where this Lease otherwise requires payment. Each party will endorse such
pleadings, checks and other documents as will be appropriate to carry out the purposes of this
Section 23.3.

Article 24. NO WARRANTIES/“AS IS”

     LANDLORD LEASES AND WILL LEASE AND TENANT TAKES AND WILL TAKE THE PROPERTY “AS IS”, AND TENANT
ACKNOWLEDGES THAT LANDLORD HAS NOT MADE AND WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE
MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE PROPERTY,
INCLUDING ANY WARRANTY OR REPRESENTATION AS TO ITS FITNESS FOR USE OR PURPOSE, DESIGN OR CONDITION
FOR ANY PARTICULAR USE OR PURPOSE, AS TO THE QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, LATENT
OR PATENT, OR AS TO VALUE, LOCATION, USE, CONDITION, QUALITY, DESCRIPTION, OR DURABILITY OF
OPERATION. THE PROVISIONS OF THIS SECTION 24 HAVE BEEN NEGOTIATED, AND THE FOREGOING PROVISIONS
ARE INTENDED TO BE A COMPLETE
PRECLUSION AND NEGATION OF ANY WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF
THE PROPERTY, ARISING PURSUANT TO THE UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW OR HEREAFTER IN
EFFECT OR OTHERWISE.

Article 25. INTENTIONALLY OMITTED

Article 26. SUBORDINATION AND NON-DISTURBANCE

     Tenant agrees that, upon the request of Landlord made in writing, Tenant will subordinate this
Lease to any First Mortgage and to all renewals, modifications, consolidations, replacements and
extensions thereof; provided, however, that the First Mortgagee shall enter into

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a binding
agreement (the “Non-Disturbance Agreement”) with Tenant providing that for so long as Tenant is not
in default hereunder beyond any applicable notice and cure period, Tenant shall not be disturbed in
its possession of the Property or its rights hereunder terminated or impaired by the First
Mortgagee, purchaser at foreclosure or other such party and that this Lease shall continue in full
force and effect following any foreclosure thereof or any deed given in lieu thereof, except that
this Lease may nonetheless be terminated pursuant to the provisions of this Lease providing for
such termination, including without limitation pursuant to Article 17. In the event the First
Mortgagee or other purchaser at foreclosure sale succeeds to the interest of Landlord under this
Lease, Tenant will automatically become the tenant of and shall be deemed to have attorned to such
successor in interest as Landlord under this Lease without change in the terms or provisions of
this Lease, provided, however, that such successor in interest shall not be bound by any amendment
or modification of this Lease made after Tenant enters into the Non-Disturbance Agreement without
the written consent of such First Mortgagee or such successor in interest. Upon written request by
such successor in interest, Tenant and such successor shall execute and deliver an instrument or
instruments whereby Tenant confirms the attornment herein provided for and in which such successor
shall acknowledge its obligations and responsibilities to Tenant under the Lease and, with respect
thereto, shall recognize this Lease and the tenancy hereunder of Tenant.

Article 27. FIRST OFFER RIGHT

     27.1 Landlord shall not (a) sell, transfer, assign or otherwise dispose of any partial
interest in the Property or any part thereof to an unrelated third party, or (b) sell, transfer,
assign or otherwise dispose of its interest in the Property to an unrelated third party until at
least fifteen (15) days after it has given Tenant written notice (the “Landlord’s Notice”) as
herein provided of its intention to dispose of the Property. The Landlord’s Notice shall describe
in reasonable detail Landlord’s determination of the fair market value of the Property at which
Landlord intends to sell the Property (including, if the proposed consideration for such
disposition is property other than cash, the Fair Market Value of such property, in Landlord’s
opinion, as of the date of the notice), and the other terms of such proposed disposition. Tenant
shall have and is hereby granted the first right and option (“First Offer Right”) to purchase the
Property in the manner, at the price and on the terms provided in the Landlord’s Notice. During
the Term of this Lease and
except as required by the terms of the First Mortgage, Landlord shall not transfer, sell or convey
all or any portion of any Property Location independently from the other Property Locations.

     27.2 The First Offer Right may be exercised by Tenant by giving notice to Landlord at any time
within ten (10) days after receipt of the Landlord’s Notice.

     27.3 The purchase price for the Property pursuant to exercise of the First Offer Right shall
be the price stated in the Landlord’s Notice as the price at which Landlord proposes to sell,
transfer or assign the Property; provided that (a) if all or any part of the proposed consideration
for said sale, transfer or assignment is property other than cash, such portion of the purchase
price to be paid by Tenant shall be based on the Fair Market Value of said property as of the date
of the Notice to be determined by appraisal in accordance with Article 28 below, and (b) if the
Property is being disposed of together with other land or property, then Tenant may elect to have
the consideration payable by it for the Property equal the Fair Market Value of such interest as of
the date of the Landlord’s Notice to be determined by appraisal in accordance with the procedure
provided in Article 28 below.

22

 

     27.4 Contemporaneously with giving the Landlord’s Notice, Landlord shall provide a title
insurance commitment for the Property with a then-current effective date. If such commitment
reflects any matter materially and adversely affecting title to the Property in addition to the
Permitted Exceptions (other than this Lease, a First Mortgage, and any encumbrances created on or
after the date hereof by Tenant or those claiming by, through or under Tenant or with Tenant’s
consent), then Tenant may give Landlord written notice of such matter. If Tenant gives Landlord
such notice, Landlord use reasonable efforts to cause such matter to be removed and corrected of
record within said ten (10) days of receipt of Tenant’s notice. If Landlord fails to do so within
said thirty (30) days, Tenant may at its option (a) attempt to cause such encumbrances to be
removed, (b) proceed to close, or (c) terminate the agreement formed by exercise of the First Offer
Right by giving written notice thereof to Landlord, without such termination releasing Landlord
from liability for damages hereunder. If Tenant elects alternative (a) above, closing shall be
postponed until the encumbrances in question are removed and, if Tenant is unable within a further
period of ten (10) days to cause such encumbrances to be removed, Tenant may then elect either
alternative (b) or (c) above. All costs and expenses incurred by Tenant in causing or attempting
to cause such encumbrances to be removed, including reasonable attorneys fees, shall be payable by
Landlord.

     27.5 Subject to postponement pursuant to Section 27.4, Landlord shall convey the Property to
Tenant on the first business day occurring thirty (30) days after the date Tenant exercises the
First Offer Right at Landlord’s main offices. The deed shall be in the usual, proper limited
warranty form for recording and registration, subject only to Permitted Exceptions and the other
matters permitted pursuant to Section 27.4, and shall be accompanied by all documents necessary to
allow the deed to be recorded. Landlord shall pay any state deed tax or revenue stamps or other
transfer tax. Landlord shall pay any prepayment penalty or provision payable under the First
Mortgage if the First Mortgage is satisfied in connection with the closing. Tenant shall pay any
assumption fee payable under the First Mortgage in connection with such closing if Tenant assumes
the First Mortgage. The purchase price (less the unpaid principal balance of the
First Mortgage if assumed (subject to the terms thereof) by Tenant at the closing) shall be payable
by wire transfer or other readily available funds. This Lease and all of the terms and provisions
hereof shall remain in full force and effect until the purchase has closed, except as otherwise
provided herein. Notwithstanding anything to the contrary in this Article 27, to the extent Tenant
(subject to the terms of the First Mortgage) does not assume the First Mortgage, Landlord shall
discharge the First Mortgage and all documents and agreements associated therewith at the closing.

     27.6 If Tenant fails to exercise the First Offer Right within the ten (10) day period provided
in Section 27.2, Landlord shall be free to sell the Property free from the First Offer Right but
subject to this Lease on the same price and terms provided in the Landlord’s Notice for a period of
one hundred eighty (180) days following the expiration of such ten (10) day period. If Landlord
does not close upon the transfer of the Property within such one hundred eighty (180) day period on
substantially the same terms as those provided in the Landlord’s Notice, then the First Offer Right
shall revive and Landlord shall be obligated to re-offer the Property to

23

 

Tenant in accordance with Section 27.1 prior to any sale, transfer or disposition of the same.
As used in this Section 27.6, “substantially the same” terms shall mean that the purchase price
pursuant to which Landlord proposes to sell the Property is not less than ninety-five percent (95%)
of that provided in the Landlord’s Notice, adjusted for any difference in treatment of closing
costs, and the terms are otherwise the same terms as provided in the Landlord’s Notice, provided
that the provision of representations, warranties or other comfort to a third party purchaser, to
the extent they relate to matters which such third party purchaser, not like Tenant having been in
possession of and having knowledge of the Property, may require, shall not cause such transaction
not to be on the same terms. Tenant shall, within five (5) days after Landlord’s request
therefore, deliver an instrument in form reasonably satisfactory to Landlord confirming the
provisions of this Section 27.6, but no such instrument shall be necessary to make the provisions
hereof effective.

     27.7 If Tenant does not timely exercise its First Offer Right and the Property is transferred
to a third party, Tenant will attorn to such third party as Landlord so long as such third party
and Landlord notify Tenant in writing of such transfer.

     27.8 Notwithstanding anything to the contrary contained herein, the provisions of this Article
27 shall not apply to or prohibit the following:

     27.8.1 The giving or granting of the First Mortgage;

     27.8.2 Any sale of the Property pursuant to a private power of sale under or judicial
foreclosure of the First Mortgage;

     27.8.3 Any transfer of Landlord’s interest in the Property to First Mortgagee in lieu
of foreclosure of the First Mortgage; or

     27.8.4 Any Taking.

     27.9 If any payment of Basic Rent or any other sums payable by Tenant under this Lease remain
outstanding on the closing date of a sale to Tenant, then Landlord may add to the purchase price
for the Property the amount of such additional obligations. Any prepaid obligations paid to
Landlord shall be prorated as of the closing date, and the prorated unapplied balance shall be
deducted from the purchase price due to Landlord.

     27.10 The First Offer Right herein granted to Tenant is a continuing right of first offer and
shall apply as often as any then holder of any part of the Landlord’s interest hereunder
(including, but not limited to, any such holder who or which shall have acquired its interest in a
disposition to which the First Offer Right applied but was not exercised) shall make or propose to
make a sale, transfer, conveyance or other disposition of all or any part of the Property or any
interest therein during the Term of this Lease.

     27.11 The provisions of this Article 27 shall apply to any sale, transfer, assignment or other
disposition of any membership or other interest in Landlord which result in a change of
control (as defined in Section 15.1) of Landlord in the same manner as to a transfer of title to
the Property.

24

 

Article 28. APPRAISAL

     28.1 Whenever Fair Market Value or Fair Rental Value is to be determined by appraisal in
accordance with this Lease, the parties shall proceed as follows:

     28.1.1 Landlord and Tenant shall make good faith efforts to reach agreement as to the
Fair Market Value or Fair Rental Value, as the case may be, within the thirty (30) days
following the date of the event which gave rise to the need for such determination.
Authorized representatives of Landlord and Tenant shall meet at least once during that
period. If they reach agreement as to the Fair Market Value or Fair Rental Value, as the
case may be, they shall put the same in writing and it shall then be binding on both parties
for the purposes for which determined.

     28.1.2 If Landlord and Tenant do not reach agreement as to the Fair Rental Value or
Fair Market Value, as the case may be, within the time permitted in Section 28.1.1 above,
each party will choose a person with at least ten (10) years experience as a real estate
appraiser appraising similar properties who shall be a member in good standing of the
American Institute of Real Estate Appraisers (or successor organization or, if no such
organization exists, then persons of similar professional qualifications) and given notice
of the name and address of such person to the other within thirty (30) days after the period
for reaching agreement in subparagraph (a) has expired. Those two persons shall within
fifteen (15) days select a third appraiser who has the minimum qualifications set forth
above for the first two appraisers. If either party does not designate an appraiser within
the prescribed thirty (30) day period, or if the two appraisers do not select a third
appraiser within the prescribed fifteen (15) day period, the second or third appraiser, or
both, as the case may be, shall be appointed by the president of the chapter of the American
Institute of Real Estate Appraiser in a county where one of the Property Locations is
located (or successor organization, or, if no such organization exists, any judge of a court
of general jurisdiction in such county). The three persons (the “Experts”) shall, after
initially consulting each other, make a determination of the Fair Rental Value or Fair
Market Value, as the case may be, as expeditiously as possible thereafter and in any event
within thirty (30) days after the selection of the third Expert. The determination of the
experts shall be made as follows:

28.1.2.1 Each Expert will independently determine the Fair Rental Value or Fair
Market Value, as the case may be, and then all will meet and simultaneously disclose
to the others their respective determinations.

28.1.2.2 If neither the highest nor the lowest determination differs from the
middle determination by more than ten percent (10%) of such middle determination,
then the Fair Rental Value or Fair Market Value, as the case may be, shall be the
average of all three determinations.

25

 

28.1.2.3 The Experts shall promptly notify Landlord and Tenant of each of their
separate determinations and the resulting Fair Rental Value or Fair Market Value, as
the case may be. Judgment upon any appraisal decision rendered in accordance with
the procedure may be entered by any Court having jurisdiction thereof. The
determination of the Fair Rental Value pursuant to this procedure shall be final,
binding and conclusive upon Landlord and Tenant.

Article 29. TENANT’S PROPERTY

     29.1 The following property (collectively, “Tenant’s Property”), whether or not located in or
on the Property or Improvements, does not constitute a portion of the Property and shall at all
times during and after the Term be the property of Tenant:

     29.1.1 All items of personal property, equipment and fixtures in the Property, and
whether or however attached to the Building, at any time that are necessary, incidental or
convenient to the business from time to time conducted at the Property, including, without
limitation, exercise equipment, kitchen equipment and furnishings, work stations, portable
or movable partitions, receptionist desks, millwork, credenzas, computer installations
(including computers, computer hardware, raised flooring, freestanding supplemental air
conditioning or cooling systems therefor), communications systems and equipment, financial
services equipment (such as ATM’s), safes, safe doors, bulletin boards, book shelves and
file cabinets, but excluding central HVAC and other building systems (other than
telecommunications equipment, which shall be deemed the personal property of Tenant), walls
(other than demountable walls or partitions), doors, trim, floor and wall coverings, ceiling
lights and tile, window shades and the like;

     29.1.2 All furniture, inventory, machinery, racking, shelving, and other personal
property;

     29.1.3 Any personal property, equipment or fixtures which is either not owned by
Landlord or Tenant or is on consignment to Tenant, including any personal property owned by
Tenant’s, subtenant’s, employees or invitees;

     29.1.4 All signs and other forms of business identification; and

     29.1.5 Any other items of personal property whatsoever;

     29.2 Tenant shall have the right in its sole and absolute discretion from time to time to
install, alter, remove and/or replace such of Tenant’s Property as it shall deem to be useful or
desirable in connection with its business in the Property. Tenant further shall have the right to
enter into such agreements and assignments with respect to the Tenant’s Property as Tenant in its
sole discretion shall deem advisable, including financing and similar arrangements.

     29.3 Landlord shall execute such landlord consents and other agreements as shall be reasonably
requested by Tenant in connection with any such agreements and arrangements. Landlord hereby
waives each and every right which Landlord now has or may hereafter have under Legal Requirements
or by the terms of any agreement now in effect or hereafter exercised by Landlord or Lender to levy
or distrain upon any of Tenant’s Property for rent or to claim or assert title to any of Tenant’s
Property.

26

 

Article 30. MISCELLANEOUS

     30.1 In any case under this Lease which requires that a consent or approval may not be
unreasonably withheld, such consent or approval shall be acted on promptly and without unreasonable
delay.

     30.2 If any term of this Lease or any application thereof shall be invalid or unenforceable,
the remainder of this Lease and any other application of such term shall not be affected thereby.
This Lease may be amended, changed, waived, discharged or terminated only by an instrument in
writing signed by the then owners of the Landlord and Tenant interests herein. This Lease shall be
binding upon and inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto. The headings of this Lease are for purposes of reference only and
shall not limit or define the meaning hereof. This Lease may be executed in any number of
counterparts, each of which is an original, but all of which shall constitute one instrument.

     30.3 The First Mortgage contemplates that Landlord may from time to time substitute one or
more Property Location (a “Substitution”) leased by Tenant from an affiliate of Landlord or cause a
Property Location to be released from the lien of the First Mortgage (a “Property Release”). In
the event that Landlord accomplishes a Substitution, Landlord will cause the new Property Location
to be conveyed to Landlord and Landlord and Tenant will terminate any lease for such new Property
Location and will amend this Lease to add the new Property Location to this Lease. In the event
that Landlord accomplishes a Property Release, Landlord and Tenant will enter into a separate
replacement lease for the released Property Location on the same form (or such other form as may be
acceptable to Landlord and Tenant) and shall amend this Lease to release such Property Location
from the terms of this Lease (with an proportionate reduction in the Basic Rent). Any Substitution
or Property Release shall be accomplished in accordance with all of the terms and conditions of the
First Mortgage.

     30.4 Within 60 days after the close of each Fiscal Year, Tenant shall deliver to Landlord an
annual report for the most recently completed Fiscal Year, describing any Alterations, Remodeling
and leasing commissions, if any. Additionally, within 30 days after the end of each Fiscal Quarter
(including year-end), Tenant shall deliver to Landlord a quarterly report shall be accompanied by a
report of Tenant detailing, for such Fiscal Quarter, (i) the deposits into, withdrawals from and
balances in the FF&E Account, (ii) the Property Revenues, (iii) the Pooled Properties EBITDAR, and
(iv) the number of memberships at the Property.

[remainder of page intentionally left blank]

27

 

SIGNATURE PAGE

TO

LEASE AGREEMENT

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

	 	 	 	 	 	 	 	 	 	 	 
	 	 	LANDLORD:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	LTF CMBS I, LLC,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	LTF CMBS Managing Member, Inc.,

a Delaware corporation	 	 
	 	 	Its: Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name: Eric J. Buss

Its:      Secretary	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	TENANT:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	LTF CLUB OPERATIONS COMPANY, INC.,

a Minnesota corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	Name: Eric J. Buss	 	 
	 	 	Its:      Secretary	 	 

 

 

EXHIBIT A

Legal Description of Land

Exhibit A is comprised of Exhibits A-1 through A-6, attached hereto.

 

 

EXHIBIT A-1

Legal Description of the Arizona Property

Lot 6, of Amended Final Plat of the Emerald, a Replat of Lot 1, According to the Plat of Record in
the Office of the County Recorder of Maricopa County, Arizona, Recorded in Book 571 of Maps, Page
5.

Tempe, Arizona

A-1-1

 

EXHIBIT A-2

Legal Description of the Michigan Property

PART OF THE NORTHEAST 1/4 AND NORTHWEST 1/4 OF SECTION 36, TOWNSHIP 2 NORTH, RANGE 8 EAST, COMMERCE
TOWNSHIP, OAKLAND COUNTY, MICHIGAN, DESCRIBED AS: COMMENCING AT THE NORTH 1/4 CORNER OF SAID
SECTION 36; THENCE SOUTH 00 DEGREES 23 MINUTES 54 SECONDS WEST 1483.09 FEET ALONG THE NORTH-SOUTH
LINE OF SAID SECTION 36; THENCE SOUTH 80 DEGREES 51 MINUTES 00 SECONDS EAST 29.94 FEET TO THE POINT
OF BEGINNING: THENCE CONTINUING SOUTH 80 DEGREES 51 MINUTES 00 SECONDS EAST 57.13 FEET: THENCE
SOUTH 68 DEGREES 46 MINUTES 17 SECONDS EAST 172.66 FEET; THENCE SOUTH 70 DEGREES 08 MINUTES 18
SECONDS EAST 155.09 FEET; THENCE SOUTH 67 DEGREES 31 MINUTES 48 SECONDS EAST 276.10 FEET; THENCE
SOUTH 73 DEGREES 53 MINUTES 07 SECONDS EAST 184.07 FEET; THENCE SOUTH 72 DEGREES 34 MINUTES 02
SECONDS EAST 136.34 FEET; THENCE SOUTH 69 DEGREES 46 MINUTES 53 SECONDS EAST 20.03 FEET; SOUTH 23
DEGREES 07 MINUTES 50 SECONDS WEST 466.10 FEET TO THE NORTHERLY RIGHT OF WAY LINE OF SAID COMMERCE
CROSSING ROAD (VARIABLE RIGHT OF WAY): THENCE ALONG THE NORTHERLY RIGHT OF WAY LINE OF SAID
COMMERCE CROSSING ROAD THE FOLLOWING SEVEN (7) COURSES: (1) NORTH 86 DEGREES 26 MINUTES 30 SECONDS
WEST 557.82 FEET, (2) ALONG A CURVE TO THE RIGHT 94.82 FEET, SAID CURVE HAVING A RADIUS OF 495.82
FEET, A CENTRAL ANGLE OF 10 DEGREES 57 MINUTES 27 SECONDS AND A CHORD BEARING NORTH 80 DEGREES 57
MINUTES 47 SECONDS WEST 94.68 FEET; (3) ALONG A CURVE TO THE RIGHT 97.14 FEET, SAID CURVE HAVING A
RADIUS OF 110.00 FEET, A CENTRAL ANGLE OF 50 DEGREES 35 MINUTES 43 SECONDS AND A CHORD BEARING
NORTH 50 DEGREES 11 MINUTES 11 SECONDS WEST 94.01 FEET, (4) ALONG A CURVE TO THE LEFT 118.41 FEET,
SAID CURVE HAVING A RADIUS OF 102.50 FEET, A CENTRAL ANGLE OF 66 DEGREES 11 MINUTES 17 SECONDS AND
A CHORD BEARING NORTH 57 DEGREES 58 MINUTES 58 SECONDS WEST 111.93 FEET, (5) ALONG A CURVE TO THE
RIGHT 97.14 FEET, SAID CURVE HAVING A RADIUS OF 110.00 FEET, A CENTRAL ANGLE OF 50 DEGREES 35
MINUTES 43 SECONDS AND A CHORD BEARING NORTH 65 DEGREES 46 MINUTES 45 SECONDS WEST 94.01 FEET, (6)
ALONG A CURVE TO THE RIGHT 147.09 FEET, SAID CURVE HAVING A RADIUS OF 495.82 FEET, A CENTRAL ANGLE
OF 16 DEGREES 59 MINUTES 51 SECONDS AND A CHORD BEARING NORTH 31 DEGREES 58 MINUTES 58 SECONDS WEST
146.55 FEET, AND (7) NORTH 23 DEGREES 29 MINUTES 03 SECONDS WEST 126.60 FEET; THENCE NORTH 66
DEGREES 21 MINUTES 11 SECONDS EAST 187.39 FEET; THENCE NORTH 22 DEGREES 49 MINUTES 42 SECONDS EAST
254.03 FEET TO THE POINT OF BEGINNING.

Commerce, Michigan

A-2-1

 

EXHIBIT A-3

Legal Description of the Flower Mound Property

Real property in the County of Denton, State of Texas, described as follows:

Being a tract of land situated in J.T. Stewart Survey, Abstract No. 1161, Town of Flower Mound,
Denton County, Texas, being part of that certain tract of land as described by deed to Plaza Towne
Centre, LTD., recorded in Volume 4812, Page 2406, Deed Records, Denton County, Texas and being a
part of Lot 1, Block A, Downtown Flower Mound Addition, an addition to the Town of Flower Mound,
according to the plat recorded in Cabinet M, Page 223, Plat Records, Denton County, Texas, said
tract of land being more particularly described by metes and bounds as follows:

Beginning
at a 1/2" iron rod found in the Northeasterly right-of-way line
of Churchill Drive (64'
width public right-of-way), the most Westerly Northwest corner of said Plaza Towne Centre, LTD.
tract and the Southwest corner of Lot 1, Block A, Sonic Addition, an addition to the Town of Flower
Mound, according to the plat recorded in Cabinet M, Page 220, Plat Records, Denton County, Texas;

Thence East, with the South line of said Sonic Addition and with a Northerly line of said Plaza
Towne Centre, LTD. tract, a distance of 155.35 feet to a point for the Southeast corner of said
Sonic Addition, all corner for said Plaza Towne Centre, LTD. tract and from which a 1/2" iron rod
found bears North 71 degrees 11 minutes 31 seconds West, 0.25 feet;

Thence South 85 degrees 14 minutes 52 seconds East, a distance of 608.98 feet to an “X” cut in
concrete set in a Easterly line of said Plaza Towne Centre, LTD. tract and being in the West line
of Block 1, Town Center Addition, an addition to the Town of Flower Mound, according to the plat
recorded in Cabinet L, Page 6, Plat Records, Denton County, Texas;

Thence South 01 degree 05 minutes 10 seconds West, with said Easterly line of Plaza Towne Centre,
LTD. tract and with said West line of Block 1, Town Center Addition, a passing distance of 210.63
feet to an “X” cut in concrete found for the most Northerly Northeast corner of aforementioned Lot
1, Block A, Downtown Flower Mound Addition and continuing in all a total distance of 620.21 feet to
a 1/2" iron rod with yellow cap stamped “Everage RPLS 2672” found for the Southwest corner of
aforementioned Block 1, Town Center Addition;

Thence North 89 degrees 56 minutes 57 seconds East, with the South line of said Block 1, Town
Center Addition, a distance of 150.20 feet to an “X” cut in concrete set;

Thence South 00 degrees 03 minutes 03 seconds East, a distance of 225.52 feet to an “X” cut in
concrete set in the aforementioned Northeasterly right-of-way line of Churchill Drive and being in
a Southwesterly line aforementioned Lot 1, Block A, Downtown Flower Mound Addition;

Thence with said Northeasterly right-of-way line of Churchill Drive and with said Southwesterly
line of Lot 1, Block A, Downtown Flower Mound Addition the following courses and distances as
follows:

Flower Mound, Texas

A-3-1

 

South 85
degrees 11 minutes 58 seconds West, a distance of 202.27 feet to a 5/8" iron rod with
yellow cap stamped “Dunaway Assoc. Inc.” (hereinafter
called 5/8" iron rod set) set at the
beginning of a curve to the right having a central angle of 86 degrees 11 minutes 29 seconds, a
radius of 617.43 feet and a chord bearing and distance of North 51 degrees 42 minutes 19 seconds
West, 843.68 feet;

with said
curve to the right in a Northwesterly direction, an arc length of 928.81 feet to a 5/8"
iron rod set at the beginning of a compound curve to the right having a central angle of 17 degrees
29 minutes 00 seconds, a radius of 318.00 feet and a chord bearing and distance of North 00 degrees
07 minutes 56 seconds East, 96.66 feet;

with said compound curve to the right, a passing arc length of 13.60 feet to the most Westerly
Northwest corner of aforementioned Lot 1, Block A, Downtown Flower Mound Addition and continuing
with said compound curve to the right in a Northeasterly direction for an over all arc length of
97.04 feet to a 5/8" iron rod set at the beginning of a reverse curve to the left having a central
angle of 32 degrees 16 minutes 33 seconds, a radius of 532.00 feet and a chord bearing and distance
of North 07 degrees 15 minutes 51 seconds West, 295.74 feet;

Thence continuing with said Northeasterly right-of-way line of Churchill Drive and with said
reverse curve to the left, in a Northwesterly direction, an arc length of 299.69 feet to the Point
of Beginning and containing 599,760 square feet or 13.768 acres of land.

Also known as Lot 1, Block A, Lifetime Fitness Addition, an Addition to the Town of Flower Mound,
according to the plat recorded in Cabinet V, Page 389, Plat Records, Denton County, Texas.

Flower Mound, Texas

A-3-2

 

EXHIBIT A-4

Legal Description of the Garland Property

Being a tract of land situated in Onofre Alvarado Survey, Abstract No. 2, in the City of Garland,
Dallas County, Texas, being a part of that certain tract of land as described by deed to Life Time
Fitness, Inc., recorded in Volume 2003161, Page 12899, Deed Records, Dallas County, Texas and being
all of Lot 2, Block 1, Lifetime Fitness Addition, an addition to the City of Garland, according to
the plat recorded in volume 2003163, Page 128, Plat Records, Dallas County, Texas and containing a
calculated area of 597,430 square feet or 13.715 acres of land.

Garland, Texas

A-4-1

 

EXHIBIT A-5

Legal Description of the Sugar Land Property

Real property in the County of Fort Bend, State of Texas, described as follows:

Being a 14.7490 acre tract of land located in the S.M. Williams League, A-97, in Fort Bend County,
Texas; said 14.7490 acre tract being all of Commercial Reserve “A” of the plat of Lakepointe Center
recorded on Slide Number 2547B of the Fort Bend County Plat Records (F.B.C.P.R.); said 14.7490 acre
tract being more particularly described by metes and bounds as follows (all bearings are referenced
to the North line of said Commercial Reserve “A”):

Beginning at a 5/8-inch iron rod with plastic cap stamped “Costello Inc RPLS 4416” found at the
Northwest corner of said Commercial Reserve A, being the Southwest corner of Common Area “G” of
Fluor Central Development Tract Replat No. I as recorded on Slide Number 2427A of the F.B.C.P.R.
same being on the East right-of-way line of Brooks Street (Spur 58) (width varies);

Thence, with the South and West line of said Common Area “G” and with the North and East line of
said Commercial Reserve “A”, the following six (6) courses;

1. North 87 degrees 55 minutes 14 seconds East, a distance of 1,383.72 feet to a 5/8-inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

2. South 16 degrees 14 minutes 03 seconds West, a distance of 137.91 feet to a 5/8-inch iron rod
with plastic cap stamped “Brown and Gay” found;

3. South 22 degrees 13 minutes 34 seconds West, a distance of 90.97 feet to a 5/8-inch iron rod
with plastic cap stamped “Brown and Gay” found;

4. South 12 degrees 37 minutes 04 seconds West, a distance of 130.08 feet to a 5/8-inch iron rod
with plastic cap stamped “Brown and Gay” found;

5. South 20 degrees 46 minutes 28 seconds West, a distance of 68.93 feet to a 5/8-inch iron rod
with plastic cap stamped “Brown and Gay” found;

6. South 13 degrees 19 minutes 57 seconds West, a distance of 47.79 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found at the easternmost Southeast corner of said
Commercial Reserve “A”, being the Northeast corner of Commercial Reserve “C” of said plat of
Lakepointe Center;

Thence, along the common line of said Commercial Reserve “A” and Commercial Reserve “C’ the
following nine (9) courses:

7. South 87 degrees 55 minutes 14 seconds West, a distance of 517.62 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

Sugar Land, Texas

A-5-1

 

8. South 02 degrees 04 minutes 46 seconds East, a distance of 60.00 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

9. South 87 degrees 55 minutes 14 seconds West, a distance of 52.90 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

10. South 02 degrees 04 minutes 46 seconds East, a distance of 162.59 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found at the point of curvature of a curve to the right;

11. 189.87 feet, along said curve, having a central angle of 33 degrees 28 minutes 23 seconds, a
radius of 325.00 feet, and a chord that bears South 14 degrees 39 minutes 25 seconds West, a
distance of 187.18 feet to a 5/8 inch iron rod with cap stamped “Costello Inc RPLS 4416” found at
the point of tangency;

12. South 31 degrees 23 minutes 37 seconds West, a distance of 112.26 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

13. South 27 degrees 00 minutes 30 seconds West, a distance of 131.16 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

14. South 31 degrees 22 minutes 54 seconds West, a distance of 195.60 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

15. South 14 degrees 43 minutes 37 seconds East, a distance of 76.79 feet to a point on the
northeasterly right-of-way line of State Highway 6, as recorded in Volume 1090, Page 661, Volume
1313, Page 771, and Volume 1090, Page 668 of the F.B.C.D.R.;

16. Thence, 124.36 feet along the arc of a curve to the right, having a central angle of 02 degrees
32 minutes 41 seconds, a radius of 2,799.90 feet, and a chord that bears North 59 degrees 11
minutes 05 seconds West, a distance of 124.35 feet along the southerly line of said Commercial
Reserve “A” and said northeasterly right-of-way line to a 5/8 inch iron rod with cap stamped
“Costello Inc RPLS 4416” found at the southernmost Southwest corner of said Commercial Reserve “A”;

Thence, along the westerly line of said Commercial Reserve “A” the following two (2) courses:

17. North 31 degrees 22 minutes 54 seconds East, a distance of 17.76 feet a 5/8 inch iron rod with
cap stamped “Costello Inc RPLS 4416” found;

18. North 57 degrees 32 minutes 00 seconds West, a distance of 36.36 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found at the southernmost Southeast corner of Commercial
reserve “B” of said plat of Lakepointe Center;

Thence, along the common line of said Commercial Reserve “A” and Commercial Reserve “B” the
following eleven (11) courses:

Sugar Land, Texas

A-5-2

 

19. North 32 degrees 50 minutes 27 seconds East, a distance of 30.00 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

20. South 58 degrees 37 minutes 06 seconds East, a distance of 30.00 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

21. North 60 degrees 35 minutes 48 seconds East, a distance of 11.44 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

22. North 31 degrees 22 minutes 54 seconds East, a distance of 190.95 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

23. North 35 degrees 28 minutes 34 seconds East, a distance of 126.01 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

24. North 31 degrees 23 minutes 37 seconds East, a distance of 118.06 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found at the point of curvature of a curve to the left;

25. 160.66 feet, along said curve, having a central angle of 33 degrees 28 minutes 23 seconds, a
radius of 275.00 feet, and a chord that bears North 14 degrees 39 minutes 25 seconds East, a
distance of 158.38 feet to a 5/8 inch iron rod with cap stamped “Costello Inc RPLS 4416” found at
the point of tangency;

26. North 02 degrees 04 minutes 46 seconds West, a distance of 162.59 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

27. South 87 degrees 55 minutes 14 seconds West, a distance of 52.90 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

28. North 02 degrees 04 minutes 46 seconds West, a distance of 60.00 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

29. South 87 degrees 55 minutes 14 seconds West, a distance of 533.93 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found at the westernmost Southwest corner of said
Commercial Reserve “A”, being the Northwest corner of said Commercial Reserve “B”;

Thence, along the West line of said Commercial Reserve “A” the following three (3) courses:

30. 35.76 feet, along the arc of a curve to the left, having a central angle of 04 degrees 56
minutes 12 seconds, a radius of 415.00 feet, and a chord that bears North 04 degrees 09 minutes 38
seconds West, a distance of 35.74 feet to a 5/8 inch iron rod with cap stamped “Costello Inc RPLS
4416” found;

31. North 06 degrees 37 minutes 43 seconds West, a distance of 86.84 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found;

Sugar Land, Texas

A-5-3

 

32. South 36 degrees 21 minutes 48 seconds West, a distance of 11.58 feet to a 5/8 inch iron rod
with cap stamped “Costello Inc RPLS 4416” found on aforesaid East right-of-way line of Brooks
Street;

33. Thence, North 03 degrees 23 minutes 53 seconds West, a distance of 336.12 feet along the West
line of said Commercial Reserve “A” and said East right-of-way line to the Point of Beginning and
containing 14.7490 acres, more or less.

Sugar Land, Texas

A-5-4

 

EXHIBIT A-6

Legal Description of the Willowbrook Property

Real property in the County of Harris, State of Texas, described as follows:

Being all of unrestricted Reserve “A”, Block 1, of CENTERFIELD NORTH, a Subdivision in Harris
County, Texas, according to the map or plat thereof recorded at Film No. 446085 of the Map Records
of Harris County, Texas. Exhibit “A” attached.

Willowbrook, Texas

A-6-1

 

EXHIBIT “A”

                    a 12.196 acre (531,252 square feet, square footage based on the mathematical closures of the
courses and distances shown herein) tract of land situated in the George W. Childress Survey,
Abstract No. 217, Harris County, Texas: containing all of that certain 7.6114 acre tract described
as “Parcel D” in instrument recorded under Clerk’s File No. N980274 of the Harris County Official
Public Records of Real Property; containing a portion of that certain 5.8732 acre tract described
as “Parcel E” In said instrument recorded under Clerk’s File No. N980274 of the Harris County
Official Public Records of Real Property; said 12.196 acre tract being more particularly described
as follows:

BEGINNING at a 1-inch iron pipe (with tap stamped “Cotton Surveying”) set on the easterly
right-of-way line of Centerfield Blvd. (100-feet wide) as shown on the street dedication of
Centerfield Section 2, plat of which is recorded in Volume 335, Page 55 of the Harris County Map
Records and being the southwest corner of said Parcel D;

THENCE, in a northerly direction along the said easterly right-of-way line of Centerfield Blvd.,
(right-of-way varies) the following five (5) courses and distances:

	 	1.	 	Along the arc of said curve to the right having a radius of 1450.00 feet, a
central angle of 02°06’14”, an arc length of 53.25 feet and a long chord bearing North
16°00’55” West, 53.24 feet to a 1-inch iron pipe (with cap stamped “Cotton Surveying”)
found at the point of compound curvature, beginning a curve to the right;
	 
	 	2.	 	Along the arc of said curve to the right having a radius of 500.00 feet, a
central angle of 05°43’46”, an arc length of 50.00 feet and a long chord bearing North
12°05’55” West, 49.98 feet to a 1-inch iron pipe found at the point of tangency;
	 
	 	3.	 	North 09°14’02” West, 111.36 feet to a 1-inch iron pipe, found at the beginning
of a curve to the left;
	 
	 	4.	 	Along the arc of said curve to the left having a radius of 500.00 feet, a
central angle of 03°45’13”, an arc length of 32.76 feet and a long chord bearing North
11°06’39” West, 32.75 feet to a 1-inch iron pipe (with cap stamped “Cotton Surveying”)
found at the point of tangency;
	 
	 	5.	 	North 12°59’15” West, 352.75 feet to a 1-inch iron pipe (with cap stamped
“Cotton Surveying”) found on the southerly end of a 15-foot cutback at the intersection
of said easterly line and the southerly line of Willowchase Blvd. (100-feet wide);

THENCE, in an easterly direction along the said southerly right-of-way line of Willowchase Blvd.,
the following five (5) courses and distances:

Willowbrook, Texas

A-6-2

 

	 	1.	 	North 31°33’48” East, 21.49 feet along said cutback to a 1-inch iron pipe (with
cap stamped “Cotton Surveying”) found for corner;
	 
	 	2.	 	North 77°01’32” East, 85.00 feet to a 1-inch iron pipe (with cap stamped
“Cotton Surveying”) found beginning a curve to the left;
	 
	 	3.	 	Along the arc of said curve to the left having a radius of 1050.00 feet, a
central angle of 35°00’00”, an arc length of 641.41 feet and a long chord bearing North
59°31’32” East, 631.48 feet to a 1-inch iron pipe (with cap stamped “Cotton Surveying”)
found at the point of tangency;
	 
	 	4.	 	North 42°01’32” East, 100.00 feet to a 1-inch iron pipe (with cap stamped
“Cotton Surveying”) found beginning a curve to the right;
	 
	 	5.	 	Along the arc of said curve to the right having a radius of 1950.00 feet, a
central angle of 04°37’49”, an arc length of 157.59 feet and a long chord bearing North
44°20’27” East, 157.55 feet to a 1-inch iron pipe (with cap stamped “Cotton Surveying”)
found at the point of non-tangency;

THENCE, South 30°59’15” East, 543.60 feet to a 1-inch iron pipe (with cap stamped “Cotton
Surveying”) found for corner;

THENCE, South 61°59’12” West, 121.03 feet to a 5/8-inch iron rod found for an angle point;

THENCE, South 54°45’11” West, 1052.80 feet to the POINT OF BEGINNING, CONTAINING 12.196 acres of
land in Harris County, Texas.

Willowbrook, Texas

A-6-3

 

EXHIBIT B

Permitted Exceptions

     Exhibit B is comprised of Exhibits B-1 through B-6, attached hereto.

 

 

EXHIBIT B-1

Permitted Exceptions for the Arizona Property

	1.	 	Real Estate taxes for the year 2007 and thereafter, a lien not yet due and payable.
	 
	2.	 	Easement for sidewalk and public utility purposes as set forth on the plat of The Emerald
recorded in Plat Book 536 of Maps, Page(s) 24.
	 
	3.	 	Easement for sidewalk and public utility purposes as set forth on the plat of The Emerald A,
recorded in Plat Book 571 of Maps, Page 5 as amended by the Affidavit of Correction recorded
as 2003-1032783.
	 
	4.	 	Declaration of Covenants, Conditions, Restrictions and Easements, recorded in 99-1131629 and
First Amendment recorded as 2001-0771127 of Official Records, but deleting any covenant,
condition or restriction indicating a preference, limitation or discrimination based on race,
color, religion, sex, handicap, familial status or national origin to the extent such
covenants, conditions or restrictions violate 42 U.S.C § 3604(c).
	 
	5.	 	All matters set forth in Tract Declaration recorded as 2001-0771130 of Official Records, but
deleting any covenant, condition or restriction indicating a preference, limitation or
discrimination based on race, color, religion, sex, handicap, familial status, or national
origin, to the extent such covenants, conditions or restrictions violate 42 U.S.C. § 3604(c).
	 
	6.	 	All matters set forth in Covenant and Agreement Regarding Maintenance of Yards for an
Oversized Building, recorded July 15, 2002 as 2002-714573 of Official Records.
	 
	7.	 	An easement for underground electric and incidental purposes in the document recorded as
2000-0833836 of Official Records.
	 
	8.	 	An easement for underground vault and telecommunications conduits and incidental purposes in
the document recorded as 2001-0523255 of Official Records.
	 
	9.	 	An easement for water line, fire hydrant(s) and appurtenances and incidental purposes in the
document recorded as 2002-0020809 of Official Records.
	 
	10.	 	All matters as set forth in Covenant and Agreement Regarding Maintenance of Yards for an
Oversized Building, recorded July 15, 2002 as 2002-0714573 of Official Records.
	 
	11.	 	An easement for power distribution and incidental purposes in the document recorded as
2002-1190418 of Official Records.
	 
	12.	 	An easement for sewer lines and incidental purposes in the document recorded as 2003-0073402
of Official Records.
	 
	13.	 	Water rights, claims or title to water, whether or not shown by the public records.

Tempe, Arizona

B-1-1

 

EXHIBIT B-2

Permitted Exceptions for the Michigan Property

	1.	 	Real estate taxes and special assessments not yet due and payable in the year 2007 and
thereafter.
	 
	2.	 	Terms and conditions of a Grant of Water Main Easement as recorded March 11, 2005 in Liber
35123, page 330.
	 
	3.	 	Terms and conditions of a Grant of Sewer Easement as recorded March 11, 2005 in Liber 35123,
page 336.
	 
	4.	 	Terms and conditions of a Pylon Sign Easement Agreement as recorded April 27, 2004 in Liber
32902, page 640.
	 
	5.	 	Terms and conditions of a Reservation of Easement Agreement (Drainage Facilities) as
recorded April 27, 2004 in Liber 32902, page 647.
	 
	6.	 	Terms and conditions of a Corrective Assignment as recorded January 7, 2002 in Liber 24400,
page 278.
	 
	7.	 	Terms and conditions of a Declaration of Restrictive Covenant as recorded April 15, 2003 in
Liber 28808, page 806, as amended by Amendment to Declaration of Restrictive Covenant dated
January 12, 2004, recorded January 29, 2004, in Liber 32045, page 828.
	 
	8.	 	Grant of Sewer Easement to the Charter Township of Commerce, dated December 11, 1990 and
recorded December 28, 1990 in Liber 11687, page 44.
	 
	9.	 	Grant of Water Line Easement to the Charter Township of Commerce, dated September 25, 1991
and recorded November 12, 1991 in Liber 12169, page 859.
	 
	10.	 	Easement in favor of Panhandle Eastern Pipeline, as set forth in Grant of Right of Way dated
December 10, 1941 and recorded in Liber 1396, page 283 and Supplemented Easement dated
September 6, 1955 in Liber 3409, page 622 and amended by Amendment to Right of Way dated
April 10, 1961 and recorded in Liber 4188, page 351.
	 
	11.	 	Easement Agreement and the terms and conditions thereof between Life Time Fitness, Inc., a
Minnesota corporation and Haggerty Development Company Limited Partnership, a Michigan
limited partnership, dated July 13, 2005, recorded November 21, 2005 in Liber 36642, Page
493, Oakland County Records.
	 
	12.	 	Easement granted the Detroit Edison Company disclosed by instrument recorded in Liber 36652,
Page 284, Oakland County Records.
	 
	13.	 	The following matters as disclosed by the survey prepared by Alpine Engineering Inc., dated
December 15, 2006, job no. 03-194: encroachment of gas line along the Southern boundary of
the land.

Commerce, Michigan

B-2-1

 

EXHIBIT B-3

Permitted Exceptions for the Flower Mound Property

	1.	 	Standby fees, taxes and assessments by any taxing authority for the year 2007, and subsequent
years; and subsequent taxes and assessments by any taxing authority for prior years due to
change in land usage or ownership, but not those taxes or assessments for prior years because
of an exemption granted to a previous owner of the property under Section 11.13, Texas Tax
Code, or because of improvements not assessed for a previous tax year.
	 
	2.	 	Restrictive covenants recorded in Volume 2184, Page 944, Real Property Records of Denton
County, Texas. Any covenant, condition or restriction indicating a preference, limitation or
discrimination based on race, color, religion, sex, handicap, familial status, or national
origin to the extent such covenants, conditions or restrictions violate 42 USC 3604(c), is
deleted.
	 
	3.	 	Restrictive covenants filed 11/25/2003, cc# 2003-192554, Real Property Records of Denton
County, Texas. Any covenant, condition or restriction indicating a preference, limitation or
discrimination based on race, color, religion, sex, handicap, familial status, or national
origin to the extent such covenants, conditions or restrictions violate 42 USC 3604(c), is
deleted.
	 
	4.	 	Non-discriminatory covenant in document recorded in Volume 1125, Page 304, Deed Records of
Denton County, Texas. Any covenant, condition or restriction indicating a preference,
limitation or discrimination based on race, color, religion, sex, handicap, familial status,
or national origin to the extent such covenants, conditions or restrictions violate 42 USC
3604(c), is deleted.
	 
	5.	 	Rights of ingress and egress created in easement granted by William Wilkerson and Wayne
Wilkerson to Town of Flower Mound, Texas, dated 09/10/1965, filed 12/28/1965, recorded in
Volume 532, Page 193, Deed Records of Denton County, Texas, and as shown on survey of Dunway
Associates, L.P., certified to by Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	6.	 	Easement granted by C. H. McGuire and wife, Hazel McGuire to Denton County Electric
Cooperative, Inc., dated 11/07/1947, filed 02/09/1954, recorded in Volume 403, Page 399, Deed
Records of Denton County, Texas. Defined by Agreement dated 10/17/1991, filed 10/28/1991,
recorded in Volume 3088, Page 228, Real Property Records, Denton County, Texas and as shown on
survey of Dunway Associates, L.P., certified to by Stephen R. Glosup, R.P.L.S. #5570, dated
12/14/2006.
	 
	7.	 	Sanitary Sewer easement granted by Flower Mound Investment, L.C. to FM 1171 Joint Venture,
dated 02/04/1997, filed 02/13/1997, cc# 97R009458, Real Property Records of Denton County,
Texas. Correction Easement Agreement dated 03/06/2001 from Flower Mound Investments, L.C.
filed 04/09/2001, recorded in Volume 4812, Page 2431, Real
Property Records, Denton County, Texas and as shown on survey of Dunway Associates, L.P.,
certified to by Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.

Flower Mound, Texas

B-3-1

 

	8.	 	Access Easement Agreement between F.M. 1171 Joint Venture and The Kroger Co. dated
08/04/1994, filed 08/12/1994, under cc# 94R0063170, Real Property Records, Denton County,
Texas and as shown on survey of Dunway Associates, L.P., certified to by Stephen R. Glosup,
R.P.L.S. #5570, dated 12/14/2006.
	 
	9.	 	Access Easement Location Agreement between F.M. 1171 Joint Venture and Landstar Development
Corporation dated 05/31/1994, filed 06/02/1994, under cc# 94R0044351, Real Property Records,
Denton County, Texas and as shown on survey of Dunway Associates, L.P., certified to by
Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	10.	 	Easements and building lines as dedicated by plat recorded in Cabinet V, Page 389, Plat
Records, Denton County, Texas, being 60’ building line, 10’ pedestrian access easement, 26’
mutual access easements, variable width mutual access easement, 15’ utility easements,
variable width retention pond easement and 20’ utility easement and as shown on survey of
Dunway Associates, L.P., certified to by Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	11.	 	Encroachment Easement Agreement dated 12/03/2003, by and between Life Time Fitness, Inc. and
Encore Realty Company, L.C., filed 12/19/2003, under cc# 2003-204162, Real Property Records,
Denton County, Texas and as shown on survey of Dunway Associates, L.P., certified to by
Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	12.	 	Stormwater Drainage Easement Agreement dated 12/03/2003, by and between Life Time Fitness,
Inc. and Encore Realty Company, L.C., filed 12/19/2003, cc# 2003-204163, Real Property
Records, Denton County, Texas and as shown on survey of Dunway Associates, L.P., certified to
by Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	13.	 	Stormwater Drainage Easement and Management Agreement dated 12/02/2003, by and between Life
Time Fitness, Inc. and Plaza Towne Centre, Ltd., cc# 2003-104164, Real Property Records,
Denton County, Texas and as shown on survey of Dunway Associates, L.P., certified to by
Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	14.	 	Encroachment Easement Agreement dated 12/03/2003, by and between Life Time Fitness, Inc. and
Flower Mound Town Center Limited Partnership, filed 12/19/2003, cc# 2003-204166, Real Property
Records, Denton County, Texas and as shown on survey of Dunway Associates, L.P., certified to
by Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	15.	 	Encroachment Easement Agreement dated 12/03/2003, by and between Life Time Fitness, Inc. and
Kroger Texas L.P., filed 12/19/2003, cc# 2003-204167, Real Property Records, Denton County,
Texas and as shown on survey of Dunway Associates, L.P., certified to by Stephen R. Glosup,
R.P.L.S. #5570, dated 12/14/2006.

Flower Mound, Texas

B-3-2

 

	16.	 	Terms, conditions and easements contained in the Access Easement Agreement and Declaration
dated 11/20/2003, by and between Flower Mound Town Center Limited Partnership, Plaza Towne
Centre, Ltd., and Kroger Texas L.P., filed 11/25/2003, cc# 2003-192554, Real Property Records,
Denton County, Texas.
	 
	17.	 	Terms, provisions, and conditions of Town of Flower Mound ordinance No. 65-03 filed
11/05/2003, cc# 2003-182602, Real Property Records of Denton County, Texas.
	 
	18.	 	Encroachment of parking areas over and across utility easements as shown on survey of Dunway
Associates, L.P., certified to by Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.

Flower Mound, Texas

B-3-3

 

EXHIBIT B-4

Permitted Exceptions for the Garland Property

	1.	 	Standby fees, taxes and assessments by any taxing authority for the year 2007, and subsequent
years; and subsequent taxes and assessments by any taxing authority for prior years due to
change in land usage or ownership, but not those taxes or assessments for prior years because
of an exemption granted to a previous owner of the property under Section 11.13, Texas Tax
Code, or because of improvements not assessed for a previous tax year.
	 
	2.	 	Restrictive covenants recorded in Volume 2001212, Page 323, Deed Records of Dallas County,
Texas. As corrected recorded in Volume 2003037, Page 5226, Deed Records, Dallas County,
Texas, as amended in Volume 2004227, Page 5281, Deed Records, Dallas County, Texas. Said
Amendment being refiled 11/23/2004, recorded in Volume 2004239, Page 8241, Deed Records,
Dallas County, Texas. Any covenant, condition or restriction indicating a preference,
limitation or discrimination based on race, color, religion, sex, handicap, familial status,
or national origin to the extent such covenants, conditions or restrictions violate 42 USC
3604(c), is deleted.
	 
	3.	 	Restrictive covenants recorded in Volume 2003206, page 3285, Deed Records of Dallas County,
Texas. As amended by instrument recorded in Volume 2004001, Page 1902 and as affected by
Consent and Waiver filed 03/11/2004, recorded in Volume 2004048, Page 21, Deed Records, Dallas
County, Texas. Any covenant, condition or restriction indicating a preference, limitation or
discrimination based on race, color, religion, sex, handicap, familial status, or national
origin to the extent such covenants, conditions or restrictions violate 42 USC 3604(c), is
deleted.
	 
	4.	 	Easement to the City of Garland, filed 07/22/2003, recorded in Volume 2003144, Page 2189,
Deed Records of Dallas County, Texas, and as shown on survey of Dunaway Associates, L.P.,
certified to by Stephen R. Glosup, R.P.L.S. #5570, dated 12/14/2006.
	 
	5.	 	15’ wide slope easement as evidenced by permitted exception #5 on Exhibit B of Special
Warranty Deed recorded in Volume 93182, Page 238, Deed Records, Dallas County, Texas.
	 
	6.	 	15’ utility easement, private variable width pond easement, 10’ pedestrian utility and
traffic control easement, 10’ private drainage easement and 5’ pedestrian and utility easement
per plat recorded in Volume 2003163, Page 128, Map Records, Dallas County, Texas and as shown
on survey of Dunaway Associates, L.P., certified to by Stephen R. Glosup, R.P.L.S. #5570,
dated 12/14/2006.
	 
	7.	 	Declaration of Common Access and No-Build Easements between G.N.L.R., Ltd., and 190/Garland
Retail Partners, L.P., filed 10/29/2001, recorded in Volume 2001212, Page 323, Deed Records,
Dallas County, Texas, as corrected by instrument recorded in Volume 2003037, Page 5226, Deed
Records, Dallas County, Texas, as amended by
Amendment of Declaration and Grant of Access Easement for Pond filed 11/23/2004, recorded in
Volume 2004227, Page 5281, Deed Records, Dallas County, Texas.

Garland, Texas

B-4-1

 

	8.	 	Declaration of Easements and Maintenance Covenants executed by Life Time Fitness, Inc. dated
10/09/2003, filed 10/17/2003, recorded in Volume 2003206, Page 3296, Deed Records, Dallas
County, Texas.
	 
	9.	 	Utility vaults, electric transformer and grate inlets outside of easement area as shown
on survey of Dunaway Associates, L.P., certified to by Stephen R. Glosup, R.P.L.S. #5570,
dated 12/14/2006.

Garland, Texas

B-4-2

 

EXHIBIT B-5

Permitted Exceptions for the Sugar Land Property

	1.	 	Standby fees, taxes and assessments by any taxing authority for the year 2007, and subsequent
years; and subsequent taxes and assessments by any taxing authority for prior years due to
change in land usage or ownership, but not those taxes or assessments for prior years because
of an exemption granted to a previous owner of the property under Section 11.13, Texas Tax
Code, or because of improvements not assessed for a previous tax year.
	 
	2.	 	Restrictions recorded in Slide No. 2427, Pages A and B of the Plat Records of Fort Bend
County, Texas; Volume 1059, Page 152 and Volume 1077, Page 448, Deed Records; Volume 1389,
Page 112, Volume 1672, Page 769 and under Clerk’s File No.(s). 8660796, 8827135, 9144575,
9483640, 9728010, 2000005824, 2001058569, 2001081202, 2003157545, 2003157546, 2003157547, and
2005190907, all of the Official Records of Fort Bend County, Texas. Maintenance
Charge/Assessments as provided for therein. Subordination to purchase money and/or
improvement liens contained therein. Any covenant, condition or restriction indicating a
preference, limitation or discrimination based on race, color, religion, sex, handicap,
familial status, or national origin to the extent such covenants, conditions or restrictions
violate 42 USC 3604(c), is deleted.
	 
	3.	 	Easement for Roadway as set forth in instrument recorded in Volume 744, Page 48, of the Deed
records, of Fort Bend County, Texas, as shown on survey of Cotton Surveying Company, certified
to by Martin G. Hicks, R.P.L.S. #4387, dated 12/2/2006.
	 
	4.	 	Easement for electric distribution and/or natural gas facilities in favor of Reliant Energy
Incorporated as set forth in instrument recorded 5/22/2002 in Clerk’s File No. 2002053866, of
the Official records, of Fort Bend County, Texas, as shown on survey of Cotton Surveying
Company, certified to by Martin G. Hicks, R.P.L.S. #4387, dated 12/2/2006.
	 
	5.	 	Easement to CenterPoint Energy Houston Electric, LLC as set forth in instrument recorded in
Clerk’s File No. 2005070007, of the Official records, of Fort Bend County, Texas and as shown
on survey of Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S. #4387, dated
12/2/2006.
	 
	6.	 	A twenty (20) foot drainage easement as shown on the Fluor Central Development Tract Replat
Number 1, recorded on Slide 2427/A&B, of the Plat Records of Fort Bend County, Texas and as
shown on survey of Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S. #4387,
dated 12/2/2006.
	 
	7.	 	A forty (40) foot building line as shown on the Fluor Central Development Tract Replat Number
1, recorded on Slide 2427/A&B, of the Plat Records of Fort Bend County, Texas and as shown on
survey of Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S. #4387, dated
12/2/2006.

Sugar Land, Texas

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	8.	 	A twenty-five (25) foot building line as shown on the Fluor Central Development Tract Replat
Number 1, recorded on Slide 2427/A&B, of the Plat Records of Fort Bend County, Texas and as
shown on survey of Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S. #4387,
dated 12/2/2006.
	 
	9.	 	Levee along the east side of the property as set forth in instrument recorded in Volume 841,
Page 90, of the Deed Records of Fort Bend County, Texas and as shown on survey of Cotton
Surveying Company, certified to by Martin G. Hicks, R.P.L.S. #4387, dated 12/2/2006.
	 
	10.	 	Terms, conditions and stipulations contained in that certain Reciprocal Easement Agreement
filed for record on 11/7/2003, under Clerk’s File No. 2003157548, of the Official Records of
Fort Bend County, Texas and as shown on survey of Cotton Surveying Company, certified to by
Martin G. Hicks, R.P.L.S. #4387, dated 12/2/2006.
	 
	11.	 	Public utility easement located along the northeasterly property line as granted to the City
of Sugar Land, Texas, per instrument filed for record under Clerk’s File No. 2004142752, of
the Official Records of Fort Bend County, Texas.
	 
	12.	 	Mineral and/or royalty interest as set forth in instrument recorded in Volume 607, Page 101,
of the Deed records, of Fort Bend County, Texas. Title to said interest has not been
investigated to the date of the aforesaid instrument.
	 
	13.	 	Mineral and/or royalty interest as set forth in instrument recorded in Volume 1244, Page 823,
of the Deed records, of Fort Bend County, Texas. Title to said interest has not been
investigated to the date of the aforesaid instrument.
	 
	14.	 	Inclusion within Fort Bend County Levee Improvement District No. 2.
	 
	15.	 	Inclusion within Fort Bend County Drainage District.
	 
	16.	 	Storm sewer manholes, traffic signal pole and box, overhead power lines, Type C inlets, flush
valves, grate inlets, sanitary manholes, water valves, gas valves, electric control box and
electric meter pole as shown on survey of Cotton Surveying Company, certified to by Martin G.
Hicks, R.P.L.S. #4387, dated 12/2/2006.
	 
	17.	 	Mechanic’s and Materialmen’s Affidavit and Claim of Lien as set forth in instrument recorded
12/15/2004 in Clerk’s File No. 2004151353, of the Official records, of Fort Bend County, Texas
from Claimant S.T.A.R. Concrete Pumping Company, Inc. in the amount of $4,602.75.

Sugar Land, Texas

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EXHIBIT B-6

Permitted Exceptions for the Willowbrook Property

	1.	 	Standby fees, taxes and assessments by any taxing authority for the year 2007, and subsequent
years; and subsequent taxes and assessments by any taxing authority for prior years due to
change in land usage or ownership, but not those taxes or assessments for prior years because
of an exemption granted to a previous owner of the property under Section 11.13, Texas Tax
Code, or because of improvements not assessed for a previous tax year.
	 
	2.	 	Restrictions recorded in Film Code Number 446085 and Volume 335, Page 55, both of the Map
Records of Harris County, Texas, and Harris County Clerk’s File Nos. J598942, K087128,
S605697, S808795, S808797, V262601, W715481, and W715483. Any covenant, condition or
restriction indicating a preference, limitation or discrimination based on race, color,
religion, sex, handicap, familial status, or national origin to the extent such covenants,
conditions or restrictions violate 42 USC 3604(c), is deleted.
	 
	3.	 	A Ten (10’) foot building setback line parallel and adjacent to Willowchase Boulevard
property line as set forth on the recorded plat and dedication at Film Code No. 446085 of the
Map Records of Harris County, Texas, as shown on survey of Cotton Surveying Company, certified
to by Martin G. Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.
	 
	4.	 	A Twenty Five (25’) foot Landscape Reserve parallel and adjacent to Willowchase Boulevard,
and as set out in Harris County Clerk’s File No. J598942, modified by W715483, and as set
forth on the recorded plat and dedication at Film Code No. 446085 of the Map Records of Harris
County, Texas, as shown on survey of Cotton Surveying Company, certified to by Martin G.
Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.
	 
	5.	 	A Thirty Five (35’) foot building setback line parallel and adjacent to Willowchase
Boulevard, and as set out in Harris County Clerk’s File No. J598942, modified by W715483 and
as set forth on the recorded plat and dedication at Film Code No. 446085 of the Map Records of
Harris County, Texas, as shown on survey of Cotton Surveying Company, certified to by Martin
G. Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.
	 
	6.	 	A Ten (10’) foot building setback line parallel and adjacent to Centerfield Boulevard, and as
set out in Harris County Clerk’s File No. K087128, and as set forth on the recorded plat and
dedication at Film Code No. 446085 of the Map Records of Harris County, Texas, as shown on
survey of Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S #4387, dated
3/4/2004, updated 11/17/2006.
	 
	7.	 	A Twenty Five (25’) foot Landscape Reserve along the parallel and adjacent to Centerfield
Boulevard, and as set out in Harris County Clerk’s File No. K087128, and as
set forth on the recorded plat and dedication at Film Code No. 446085 of the Map Records of
Harris County, Texas, as shown on survey of Cotton Surveying Company, certified to by Martin
G. Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.

Willowbrook, Texas

B-6-1

 

	8.	 	A Thirty Five (35’) foot building setback line along the parallel and adjacent to
Centerfield Boulevard, and as set out in Harris County Clerk’s File No. K087128, and as set
forth on the recorded plat and dedication at Film Code No. 446085 of the Map Records of Harris
County, Texas, as shown on survey of Cotton Surveying Company, certified to by Martin G.
Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006. .
	 
	9.	 	Sanitary Sewer Easements as shown on the recorded plat and dedication at Film Code No. 446085
of the Map Records of Harris County, Texas and by Volume 335, Page 55 of the Map Records of
Harris County, Texas, as shown on survey of Cotton Surveying Company, certified to by Martin
G. Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.
	 
	10.	 	A Fifteen (15’) foot in width foot building setback line along the Easterly property line as
set forth on the recorded plat and dedication at Film Code No. 446085 of the Map Records of
Harris County, Texas and being set forth in instrument filed for record under Harris County
Clerk’s File No. J598942 and as shown on survey of Cotton Surveying Company, certified to by
Martin G. Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006..
	 
	11.	 	Utility Easement as shown on the recorded plat and dedication at Film Code No. 446085 of the
Map Records of Harris County, Texas and by Film Code No. 368029 of the Map Records of Harris
County, Texas, and, by instrument filed for record under Harris County Clerk’s File No.
R265303 and as shown on survey of Cotton Surveying Company, certified to by Martin G. Hicks,
R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.
	 
	12.	 	A Ten (10’) foot building setback line along the Southerly property line as set forth on the
recorded plat and dedication at Film Code No. 446085 of the Map Records of Harris County,
Texas and by instrument recorded under Harris County Clerk’s File No. J598942 and as shown on
survey of Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S #4387, dated
3/4/2004, updated 11/17/2006.
	 
	13.	 	A Houston Lighting and Power Company easement five (5) feet in width along the Southerly
property lines, together with an unobstructed aerial easement ten (10’) feet wide, beginning
at a plane sixteen (16) feet above the ground and extending upward, located Northerly of and
adjoining said five (5) foot wide easement, as shown on the map or plat thereof, recorded in
Film Code Number 446085 of the Map Records of Harris County, Texas, and being granted by
instrument recorded under Harris County Clerk’s File No. K344685 and as shown on survey of
Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S #4387, dated 3/4/2004,
updated 11/17/2006.
	 
	14.	 	A Permanent and Perpetual Non-Exclusive Easement for storm sewer purposes along the Northerly
property lines, parallel and adjacent to Willowchase Boulevard, as set forth and defined in
instrument granted to The City of Houston, Texas, filed for record under Harris County Clerk’s
File No. U5700665 and as shown on survey of Cotton Surveying Company, certified to by Martin
G. Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.

Willowbrook, Texas

B-6-2

 

	15.	 	Drainage Easement Fifteen (15’) feet on each side of the center line of all natural
drainage courses as set forth on the recorded plat of said subdivision at Film Code No. 446085
of the Map Records of Harris County, Texas and as shown on survey of Cotton Surveying Company,
certified to by Martin G. Hicks, R.P.L.S #4387, dated 3/4/2004, updated 11/17/2006.
	 
	16.	 	Mineral and/or royalty interest recorded in Volume 2351, Page 110, of the Deed Records, of
Harris County, Texas. Title to said interest has not been investigated to the date of the
aforesaid instrument.
	 
	17.	 	Mineral and/or royalty interest recorded in Volume 3277, Page 689, of the Deed Records, of
Harris County, Texas. Waiver of surface rights as contained in instrument recorded under
Harris County Clerk’s File No. H316173 and H316174 of the Official Records of Harris County,
Texas. Title to said interest has not been investigated to the date of the aforesaid
instrument.
	 
	18.	 	Mineral and/or royalty interest recorded in Volume 5470, Page 385, of the Deed Records, of
Harris County, Texas. Title to said interest has not been investigated to the date of the
aforesaid instrument.
	 
	19.	 	Mineral and/or royalty interest recorded 06/03/2003 in Harris County Clerk’s File No.
W715481, of the Official Records, of Harris County, Texas. Surface Waiver contained therein
and subject to the terms, conditions and stipulations shown therein. Title to said interest
has not been investigated to the date of the aforesaid instrument.
	 
	20.	 	Annual Maintenance Charge as set forth and secured by a Vendor’s Lien retained in instrument
filed for record under Harris County Clerk’s File No(s). J598942 and K087128.
	 
	21.	 	Easement for Storm Sewer as set forth in instrument recorded 08/17/2000 in Harris County
Clerk’s File No. U570665, of the Official Records, of Harris County, Texas.
	 
	22.	 	Easement for Water Meter and Waterline as set forth in instrument recorded 03/10/2004 in
Harris County Clerk’s File No. X450793, of the Official Records, of Harris County, Texas, as
shown on survey of Cotton Surveying Company, certified to by Martin G. Hicks, R.P.L.S #4387,
dated 3/4/2004, updated 11/17/2006.
	 
	23.	 	All of the Terms, conditions, Repurchase options, provisions and all other obligations
contained in Special Warranty Deed, executed by May 29, 2003 by Metro National Corporation, a
Texas Corporation, as “Grantor”, and Life Time Fitness, Inc., a Minnesota Corporation,
recorded under Harris County Clerk’s File No. W715481.

Willowbrook, Texas

B-6-3

 

	24.	 	The subject property is located within the City of Houston or within its extra territorial
jurisdiction (within 5 miles of the city limits but outside another municipality) it is
subject to the terms, conditions and provisions of City of Houston Ordinance #85-1878,
pertaining to among other things, the platting and replatting of real property and to the
establishment of building lines (25 feet along major thoroughfares and 10 feet along other
streets). A certified copy of said Ordinance was filed for record August 1, 1991, under
Harris County Clerk’s File No. N253886 and having been amended by Ordinance No. 1999-262
enacted February 17, 1999.
	 
	25.	 	Notice of Storm Water Quality Requirements, dated July 7, 2003, executed by Life Time Fitness
and recorded under Harris County Clerk’s File No. W842716.
	 
	26.	 	Terms, conditions and provisions of that Ordinance #89-1312 of the City of Houston, a
certified copy of which is recorded under Harris County Clerk’s File No. M337573, which
provides that sellers advise purchasers of the restrictions outstanding against the purchase
property.

Willowbrook, Texas

B-6-4exv10w3

 

GUARANTY

          THIS GUARANTY (this “Guaranty”) is executed as of January 24, 2007 by LIFE TIME
FITNESS, INC., a Minnesota corporation (together with any permitted successors and assigns,
“Guarantor”), for the benefit of GOLDMAN SACHS COMMERCIAL MORTGAGE CAPITAL, L.P., a
Delaware limited partnership, having an address at 600 East Las Colinas Boulevard, Suite 450,
Irving, Texas 75039 (together with its successors and assigns, “Lender”).

W I T N E S S E T H

          WHEREAS, Lender has agreed to make a loan (the “Loan”) to LTF CMBS I, LLC, a Delaware
limited liability company, (“Borrower”), in the original principal amount of $105,000,000
(the “Loan Amount”), pursuant to that certain Loan Agreement, dated as of the date hereof,
by and between Borrower and Lender (the “Loan Agreement”);

          WHEREAS, to evidence the Loan, Borrower has executed and delivered to Lender a promissory
note, dated as of the date hereof, in the original principal amount of the Loan Amount (as the same
may be amended, restated, replaced, supplemented, or otherwise modified from time to time, the
“Note”), and Borrower has or will become indebted, and may from time to time become further
indebted, to Lender with respect to the Loan;

          WHEREAS, Lender requires as a condition to making the Loan that Guarantor agrees to
unconditionally guaranty for the benefit of Lender and its successors and assigns, the full and
timely payment and performance of the Guaranteed Obligations (as hereinafter defined);

          WHEREAS, Guarantor directly and/or indirectly owns an interest in Borrower and will derive
substantial economic benefit from the making of the Loan by Lender to Borrower; and

          WHEREAS, Guarantor has agreed to execute and deliver this Guaranty in order to induce Lender
to make the Loan.

          NOW, THEREFORE, to induce Lender to make the Loan to Borrower and in consideration for the
substantial benefit Guarantor will derive from the making of the Loan and for other good and
valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:

ARTICLE I

NATURE AND SCOPE OF GUARANTY

          1.1 Guaranty of Obligations. Guarantor hereby absolutely, irrevocably and
unconditionally guarantees to Lender the full and timely payment and performance of all of the
Guaranteed Obligations as and when the same shall be due and payable, whether by lapse of time, by
acceleration of maturity or otherwise. Guarantor hereby absolutely, irrevocably and
unconditionally covenants and agrees that it is liable for the Guaranteed Obligations as primary
obligor.

Goldman Sachs Commercial Mortgage Capital, L.P.

Guaranty

Lifetime Fitness Portfolio

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          1.2 Definitions of Guaranteed Obligations. As used herein, the term “Guaranteed
Obligations” means all obligations and liabilities of Borrower pursuant to Section 9.19 of the
Loan Agreement.

          1.3 Nature of Guaranty. This Guaranty is an irrevocable, absolute and continuing
guaranty of payment and not a guaranty of collection. No exculpatory language contained in any of
the other Loan Documents shall in any event or under any circumstances modify, qualify or affect
the personal recourse obligations and liabilities of Guarantor hereunder. This Guaranty may not
be revoked by Guarantor and shall continue to be effective with respect to the Guaranteed
Obligations arising or created after any attempted revocation by Guarantor and, if Guarantor is a
natural person, after Guarantor’s death, in which event this Guaranty shall be binding upon
Guarantor’s estate and Guarantor’s legal representatives and heirs. It is the intent of Guarantor
and Lender that the obligations and liabilities of Guarantor hereunder are absolute and
unconditional under any and all circumstances and that so long as any portion of the Indebtedness
shall be outstanding, such obligations and liabilities shall not be discharged or released in whole
or in part, by any act or occurrence (including, without limitation, the fact that at any time or
from time to time the Indebtedness or the Guaranteed Obligations may be increased or reduced) which
might, but for the provisions of this Guaranty, be deemed a legal or equitable discharge or release
of Guarantor. This Guaranty may be enforced by Lender and any subsequent holder of the Note or any
part thereof and shall not be discharged by the assignment or negotiation of all or any part of the
Note.

          1.4 Joint and Several Liability. Notwithstanding anything to the contrary, if
Guarantor is comprised of more than one Person, the obligations and liabilities of each such Person
under this Guaranty shall be joint and several.

          1.5 Guaranteed Obligations Not Reduced by Set-Off. The Guaranteed Obligations and the
liabilities and obligations of Guarantor to Lender hereunder shall not be reduced, discharged or
released because or by reason of any existing or future set-off, offset, claim or defense of any
kind or nature which Borrower, Guarantor or any other Person has or may hereafter have against
Lender or against payment of the Indebtedness or the Guaranteed Obligations, whether such set-off,
offset, claim or defense arises in connection with the Guaranteed Obligations or otherwise.

          1.6 No Duty to Pursue Others; No Duty to Mitigate. It shall not be necessary for
Lender (and Guarantor hereby waives any rights which Guarantor may have to require Lender) to take
any action, obtain any judgment or file any claim prior to enforcing this Guaranty, including,
without limitation, to (i) institute suit or otherwise enforce Lender’s rights, or exhaust its
remedies, against Borrower or any other Person liable on all or any part of the Indebtedness or the
Guaranteed Obligations, or against any other Person, (ii) enforce Lender’s rights, or exhaust any
remedies available to Lender, against any collateral which shall ever have been given to secure all
or any part of the Indebtedness or the Guaranteed Obligations, (iii) join Borrower or any other
Person liable on the Guaranteed Obligations in any action seeking to enforce this Guaranty or (iv)
resort to any other means of obtaining payment of the all or any part of the Indebtedness or the
Guaranteed Obligations. Lender shall not be required to mitigate damages or take any other action
to reduce, collect or enforce the Guaranteed Obligations.

Goldman Sachs Commercial Mortgage Capital, L.P.

Guaranty

Lifetime Fitness Portfolio

2

 

          1.7 Payment by Guarantor. If all or any part of the Guaranteed Obligations shall not
be punctually paid or performed when due, whether at demand, maturity, acceleration or otherwise,
Guarantor shall, immediately upon demand by Lender and without presentment, protest, notice of
protest, notice of non-payment, notice of intention to accelerate the maturity, notice of
acceleration of the maturity or any other notice whatsoever, pay in lawful money of the United
States of America, the amount due thereon to Lender. Amounts not paid when due hereunder shall
accrue interest at the Default Rate, unless such amounts already include interest at the Default
Rate pursuant to the terms of the other Loan Documents. Such demands may be made at any time
coincident with or after the time for payment of all or any part of the Guaranteed Obligations and
may be made from time to time with respect to the same or different Guaranteed Obligations.

          1.8 Application of Payments. If, at any time, there is any Indebtedness or
obligations of Borrower to Lender which is not guaranteed by Guarantor, Lender, without in any
manner impairing its rights hereunder, may, at its option, apply all amounts realized by Lender
from any collateral or security held by Lender first to the payment of such unguaranteed
Indebtedness or obligations, with the remaining amounts, if any, to then be applied to the payment
of the Indebtedness or obligations guaranteed by Guarantor.

          1.9 Waivers.

          (a) Guarantor hereby assents to all of the terms and agreements heretofore or hereafter made
by Borrower with Lender (including, without limitation, the provisions of the Loan Documents) and
hereby waives diligence, presentment, protest, demand on Borrower for payment or otherwise, filing
of claims, requirement of a prior proceeding against Borrower and all notices (other than notices
expressly provided for hereunder or required to be delivered under applicable law), including,
without limitation, notice of:

     (i) the acceptance of this Guaranty;

     (ii) the present existence or future incurring of all or any part of the Indebtedness,
or any future change to the time, manner or place of payment of, or in any other term of all
of any part of the Indebtedness or the Guaranteed Obligations;

     (iii) any amendment, modification, replacement or extension of any of the Loan
Documents;

     (iv) the execution and delivery by Borrower and Lender of any other loan or credit
agreement or of Borrower’s execution and delivery of any promissory note or other documents
arising under the Loan Documents or in connection with the Property;

     (v) Lender’s transfer, participation, componentization or other disposition of all or
any part of the Loan or this Guaranty, or an interest therein;

     (vi) the sale or foreclosure (or posting or advertising for sale or foreclosure), or
assignment-in-lieu of foreclosure, of any collateral for the Guaranteed Obligations;

Goldman Sachs Commercial Mortgage Capital, L.P.

Guaranty

Lifetime Fitness Portfolio

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     (vii) any protest, proof of non-payment or default by Borrower, or the occurrence of a
breach or an Event of Default, or the intent to accelerate or of acceleration in relation to
any instrument relating to the Indebtedness or the Guaranteed Obligations;

     (viii) the obtaining or release of any guaranty or surety agreement, pledge, assignment
or other security for the Indebtedness or the Guaranteed Obligations, or any part thereof;
or

     (ix) any other action at any time taken or omitted to be taken by Lender generally and
any and all demands and notices of every kind in connection with this Guaranty, the other
Loan Documents and any other documents or agreements evidencing, securing or relating to the
Indebtedness or the Guaranteed Obligations, or any part thereof.

          (b) Guarantor hereby waives any and all rights it may now or hereafter have to, and covenants
and agrees that it shall not at any time, insist upon, plead or in any manner whatsoever claim or
take the benefit or advantage of, any and all appraisal, valuation, stay, extension,
marshaling-of-assets or redemption laws, or right of homestead or exemption, whether now or at any
time hereafter in force, that may delay, prevent or otherwise affect the performance by Guarantor
of its obligations under, or the enforcement by Lender of, this Guaranty. Guarantor hereby further
waives any and all rights it may now or hereafter have to, and covenants and agrees that it shall
not, set up or claim any defense, counterclaim, cross-claim, set-off, offset, right of recoupment
or other objection of any kind to any action, suit or proceeding in law, equity or otherwise, or to
any demand or claim that may be instituted or made by Lender hereunder, except for the defense of
the actual timely performance of the Guaranteed Obligations hereunder.

          (c) Guarantor specifically acknowledges and agrees that the waivers made by it in this Section
and in the other provisions of this Guaranty are of the essence of the Loan transaction and that,
but for this Guaranty and such waivers, Lender would not make the Loan to Borrower.

          1.10 Waiver of Subrogation, Reimbursement and Contribution. Notwithstanding anything
to the contrary contained herein, Guarantor hereby unconditionally and irrevocably waives, releases
and abrogates any and all rights it may now or hereafter have under any agreement, at law or in
equity (including, without limitation, any law subrogating the Guarantor to the rights of Lender),
to assert any claim against or seek contribution, indemnification or any other form of
reimbursement from Borrower or any other Person liable for payment of any or all of the Guaranteed
Obligations for any payment made by Guarantor under or in connection with this Guaranty until such
time as all of the Guaranteed Obligations have been satisfied in full and beyond the final date
that Lender may be required to disgorge any payment of the principal of or interest under the Note
or any other amount payable by the Borrower under the Loan Documents upon the insolvency,
bankruptcy or reorganization of the Borrower.

Goldman Sachs Commercial Mortgage Capital, L.P.

Guaranty

Lifetime Fitness Portfolio

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          1.11 Reinstatement; Effect of Bankruptcy. Guarantor agrees that if at any time all or
any part of any payment at any time received by Lender from, or on behalf of, Borrower or Guarantor
under or with respect to this Guaranty is held to constitute a Preferential Payment (as defined in
Section 4.2), or if Lender is required to rescind, restore or return all or part of any
such payment or pay the amount thereof to another Person for any reason (including, without
limitation, the insolvency, bankruptcy reorganization, receivership or other debtor relief law or
any judgment, order or decision thereunder), then the Guaranteed Obligations hereunder shall, to
the extent of the payment rescinded, restored or returned, be deemed to have continued in
existence notwithstanding such previous receipt by Lender, and the Guaranteed Obligations hereunder
shall continue to be effective or reinstated, as the case may be, as to such payment as though such
previous payment to Lender had never been made.

          1.12 Exculpation. No member of or any agent, employee, officer, manager, director,
governor or affiliate (other than Guarantor, as set forth herein and/or in the Loan Agreement) of
Borrower or of Guarantor shall be personally liable to repay the Loan or any amount due thereunder
or perform any obligations of Borrower or Guarantor under the Loan Documents.

ARTICLE II

EVENTS AND CIRCUMSTANCES NOT

REDUCING OR DISCHARGING GUARANTOR’S OBLIGATIONS

          2.1 Events and Circumstances Not Reducing or Discharging Guarantor’s
Obligations. Guarantor hereby consents and agrees to each of the following and agrees
that Guarantor’s obligations under this Guaranty shall not be released, diminished, impaired,
reduced or adversely affected in any way by any of the following, although without notice to or the
further consent of Guarantor, and waives any common law, equitable, statutory or other rights
(including, without limitation, rights to notice) or defenses which Guarantor might otherwise have
as a result of or in connection with any of the following:

          (a) Modifications. Any change in the time, manner or place of payment of all or any
part of the Indebtedness or the Guaranteed Obligations, or in any other term thereof, or any
renewal, extension, increase, alteration, rearrangement, amendment or other modification to any
provision of any of the Loan Documents or any other document, instrument, contract or understanding
between Borrower and Lender or any other Person pertaining to the Indebtedness or the Guaranteed
Obligations.

          (b) Adjustment. Any adjustment, indulgence, forbearance, waiver, consent or
compromise that Lender might extend, grant or give to Borrower, Guarantor or any other Person with
respect to any provision of this Guaranty or any of the other Loan Documents.

          (c) Condition of Borrower or Guarantor. Borrower’s or Guarantor’s voluntary or
involuntary liquidation, dissolution, sale of all or substantially all of their respective assets
and liabilities, appointment of a trustee, receiver, liquidator, sequestrator or conservator for
all or any part of Borrower’s or Guarantor’s assets, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, consolidation, merger arrangement, composition,

Goldman Sachs Commercial Mortgage Capital, L.P.

Guaranty

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readjustment or the commencement of any other similar proceedings affecting Borrower or
Guarantor or any of the assets of either of them, including, without limitation, (A) the release or
discharge of Borrower from the payment and performance of its obligations under any of the Loan
Documents by operation of law or (B) the impairment, limitation or modification of the liability of
Borrower, its partners or Guarantor, or of any remedy for the enforcement of Lender’s rights, under
this Guaranty or any of the other Loan Documents, resulting from the operation of any present or
future provisions of the Bankruptcy Code or other present or future federal, state or applicable
statute of law or from the decision in any court.

          (d) Invalidity of Guaranteed Obligations. The invalidity, illegality, irregularity or
unenforceability of all or any part of this Guaranty or of any of the Loan Documents, or of any
other document or agreement executed in connection with the Indebtedness or the Guaranteed
Obligations for any reason whatsoever, including, without limitation, the fact that (i) the
Indebtedness or the Guaranteed Obligations, or any part thereof, exceeds the amount permitted by
law, (ii) the act of creating the Indebtedness or the Guaranteed Obligations, or any part thereof,
is ultra vires, (iii) the officers or representatives executing the Loan Documents
or any other document or agreement executed in connection with the creating of the Indebtedness or
the Guaranteed Obligations, or any part thereof, acted in excess of their authority, (iv) the
Indebtedness or the Guaranteed Obligations, or any part thereof, violates applicable usury laws,
(v) Borrower or Guarantor has valid defenses, claims or offsets (whether at law, in equity or by
agreement) which render the Indebtedness or the Guaranteed Obligations wholly or partially
uncollectible, (vi) the creation, performance or repayment of the Indebtedness or the Guaranteed
Obligations, or any part thereof (or the execution, delivery and performance of any document or
instrument representing the Indebtedness or the Guaranteed Obligations, or any part thereof, or
executed in connection with the Indebtedness or the Guaranteed Obligations, or given to secure the
repayment of the Indebtedness or the Guaranteed Obligations, or any part thereof), is illegal,
uncollectible, legally impossible or unenforceable or (vii) any of the Loan Documents or any other
document or agreement executed in connection with the Indebtedness or the Guaranteed Obligations,
or any part thereof, has been forged or otherwise are irregular or not genuine or authentic.

          (e) Release of Obligors. Any compromise or full or partial release of the liability
of Borrower or any other Person now or hereafter liable, whether directly or indirectly, jointly,
severally, or jointly and severally, to pay, perform, guarantee or assure the payment of the
obligations under this Guaranty or any of the other Loan Documents.

          (f) Release of Collateral; Other Collateral. Any release, surrender, exchange,
subordination, deterioration, waste, loss or impairment by Lender (including, without limitation,
negligent, willful, unreasonable or unjustifiable impairment) of, or failure to perfect or obtain
protection of, any collateral, property or security at any time existing in connection with, or
assuring or securing payment of, all or any part of the Indebtedness or the Guaranteed Obligations;
or the taking or accepting of any other security, collateral or guaranty or other assurance of
payment for all or any part of the Indebtedness or the Guaranteed Obligations.

          (g) Offset. Any existing or future right of set-off, offset, claim, counterclaim or
defense of any kind or nature against Lender or any other Person, which may be available to or
asserted by Guarantor or Borrower.

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          (h) Change in Law. Any change in the laws, rules or regulations of any jurisdiction
or any present or future action of any Governmental Authority or court amending, varying, reducing
or otherwise affecting, or purporting to amend, vary, reduce or otherwise affect, any of the
obligations of Borrower under any of the Loan Documents or Guarantor under this Guaranty.

          (i) Event of Default. The occurrence of any Event of Default or any potential Event
of Default under any of the Loan Documents, whether or not Lender has exercised any of its rights
and remedies under the Loan Documents upon the happening of any such Event of Default or potential
Event of Default.

          (j) Actions Omitted. The absence of any action to enforce any of Lender’s rights
under the Loan Documents or available to Lender at law, equity or otherwise, to recover any
judgment against Borrower or to enforce a judgment against Borrower under any of the Loan
Documents.

          (k) Other Circumstances. Any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor generally, it being the unambiguous and
unequivocal intention of Guarantor and Lender that the liability of Guarantor hereunder shall be
direct and immediate and that Guarantor shall be obligated to pay the Guaranteed Obligations when
due, notwithstanding any occurrence, circumstance, event, action, or omission whatsoever, whether
contemplated or uncontemplated, and whether or not otherwise or particularly described herein,
except for the full and final payment and satisfaction of the Guaranteed Obligations.

          2.2 Indebtedness or Other Obligations of Guarantor. If Guarantor is or becomes liable
for any Indebtedness owed by Borrower to Lender by endorsement or otherwise than under this
Guaranty such liability shall not be in any manner impaired or affected by this Guaranty and the
rights of Lender hereunder shall be cumulative of any and all other rights that Lender may ever
have against Guarantor. The exercise by Lender of any right or remedy hereunder or under any other
instrument or at law or in equity shall not preclude the concurrent or subsequent exercise of any
right or remedy under any other instrument or at law or in equity, including the making of multiple
demands hereunder. Further, without in any way diminishing or limiting the generality of the
foregoing, it is specifically understood and agreed that this Guaranty is given by Guarantor as an
additional guaranty to any and all guarantees as may heretofore have been or may hereafter be
executed and delivered by Guarantor in favor of Lender, whether relating to the obligations of
Borrower under the Loan Documents or otherwise, and nothing herein shall ever be deemed to replace
or be in-lieu of any other such previous or subsequent guarantees.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

          3.1 Representations and Warranties. To induce Lender to enter into the Loan
Documents and extend credit to Borrower, Guarantor hereby represents and warrants to Lender that,
on the date hereof and during the duration of this Guaranty:

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          (a) Due Formation, Authorization and Enforceability. Guarantor is duly organized and
validly existing under the laws of the jurisdiction of its incorporation or formation, as the case
may be, and has full power and legal right to execute and deliver this Guaranty and to perform
under this Guaranty and the transactions contemplated hereunder. Guarantor has taken all necessary
action to authorize the execution, delivery and performance of this Guaranty and the transactions
contemplated hereunder. This Guaranty has been duly authorized, executed and delivered by
Guarantor and constitutes a legal, valid and binding obligation of Guarantor, enforceable against
Guarantor in accordance with its terms.

          (b) Benefit to Guarantor. Guarantor hereby acknowledges that Lender would not make
the Loan but for the personal liability undertaken by Guarantor under this Guaranty. Guarantor (i)
is an affiliate of Borrower, (ii) is the owner of direct and/or indirect interest in Borrower,
(iii) has received, or will receive, direct and/or indirect benefit from the making of the Loan to
Borrower and (iv) has received, or will receive, direct and/or indirect benefit from the making of
this Guaranty with respect to the Guaranteed Obligations.

          (c) Familiarity and Reliance. Guarantor is familiar with, and has independently
reviewed books and records regarding, the financial condition of Borrower and is familiar with the
value of any and all collateral granted, or intended to be granted, as security for the
Indebtedness or the Guaranteed Obligations; provided, however, Guarantor is not
relying on such financial condition or such collateral as an inducement to enter into this
Guaranty.

          (d) No Representation by Lender. Neither Lender nor any other Person has made any
representation, warranty or statement to Guarantor or to any other Person in order to induce the
Guarantor to execute this Guaranty.

          (e) Solvency. Guarantor has not entered into this Guaranty with the actual intent to
hinder, delay or defraud any creditor. Guarantor received reasonably equivalent value in exchange
for the Guaranteed Obligations. As of the date hereof, and after giving effect to the this
Guaranty and the contingent obligations evidenced hereby, Guarantor (i) is, and will, immediately
following the making of the Loan and this Guaranty, be solvent, (ii) has separate assets, the fair
saleable value of which exceeds and will, immediately following the making of the Loan and this
Guaranty, exceed its separate total liabilities and debts, including, without limitation,
subordinated, unliquidated, disputed and contingent liabilities and (iii) has separate assets which
do not, and will not, immediately following the making of the Loan and this Guaranty, constitute
unreasonably small capital to carry out its business as conducted or as proposed to be conducted.
Guarantor does not intend to, nor does Guarantor believe that it will, incur liabilities or debts
(including, without limitation, subordinated, unliquidated, disputed and contingent liabilities)
beyond its ability to satisfy such liabilities and debts as they mature.

          (f) No Conflicts. The execution and delivery of this Guaranty by Guarantor, and the
performance of transactions contemplated hereunder do not and will not (i) conflict with or violate
any Legal Requirements or any governmental statutes, laws, rules, orders, regulations, ordinances,
judgments, decrees and injunctions of Governmental Authorities (including Environmental Laws)
affecting Guarantor or any of its assets or property, (ii) conflict with, result in a breach of, or
constitute a default (including any circumstance or event which would be a default but for the lack
of due notice or lapse of time or both) under any of the terms, conditions

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or provisions of any of Guarantor’s organizational documents or any agreement or instrument to
which Guarantor is a party, or by which Guarantor or its assets or property are bound or (iii)
result in the creation or imposition of any Lien on any of Guarantor’s assets or property.

          (g) Litigation. There is no action, suit, proceeding, arbitration or investigation
pending or, to Guarantor’s knowledge after due and diligent inquiry, threatened against Guarantor
in any court or by or before any other Governmental Authority, in each case, which might have
consequences that would materially and adversely affect the performance of Guarantor’s obligations
and duties under this Guaranty. There are no outstanding or unpaid judgments against Guarantor.

          (h) Consents. No consent, approval, authorization, order or filings of or with any
court or Governmental Authority is required for the execution, delivery and performance by
Guarantor of, or compliance by Guarantor with, this Guaranty or the consummation of the
transactions contemplated hereunder, other than those which have been obtained by Guarantor.

          (i) Compliance. Guarantor is not in default or violation of any regulation, order,
writ, injunction, decree or demand of any Governmental Authority, the violation or default of which
might have consequences that would materially and adversely affect the condition (financial or
otherwise) or business of Guarantor or might have consequences that would materially and adversely
affect its performance hereunder.

          (j) Financial Information. All financial data that have been delivered to Lender with
regard to Guarantor (i) are true, complete and correct in all material respects, (ii) accurately
represent the financial condition of Guarantor as of the date of such reports and (iii) have been
prepared in accordance with GAAP throughout the periods covered, except as may be explicitly
disclosed therein.

          (k) No Defenses. This Guaranty and the obligations of Guarantor hereunder are not
subject to, and Guarantor has not asserted, any right of rescission, offset, counterclaim,
cross-claim, recoupment or affirmative or other defense of any kind and neither the operation of
any of the terms of this Guaranty nor the exercise of any right hereunder will render the Guaranty
unenforceable in whole or in part.

          (l) Tax Filings. Guarantor has filed (or has obtained effective extensions for
filing) all federal, state and local tax returns required to be filed and has paid, or has made
adequate provision for the payment of, all federal, state and local taxes, charges and assessments
payable by Guarantor. Guarantor reasonably believes that its tax returns properly reflect the
incomes and taxes of Guarantor for the periods covered thereby.

          (m) No Bankruptcy Filing. Guarantor is not a debtor in any state or federal
bankruptcy, insolvency or similar proceeding. Guarantor is contemplating neither the filing of a
petition under any state or federal bankruptcy or insolvency laws nor the liquidation of its assets
or property and Guarantor does not have any knowledge (after due and diligent inquiry) of any
Person contemplating the filing of any such petition against it.

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          (n) No Change in Facts or Circumstances; Full and Accurate Disclosure. There has been
no material adverse change in any condition, fact, circumstance or event, and there is no fact or
circumstance presently known to Guarantor which has not been disclosed to Lender, in each case that
would make the financial statements or other documents submitted in connection with the Loan or
this Guaranty inaccurate, incomplete or otherwise misleading in any material respect or that
otherwise materially and adversely affects, or might have consequences that would materially and
adversely affect, Guarantor or its business, operations or conditions (financial or otherwise).

          (o) Embargoed Person. To the best of Guarantor’s knowledge, after due and diligent
inquiry (i) none of the funds or other assets of Guarantor constitute property of, or are
beneficially owned, by any Embargoed Person; (ii) no Embargoed Person has any interest of any
nature whatsoever in Guarantor (whether directly or indirectly) and (iii) none of the funds of
Guarantor have been derived from any unlawful activity. Notwithstanding anything to the contrary
contained herein, the representations and warranties contained in this subsection shall survive in
perpetuity.

          (p) Compliance with Anti-Terrorism, Embargo, Sanctions and Anti-Money Laundering Laws.
Guarantor, and to the best of Guarantor’s knowledge after due and diligent inquiry, each Person
owning an interest in Guarantor: (a) is not currently identified on the OFAC List and (b) is not a
Person with whom a citizen of the United States is prohibited to engage in transactions by any
trade embargo, economic sanction, or other prohibition of any Legal Requirement. Guarantor has
implemented procedures, and will consistently apply such procedures throughout the term of the Loan
and the existence of this Guaranty, to ensure the foregoing representations and warranties remain
true and correct during the term of the Loan and the existence of this Guaranty.

          (q) Survival. All representations and warranties made by Guarantor herein shall
survive the execution hereof.

ARTICLE IV

SUBORDINATION OF CERTAIN INDEBTEDNESS

          4.1 Subordination of Guarantor’s Conditional Rights. As used herein, the
term “Guarantor’s Conditional Rights” shall mean all rights and claims of Guarantor for
subrogation, reimbursement, exoneration, contribution or indemnification, any right to participate
in any claim or remedy of Lender against Borrower or any security or collateral which Lender now
has or may hereafter acquire, whether or not such claim, remedy or right arises in equity or under
contract, statute (including the Bankruptcy Code or any successor or similar statute) or common
law, by any payment made hereunder, including, without limitation, the right to take or receive
from Borrower, directly or indirectly, in cash or other property or by set-off or in any other
manner, payment or security on account of such claim or other rights, against Borrower, as a result
of Guarantor’s payment of all or any portion of the Guaranteed Obligations.

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          4.2 Payments Held in Trust. In the event that, notwithstanding anything to
the contrary in this Guaranty, Guarantor should receive any funds, payment, claim or distribution
which is prohibited by this Guaranty on account of any of the Guarantor’s Conditional Rights and
either (i) such amount is paid to Guarantor at any time when any part of the Indebtedness or the
Guaranteed Obligations shall not have been paid or performed in full or, (ii) regardless of when
such amount is paid to Guarantor, any payment made by, or on behalf of, Borrower to Lender is
subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be
repaid by Lender or paid over to a trustee, receiver or any other Person, whether under any
bankruptcy act or otherwise (such payment, a “Preferential Payment”), then such amount paid
to Guarantor shall be held in trust for the benefit of Lender and shall forthwith be paid to Lender
to be credited and applied upon the Indebtedness or the Guaranteed Obligations, whether matured or
unmatured, in such order as Lender, in its sole and absolute discretion, shall determine. To the
extent that any of the provisions of this Article 4 shall not be enforceable, Guarantor
agrees that until such time as the Indebtedness and the Guaranteed Obligations have been paid and
performed in full and the period of time has expired during which any payment made by Borrower to
Lender may be determined to be a Preferential Payment, all of the Guarantor’s Conditional Rights,
to the extent not validly waived, shall be subordinate to Lender’s right to full payment and
performance of the Indebtedness and the Guaranteed Obligations and Guarantor shall not enforce any
of the Guarantor’s Conditional Rights during such period.

ARTICLE V

MISCELLANEOUS

          5.1 Lender’s Benefit; No Impairment of Loan Documents. This Guaranty is for the
benefit of Lender and its successors and assigns and nothing contained herein shall impair, as
between Borrower and Lender, the obligations of Borrower under the Loan Documents. Lender and its
successors and assigns shall have the right to assign, in whole or in part, this Guaranty and the
other Loan Documents to any Person and to participate all or any portion of the Loan, including,
without limitation, any servicer or trustee in connection with a Securitization.

          5.2 Successors and Assigns; Binding Effect. This Guaranty shall be binding upon
Guarantor and its heirs, executors, legal representatives, successors and assigns, whether by
voluntary action of the parties or by operation of law. Notwithstanding anything to the contrary
herein, Guarantor may in no event delegate or transfer its obligations under, or be released from,
this Guaranty, except in accordance with the terms of the Loan Agreement and this Guaranty.

          5.3 Borrower. The term “Borrower” as used herein shall include any new or
successor corporation, association, partnership (general or limited), limited liability company,
joint venture, trust or other individual or organization formed as a result of any merger,
reorganization, sale, transfer, devise, gift or bequest of or by Borrower or any interest in
Borrower.

          5.4 Costs and Expenses. If Guarantor should breach or fail to timely perform any
provision of this Guaranty, Guarantor shall, immediately upon demand by Lender, pay to Lender any
and all reasonable costs and expenses (including court costs and reasonable
attorneys’ fees and expenses) incurred by Lender in connection with the enforcement hereof or
the preservation of Lender’s rights hereunder. The covenant contained in this Section shall
survive the payment and performance of the Guaranteed Obligations.

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          5.5 Not a Waiver; No Set-Off. The failure of any party to enforce any right or remedy
hereunder, or to promptly enforce any such right or remedy, shall not constitute a waiver thereof,
nor give rise to any estoppel against such party, nor excuse any other party from its obligations
hereunder, nor shall a single or partial exercise thereof preclude any other future exercise, or
the exercise of any other right, power, remedy or privilege. In particular, and not by way of
limitation, by accepting payment after the due date of any amount payable under this Guaranty,
Lender shall not be deemed to have waived any right either to require prompt payment when due of
all other amounts due under this Guaranty or to declare a default for failure to effect prompt
payment of any such other amount. Lender shall not be required to mitigate damages or take any
other action to reduce, collect or enforce any of the Indebtedness or the Guaranteed Obligations.
No set-off, counterclaim (other than compulsory counterclaims), reduction, diminution of any
obligations or any defense of any kind or nature which Guarantor has or may hereafter have against
Borrower or Lender shall be available hereunder to Guarantor.

          5.6 PRIOR AGREEMENTS. THIS GUARANTY CONTAINS THE ENTIRE AGREEMENT OF THE PARTIES
HERETO IN RESPECT OF THE GUARANTY DESCRIBED HEREIN, AND ALL PRIOR AGREEMENTS AMONG OR BETWEEN SUCH
PARTIES, WHETHER ORAL OR WRITTEN, INCLUDING ANY TERM SHEETS, CONFIDENTIALITY AGREEMENTS AND
COMMITMENT LETTERS, ARE SUPERSEDED BY THE TERMS OF THIS GUARANTY AS THEY RELATE TO THE GUARANTY
DESCRIBED HEREIN.

          5.7 No Oral Change. No modification, amendment, extension, discharge, termination or
waiver of any provision of this Guaranty, nor consent to any departure by Guarantor therefrom,
shall in any event be effective unless the same shall be in a writing signed by Lender, and then
such waiver or consent shall be effective only in the specific instance, and for the purpose, for
which given. Except as otherwise expressly provided herein, no notice to, or demand on, Guarantor,
shall entitle Guarantor to any other or future notice or demand in the same, similar or other
circumstances.

          5.8 Separate Remedies. Each and all of Lender’s rights and remedies under this
Guaranty and each of the other Loan Documents are intended to be distinct, separate and cumulative
and no such right or remedy herein or therein mentioned is intended to be in exclusion of or a
waiver of any other right or remedy available to Lender.

          5.9 Severability. Wherever possible, each provision of this Guaranty shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Guaranty shall be prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Guaranty.

          5.10 Number and Gender. All references to sections and exhibits are to sections and
exhibits in or to this Guaranty unless otherwise specified. Unless otherwise

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specified, the words “hereof,” “herein,” “hereby,” “hereunder” and words of similar import
when used in this Guaranty shall refer to this Guaranty as a whole and not to any particular
provision, article, section or other subdivision of this Guaranty. Unless otherwise specified, all
meanings attributed to defined terms herein shall be equally applicable to both the singular and
plural forms of the terms so defined. Whenever the context may require, any pronouns used herein
shall include the corresponding masculine, feminine or neuter forms and the singular form of nouns
and pronouns shall include the plural and vice versa.

          5.11 Headings. The Section headings in this Guaranty are included in this Guaranty
for convenience of reference only and shall not constitute a part of this Guaranty for any other
purpose.

          5.12 Recitals. The recitals and introductory paragraphs of this Guaranty are
incorporated herein, and made a part hereof, by this reference.

          5.13 Counterparts. This Guaranty may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument.

          5.14 Notices. All notices, consents, approvals and requests required or permitted
hereunder shall be given in writing by expedited prepaid delivery service, either commercial or
United States Postal Service, with proof of delivery or attempted delivery, addressed as follows
(or at such other address and person as shall be designated from time to time by any party to this
Guaranty, as the case may be, in a written notice to the other parties to this Guaranty in the
manner provided for in this Section). A notice shall be deemed to have been given when delivered
or upon refusal to accept delivery.

	 	 	 
	     If to Lender:

	 	Goldman Sachs Commercial Mortgage Capital, L.P.
	 

	 	600 East Las Colinas Boulevard, Suite 800
	 

	 	Irving, Texas 75039
	 

	 	Attention: Michael Forbes
	 

	 	Facsimile: (972) 368-3499
	 
	 	 
	     and to:

	 	Goldman Sachs Commercial Mortgage Capital, L.P.
	 

	 	600 East Las Colinas Boulevard, Suite 450
	 

	 	Irving, Texas 75039
	 

	 	Attention: General Counsel
	 

	 	Facsimile: (972) 830-7698
	 
	 	 
	     with a copy to:

	 	Kroll McNamara Evans & Delehanty, LLP
	 

	 	29 South Main Street
	 

	 	West Hartford, Connecticut 06107
	 

	 	Attention: Garrett Delehanty, Esq.
	 

	 	Facsimile No.: (860) 561-7075

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	     If to Guarantor:

	 	Life Time Fitness, Inc.
	 

	 	6442 City West Parkway
	 

	 	Eden Prairie, Minnesota 55344
	 

	 	Attention: Treasurer
	 

	 	Facsimile No.: (952) 947-0099
	 
	 	 
	     with a copy to:

	 	Faegre & Benson LLP
	 

	 	2200 Wells Fargo Center
	 

	 	90 South Seventh Street
	 

	 	Minneapolis, Minnesota 55402
	 

	 	Attention: Scott A. Anderegg, Esq.

          5.15 GOVERNING LAW. (A) THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF MINNESOTA.

          (B) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST GUARANTOR ARISING OUT OF OR RELATING TO THIS
GUARANTY OR ANY OF THE OTHER LOAN DOCUMENTS (OTHER THAN ANY ACTION IN RESPECT OF THE CREATION,
PERFECTION OR ENFORCEMENT OF A LIEN OR SECURITY INTEREST CREATED PURSUANT TO ANY LOAN DOCUMENTS NOT
GOVERNED BY THE LAWS OF THE STATE OF MINNESOTA) MAY BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN
MINNESOTA. GUARANTOR HEREBY (i) IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH
A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND (ii) IRREVOCABLY SUBMITS TO THE JURISDICTION
OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.

          5.16 TRIAL BY JURY. GURANTOR, TO THE FULLEST EXTENT THAT IT MAY LAWFULLY DO SO,
HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY
RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH
REGARD TO THIS GUARANTY OR ANY OF THE OTHER LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER
ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY
AND VOLUNTARILY BY GUARANTOR AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE
AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. LENDER IS HEREBY AUTHORIZED TO
FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER BY GUARANTOR.

          5.17 Brokers and Financial Advisors. Guarantor hereby represents that none of
Borrower, Guarantor or any of their respective affiliates has dealt with any financial advisors,
brokers, underwriters, placement agents, agents or finders other than RBC Capital Advisors, Inc.,
in connection with the transactions contemplated by this Agreement and/or the other Loan

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Documents. Guarantor
agrees to indemnify and hold Lender harmless from and against any and all claims, liabilities,
costs and expenses of any kind in any way relating to or arising from a claim by any Person that
such Person acted on behalf of Borrower, Guarantor or any of their respective affiliates in
connection with the transactions contemplated in this Agreement and/or the other Loan Documents.
The provisions of this Section shall survive the expiration and termination of this Agreement and
the repayment of the Indebtedness.

          5.18 Joint and Several Liability. If Guarantor is comprised of more than one Person,
the obligations and liabilities of each such Person hereunder are joint and several.

[No Further Text on this Page; Signature Page Follows]

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          IN WITNESS WHEREOF, the undersigned has executed this Guaranty all as of the day and year
first above written.

	 	 	 	 	 	 	 
	 	 	GUARANTOR:	 	 
	 
	 	 	LIFE TIME FITNESS, INC.,	 	 
	 	 	a Minnesota corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

(Signature page to Guaranty)

Goldman Sachs Commercial Mortgage Capital, L.P.

Guaranty

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