BIG BOX AGREEMENT OF LEASE By Richard R. Goldberg Ballard Spahr Andrews & Ingersoll, LLP Philadelphia, Pennsylvania All Rights Reserved 1999 THIS AGREEMENT OF LEASE (this "Lease') is dated as of, 19, between, (the 'Landlord'), and a corporation (the "Tenant"), and provides: I. PREMISES A. Leased Premises. Pursuant to the terms and provisions of this Lease, the Landlord hereby leases to the Tenant, and the Tenant hereby leases from the Landlord, the Leased Premises (as hereinafter defined). The term Leased Premises means the Pad (as defined herein) shown cross-hatched on the site plan of the Shopping Center (as hereinafter defined) attached hereto as Exhibit A (the "Site Plan") and incorporated herein by this reference. The Leased Premises shall consist of approximately square feet. The actual dimensions and square footage of the Leased Premises shall be determined by measurement pursuant to the provisions of Section 3.1. hereof. The Leased Premises are to be part of a commercial complex to be known as " " (the "Shopping Center') situate in the of County,, and more particularly described on Exhibit B attached hereto and incorporated herein by reference, which complex may be altered, reduced, expanded or replaced from time to time to the extent permitted pursuant to the provisions of this Lease and which complex may be, renamed by the Landlord from time to time. B. License. The Landlord also grants to the Tenant, its licensees and subtenants, and their respective customers', employees, and invitees, for the entire term of this Lease, an irrevocable, non-exclusive license in common with the other tenants and occupants of the Shopping Center for the use of the Common Areas, subject to the terms and conditions of this Lease and reasonable rules and regulations which may be adopted by Landlord from time to time pursuant to Section 23.4 hereof. - 1-
II. TERM A. Initial Term. The Initial Term of this Lease shall begin on the "Commencement Date" (as defined below) and. shall end on the last day of the fifteenth (15th) "Lease Year" (as defined below). The Commencement Date shall be the first to occur of (i) the date upon which the Tenant shall initially open the Leased Premises for business to the public or (ii) the date which is one hundred fifty (150) days after the Delivery Date (as hereinafter defined). When the Commencement Date has been determined, the parties hereto shall execute a memorandum confirming such date in the form of Exhibit C attached to this Lease. B. Lease Year. The first Lease Year of the Term (as is defined in Section 2.4 below) shall commence on the Commencement Date and shall end on the last day of the twelfth (12th) full calendar month following the Commencement Date. The term "Lease Year" thereafter shall mean each successive period of twelve (12) consecutive calendar months of the Term following the initial Lease Year. C. Renewal Terms. Provided Tenant is not in default under the terms of this law, the Tenant shall have five (5) consecutive separate options to extend the Term for successive renewal terms of five (5) Lease Years each (each a "Renewal Term and collectively the "Renewal Terms ). The Tenant may exercise each such renewal option by giving written notice to the Landlord at least two hundred seventy (270) days prior to the end of the Initial Term or the then current Renewal Term, as the case may be. D. Term, Defined. The term "Term" shall be deemed to refer to the Initial Term and any Renewal Terms from time to time properly exercised hereunder. III. RENT A. Base Rent. (1) Beginning on the Commencement Date and continuing until the last day of the fifth (5th) Lease Year, the Tenant agrees to pay to the Landlord annual base rent ("Annual Base Rent') in an amount equal to Dollars($ ), which is based on a rental rate of $ per square feet, assuming the Leased Premises is square feet. If the Leased Premises is determined to more or less than square feet as determined in accordance with Section 3.1, Annual Base Rent shall be equitably adjusted. Commencing on the first day of the sixth (6th) Lease Year, and on the first day of every fifth Lease Year thereafter during the Term, Annual Base Rent shall be increased by an amount equal to percent ( %) of the Annual Base Rent payable during the preceding five (5) Lease Years. - 2-
(2) The Annual Base Rent shall be payable in advance without notice, set-off, deduction or demand in equal monthly installments payable on the first day of each calendar month during, the Term; provided, however, if the Commencement Date is not the first day of a month, then the Annual Base Rent for the period from the Commencement Date to the last day of that calendar month shall be prorated and paid together with the first full monthly installment of the Annual Base Rent. All payments of the Base Rent shall be sent to the Landlord's address for notices set forth in Section 23.3 hereof or to such other address as the Landlord may direct in writing. (3) On or about the Delivery Date, the Landlord shall cause a licensed architect to measure the Leased Premises and shall cause such architect to certify to the Tenant the actual square footage of the Leased Premises (such area hereinafter referred to as Tenant's GLA"). IV. ADDITIONAL RENT - 3- A. Taxes. (1) The Landlord shall pay, as and when they become due, all real estate taxes and special and general assessments, whether federal, state, county or municipal (collectively referred to as "Taxes ) levied or imposed from time to time on the Shopping Center or the tax parcel of which the Leased Premises is a part. The term "Taxes shall also include the costs incurred by the Landlord in contesting the amount of any such Taxes. (2) The Tenant shall pay all Taxes levied or imposed against the Leased Premises with respect to the Term. The Tenant shall reimburse the Landlord for "Tenant's Proportionate Share" (as h defined) of the Taxes levied, imposed or payable during each Lease Year. The Tenant's Proportionate Share shall be a fraction, the numerator of which is Tenant's GLA and the denominator of which is the number of square feet of gross leasable area of all buildings within the Shopping Center, including the Leased Premises. The Tenant shall make such reimbursements, upon Landlord's election, either (i) annually within thirty (30) days after the date the Landlord provides the Tenant with a statement setting forth in reasonable detail the Tenant's Proportionate Share of such Taxes, or (ii) in monthly installments on the first day of each month based on estimates provided by Landlord based upon the previous year's tax bill. (3) The Tenant's Proportionate Share of Taxes paid by the Landlord with respect to the Shopping Center shall be prorated on a per them basis for any partial tax year included in the Term. The Tenant's obligation to pay the Tenant's Proportionate Share of Taxes during the last Lease Year of the Term shall survive the termination of this Lease.
(4) Nothing contained in this Lease shall require the Tenant to pay any income, estate, franchise, corporate, inheritance, succession, capital levy, business or transfer tax of the Landlord. Notwithstanding the above, if federal, state or local law now or hereafter imposes any tax, assessment, levy or other charge (other than any income, inheritance or estate tax) directly or indirectly upon (a) the Landlord with respect to this Lease or the value thereof, (b) the Tenant's use or occupancy of the Leased Premises, or (c) the Annual Base Rent, Additional Rent or any other sum payable under this Lease, then the Tenant shall pay the amount as Additional Rent to the Landlord upon demand, or if, due to a future change in the method of taxation or assessment, any income, profit franchise or other tax, however designated, shall be imposed in substitution, in whole or in part, for (or in lieu of) any tax, assessment or charge which would otherwise be included within the definition of Taxes, such other tax shall be deemed to be included within Taxes as defined herein to the extent of such substitution. (5) If the Leased Premises are a separately sub-divided parcel consisting of the Leased Premises, Tenant shall pay the Taxes separately, assessed as a result thereof without regard to the calculations contained in this section 4.1. B. Insurance Premium. During each Lease Year, the Tenant shall reimburse the Landlord for the Tenant's Proportionate Share (as defined in Section 4.1) of the annual premiums paid by the Landlord during such Lease Year for fire and casualty insurance the Landlord maintains with respect to all buildings now or hereafter located in the Shopping Center, and all commercial general liability insurance maintained by the Landlord with respect to the Common Areas (as defined in Section 10.1) ( Insurance Premiums"). Such payment shall be due from the Tenant within thirty (30) days after the Landlord delivers to the Tenant a copy of the, bill for such premiums and a calculation of the Tenant's Proportionate Share of such premiums. The Tenant's Proportionate Share of the Insurance Premiums paid by the Landlord shall be prorated on a per them basis for any Lease Year of less than 365days. Notwithstanding anything to the contrary contained in this Lease, the Landlord reserves the right to charge the Tenant, on a monthly basis, the Landlord's estimation of the Insurance Premiums based on the previous year's insurance premium bill, and to reimburse the Tenant for any excess amounts paid or to charge the Tenant for the additional amount owed promptly upon the Landlord's receipt of the actual bill for the Insurance Premium. C. Common Area Charges. (1) Subject to Section 4.3(d) below, the Tenant shall reimburse the Landlord for the Tenant's Proportionate Share (as defined in Section 4.1) of the Landlord's "Common Area Maintenance Costs". Common Area Maintenance Costs" shall mean the costs and expenses paid by the Landlord during the Term for maintaining, repairing, insuring, securing and replacing the Common Areas, and performing all duties reasonably required to be performed in accordance with Section 10.1 hereof and a - 4-
management fee equal to fifteen percent (15%) of the Landlord's Common Area Maintenance Costs. Common Area Maintenance Costs includes, without limitation, all costs and expenses of operating, maintaining, repairing;, lighting, signing, cleaning, painting, striping, policing and security of the Common Areas (including the cost of uniforms, equipment and employment taxes); alarm and life safety systems; the costs and expenses of maintenance of all exterior glass; maintenance of sprinkler systems; removal of water, snow, ice, trash and debris; regulation of traffic; surcharges levied upon or assessed against parking spaces or areas by governmental or quasi-governmental authorities, payments toward mass transit or car pooling facilities or otherwise as required by governmental or quasi-governmental authorities; costs and expenses in connection with maintaining federal, state or local governmental ambient air and environmental standards; the cost of all materials, supplies and services purchased or hired therefor; operation of public toilets; installing and renting of signs; fire protection; maintenance, repair ;and replacement of utility systems serving the Common Areas, including, but not limited to, water, sanitary sewer and storm water lines and other utility lines, pipes and conduits; costs and expenses of maintaining and operating sewage treatment facilities, if any; costs and expenses of inspecting of machinery and equipment used in the operation and maintenance of the Common Areas and personal property taxes and other charges (including, but not limited to, financing, leasing or rental costs) incurred in connection with such equipment; costs and expenses of the coordination and use of truck docks and loading facilities; costs and expenses of repair or replacement of awnings, paving, curbs, walkways, landscaping, drainage, pipes, ducts, conduits and similar items, plate glass, lighting facilities, floor coverings, and the roof; costs and expenses of planting, replanting, replacing and displaying flowers, shrubbery and planters; costs of providing light and power to the Common Areas; cost of water services, if any, furnished by Landlord for the non-exclusive use of all tenants; and parcel pick-up and delivery services; and administrative costs attributable to the Common Areas for on site personnel. Notwithstanding the foregoing, Common Area Maintenance Costs shall not include: (i) Taxes; (ii) costs actually reimbursed by insurance; (iii) interest; (iv) amortization (other then amortized capital costs); (v) structural or roof repairs to any building in the Shopping Center; (vi) any costs incurred by the Landlord in repairing any defective construction of the Common Areas or improvements thereto that are covered by insurance or paid by the general contractor that performed such defective work; or (vii) Insurance Premiums. (2) The Tenant shall pay the Tenant's Proportionate Share of Common Area Maintenance Costs in monthly installments together with the Annual Base Rent in the manner set forth below. The monthly installments for each subsequent calendar year of the Term shall be equal to one-twelfth of the Tenant's Proportionate Share of Common Area Maintenance Costs for the previous calendar year. Within ninety (90) days after the end of each calendar year, the Landlord shall give the Tenant a statement (the "CAM Statement") setting forth in reasonable detail the actual Common Area Maintenance Costs for such calendar year, the Tenant's Proportionate Share thereof and the monthly installments of Common Area Maintenance Costs due from the Tenant for the following - 5-