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HomeMy Public PortalAboutNorth Beach Grill lease November 30, 2007 City of Tybee Island Attn: Diane Schleicher PO Box 2749 Tybee Island, GA 31328 Re: Ground Lease dated December 10, 2001 between the City of Tybee Island as Lessor and Beachcremes, Inc. as Lessee regarding North Beach Grill Dear Ms. Schleicher, This is written notice, pursuant to Article 2 of the above Ground Lease, of Lesses's election to exercise the Renewal Option under the Ground Lease. If any further notice or information is needed in this regard, please advise. rely, 9r George S gs �7f1 r Cc: Edward M. Hughes, Esq. Callaway, Braun, Riddle & Hughes, PC 301 West Congress Street PO Box 9150 Savannah, GA 31412 i 1 1 1 1 GROUND LEASE BETWEEN MAYOR and COUNCIL OF THE CITY OF TYBEE ISLAND, GEORGIA t AS LESSOR 1 AND BEACHCREMES, Inc. 1 Dba "North Beach Grill" AS LESSEE DATE: December 10, 2001 1 1 1 i 1 1 1 1 426481.1 1 1 1 1 GROUND T RASE THIS GROUND LEASE ( "Lease ") made and entered into as of December 10, 2001, by and between Mayor and Council of the City of Tybee Island, Georgia ( "Lessor ") and Beachcremes, Inc. dba "North Beach Grill" ("Lessee "). 1 WITNESSETH- 1 WHEREAS, Lessor is the owner of improved real property lying and being in the City of Tybee Island, Chatham County, Georgia, which property is more particularly described in the legal description attached hereto as Exhibit "A" and incorporated by reference herein (the "Demised Premises "); and WHEREAS, the Lessor desires to lease to Lessee and Lessee desires to lease from Lessor the Demised Premises under the terms and conditions contained herein. NOW, THEREFORE, in consideration of the mutual promises and agreements herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties do for themselves, their heirs, administrators, executors, successors and assigns, contract and agree as follows: ARTICLE 1. GRANT: 1 Lessor hereby leases and Iets to Lessee, and Lessee hereby takes and hires from Lessor, upon and subject to the terms, conditions, covenants and provisions hereof, the Demised Premises, together with any and all buildings, improvements, rights, privileges tenements, hereditaments, easements and appurtenances belonging or appertaining thereto. 1 ARTICLE 2. TERM: The interim term of this Lease (the "Interim Term ") shall commence on the date hereof and shall expire as of the earlier of (a) 120 days after the date hereof, or (b) the date Lessee completes its planned remodeling work on the Demised Premises and opens for business to the general public (the "Commencement Date "). The main term of this Lease shall commence on the Commencement Date and shall end on the last day of the month in which the fifth (5th) anniversary of the Commencement Date occurs (the "Main Term "). In addition to the Main Term, the Lessee shall have the option (each such right referred to herein as a "Renewal Option ") to renew and extend the Lease for two (2) consecutive five (5) year periods (each such period referred to as an "Option" and collectively as the "Option Periods ") immediately following the Main Term at the rent specified below. Lessee shall give Lessor written notice of its election to exercise any Renewal Option at 1 least 180 days prior to the expiration of the Main Term or any then current Option Period, as 1 426481.1 1 • 1 ARTICLE 4. RENT TO BE NET TO LESSOR: It is the intention of the parties that the rent payable hereunder shall be net to Lessor, so that this Lease shall yield to Lessor the rent specified herein during the term of this Lease, and that, except as provided in Article 6(3) below, all expenses of every kind and nature whatsoever relating to the Demised Premises shall be paid by Lessee. 1 ARTICLE 5. USE OF DEMISED PREMISES: The Demised Premises may be used for any lawful restaurant use, including the incidental sale of merchandise. Lessee agrees not to use or permit the Demised Premises to be used for any purposes prohibited by applicable federal, state, county, municipal or other governmental laws, codes, zoning, rules and regulations. Lessee shall not operate nor permit the operation of any building or tenant space on the Demised Premises in violation of the City of Tybee Island ordinances and the Lessor must approve any changes in use contemplated. ARTICLE 6. TAXES AND UTILITY EXPENSES: 1 (A) (1) Lessee shall, during the Term of this Lease, as Additional Rent, pay and discharge, or cause to be paid and discharged, punctually, as and when the same shall become due and payable, all taxes, special and general assessments, water rents, rates and charges, sewer rents and other governmental impositions and charges of every kind and nature whatsoever ( "Taxes "), and each and every installment thereof which shall or may during the term of this Lease be charged, levied, laid, assessed, imposed, become due and payable, or become liens upon or for or with respect to the Demised Premises or any part thereof or any building thereon or any part thereof; together with all interest and penalties thereon, under or by virtue of all present or future laws, ordinances, requirements, orders, directives, rules or regulations of the Federal, State, County and City Governments and of all other governmental authorities whatsoever, and all sewer rents and charges for water, steam, heat, gas, hot water, electricity, light and Power, and other service or services, furnished to the Demised Premises or the occupants thereof during the term of this Lease ( "Utility Expenses "). (2) Lessee shall be deemed to have complied with the covenants of this paragraph (A) if payment of such Taxes and Utility Expenses shall have been made within 1 any period allowed by law or by the governmental authority imposing the same during which payment is permitted without penalty or interest. Upon request of Lessor, Lessee shall produce and exhibit to Lessor satisfactory evidence of such payment within 30 days 1 after the last date on which such payment may be made without penalty. (B) Lessee or its designees shall have the right to contest or review all such Taxes by legal proceedings, or in such other manner as it may deem suitable (which proceedings, contest or review, if instituted, Lessee or its designees shall conduct promptly at its own cost and expense, and free of any expense to Lessor, and, if 1 426481.1 - 1 1 necessary, in the name of and with the cooperation of Lessor, and Lessor shall execute all documents necessary to accomplish the foregoing (C) Lessor covenants and agrees that if there shall be any refunds or rebates on account of the Taxes paid by Lessee under the provisions of this Lease, such refund or rebate (net of any legal fees or expenses incurred by Lessor in connection with procuring the refund or rebate) shall belong to Lessee. Lessor further covenants and agrees on request of Lessee at any time, and from time to time, but without cost to Lessor, to make application individually (if legally required) or to join in Lessee's application (if legally required) for separate tax assessments for such portions of the Demised Premises as Lessee shall, at any time, and from time to time designate. Lessor hereby agrees upon request of Lessee to execute such instruments and to give Lessee such assistance in connection with such application as shall be required by Lessee. (D) Nothing herein or in this Lease otherwise contained shall require or be construed to require Lessee to pay any inheritance, estate, succession, transfer, gift, franchise, income or profit taxes that are or may be imposed upon Lessor, its successors or assigns (but Lessee shall pay all sales or rental taxes with respect to the rents payable under this Lease). Nothing herein or in this Lease otherwise contained shall require or be construed to require Lessor to pay any inheritance, estate, succession, transfer, gift, franchise, income or profit taxes that are or may be imposed upon Lessee, its successors or assigns. 1 ARTICLE 7. IMPROVEMENTS. REPAIRS, ADDITIONS, REPLACEMENTS: (A) Lessee shall have the right, (1) at its own cost and expense, to construct on any part or all of the Demised Premises, at any time and from time to time, such signs, advertising matter, buildings, parking areas, driveways, walks, gardens and other similar and dissimilar improvements as Lessee shall from time to time determine, provided that the same shall be in compliance with all then applicable building codes and ordinances, and (2) at its own cost and expense, at any time and from time to time, to make such additions, alterations, changes, replacements and improvements thereon as it may deem desirable, including the demolition of any buildings and improvements and/or structures that now or hereafter may be situated or erected on the Demised Premises, provided that the resulting improvements are equivalent in value to or greater in value than the improvements which previously existed on the Demised Premises. (B) Lessor shall not be required to furnish any services or facilities or to make any improvements, repairs or alterations in or to the Demised Premises during the term of this Lease; provided however, that Lessor agrees to cooperate with and assist Lessee in its efforts to obtain any improvements, repairs or alterations required by Lessee, subject to Lessor's review and approval of 1 any plans for such improvements, repairs or alterations. (C) Until the last day or sooner termination of the Term of this Lease, including any 1 extension thereof, title to any building or buildings or improvements situated or erected on the 1 426481.1 -4- i 1 • 1 Demised Premises and the building equipment and other items installed thereon or contained therein and any alteration, change or addition thereto shall remain solely in Lessee; and Lessee alone shall be entitled to deduct all depreciation on Lessee's income tax returns for any such building or buildings, building equipment and/or other items, improvements, additions, changes or alterations. (D) On the last day or sooner termination of the Term of this Lease, including any extension thereof, Lessee shall quit and surrender to Lessor the Demised Premises and the buildings and permanent improvements then thereon. ARTICLE 8. REQUIREMENTS ORPUBLIC AUTHORITY: (A) During the term of this Lease, including any extensions thereof, Lessee shall, at its own cost and expense, promptly observe and comply with all present and future laws, ordinances, requirements, orders, directives, rules and regulations of the Federal, State, County and City Governments and of all other governmental authorities affecting the Demised Premises or appurtenances thereto or any part thereof whether the same are in force at the commencement of the term of this Lease or may in the future be passed, enacted, or directed, and Lessee shall pay all costs, expenses, liabilities, losses, damages, fines, penalties, claims and demands that may in any manner arise out of or be imposed because of the failure of Lessee to comply with the covenants of this Article 8. • (B) Lessee, at its sole expense, shall be responsible for obtaining all necessary site plan approvals and entitlements required in connection with its contemplated use of the Demised Premises. Lessor agrees to cooperate with Lessee in obtaining such site plan approvals and entitlements and to execute such documents as are reasonably required in connection therewith. ARTICLE 9. LIENS: (A) All persons to whom these presents may come are put upon notice of the fact that Lessee shall never, under any circumstances, have the power to subject the interest of Lessor in the Demised Premises to any mechanic's or materialmen's lien or liens of any kind. (B) All persons who may hereafter during the term of this Lease, including any extensions thereof, furnish work, labor, services or materials to the Demised Premises upon the request or order of the Lessee or any person claiming under, by or through or under the Lessee, must look for claims or compensation wholly to the interest of the Lessee and not to that of the Lessor. 426491.1 -5- 1 I applicable; provided, however, that in order to avoid any forfeiture or inadvertent lapse of such Renewal Option, if Lessee shall fail to give any such notice within the 180 -day time limit and shall not have given Lessor prior written notice of its intent not to exercise its Renewal Option, then and I as often as the same shall occur, Lessee's right to exercise such Renewal Option shall nonetheless continue, as shall its tenancy hereunder (under the same terms and conditions as theretofore in effect and notwithstanding that the Main Term or then current Option Period shall have expired) until ten I (10) business days after Lessor shall have given Lessee written notice of Lessor's election to terminate the Renewal Option, during which period Lessee may exercise its Renewal Option at any time prior to the expiration of such ten (10) business day period. Lessor may satisfy its obligations U to give Lessee written notice of Lessor's election to terminate the Renewal Option by delivery of such notice at any time within 360 days prior to the expiration of the Main Term or any then - current Option Period, provided that the delivery of such notice by Lessor shall not (i) trigger the 10 -day I response period if such notice is given more than 280 days prior to the expiration of the Main Term or any then - current Option Period, or (ii) require Lessee to give its renewal notice earlier than 270 days prior to the expiration of the Main Term or any then - current Option Period, as applicable. I Upon the giving of notice of renewal and extension in accordance with the foregoing provisions, the Term (defined below) of this Lease shall thereupon be renewed and extended in accordance with such notice without further act by Lessor or Lessee, the same as if such notice had been timely I given hereunder. The Interim Term, the Main Term and the Option Periods are, collectively, the "Term ". 1 ARTICLE 3. RENT: 1 The Base Rent for each year of the Term shall be as follows: Lease Years Annual Base Rent Monthly Base Rent Interim Term $9,000.00 $750.00 1 1 -2 $12,000.00 $1,000.00 I 3 —4 $12,600.00 $1,050.00 5 $13,200.00 $1,100.00 1 6 $13,200.00 $1,100.00 7 -8 $13,800.00 $1,150.00 I 940 $14,400.00 $1,200.00 11 -15 As agreed upon 5 % increases per Lease Year 1 1 Lessee shall pay annual Base Rent in equal monthly installments of the above amounts. 1 426481.1 -2- 1 1 • 1 ARTICLE 10. SUBLEASE AND ASSIGNMENT: Subject to Lessor's right to approve the creditworthiness of any subtenants, Lessee shall have the right to sublease the Demised Premises with the consent of Lessor. Notwithstanding anything to the contrary provided in this Article 10, Lessee shall be permitted to assign its interest in the Lease, without the consent of the Lessor, in connection with granting a Leasehold Mortgage (as hereinafter defined) or to an "Affiliate." For purposes hereof, "Affiliate" shall mean (1) any director or shareholder of Lessee or a partner or member of Lessee, (2) any corporation, partnership, limited liability company, trust or other entity controlling, controlled by or under common control with Lessee or a member or partner of Lessee, and (3) any officer, director, trustee, member, general partner or principal employee of any corporation, limited liability company, partnership trust or other entity controlling, controlled by or under common control with Lessee and or a member or partner of Lessee. ARTICLE 11. INDEMNITY: (A) Lessee shall indemnify and save harmless Lessor from and against any and all liability, damage, penalties or judgments arising from injury to person or property sustained by anyone in and about the Demised Premises resulting from any act or acts or omission or omissions of Lessee, or Lessee's officers, agents, servants, employees, contractors, or sublessees. Lessee shall, at its own cost and expense, defend any and all suits or actions (just or unjust) that may be brought against Lessor or in which Lessor may be impleaded with others upon any such above mentioned matter, and against any and all claim or claims, except as may result from the acts as set forth in paragraph (B) of this Article 11. (B) Except for the willful act(s) or gross negligence of Lessor its officers, agents, servants, employees or contractors, Lessor shall not be responsible or liable for any damage or injury to any property, fixtures, buildings, or other improvements, or to any person or persons occurring at any time during the term of this Lease or any extensions thereof on the Demised Premises, including any damage or injury to Lessee or to any of Lessee's officers, agents, servants, employees, contractors, customers or sublessees. ARTICLE 12. INSURANCE: (A) Lessee shall provide or cause to be provided at its expense, and keep in force during the term of this Lease, general liability insurance in a solvent insurance company or companies licensed to do business in the State of Georgia, selected by Lessee, and reasonably satisfactory to the holder of any Leasehold Mortgage (as hereinafter defined), with a combined single limit in the amount of at least One Million Dollars ($1,000,000) with respect to bodily injury or property damage. Such policy or policies shall name Lessor as an additional insured. Lessee agrees to deliver certificates of such insurance to Lessor. Such insurance shall be cancelable only upon thirty (30) days written notice to Lessor and to each Leasehold Mortgagee, if any. 426481.1 -6- 1 (B) During the term of this Lease, Lessee shall cause all buildings and improvements erected by Lessee on the Demised Premises at any time to be insured for the benefit of Lessee and any Leasehold Mortgagee, as their respective interests may appear, against Loss or damage by fire, and for customary extended coverage in a minimum amount necessary to avoid the effect of co- insurance provisions of the applicable policies. All such policies, or certificates thereof, shall be held by such Leasehold Mortgagee, if any, or by Lessee, so long as there shall be no Leasehold Mortgage. All proceeds payable at any time and from time to time by any insurance company under such policies shall be payable to the Leasehold Mortgagee, if any, or, if none, to Lessee. If any such proceeds are paid to the Leasehold Mortgagee or Lessee, Lessee shall be entitled to receive the full amount thereof subject to the terms of such Leasehold Mortgage, and except as hereinafter provided, Lessor shall not be entitled to, and shall have no interest in, such proceeds, or any part thereof. Any proceeds paid directly to Lessee shall be retained by Lessee and, provided Lessee utilizes all or any portion of such proceeds to repair, restore or replace improvements on the Demised Premises such that the value of the improvements equals or exceeds the value prior to the damage or destruction, Lessor shall not be entitled to, and shall have no interest in, such proceeds or any part thereof If Lessee does not so repair, restore, or replace improvements on the Demised Premises, then (1) the proceeds shall be paid to any Leasehold Mortgagee to the extent of the unpaid balance of such Leasehold Mortgage and the remainder to the Lessor, or (2) if there shall not be a Leasehold Mortgagee, to Lessor. Lessor shall, at Lessee's cost and expense, cooperate fully with Lessee in order to obtain the largest possible recovery, and shall execute any and all consents and other instruments and take all other actions necessary or desirable in order to effectuate the same. (C) Any insurance required to be provided by Lessee pursuant to this Lease may be provided by blanket insurance covering the Demised Premises and other locations of Lessee, provided such blanket insurance complies with all of the other requirements of this Lease with respect to the insurance involved and such blanket insurance is acceptable to any Leasehold Mortgagee. ARTICLE 13. WAIVER OF SUBROGATION: Subject to the limitations of this Article, all insurance policies or endorsements thereto carried by Lessee covering the Demised Premises, including, but not limited to, contents, fire and casualty insurance, will include provisions expressly waiving any right on the part of the insurer against the Lessor. Lessee agrees that its policies will include such waiver clause or endorsement so long as the same shall be obtainable without extra cost, but shall not be obligated to do so. The failure of any insurance policy to include such waiver clause or endorsement shall not affect the validity of this Lease. Lessor and Lessee each hereby waive all claims, causes of action and rights of recovery against the other and their respective agents, officers and employees for any damage to or destruction of persons, property or business that shall occur on or about the Demised Premises and 426481.1 -7- 1 shall result from any of the perils insured against any and all policies of insurance maintained by Lessor .and Lessee, regardless of cause, including the negligence and intentional wrongdoing of either party and their respective agents, officers and employees; but, only to the extent of recovery, if any, under such policy or policies of insurance; provided, however, that this waiver shall be null and void to the extent that any such insurance shall be invalidated by reason of this waiver. ARTICLE 14. DAMAGE OR DESTRUCTION: If at any time during the Term of this Lease, the Demised Premises or the improvements or buildings located thereon, or any portion thereof, shall be destroyed or substantially damaged by fire or other cause, then Lessee shall restore, repair, replace, rebuild or alter the buildings or improvements on the Demised Premises, provided only that the resulting buildings or improvements are equivalent in value to or greater in value than the improvements or buildings on the Demised Premises prior to the damage or destruction. ARTICLE 15. CONDEMNATION CLAUSE: If at any time during the Term of this Lease, the Demised Premises or the improvements or ( buildings located thereon, or any portion thereof; be taken or appropriated or condemned by reason of eminent domain, there shall be such division of the proceeds and awards in such condemnation proceedings and such abatement of rents and other adjustments made so as to give effect to the ► following: (A) The proceeds and awards in any such proceedings shall be divided arnong the Lessor and Lessee in such manner as shall be just and equitable under the circumstances. Lessor and -- Lessee agree that the value of the land as encumbered by this Lease shall be allocable to Lessor. Any compensation for Lessee's leasehold value under this Lease shall be allocable to Lessee. The value of the improvements on the Demised Premises shall be allocable between Lessor and Lessee based upon the remaining term of this Lease as of the date of the taking, provided that Lessor and Lessee agree that, notwithstanding such allocation, any proceeds and awards allocable to the improvements and buildings on the Demised Premises shall, prior to making any distribution to Lessor or Lessee, be paid to the First Leasehold Mortgage for satisfaction of its Leasehold Mortgage and to any subtenant to the extent its sublease entitles it to be reimbursed for arnounts it expended in connection with the construction of the improvements on the Demised Premises. If such parties are unable to agree upon such division within 30 days after such award has been made, then the matter in dispute shall, by appropriate proceedings, be submitted to a court then having jurisdiction of the subject matter of such controversy in Chatham County, Georgia. Lessee agrees that all proceeds allocable to Lessee shall be paid to the First Leasehold Mortgagee for application in accordance with its Leasehold Mortgage. (B) If the fee simple title to the entire Demised Premises were wholly taken by condemnation, this Lease shall be cancelled and terminated except that for purposes of the division 426481.1 -8- • 1 of the proceeds and awards in any such proceedings the estate of the Lessee shall be deemed to continue for the full term hereof (C) If part, but not all, of the Demised Premises shall be taken by condemnation so that the area remaining to the Lessee shall be insufficient in the Lessee's opinion for the conduct of the usual business operations being conducted upon the Demised Premises at the time of condemnation, 1 then the Lessee shall have the option (to be exercised by notice to the Lessor within 120 days after the vesting of title in the condemning authority) to terminate This Lease; and upon the exercise of such option, this Lease shall terminate and the parties hereto shall be released of and from any 1 further liability hereunder, except those liabilities accruing up to the time of such termination and further except with respect to any portion of the condemnation award or proceeds to which the parties are entitled pursuant to subparagraph (A) of this Article 15. In determining the portion of the 1 award payable to Lessee, the estate of the Lessee in the Demised Premises shall be deemed to continue for the full term hereof (D) In general, it is the intent of this Article that, upon condemnation, the parties shall share in the awards to the extent that their interests respectively are depreciated, damaged or destroyed by the exercise of the right of eminent domain. (E) If the temporary use of the whole or any part of the Demised Premises, including the improvements thereon, shall be taken, by any lawful power or authority, by the exercise of the right of condemnation or eminent domain, Lessee shall give prompt notice to Lessor, but the terra of this Lease shall not be reduced or effected in any way. Lessee shall continue to pay in full the rental and other charges herein reserved, without reduction or abatement, and Lessee shall be entitled to receive for itself any award or payment made for such use. If such use shall extend beyond any. expiration of the term of this Lease, the award shall be apportioned between Lessor and Lessee as of the date of expiration, based upon the periods involved and on their respective interests in the Demised Premises. (F) Each of Lessor, Lessee and Lessee's First Leasehold Mortgage shall have the right to participate in any condemnation proceeding. Without the consent of Lessee and any Leasehold Mortgagee, Lessor shall not make any settlement with the condemning authority or convey any portion of the Demised Premises to any such authority in lieu of condemnation or consent to any taking. ARTICLE 16. UTILITY EASEMENTS AND HIGHWAY ALIGNMENT: With the consent of the Lessor, Lessee shall have the right to enter into reasonable agreements with utility companies and governmental bodies creating easements in favor of such companies and governmental bodies as are required in order to provide utility service to the buildings and improvements on the Demised Premises, and then, after Lessor's review and approval of any such easement agreements, the Lessor may consent thereto and to execute any and all 426481.1 -9- 1 documents, agreements and instruments, and to take all other actions reasonably required in order to effectuate the same, all at Lessee's cost and expense. ARTICLE 17. MORTGAGES: Lessee hereby covenants and agrees that during the Term of this Lease, Lessor shall have the right and power to grant mortgages or otherwise create any security or other liens or encumbrances upon or affecting its fee interest in the Demised Premises, provided any such mortgage, lien or encumbrance is expressly made subject and subordinate to all of the terms and conditions of this Lease and all subleases hereunder and all Leasehold Mortgages (as hereinafter defined) and the rights of the Lessee and Leasehold Mortgagees hereunder and of all sublessees and provided further that within 30 days following the recordation of such mortgage or encumbrance Lessor shall give notice thereof to Lessee. ARTICLE 18. INTENTIONALLY DELETED ARTICLE 19. LEASEHOLD MORTGAGES: Lessee is hereby given the right by Lessor, in addition to any other rights herein granted, and without Lessor's prior written consent, to, from time to time, convey or encumber by deed to secure , debt, mortgage or other instrument its interest in this Lease and to assign this Lease and any sublease with respect thereto as collateral security for any debt secured by such mortgage, upon the condition that all rights acquired under such mortgage shall, except as expressly provided in this Lease, be subject to each and all of the covenants set forth in this Lease, and to all rights and interests of Lessor herein. Any such mortgage shall be a "Leasehold Mortgage" as such term is used in this Lease. The owner and holder of any Leasehold Mortgage shall be a "Leasehold Mortgagee" as such term is used in this Lease. As used in this Lease, the term "First Leasehold . Mortgage "shall mean a first priority Ieasehold mortgage. The owner and holder of the First Leasehold Mortgage is hereinafter called the "First Leasehold Mortgagee." If Lessee shall from time to time mortgage this leasehold, and if the holder of such mortgage has sent to Lessor a true copy thereof, together with written notice specifying the name and address (which address may be changed by subsequent written notice) of the Mortgagee and the pertinent recording date with respect to such Mortgage, Lessor and Lessee agree that so long as any such Leasehold Mortgage shall remain unsatisfied of record or until written notice of satisfaction is given by the holder to Lessor, the following provisions shall apply: (A) There shall be no cancellation, surrender or modification of this Lease by joint action of Lessor and Lessee without the prior consent in writing of the Leasehold Mortgagee. (B) Lessor shall, upon serving Lessee with any notice of default, simultaneously serve a copy of such notice upon the holder of such Leasehold Mortgage and, further, Lessor acknowledges and agrees no notice of default to the Lessee shall be effective unless and until a copy thereof is 426481.1 -10- • served upon the holder of such Leasehold Mortgage. The Leasehold Mortgagee shall thereupon have the same period as Lessee has plus an additional 20 days (or in the case of a non-monetary default that cannot be cured within 20 days such period of time as is reasonably required by the Leasehold Mortgagee to effect a cure of the applicable default, provided the Leasehold Mortgagee promptly commences and, thereafter, diligently prosecutes the cure of such default) after service of such notice upon it to remedy or cause to be remedied the defaults complained of and Lessor shall accept such performance by or at the instigation of such Leasehold Mortgagee as if the same had been done by Lessee. (C) Anything herein contained notwithstanding, while such Leasehold Mortgage remains unsatisfied of record, or until written notice of satisfaction is given by the holder to Lessor, if any default shall occur, which, pursuant to any provision of this Lease, entities Lessor to terminate this Lease, and if before the expiration of 20 days from the date of service of notice of termination upon such Leasehold Mortgagee, such Leasehold Mortgagee shall have notified Lessor of its desire to nullify such notice and shall have cured or commenced the work of curing any default of Lessee under this Lease, and shall prosecute the same to completion with reasonable diligence, then in such event Lessor shall not be entitled to terminate this Lease and any notice of termination theretofore given shall be void and of no effect. (D) If Lessor shall elect to terminate This Lease by reason of any default of Lessee, the Leasehold Mortgagee shall not only have the right to nullify any notice of termination by curing such default, as aforesaid, but also shall have the right to postpone and extend the specified date for the termination of this Lease as fixed by Lessor in its notice of termination, for a period of 12 months, provided that such Leasehold Mortgagee shall cure or cause to be cured any then existing defaults that can be cured solely by the payment of money and, thereafter, pay or cause to be paid _ all amounts due Lessor under Lease as and when due and payable and provided further that the Leasehold Mortgagee shall forthwith take steps to acquire or sell Lessee's interest in this Lease by foreclosure of the Mortgage (deed to secure debt) or otherwise and shall prosecute the . same to completion with all due diligence. If, at the end of said 12 -month period, the Leasehold Mortgagee shall be actively engaged in steps to acquire or sell Lessee's interest herein, the time permitted for compliance by said Leasehold Mortgagee with the provisions of this Article 19 shall be extended for such period as shall be reasonably necessary (not to exceed an additional six (6) months) to complete such steps (including any appellate proceedings) with reasonable diligence and continuity. (E) Lessor agrees that the name of the Leasehold Mortgagee may be added to the "Loss Payable Endorsement" of any and all insurance policies required to be carried by Lessee hereunder and, anything herein to the contrary notwithstanding, the insurance proceeds shall be applied as required by any then extant First Leasehold Mortgage. (F) Lessor agrees promptly after submission thereof to Lessor to execute, acknowledge and deliver any agreements modifying this Lease requested by any First Leasehold Mortgagee, provided that such modification does not reduce Lessee's monetary obligations under this Lease or 426481.1 • -11- 1 1 materially decrease Lessees other obligations or increase Lessee's rights or materially decrease Lessor's rights and provided that such modification meets with the approval of Lessor, which approval shall not be unreasonably withheld in accordance with the foregoing standards. (G) Lessor shall, upon request, execute, acknowledge and deliver to each Leasehold Mortgagee an agreement prepared at the sole cost and expense of Lessee, in a form reasonably satisfactory to Lessor and such Leasehold Mortgagee, between Lessor, Lessee and Leasehold Mortgagee, agreeing to all of the provisions of this Article 19. Lessor shall also, upon request, execute, acknowledge and deliver to each First Leasehold Mortgagee an acknowledgment that said First Leasehold Mortgagee is a First Leasehold Mortgagee. The tern "Leasehold Mortgage" whenever used herein, shall include whatever security instruments are used in the locale of the Demised Premises, such as, without limitation, mortgages, security deeds and conditional deeds, as well as financing statements, security agreements and other documentation required pursuant to the Uniform Commercial Code. The term "Leasehold Mortgage" whenever used herein shall also include any instruments required in connection with a sale - leaseback transaction. (H) The rights granted herein to Leasehold Mortgagees are for their exclusive benefits and shall not be deemed to extend or expand any rights granted to Lessee. ARTICLE 20. PERFORMANCE BY SUBTENANT: Any act required to be performed by Lessee pursuant to the terms of this Lease may be performed by any sublessee occupying all or any part of the Demised Premises, and the performance of such act shall be deemed to be performance by Lessee and shall be acceptable as Lessee's act by Lessor. ARTICLE 21. DEFAULTS: Subject, in all cases, to Article 19 hereof (A) In the event of Lessee's failure to perform any of the covenants, conditions and agreements herein contained to be kept or performed on Lessee's part and the continuance of such failure without the curing of same for a period of 60 days after receipt by Lessee of notice in writing from Lessor specifying in detail the nature of such failure, and provided Lessee shall not cure said failure as provided in subparagraph (B) of this Article 21, then, Lessor may, at its option, give to Lessee a notice of election to end the terra of this Lease upon a date specified in such notice, which date shall be not less than 90 days after the date of receipt by Lessee of such notice from Lessor, and upon the date specified in said notice, the term and estate hereby vested in Lessee shall cease and any and all other right, title and interest of Lessee hereunder shall likewise cease without further notice or lapse of time, as fully and with like effect as if the entire term. of this Lease had elapsed unless, if the default specified in such notice is nonmonetary in nature, said default has been cured within said 90 -day period. Simultaneously with the sending of the notice to Lessee hereinabove 426481.1 -12- 1 provided for, Lessor shall send a copy of such notice to all Leasehold Mortgagees and to any sublessee of the Demised Premises or portions thereof that Lessee may have designated by written notice to Lessor. The curing of any defaults within the above time limits by any of the aforesaid parties or combination thereof shall constitute a curing of any defaults hereunder with like effect as if Lessee had cured same hereunder. Notwithstanding the foregoing provisions of this Article 21, with respect to defaults that are monetary in nature only, Lessor shall be required to provide Lessee with the opportunity to cure a monetary default not more than twice during any 12 -month period. Upon the third monetary default during any 12 -month period (subject to the rights of any Leasehold Mortgagee or sublessee to cure) Lessor may give Lessee notice of Lessor's election to end the term of the Lease upon a date not less than 90 days from the date of such notice and upon the date specified in such notice the term and estate vested in Lessee shall cease. (B) In the event that Lessor gives notice of a default that cannot be cured solely by the payment of money and is (1) of such nature that it cannot be cured within such 90 -day period, or (2) if the curing thereof cannot be completed within said 90 -day period due to causes beyond the control of Lessee, then such default shall not be deemed to continue so long as Lessee, after receiving such notice, proceeds to cure the default as soon as reasonably possible and continues to take all steps necessary to complete the same within a period of time, which, under all prevailing circumstances, shall be reasonable. (C) Notwithstanding anything to the contrary contained in this Article 21, in the event that any defaults of Lessee shall be cured in any manner hereinabove provided prior to the cancellation of this Lease, such defaults shall be deemed never to have occurred and Lessee's tights hereunder shall continue unaffected by such defaults. • ARTICLE 22. WAIVERS: • • Failure of Lessor or Lessee to complain of any act of omission on the part of the other party no matter how long the same may continue shall not be deemed to be a waiver by said party of any of its rights hereunder. No waiver, at any time by Lessor or Lessee, whether expressed or implied, of any breach of any provision of this Lease shall be deemed a waiver of a breach of any other provision of this Lease or a consent to any subsequent breach of the same or any other provision. No acceptance by Lessor of any partial payment shall constitute an accord or satisfaction; but shall only be deemed a part payment on account. ARTICLE 23 . INTENTIONALLY DELETED ARTICLE 24. NOTICES: No notice, approval, consent or other communication authorized or required by this Lease shall be effective unless same shall be in writing and either (i) personally delivered, (ii) sent via national overnight delivery service, or (iii) sent postage prepaid by United States registered or 426481.1 -13- �' N. certified mail, return receipt requested, directed to the parties at the following addresses: Lessee: Beachcremes, Inc. Attn: George Jackson PO Box 2842 Tybee Island, GA 31328 With a copy to: Thomas R. Devaney, Esq. 7370 Hodgson Memorial Drive Suite E -12 Savannah, GA 31406 Lesssor: City of Tybee Island Attn: Tom Cannon, City Manager POBox2749 Tybee Island, GA 31328 With a copy to: Edward M. Hughes, Esq. Callaway, Braun, Riddle & Hughes, PC 301 West Congress Street PO Box 9150 1 Savannah, GA 31412 • or to such other addresses as either party may designate by notice given from time to time in accordance with this Article 24. A notice shall not be deemed to have been given or delivered until the date the notice is actually received. ARTICLE 25. CERTIFICATES: • Either party shall, without charge, at any time and from time to time hereafter, within ten (10 ) days after written request of the other, certify by written instrument duly executed and acknowledged to any mortgagee, sublessee, or purchaser, or proposed mortgagee, sublessee, or proposed purchaser, or any other person, firm or corporation specified in such request: (A) as to whether this Lease has been supplemented or amended, and if so, the substance and manner of such supplement or amendment; (B) as to the validity and force and effect of this Lease, in accordance with its tenor as then constituted; (C) as to the existence of any default thereunder by the party requesting the certificate; 426481.1 -14- 1 {D) as to the existence of any offsets, counterclaims, or defenses thereto on the part of the party giving the certificate; (E) as to the commencement and expiration dates of the teen of this Lease; and (F) as to any other matters as may reasonably be so requested. Any such certificate may be relied upon by the party requesting it and any other person, fnn or corporation to whom the same may be exhibited or delivered, and the contents of such certificate shall be binding on the party executing same. ARTICLE 26. ATTORNEYS' FEES: (A) If at any time, by reason of the failure of the Lessee to keep and perform any covenant or agreement, which, under the terms of this Lease, the Lessee is bound and obligated to keep and perform, it becomes necessary for the Lessor to employ an attorney at law to protect the rights and interests of the Lessor in the property demised, or to enforce this Lease or proceed under it in any particular, then, in any of such events, and provided the Lessor is successful in such enforcement or proceeding, the Lessee will owe and pay unto the Lessor all costs of court and , reasonable attorneys' fees incurred or expended by the Lessor in taking such actions. (B) If at any time, by reason of the failure of the Lessor to keep and perform any covenant or agreement, which, under the terms of this Lease, the Lessor is bound and obligated to keep and perform, it becomes necessary for the Lessee to employ an attorney at law to protect the rights and interests of the Lessee in the property demised, or to enforce this Lease or proceed under it in any particular, then, in any of such events, and provided the Lessee is successful in such enforcement or proceeding, the Lessor will owe and pay unto the Lessee all costs of court and reasonable attorneys' fees incurred or expended by the Lessee in taking such actions. ARTICLE 27. OUIET ENJOYMENT: Lessee, upon paying the Base Rent and Additional Rent and all other sums and charges to be paid by it as herein provided, and observing and keeping all covenants, warranties. agreements and conditions of this Lease on its part to be kept, shall quietly have and enjoy the Demised Premises during the term of this Lease, without hindrance or molestation by anyone, subject only to the terms and conditions of this Lease. ARTICLE 28. LESSOR'S REPRESENTATIONS AND WARRANTIES: Lessor hereby represents and warrants to Lessee: (i) that Lessor has the power and authority to execute and deliver this Lease and to 426481.1 -15- carry out and perform all covenants to be performed by Lessor hereunder. (ii) that at the time of the commencement of the term of this Lease, sole and undisturbed physical possession of the entire Demised Premises will be delivered to Lessee. (iii) that the Demised Premises is delivered to Lessee free and clear of all claims, obligations, mortgages, easements, liens, encumbrances and other natters of any nature, except for the matters set forth on Exhibit "13" attached hereto and by this reference made a part hereof (the "Permitted Exceptions "). (iv) that the execution and delivery of this Lease does not violate any of the provisions of the Permitted Exceptions. ARTICLE 29. GOVERNING LAW: This Lease and the performance thereof shall be governed, interpreted, construed and regulated by the laws of the State of Georgia. ARTICT .F. 30. PARTIAL INVALIDITY: If any term, covenant, condition or provision of this Lease or the application thereof to any person or circumstance shall, at any time or to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each remaining term, covenant, condition and provision of this Lease shall be valid and be enforced to the fullest extent permitted by law. ARTICLE 31. SHORT FORM LEASE: The parties will, at any time, at the request of either one, promptly execute duplicate originals of an instrument, in recordable form, that will constitute a short form of Lease, setting forth a description of the Demised Premises, the term of this Lease and any other portions thereof, excepting the rental provisions, as either party may request. ARTICLE 32. INTERPRETATION: Wherever herein the singular number is used, the same shall include the plural, and the masculine gender shall include the feminine and neuter genders, and vice versa, as the context shall require. The section headings used herein are for reference and convenience only, and shall not enter into the interpretation hereof. This Lease may be executed in several counterparts, each of which shall be an original; but all of which shall constitute one and the same instrument. The terms "Lessor" and "Lessee," whenever used herein, shall mean only the owner at the time of Lessor's or 426481.1 - 16 - 1 Lessee's interest herein, and upon any sale or assignment of the interest of either Lessor or Lessee herein, their respective successors in interest and/or assigns shall, during the term of their ownership of their respective estates herein, be deemed to be Lessor or Lessee, as the case may be. ARTICLE 33. ENTIRE AGREEMENT: No oral statement or prior written matter made by or between the parties hereto shall have any force or effect. Lessee agrees that it is not relying on any representations or agreements other than those contained in this Lease. This Lease shall not be modified or cancelled except by writing subscribed by all parties. ARTICLE 34. REAL ESTATE BROKER: Lessor and Lessee mutually represent and acknowledge that no real estate broker or salesman has participated in this transaction and Lessor and Lessee shall indemnify and hold harmless the other against any claims for commissions arising out of the acts of such other party. ARTICLE 35. PARTIES: Except as herein otherwise expressly provided, the covenants, conditions and agreements contained in this Lease shall bind and inure to the benefit of Lessor and Lessee and their respective successors and assigns. ARTICLE 35. FIRST LEASEHOLD MORTGAGEE: Anything in this Lease to the contrary notwithstanding, should a First Leasehold Mortgagee succeed to the rights of the Lessee hereunder (by reason of foreclosure of the Leasehold Mortgage or assignment of the Lessee's rights hereunder in lieu of foreclosure), or become the Lessee under a new Lease with Lessor pursuant to Article 19 hereof, all insurance proceeds shall first be paid over to such First Leasehold Mortgagee to the extent of its "stake," as such term is hereinafter defined, and then paid as provided in the preceding articles of this Lease. The term "stake" as used herein shall mean the unpaid principal and accrued interest owed to the First Leasehold Mortgagee at the time when it succeeds to the rights of Lessee hereunder or enters into a lease with Lessor hereunder pursuant to Article 19 hereof plus all costs, expenses and attorney's fees incurred by such First Leasehold Mortgagee in connection with its succession to Lessee's rights hereunder or in entering into such new lease. ARTICLE 37. ACCESS TO PREMISES: Lessor and Lessor's designees shall have the right, but not the obligation, to enter upon the Demised Premises at all reasonable times to examine the same. 426481.1 -17- I� ARTICLE 38. INTENTIONALLY DELETED ARTICLE 39. ENVIRONMENTAL: In addition to, and not in limitation of any other provision of this Lease, Lessee agrees not to generate, store, use, treat or dispose of nor to allow, suffer or permit the generation, storage, use, treatment or disposal of any "hazardous waste" or "hazardous substance" (as those terms are defined in the Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901 et seq., as amended "RCRA ") or the Comprehensive Environmental Response, Compensation, and Liability act, 42 U.S.C. Sections 9601 et seq., as amended ( "CERCLA "), and any rules and regulations now or hereafter promulgated under either of such acts) or any pollutant or other contaminant on, in, from or about the Demised Premises, which hazardous material is prohibited or controlled by any federal, state or local law, ordinance, rule or regulation now or hereafter in effect. The foregoing shall not prohibit the storage or use of hazardous substances on the Demised Premises utilized by subtenants in the normal course of their business, provided such hazardous substances are utilized, stored and maintained in accordance with all applicable local, state and federal laws. Lessee shall and hereby does indemnify and hold Lessor harmless from and against any and all loss, damages, expenses, fees, claims, costs and liabilities (including, but not limited to, attorneys' fees and costs of litigation) arising out of or in any manner related to the "release" or "threatened release" of, and for any clean -up responsibility imposed upon Lessor under any federal, state or local law, ordinance, rule or regulation now or hereafter in effect, with respect to, any "hazardous waste" or "hazardous substance" (as those terms are defined in RCRA AND CERCLA, and any rules and regulations now or hereafter promulgated thereunder), or any pollutant, or other contaminant on, in, from or about the Demised Premises, which release or threatened release arises out of or is in any manner related to Lessee's use or occupancy of the Demised Premises; provided, however, the foregoing indemnification shall be inapplicable as to any hazardous waste or hazardous substance which was in the Demised Premises prior to the date of this Lease, and Lessor agrees that it shall be responsible for same. Lessee's obligations under this Section shall survive the expiration or earlier termination of this Lease. ARTICLE 40. NO MERGER OF TITLE: There shall be no merger of this Lease nor of the leasehold estate created by this Lease with the fee estate in the Demised Premises or any part thereof by reason of the fact that the same person, firm, corporation or other entity may acquire or own or hold, directly or indirectly, such interests at the same time unless such party shall express such intention in a written instrument effecting such merger and shall duly record the same. 426481.1 -18- IN WITNESS WHEREOF, the parties hereto have hereunto set their hands and seals on the day and year first above written. LESSOR: ATTEST: J .CITY OF j :RE ISLA1ISLAND' - acrlya.- i of Council By: /' WI a W. Parker, Mayor LESSEE: ATTEST: BEACH ' 1 , INC. 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" %4:. ; • .":' .- it' 01, *5 . 4 11 -.- • I i ' .1, ..,-.... 1 1 Xii. A ' tot COO V\( BO ARD 4,00001: AS A SESS. OAP: MaP t td GUARANTY ANNEXED TO GROUND T.F.ASE dated as of December 10, 2001 by and between Mayor and Council of the City of Tybee Island, Georgia, as Lessor, and Beachcremes, Inc. dba "North Beach Grill ", as Lessee. The undersigned, George I. Spriggs, Jr., in consideration of the leasing of the Demised Premises described in the Ground Lease ( "Lease") to Beachcremes, Inc., dba "North Beach Grill" (referred to as "Tenant "), does hereby covenant and agree as follows: A. The undersigned does hereby guarantee the full, faithful and timely payment and performance by Tenant of all the payments, covenants and other obligations of Tenant under or pursuant to the Lease. If Tenant shall default at any time in the payment of any rent or any other sums, costs or charges whatsoever, or in the performance of any of the other covenants and obligations of Tenant, under or pursuant to the Lease, then the undersigned, at its expense, shall on demand of the Landlord fully and promptly, and will and truly, pay all rent, sums, costs and charges to be paid by Tenant, and perform all the other covenants and obligations to be performed by Tenant, under or pursuant to the Lease, and in addition shall on Landlord's demand pay to Landlord any and all sums due to Landlord, including (without limitation) all interest on past due obligations of Tenant, cost advanced by Landlord, and damages and all expenses (including attorneys' fees and litigation cost), that may arise in consequence of Tenant's default. The undersigned hereby waives all requests of notice of acceptance of the Guaranty, and all requests of notice of breach of non- performance by Tenant. B. The obligations of the undersigned hereunder are independent of and may exceed, the obligations of Tenant. A separate action or actions may, at Landlord's option, be brought and prosecuted against the undersigned, whether or not any action, is first or subsequently brought against Tenant, or whether or not Tenant is joined in any such action, and the undersigned may be joined in any action or proceeding commenced by Landlord against Tenant arising out of, in connection with or based upon the Lease. The undersigned waives any right to require Landlord to proceed against Tenant or pursue any other remedy in Landlord's power whatsoever, any right to complain of delay in the enforcement of Landlord's rights under the Lease, and any demand by Landlord and/or prior action by Landlord of any nature whatsoever against Tenant, or otherwise. C. The Guaranty shall remain and continue in full force and effect and shall not be discharged in whole or in part notwithstanding (whether prior or subsequent to the execution hereof) any alteration, renewal, extension, modification, amendment or assignment of or subletting, concession, franchising, licensing or permitting under, the Lease. The undersigned hereby waives notice of any of the foregoing, and agrees that the liability of the undersigned hereunder shall be based upon the obligations of Tenant set forth in the Lease as the same may be altered, renewed, extended, modified, amended or assigned. ,IP D. The undersigned's obligations hereunder shall remain fully binding although Landlord may have waived one or more defaults by Tenant, extended the time of performance by Tenant, released, returned or misapplied other collateral at any time given the security for Tenant's obligations (including other guaranties) and/or released Tenant from the performance of its obligations under the Lease. E. This Guaranty shall remain in full force and effect notwithstanding the institution by or against Tenant, of bankruptcy, reorganization, readjustment, receivership or insolvency proceedings of any nature, or the disaf&nriance of the Lease in any such proceedings or otherwise. F. The Guaranty shall be binding upon and inure to the benefit of the parties, and their successors and assigns. G. In the event that Landlord should institute any suit against the Guarantor for violation of or to enforce any of the covenants or conditions of this Guaranty or to enforce any right of Landlord hereunder, or should the undersigned institute any suit against Landlord arising out of or in connection with this Guaranty, or should either party institute a suit against the other for a declaration of rights hereunder, or should either party intervene in any suit in which the other is a party, to enforce or protect its interest or rights hereunder, the prevailing party in any such suit shall be entitled to the fees of its attorney(s) in the reasonable amount thereof, to be determined by the court. IN WITNESS WHEREOF, the undersigned has executed this Guaranty this day of WITNESS: ( 1 &b ; -2- 779604 GUARANTY ANNEXED TO GROUND LEASE dated as of December 10, 2001 by and between Mayor and Council of the City of Tybee Island, Georgia, as Lessor, and Beachcremes, Inc. dba "North Beach Grill", as Lessee. The undersigned, George W. Jackson, in consideration of the leasing of the Demised Premises described in the Ground Lease ( "Lease ") to Beachcremes, Inc., dba "North Beach Grill" (referred to as "Tenant "), does hereby covenant and agree as follows: A. The undersigned does hereby guarantee the full, faithful and timely payment and performance by Tenant of all the payments, covenants and other obligations of Tenant under or pursuant to the Lease. If Tenant shall default at any time in the payment of any rent or any other sums, costs or charges whatsoever, or in the performance of any of the other covenants and obligations of Tenant, under or pursuant to the Lease, then the undersigned, at its expense, shall on demand of the Landlord fully and promptly, and will and truly, pay all rent, sums, costs and charges to be paid by Tenant, and perform all the other covenants and obligations to be performed by Tenant, under or pursuant to the Lease, and in addition shall on Landlord's demand pay to Landlord any and all sums due to Landlord, including (without limitation) all interest on past due obligations of Tenant, cost advanced by Landlord, and damages and all expenses (including attorneys' fees and litigation cost), that may arise in consequence of Tenant's default. The undersigned hereby waives all requests of notice of acceptance of the Guaranty, and all requests of notice of breach of non- performance by Tenant. B. The obligations of the undersigned hereunder are independent of, and may exceed, the obligations of Tenant. A separate action or actions may, at Landlord's option, be brought and prosecuted against the undersigned, whether or not any action, is first or subsequently brought against Tenant, or whether or not Tenant is joined in any such action, and the undersigned may be joined in any action or proceeding commenced by Landlord against Tenant arising out of, in connection with or based upon the Lease. The undersigned waives any right to require Landlord to proceed against Tenant or pursue any other remedy in Landlord's power whatsoever, any right to complain of delay in the enforcement of Landlord's rights under the Lease, and any demand by Landlord and/or prior action by Landlord of any nature whatsoever against Tenant, or otherwise. C. The Guaranty shall remain and continue in full force and effect and shall not be discharged in whole or in part notwithstanding (whether prior or subsequent to the execution hereof) any alteration, renewal, extension, modification, amendment or assignment of or subletting, concession, franchising, licensing or permitting under, the Lease. The undersigned hereby waives notice of any of the foregoing, and agrees that the liability of the undersigned hereunder shall be based upon the obligations of Tenant set forth in the Lease as the same may be altered, renewed, extended, modified, amended or assigned. i • D. The undersigned's obligations hereunder shall remain fully binding although Landlord may have waived one or more defaults by Tenant, extended the time of performance by Tenant, released, returned or misapplied other collateral at any time given the security for Tenant's obligations (including other guaranties) and/or released Tenant from the performance of its obligations under the Lease. E. This Guaranty shall remain in full force and effect notwithstanding the institution by or against Tenant, of bankruptcy, reorganization, readjustment, receivership or insolvency proceedings of any nature, or the disafftrmance of the Lease in any such proceedings or otherwise. F. The Guaranty shall be binding upon and inure to the benefit of the parties, and their successors and assigns. G. In the event that Landlord should institute any suit against the Guarantor for violation of or to enforce any of the covenants or conditions of this Guaranty or to enforce any right of Landlord hereunder, or should the undersigned institute any suit against Landlord arising out of or in connection with this Guaranty, or should either party institute a suit against the other for a declaration of rights hereunder, or should either party intervene in any suit in which the other is a party, to enforce or protect its interest or rights hereunder, the prevailing party in any such suit shall be entitled to the fees of its attorney(s) in the reasonable amount thereof, to be determined by the court. IN WITNESS WHEREOF, the undersigned has executed this Guaranty this 6 day of WITNESS: r ti / �_ C„,.. G- •rge V/. Jackson I -2- 1 1 COMMENCEMENT OF GROUND LEASE LANDLORD: MAYOR AND COUNCIL OF THE CITY OF TYBEE ISLAND PO Box 2749 Tybee Island GA 31328-2749 TENANT: BEACHCREMES, INC. PO Box 2842 Tybee Island GA 31328 -2842 1 DATE OF LEASE: December 10, 2001 PREMISES: NorthBeach Grill EFFECTIVE DATE: April 8, 2002 As provided in the Lease, the parties establish and agree that that the Interim Term will expire as of April 9, 2002, and that the Commencement Date is April 10, 2002, and the expiration of the Main Term is April 9, 2007, although the Main Term may be extended by the two (2) Option Periods as provided in the Lease for the exercise of the Renewal Options. Effective as of the Commencement Date, the Base Rent shall be paid in equal monthly installments, with each payment due and payable as of the 14 of each month. ex Except as expressly modified in this Agreement, all the terms, covenants and conditions of said P lease shall remain in full force and effect, shall be binding on the parties hereto, and are hereby ratified and affirmed. Witness: LANDLORD: THE CITY OF TYBEE ISLAND Byd • • "' ' & - - Walter W. Parker, Mayor rk . •'ty € until 4 - t s - v-- itness: TENANT: --� BEACHC' . MES, INC. B Geor_ - W. Jackson, Presi • ent 7789TIv1 1