Doug Heller for Commissioner, Springfield, PA

Flourtown Country Club Lease

Flourtown Country Club Lease
LEASE AGREEMENT

1. PARTIES. THIS LEASE made this 1st day of May, 2006, by and between the TOWNSHIP OF SPRINGFIELD, a first class Township in Montgomery County, Pennsylvania, with offices at 1510 Paper Mill Road, Wyndmoor, Pennsylvania, 19038, (the "Lessor") and TJKFCC, LLC, a Pennsylvania limited liability company with an office address at 124 Azalea Way, Flourtown, Pennsylvania 19031 (the "Lessee").

2. PROPERTY. As used herein, the term "Premises" shall mean the tract of land, consisting of approximately 53 acres, known as the Flourtown Country Club, located in Springfield Township, Montgomery County, Pennsylvania, including all buildings and improvements located thereon, but specifically excluding the existing cell tower located on the Premises, and together with the nonexclusive right to use all driveways, sidewalks, loading and parking areas serving the Premises. The Premises is described more fully at Schedule "A" hereto. As used herein, the term "Equipment" shall mean all of the items of equipment, fixtures, and personal property listed at Schedule "B" attached hereto. The Premises and the Equipment are referred to collectively herein as the "Property". Lessor does hereby demise and let unto Lessee and Lessee does hereby lease and take from Lessor for the term and upon the terms, covenants, conditions and provisions set forth herein, all of the Property, subject to the following rights of Lessor:

During the Term (as hereinafter defined), Lessee shall allow Lessor to use one (1) or more rooms on the second floor of the main building as a meeting room for various township events when Lessee is not using said room(s) for other events. Lessor shall not be required to pay for the use of the room(s) and Lessee shall not be required to provide any services in connection with Lessor's use of the room(s) unless requested to do so by Lessor in which event Lessor agrees to pay for such services (i.e. food and drinks). Lessor agrees to contact Joseph Halligan or his designee, concerning the availability of the room(s) and Lessee shall not unreasonably withhold its consent to Lessor's request to use a room(s).
Lessor shall have the right at any time during the Term to construct a bike path and or walking trails (collectively the "Trails") through the Premises, for use by the public. The location of the Trails shall not unreasonably interfere with the conduct of Lessee's business on the Property. In the event that Lessor constructs the Trails, then Lessor shall be responsible for the construction, maintenance and up keep of the Trails. Lessor shall provide Lessee with written notice of its intention to construct the Trails at least ninety (90) days prior to the commencement of construction.
Lessor shall have the right to build a building or buildings on the Premises (the "New Building(s)") provided, that, access to the existing building is not unreasonably interfered with and further provided, that, the construction and use of the New Building(s) shall not unreasonably interfere with Lessee's use of the Premises (including, but not limited to, the golf course, parking lots and pool facilities). Lessor shall be responsible for the maintenance and repair, payment of taxes, utilities and insuring of the New Building(s) and Lessee shall have no such obligations in connection with the New Building(s). In the event that Lessor constructs the New Building(s), Lessor's employees, contractors, agents and invitees shall have the right to use the existing entrances and parking facilities on the Premises at no charge. Lessor shall provide Lessee with written notice of its intention to start construction of the New Building(s) at least ninety (90) days prior to the commencement of construction of the New Building(s).
In the event that Lessor either constructs the Trails or builds the New Building(s) Lessor agrees to obtain insurance in accordance with Section 7(d) below and to indemnify Lessee in accordance with Section 19(b) below.

3. TERM

TERM. The term (hereinafter referred to as the "Term") shall commence on the date of full execution of this Lease by both parties (hereinafter called the "Commencement Date") and shall terminate on December 31, 2020, unless sooner terminated or renewed as provided for herein. It is presently anticipated that the Property will be ready for delivery to the Lessee on the Commencement Date; however, in the event that Lessor does not make the Property available to Lessee by such date, then (a) Lessor shall not have any liability whatsoever to Lessee for such failure, (b) this Lease shall not be rendered void or voidable as a result thereof, and (c) the Commencement Date shall be extended for one (1) day for each day that Lessor is delayed from making the Property available to Lessee.
OPTION TO EXTEND. Provided that no Event of Default (as hereinafter defined) has occurred under the terms of this Lease, Lessee shall have the right to extend the Term of this Lease for one (1) additional five (5) year term (the "Extension Period") beginning on the day after the expiration of the Term. In order to exercise the Extension Period, Lessee must give Lessor written notice that it wishes to exercise such Extension Period not less than three hundred sixty (360) days prior to the expiration date of the Term. The terms and conditions of this Lease during such Extension Period shall be identical to those during the initial Term except that the Rentals (as hereinafter defined) shall be determined as set forth in Paragraph 4(d). If Lessee does not give notice that it wishes to extend the Lease in accordance herewith, the Lease shall terminate at the expiration of the Term. In addition to the other requirements set forth above, it shall be a condition of Lessee's right to extend the Term that no Event of Default exists at the time the Extension Period is scheduled to commence. All references in this Lease to the Term shall include the Extension Period (if exercised).

4. RENT

MINIMUM ANNUAL RENTAL. Lessee shall pay "Minimum Annual Rent" in the amounts set forth below without notice or demand, and without setoff or deduction, in five (5) equal payments on January 1st, February 1st, March 1st, April 1st and May 1st of each Lease Year (as hereinafter defined) during the Term. Unless Lessee is otherwise notified in writing by Lessor, all sums shall be paid to Lessor at the address provided herein. The Minimum Annual Rent for the Initial Term shall be:

Year 1: May 1, 2006 December 31, 2006	$50,000.00 payable in a lump sum on the Commencement Date
Year 2: January 1, 2007 through December 31, 2007	Annual Rent $75,000.00
Lease Years 3 through 5 January 1, 2008 through December 31, 2010	Annual Rent $85,000.00
Lease Year 6 January 1, 2011 through December 31, 2011	Annual Rent $95,000.00
Lease Years 7 through 10 January 1, 2012 through December 31, 2015	Annual Rent $100,000.00
Lease Years 11 through 12 January 1, 2016 through December 31, 2017	Annual Rent $105,000.00
Lease Years 13 through 15 January 1, 2018 through December 31, 2020	Annual Rent $115,000.00
Extension Period Lease Years 16 through 17: January 1, 2021 through December 31, 2022	Annual Rent $125,000.00
Lease Years 18 through 20: January 1, 2023 through December 31, 2025	Annual Rent $135,000.00

In the event that the Commencement Date (hereinafter sometimes referred to as the "Rent Commencement Date") shall be on a day other than the first day of a calendar month, the Minimum Monthly Rent shall be prorated for the fractional month between the Rent Commencement Date and the first day of the first full calendar month following the Rent Commencement Date on a per diem basis, calculated on a thirty (30) day month. In addition, the Minimum Annual Rent for Lease Year 1 shall be payable by Lessee to Lessor in a lump sum on the Rent Commencement Date. The First Lease Year shall commence on May 1, 2006 and shall terminate on December 31, 2006 and each Lease Year thereafter shall be twelve (12) consecutive full calendar months.
On the Rent Commencement Date Lessor agrees to pay to Lessee a sum equal to all golf membership fees and all pool membership fees collected by Lessor prior to the Rent Commencement Date, less all reasonable expenses paid by Lessor in connection with the Property prior to the Rent Commencement Date, and less the Minimum Annual Rent for Lease Year 1.

ADDITIONAL RENT. Lessee hereby acknowledges that this Lease is a full net lease thereby obligating Lessee to pay all costs of operating and managing the Property and the facilities located thereon or appurtenant thereto which shall include, but not be limited to: all real estate taxes and all other types of taxes (excepting real estate taxes to be paid to Springfield Township) assessed against the Property or the operation of the Property, fire and extended coverage or all risk insurance, sprinkler and fire system monitoring, HVAC maintenance and repair, liability insurance, lawn and shrubbery care, snow removal, maintenance and repairs to buildings and all improvements (except as otherwise provided herein), sign maintenance, repair of parking lots, pavement and curbs, repainting of parking lot lines, exterior painting, repainting and redecorating, common area maintenance, security, lighting, cleaning, and any other normal and customary fees and costs related to the operation of the Property. If Lessor shall incur any costs as a result of services requested by Lessee, or as a result of Lessee's failure to comply with the terms, covenants and conditions of this Lease, Lessee shall be responsible for any such costs. It is presently anticipated that Lessee will pay all of the foregoing items directly to the taxing authorities, insurers and entities providing services to the Premises; however, at the option of Lessor, Lessor may require Lessee to pay the additional rent to Lessor monthly, in an amount equal to the estimated amount of all of the costs of operating and managing the Premises for one year, divided by 12. In such event, Lessor shall determine the actual cost of operating and managing the Premises once per year, and if the actual costs are greater than the estimated costs that have been paid by Lessee, the Lessee shall pay to Lessor the difference between the actual cost and estimated cost paid by Lessee with the next payment of Minimum Annual Rent. If the actual costs are less than the estimated costs paid by Lessee, Lessor shall credit the amount of Lessee's excess payment against Lessee's future Additional Rent payments, except in the last year of the Term in which event Lessor shall refund such excess payment to Lessee within sixty (60) days after such expiration.
PERCENTAGE RENT. In addition to the payment of Minimum Annual Rent and all other forms of Additional Rent, Lessee shall pay Lessor during each Lease Year of the Term, as additional rent, the percentage rent as described below (sometimes referred to herein as "Percentage Rent"). During the Term, Percentage Rent shall be six percent (6%) of the amount by which Lessee's Total Gross Receipts, as hereinafter defined, exceed One Million Five Hundred Thousand ($1,500,000.00) Dollars but do not exceed Two Million ($2,000,000.00) Dollars and eight (8%) percent of the amount by which Lessee's Total Gross Receipts exceed Two Million ($2,000,000.00) Dollars.

TOTAL GROSS RECEIPTS. The term "Total Gross Receipts" is defined to mean the gross receipts of the Lessee from all business conducted on or from the Premises. They shall include receipts obtained at the Premises or elsewhere, whether paid by check, credit, charge account, exchange or otherwise. They shall include amounts received from the sale of all items, food, liquor, merchandise, fees, or services offered and performed, together with the amount of all orders taken or received at the Premises whether the orders are filled from the Premises or elsewhere. Total Gross Receipts shall not include sales of merchandise to the extent that cash has been refunded or allowances made for merchandise claimed to be defective or unsatisfactory. The sales price of merchandise returned by customers for exchange shall be deducted from Total Gross Receipts only if the receipts from this merchandise were included in Total Gross Receipts. Total Gross Receipts will not include any sales or use tax imposed by any governmental authority directly on sales and collected from customers, provided that the amount of these taxes is added to the selling price as a separate and distinct amount, and then is actually paid to the governmental authority by the Lessee. No franchise fees, income tax, or any tax based upon income or profits shall be deducted from Total Gross Receipts.
STATEMENTS.

Within one hundred and twenty (120) days following the end of each calendar year of the Term, Lessee shall submit a Statement, in writing, duly signed and certified by an officer or other principal of Lessee, setting forth the Total Gross Receipts for the preceding Lease Year, accompanied by any Percentage Rent due. Failure on the part of the Lessee to deliver the statement of Total Gross Receipts on any due date or the prompt payment of any Percentage Rent determined to be due shall constitute a default under this Lease. Lessor shall have the right, upon five (5) days written notice at any time within ninety (90) days after receipt of the Statement for the prior calendar year, to employ a certified public accountant to examine the Lessee's books and records as necessary to certify Lessee's Total Gross Receipts for the previous calendar year. In the event that such audit discloses an underpayment by Lessee, Lessee shall pay the amount of the underpayment to Lessor within twenty (20) days of receipt of the calculation of the underpayment and in the event that Lessee understated the Total Gross Receipts by more than three (3%) percent, Lessee shall also reimburse Lessor for the cost of the audit within twenty (20) days of receipt of a bill from Lessor.
Within one hundred and twenty (120) days after the end of each calendar year of this Lease, Lessee, at its sole cost and expense, shall prepare and deliver or cause to be prepared and delivered to Lessor, a complete audited annual financial statement including an audit opinion and management letter, based on the calendar year commencing January 1st and ending December 31st, certified to be correct by Lessee and prepared by an independent certified public accountant in accordance with generally accepted accounting principals. There shall thereafter be a meeting of the parties within thirty (30) days after receipt of the audit to review the financial condition and operations of the Flourtown Country Club.

LESSEE'S RECORDS. Lessee agrees to prepare and keep on the Premises full and complete financial records reflecting the results of all business transactions conducted in, on or from the Premises. Lessee shall have the right to inspect such financial records at the Premises upon forty-eight (48) hours advance notice to Lessee. All financial records shall be kept in accordance with generally acceptable accounting purposes. Lessee shall maintain a method of accounting for receipts and disbursements in connect with all business transactions conducted in connection with the Premises, which correctly and accurately reflects all gross receipts and disbursements. Lessee's financial records shall include, but shall not be limited to: general ledgers, trial balances, cash sales and purchase journals, including any supporting documents such as vouchers, checks, invoices, tickets and other documents proving payment of the sums shown, and such other accounts and records as Lessor, in its sole discretion, deems necessary. Lessee's financial records shall reflect only those transactions conducted in accordance with the operation of the Flourtown Country Club, and shall not be maintained on a consolidated basis with other activities of Lessee or with any other entity affiliated with Lessee. Lessee shall keep the records required under this Section on the Premises for a period of not less than three (3) years following the end of each calendar year or partial calendar year.

ADDITIONAL CHARGES. Lessee also agrees to pay as additional rent hereunder any and all sums which may become due by reason of Lessee's failure to comply with all of the terms, conditions and covenants of this Lease and any and all damages, costs and expenses which the Lessor may suffer or incur by reason of any default by Lessee or failure by Lessee to comply with the terms, conditions and covenants of this Lease and also any and all damages to the Property caused by any act or neglect of Lessee, or Lessee's agents, workmen, employees or invitees.
RENTALS. Minimum Annual Rent, Percentage Rent, Additional Rent and any other Lessee charges are hereinafter collectively called "Rentals".
LATE PAYMENTS. In the event any payment of Rentals is received by Lessor more than ten (10) days after the date on which it is due, such late payment shall be subject to a late charge equal to ten (10%) of such payment and shall be due with the next installment of Rentals.
Any payment by Lessee or acceptance by Lessor of a lesser amount than shall be due from Lessee to Lessor shall be treated as a payment on account. The acceptance by Lessor of a check for a lesser amount with an endorsement or statement thereon, or upon any letter accompanying such check, that such lesser amount is payment in full or payment for particular Lease charges, shall be given no effect and Lessor may accept such check without prejudice to any other rights or remedies which Lessor may have against Lessee. Lessor may apply such payments against the earliest outstanding Lease charges, or in any other manner which it may choose to account for such payments.

5. SECURITY DEPOSIT. As security for the faithful performance by Lessee of all of the terms, covenants and conditions upon Lessee's part to be performed during the Term and for the payment of any damages to which Lessor may be entitled in the event of default by Lessee under the Lease during the Term, Lessee has this day deposited with Lessor the sum of Twenty-Five Thousand Dollars ($25,000) (the "Security Deposit"), which shall be returned to Lessee, with interest, within thirty (30) days after the expiration or sooner termination of this Lease; provided, however, that Lessee has fully and faithfully carried out all of the terms, covenants and conditions on its part to be performed hereunder. Lessor shall have the right to apply any part of the Security Deposit to cure any default of Lessee and if Lessor does so, Lessee shall, within five (5) days of being notified by Lessor of the amount withdrawn from the Security Deposit, deposit with Lessor the amount so applied so that Lessor shall have the full Security Deposit on hand at all times during the Term. Notwithstanding anything to the contrary contained in any law or statute now existing or hereafter passed, (i) Lessee shall be entitled to interest on the Security Deposit at the rate determined by the bank, (ii) Lessor shall hold the Security Deposit in a separate account at Commerce Bank, and (iii) Lessor shall not co-mingle the Security Deposit with its other funds. Lessor may use, apply or retain the whole or any part of the Security Deposit to the extent required for the payment of any Rentals payable hereunder as to which Lessee is in default or to the extent required for the reimbursement to Lessor of any sum which Lessor may expend or may be required to expend by reason of Lessee's default in respect to any of the terms, covenants, agreements and conditions of this Lease.

LESSOR'S LIABILITY. In the event of a sale or transfer of Lessor's estate or interest in the Property, the Lessor shall have the right to transfer the said Security Deposit to the purchaser or transferee and, upon written acknowledgment from the purchaser or transferee to Lessee of receipt (or crediting) of the required Security Deposit hereunder, the Lessor shall be considered released by Lessee from all liability for the return of such Security Deposit and the Lessee shall look solely to the purchaser or transferee for the return of said Security Deposit, and it is agreed that this shall apply to every transfer or assignment made of the Security Deposit to a new purchaser or transferee. In the event of any rightful and permitted assignment of this Lease by Lessee, the Security Deposit shall be deemed to be held by Lessor as a Security Deposit made by the assignee and Lessee shall have no further liability in respect to the return of said Security Deposit to the assignor.
LESSOR'S LIEN. With only such exceptions as are specifically agreed to in writing by the Lessor in advance, a lien is hereby granted the Lessor upon the Lessee's interest in the Property and in any Lessee improvements installed in the Premises as security for the payment of Rentals and performance of other obligations undertaken by the Lessee. Such lien shall be prior and superior to any and all other liens thereupon whatsoever. Lessee agrees Lessor may file any financing statements and that Lessee will execute any security agreements which are necessary, in the reasonable opinion of Lessor, to properly attach and perfect the liens and security interests granted herein. At the expiration or earlier termination of the Term of this Lease, including any renewals thereof, Lessor is hereby granted the irrevocable option to purchase the Country Club License (as hereinafter defined) for a sum equal to One ($1.00) Dollar. As further security for the performance by Lessee of the terms and conditions of this Lease, the Lessee hereby agrees to execute a separate security agreement (which such form is attached hereto as part of Exhibit "D"), granting to Lessor a first perfected continuing security interest in the Country Club License and a pledge of 100% of Lessee's membership interests. Lessee agrees to execute the appropriate financing statements (UCC-1's) for recordation by Lessor to evidence the aforesaid security interest. Lessee agrees that it will comply with all rules and regulations of the Pennsylvania Liquor Control Board ("PLCB"); that it will timely renew and/or validate its Country Club License; that it will execute a letter to the PLCB directing that Lessor is to receive a copies of all correspondence and communications therefrom. In addition to the foregoing, Lessee agrees that within fifteen (15) days prior to the designated license renewal/validation filing date imposed by the PLCB, Lessee shall deliver to Lessor copies of the renewal/validation applications as filed (together with all supporting materials, including, without limitation, tax clearance certificates).

6. USE.

Unless otherwise permitted by written consent of the Lessor, Lessee shall occupy and use the Property throughout the Term, and shall use the same for, and only for the operation of a Country Club and shall at all times provide the usual and customary Country Club activities, such as golf, swimming, dining, and banquet services and shall not use the Premises for any other purpose without the prior written consent of Lessor. Lessee shall not discontinue any of the activities currently offered at the Flourtown Country Club without the prior written consent of Lessor. Lessee agrees that commencing with the Commencement Date and thereafter throughout the Term, Lessee will continuously, actively and diligently operate the Flourtown Country Club in good faith and in an efficient, businesslike and respectable manner, maintaining all of the Property in a first class order and repair, maintaining a full staff of employees and a full stock of seasonable merchandise, food and liquor (if Lessee obtains a liquor license), of the quality, kind, type and brand which a first class municipal country club would typically maintain, and employing Lessee's best continual efforts and abilities to the end that the maximum gross sales which can reasonably be produced from the Property shall be produced, and in compliance with all laws, ordinances and regulations of public authorities.
Lessee agrees to allow a portion of the building on the Premises, the location of which shall be mutually agreed upon by Lessor and Lessee, to be used by Lessor on Primary Election Day and General Election Day as a polling place, free of charge. Lessor and its invitees shall have the right to utilize the entrances and parking areas of the Premises for such purpose, free of charge.

7. RULES AND REGULATIONS GOVERNING OPERATIONS. Lessee shall, at all times during the Term, operate the Property in strict accordance with such rules and regulations promulgated by Lessor from time to time and agreed to by Lessee, provided, that Lessee may not unreasonably withhold its approval of such proposed rules and regulations.

8. INSURANCE

CASUALTY INSURANCE. Lessor shall maintain and keep throughout the Term insurance against loss or damage to the Property, in the full insurable replacement value of the Property, by fire and such other casualties as may be included within either fire and extended coverage insurance or all risk insurance, and other insurance as may reasonably be necessary in the opinion of Lessor. Lessor shall not be required to insure Lessee's trade fixtures, improvements or equipment. Lessee agrees to reimburse Lessor for the cost of such insurance policy(s) within fifteen (15) days of receipt of a bill from Lessor.
LIABILITY INSURANCE.

Lessee, at Lessee's sole cost and expense, shall maintain and keep in effect throughout the Term: (i) insurance against liability for bodily injury (including death) or property damage in or about the Premises under a policy of comprehensive general public liability insurance, with such limits not less than Two Million Dollars ($2,000,000) for each person and Two Million Dollars ($2,000,000) for each occurrence of bodily injury (including death) and Two Million Dollars ($2,000,000) for property damage, and (ii) if Lessee obtains a liquor license, such types of insurance as are usual and customary in connection with the sale of alcoholic beverages in the Commonwealth of Pennsylvania. The minimum limits of the commercial general public liability insurance policy described in this Section shall be subject to increase at any time after the fifth Lease Year (as hereinafter defined) and from time to time thereafter (but no more frequently than once every five (5) years) if deemed necessary by Lessor for adequate protection based upon similar insurance coverage amounts maintained by prudent owners or lessee's of property comparable to the Premises in the Philadelphia metropolitan area and if available at commercially reasonable rates, such increased minimum limits to be requested by Lessor upon not less than ninety (90) days prior notice to Lessee.
In the event that Lessor constructs the Trails or New Building(s) Lessor, at Lessor's sole cost and expense, shall maintain and keep in effect: (i) insurance against liability for bodily injury (including death) or property damage in or about the Premises under a policy of comprehensive general public liability insurance, with such limits not less than Two Million Dollars ($2,000,000) for each person and Two Million Dollars ($2,000,000) for each occurrence of bodily injury (including death) and Two Million Dollars ($2,000,000) for property damage, naming Lessee as an additional insured.

WORKERS COMPENSATION INSURANCE. To the extent required by law, Lessee shall maintain, throughout the Term, worker's compensation or similar insurance in form and amounts required by law.
INSURANCE CERTIFICATES. All policies of insurance shall be nonassessable and shall be issued by responsible insurance companies, holding a rating of "A"/Class XI or better by Best's Insurance Reports, or by an equivalent rating bureau should Best's Insurance Reports cease to be issued, qualified to do business in the Commonwealth of Pennsylvania and qualified under the laws of the Commonwealth of Pennsylvania to assume risks covered by all policies. The policies of insurance required herein shall name Lessor, Lessee and any mortgagee of Lessor as the insured parties, and shall be endorsed to provide that they may not be amended or cancelled, and may not expire, without at least thirty (30) days written notice to the other party. Each policy will be on an occurrence basis insurance policy form that is reasonably acceptable to Lessor. Prior to the Commencement Date, certificates of Lessee's insurance shall be delivered to Lessor.
If Lessee shall fail to perform any of its obligations under this Section, Lessor may, at its sole discretion, perform same, and the cost thereof shall be payable as Additional Rent upon demand by Lessor or deduct said costs from the Security Deposit.
WAIVER OF SUBROGATION. Each of the parties hereto hereby releases the other to the extent of the releasing party's insurance coverage, from any and all liability for any loss or damage covered by such insurance upon the property of such party even if such loss or damage shall be brought about by the fault or negligence of the other party, its agents or employees; provided, however, that this release shall be effective only with respect to loss or damage occurring during such time as the appropriate policy of insurance shall contain a clause to the effect that this release shall not affect said policy or the right of the insured to recover thereunder. If any policy does not permit such a waiver, and if the party to benefit therefrom requests that such a waiver be obtained, the other party agrees to obtain an endorsement to its insurance policies permitting such waiver of subrogation if it is available. If an additional premium is charged for such waiver, the party benefiting therefrom agrees to pay the amount of such waiver, and the party benefiting therefrom agrees to pay the amount of such additional premium promptly upon being billed therefor.

9. IMPROVEMENTS.

LESSOR IMPROVEMENTS. Lessor agrees to make certain improvements to the Premises as described more fully at Schedule "C" attached hereto ("Lessor Improvements").
LESSEE IMPROVEMENTS. Subject to the requirements of Section 9 below, Lessee agrees to make certain improvements to the Premises with an aggregate cost of not less than Five Hundred and Seventy-Five Thousand ($575,000.00) Dollars. Lessee agrees to provide a list of Lessee's proposed improvements and a proposed timeline as to when each of Lessee's proposed improvements shall be completed by August 1, 2006 to Lessor ("Lessee Improvements"). Lessee agrees to complete the Lessee Improvements by May 1, 2007. By May 10, 2006, Lessee will provide Lessor with proof of Lessee's financial ability to complete the Lessee Improvements in a form reasonably satisfactory to the Lessor, in the minimum amount of Five Hundred Seventy Five Thousand ($575,000) Dollars, which represents the estimated cost of the Lessee Improvements. In addition, prior to making any other improvements to the Property, Lessee shall be required to provide Lessor with proof of Lessee's financial ability to complete such Improvements in a form reasonably satisfactory to the Lessor. Notwithstanding anything to the contrary contained herein, Lessee agrees to complete the Lessee Improvements by May 1, 2007.

10. ALTERATIONS, ADDITIONS AND FIXTURES

INSTALLATION OF TRADE FIXTURES. Lessee shall have the right (at Lessee's sole expense) to install trade fixtures on the Premises, subject to the provisions of this Lease, without Lessor's prior written consent. No installation of trade fixtures shall affect the structural portions of the buildings or improvements located on the Premises and Lessee shall repair and restore any damage or injury to the buildings or improvements caused thereby.
ALTERATIONS. Lessee shall not make or permit to be made any alterations, improvements, or additions to the Premises (including the Lessee Improvements) without on each occasion first presenting to Lessor plans and specifications therefor and obtaining Lessor's prior written consent thereto, which shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, Lessee shall have the right to make nonstructural, interior alterations to the Premises, which such improvements do not cost in excess of Twenty-Five Thousand ($25,000.00) Dollars in the aggregate, per calendar year, without Lessor's prior written consent. In making any alterations or additions, Lessee shall comply with the requirements of this Lease and shall make every effort to see that no other occupants of the Premises (if applicable) or adjoining real estate will be disturbed or annoyed by reason thereof. Any and all alterations and additions to the Premises which are constructed, installed or otherwise made by Lessee shall be the property of Lessee until the expiration or sooner termination of this Lease; at that time all such alterations and additions, shall remain on the Premises and become the property of Lessor without payment therefor; unless, upon the termination of this Lease, Lessor shall give written notice to Lessee to remove the same in which event Lessee will remove such alterations and additions, and repair and restore any damage to the Premises caused by the installation or removal thereof.
CONSTRUCTION STANDARDS. All work to be performed by Lessee shall be prosecuted to completion with due diligence, in a good and workman like manner with first class materials, and in compliance with all laws, ordinances and regulations of public authorities. Lessee acknowledges that all exterior improvements to the Premises shall be done in such a manner as to be architecturally compatible with the existing exterior appearance of the Premises.

11. MAINTENANCE AND REPAIRS TO THE PREMISES

LESSEE'S OBLIGATIONS. Except as specifically provided in this Section, Lessee, at its sole cost and expense and throughout the Term, shall keep and maintain the Premises, including but not limited to, the parking lots, swimming pool(s), golf course, landscaped areas and buildings in good order and condition, free of accumulation of dirt and rubbish, snow and ice, and shall promptly make all repairs, replacements and renewals, including, but not limited to, glass and windows, necessary to keep and maintain such good order and condition. Lessee shall not be responsible for repairs to, or replacement of exterior walls, boilers, or the roof of the buildings on the Premises unless such repairs, replacements or renewals have been necessitated by actions of the Lessee, its agents, employees or invitees. All repairs, replacements and renewals made by Lessee shall utilize materials and equipment which are at least equal in quality and usefulness to those originally used in constructing the Premises. Lessee agrees to repaint and carpet the interior of the buildings on the Premises at least every seven (7) years or more frequently as may be required to maintain said buildings in a first class manner. Lessee, at its sole cost and expense and throughout the Term, shall keep and maintain the golf course and swimming pool(s) in good order and condition, free of accumulation of dirt and rubbish, and shall promptly make all repairs, replacements and renewals necessary to keep and maintain such good order and condition.
LESSOR'S REPAIRS. Lessor, throughout the term of this Lease, shall make all necessary repairs to the roof, exterior walls of the buildings on the Premises, structure of the pool (replacement of pool filters but not repairs) and replacement of the golf course irrigation system (provided, that, the irrigation system shall only need to be replaced by Lessor if there are no is no other sufficient water source to adequately water the golf course and further provided, that, such system does not need to be replaced because of an increased load on the system caused by Lessee) (collectively "Lessor's Work"); provided, however, that Lessor shall have no responsibility to perform Lessor's Work until Lessor receives written notice of the need for such repair. After the Commencement Date, all costs of maintenance and repairs to the mechanical systems serving the buildings will be the responsibility of Lessee, including the boilers and HVAC systems servicing the Premises, provided, that Lessor shall be responsible for the replacement of the boilers and the existing HVAC systems servicing the Premises. Lessee shall be responsible for the replacement of any new HVAC systems installed by Lessee in the Premises and Lessee agrees to purchase and maintain throughout the Term and a maintenance agreement for the HVAC systems (both existing and new) from a reputable HVAC company. Notwithstanding anything to the contrary contained herein, Lessor acknowledges that Lessee intends to install an HVAC system on the second floor of the building and Lessor agrees to reimburse Lessee up to Twenty-Five Thousand ($25,000.00) Dollars towards the cost of such installation. Lessee agrees to provide Lessor with a written copy of the estimate prior to commencing the installation of the HVAC system on the second floor, which such estimate shall be subject to Lessor's reasonable approval.
LESSEE'S USE. Notwithstanding anything herein to the contrary, repairs or replacements to the Premises made necessary by Lessee's use, manner of use or occupancy of the Premises or by Lessee's installations in or upon the Premises or by any act or omission of Lessee or any employee, agent, contractor, or invitee of Lessee shall be made at the sole cost and expense of Lessee, reasonable wear and tear excepted.
SURRENDER. Upon the expiration or termination of this Lease, Lessee shall surrender the Premises to Lessor broom clean and in the same condition as received except for ordinary wear and tear or casualty damage which Lessee was not otherwise obligated to remedy under any provision of this Lease. If requested by Lessor at least thirty (30) days prior to the termination of this Lease, Lessee shall remove, at Lessee's sole cost and expense, all of Lessee's equipment and fixtures and shall restore the Premises to substantially the condition in which it was delivered to Lessee. Notwithstanding anything to the contrary contained herein, Lessee shall not be required to and shall not have the right to remove Lessee's Improvements.
INSPECTION REPORTS. Lessor and Lessee acknowledge that the Springfie1d Township Licenses and Inspections Officer and the Fire Marshall examined the Premises and identified only minor items that currently need to be corrected ("Minor Corrections") a copy of which is attached hereto as Exhibit "E". Lessor agrees to repair the Minor Corrections at its sole costs and expense. Notwithstanding anything to the contrary contained herein, Lessor acknowledges that if the Springfield Township applicable governmental authorities inspect the Premises after the Commencement Date and determine that additional violations/repairs need to be made and such condition existed at the time of the prior inspection then Lessor shall be responsible for said costs and agrees to make the required repairs and/or correct the violations.

12. EQUIPMENT. Prior to the Commencement Date, Lessee and Lessor's representatives shall take a physical inventory of all of the Equipment, which consists of the equipment, furniture, furnishings, accessory and service items in or on the Premises, including but not limited to, trucks, tractors, mowers, and other golf equipment, refrigerators, dishwashers, ranges, ice machines and other special restaurant and kitchen equipment, filters, pumps, and other swimming pool equipment, furniture, dishware, glassware, silverware, linens and other similar items as listed in Schedule "B" and attached hereto. The maintenance, repair and replacement of all of the Equipment shall be the responsibility of Lessee during the Term, except for those items designated as Lessor's responsibility. The items listed on Exhibit "B" as Lessor's responsibility shall be maintained and replaced by Lessor, provided, that, Lessee shall periodically reimburse Lessor for the cost of the maintenance of such items, within twenty (20) days of receipt of a bill from Lessor. Upon the expiration of the terms of this Lease, Lessee shall return to Lessor all items listed on Schedule "B", subject to Lessor's obligations as set forth above, in good order and repair or replacements thereof. In the event any of the items of Equipment are missing, damaged or destroyed at the expiration or termination of this Lease, the Lessee shall either replace the item with a like item having a value at least equal to the applicable value as of the Commencement Date, or pay to Lessor the cost to replace such item.

13. LIQUOR LICENSE.

Lessee acknowledges that it shall not be allowed to utilize Lessor's current liquor license for the Property. Lessee acknowledges that it has already applied for a "Public Owned Golf Course Liquor License" and agrees to diligently pursue obtaining such license (the "Country Club License"). Lessee agrees that it may not apply for a new Country Club License to without Lessor's prior written consent.
With respect to the Country Club License, Lessee shall, at all times: (i) strictly comply with all the rules and regulations promulgated by the PLCB, (ii) keep the Country Club License in good standing and pay all applicable fees and costs with respect thereto when due, (iii) use the Country Club License only for the operation of the Premises, (iv) immediately notify the Lessor of any inquiries, investigations or actions by any governmental authorities having jurisdiction with respect to liquor sales at the Premises and (v) refrain from leasing, selling, transferring or encumbering the Country Club License without the prior written consent of Lessor. Lessee shall not sell or transfer a controlling interest in the membership of Lessee in a single transaction or in the aggregate. Lessee acknowledges that it may not sell, assign or transfer the Country Club License to any party other than Lessor, or Lessor's nominee or assignee and agrees to execute the documents attached hereto as Exhibit "E" upon obtaining the Country Club License all as further security for Lessee's performance under this Lease as set forth in Section 4(j) above. Lessor agrees to attend meetings and supply any information in its possession that may be requested by the PLCB. Lessee agrees to execute the documents attached hereto as Exhibit "D" in connection with its application for the Country Club License, including, without limitation, Lessor's irrevocable option to purchase the License upon the expiration or sooner termination of the Lease.
Notwithstanding the foregoing, in the event that Lessee is unable to obtain the Country Club License within ninety (90) days of the Commencement Date, then Lessor shall have the right to terminate this Lease at any time prior to the date that Lessee obtains the Country Club License, upon thirty (30) days written notice to Lessee.

14. UTILITY CHARGES. In addition to all rentals herein specified, Lessee shall pay for any and all utilities used of consumed in, about or upon the Premises (but specifically excluding the New Building, if built), as and when the charges therefore shall become due and payable, including, but not limited to gas, water, sewer, electricity, heat and other similar charge or charges. Lessor shall not be liable to Lessee in damages or otherwise: (a) if any utility shall become unavailable from any public utility company, public authority or any other person or entity (including Lessor) supplying or distributing such utility; or (b) for any interruption in any utility service (including, without limitation, any heating, ventilating or air conditioning).

15. GOVERNMENTAL REGULATIONS

COMPLIANCE WITH GOVERNMENTAL REGULATIONS. Throughout the Term, and at its sole cost and expense, Lessee shall comply with all laws, ordinances, notices, orders, rules, regulations and requirements relating to its specific use or manner of use of the Premises and the Property, or to the operation of Lessee's business, of all federal, state and municipal governments and all departments, commissions, boards and officers thereof, and of the National Board of Fire Underwriters or any other body now or hereafter constituted exercising similar functions, including, but not limited to, the Americans With Disabilities Act, as amended, whether now existing or hereinafter enacted.
HAZARDOUS MATERIALS. For purposes of this Lease, "hazardous materials" means any explosives, radioactive materials, hazardous wastes, or hazardous substances, including, without limitation, asbestos, polychlorinated biphenyls; petroleum or petroleum products; any material or substances defined as "hazardous substances" in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §§9601 et seq.; the Hazardous Materials Transportation Act of 1975, 49 U.S.C. §§1801 et seq.; the Resource Conservation and Recovery Act of 1976, 42 U.S.C. §§6901 et seq.; any 'red bag' or 'yellow bag' waste, including, but not limited to, infectious, chemotherapeutic, radioactive and contaminated waste as defined pursuant to the provisions of the Pennsylvania Solid Waste Management Act, 35 P.S. §6018.01 et seq. and the Pennsylvania Infectious and Chemotherapeutic Waste Disposal Act, 35 P.S. 6019.1 et seq.; or any other federal, state or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning hazardous materials, waste, or substances now or at any time hereafter in effect (collectively "hazardous materials laws").
LESSEE OBLIGATIONS. Lessee will not cause or permit the storage, use, generation, or disposition of any hazardous materials in, on or about the Premises by Lessee, its agents, employees, or contractors except in strict conformity with the hazardous materials laws. Lessee will not permit the Premises to be used or operated in a manner that may cause the Premises to be contaminated by any hazardous materials in violation of any hazardous materials laws. Lessee will immediately advise Lessor in writing of (1) any and all enforcement, cleanup, remedial, removal, or other governmental or regulatory actions instituted, completed, or threatened pursuant to any hazardous materials laws relating to any hazardous materials affecting the Premises; and (2) all claims made or threatened by any third party against Lessee, Lessor, or the Premises relating to damage, contribution, cost recovery, compensation, loss or injury resulting from any hazardous materials on or about the Premises. Without Lessor's prior written consent, not to be unreasonably withheld, Lessee will not take any remedial action or enter into any agreements or settlements in response to the presence of any hazardous materials, in, on or about the Premises.
INDEMNITY.

Lessee will be solely responsible for and will defend, indemnify and hold Lessor, its agents, and employees harmless from and against any and all claims, costs and liabilities, in connection with Lessee's breach of its obligations in this Section. Lessee will be solely responsible for and will defend, indemnify and hold Lessor, its agents, and employees harmless from and against any and all claims, costs and liabilities, including reasonable attorneys fees and costs, arising out of or in connection with the removal, clean up, and restoration work and materials necessary to return the Premises and any other property of any nature located on the Premises to their condition existing prior to the appearance of Lessee's hazardous materials on the Premises. Lessee's obligations under this Section will survive the expiration or other termination of this Lease.
Lessor will be solely responsible for and will defend, indemnify and hold Lessee, its agents, and employees harmless from and against any and all claims, costs and liabilities, including reasonable attorneys fees and costs, arising out of or in connection with the removal, clean up, and restoration work as a result of any hazardous materials existing on the Premises as of the Commencement Date. Lessee's obligations under this Section will survive the expiration or other termination of this Lease.

16. SIGNS. Except for signs which are wholly within the interior of the Premises and which are not visible from the exterior of the Premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Lessor. All signs shall be erected by Lessee at Lessee's sole cost and expense, maintained by Lessee in good condition during the Term and shall be in compliance with local ordinances, rules and regulations. If requested by Lessor, Lessee shall remove all signs at the termination of this Lease and shall repair and restore any damage caused by the installation or removal thereof. Notwithstanding the foregoing, if Lessor installs any new signs at the entrance to the Premises then Lessor shall be responsible for the repair, maintenance and replacement of such signs. Notwithstanding anything to the contrary contained herein, Lessor agrees that any signs currently on the Premises may remain on the Premises.

17. MECHANICS' LIENS. Lessee shall promptly pay any contractors and materialmen who supply labor, work or materials to Lessee at the Premises so as to minimize the possibility of a lien attaching to the Premises. Lessee shall take all steps permitted by law in order to avoid the imposition of any mechanics', laborer's or materialmen's lien upon the Premises. All work permitted to be done at the Premises by Lessee under this Lease, the aggregate cost for which is in excess of Ten Thousand Dollars ($10,000.00), shall be done pursuant to contracts and/or subcontracts containing or accompanied by a stipulation that neither the contractor nor any subcontractor shall have the right to file or otherwise assert any mechanics' or materialmen's liens against the Premises, and a stipulation to that effect shall be filed in the office of the Prothonotary of Montgomery County, or otherwise filed or recorded as to constitute an effective waiver of such liens under the laws of the Commonwealth of Pennsylvania.

18. INSPECTION. Lessee shall permit the Lessor and the authorized representatives of Lessor and of any mortgagee or any prospective mortgagee, prospective purchaser or Lessee to enter the Premises at all reasonable times for the purpose of (i) inspecting the Property or (ii) making any necessary repairs therein or thereto and performing any work therein or thereto. With the exception of emergency repairs, Lessor will make a good faith effort to provide Lessee with reasonable notice of Lessor's intention to enter the Premises. Upon entry, Lessor will make reasonable efforts not to inconvenience Lessee, but shall not be liable for inconvenience, annoyance, disturbance or other damage to Lessee by reason of making any repair or by bringing or storing materials, supplies, tools and equipment in the Premises during the performance of any work, and the obligations of Lessee under this Lease shall not be thereby affected in any manner whatsoever.

19. DAMAGE TO THE PROPERTY.

DAMAGE/RESTORATION. Subject to subsections (b), (c) and (d) below, if the Property shall be damaged or destroyed by fire or other casualty, Lessee shall promptly notify Lessor, and, Lessee, subject to any mortgagee's consent and to the conditions set forth in subsections (b) through (d) of this Section, shall repair, rebuild or replace such damage and restore the Property to substantially the same condition in which it was immediately prior to such damage or destruction.
COMMENCEMENT OF WORK. The work shall be commenced promptly and completed with due diligence, taking into the account the time required by Lessee to effect a settlement with and to procure insurance proceeds from the insurer and for delays beyond Lessee's reasonable control.
INSURANCE PROCEEDS. All insurance proceeds received on account of such damage to or destruction of the Premises (excluding proceeds received pursuant to a rental coverage endorsement) shall be held by Lessor, and applied towards the cost of restoration of the Property. Lessee agrees to turn over all insurance proceeds received by Lessee in connection with any casualty to Lessor to be held and distributed in accordance with this Section.
ABATEMENT. Lessee will receive an abatement of its Minimum Annual Rent and additional rent during any period of time after a casualty or during repair or construction that Lessee is materially impaired from conducting its business. If such impairment relates only to a portion of the Premises or Property, then such abatement shall be adjusted proportionately.

20. INDEMNIFICATION.

Lessee will indemnify Lessor, its agents and employees against, and hold Lessor, its agents and employees harmless from any and all demands, claims, causes of action, fines, penalties, damages (excluding consequential damages), losses, liabilities, judgments and expenses (including, without limitation, reasonable attorneys' fees and court costs) incurred in connection with or arising from: (a) the use or occupancy of the Premises by Lessee or any person claiming under Lessee; (b) any activity, work or thing done or permitted by Lessee in or about the Premises; (c) any acts, omissions or negligence of Lessee, or any person claiming under Lessee, or the employees, agents, contractors, invitees or visitors of Lessee or any such person; (d) any breach, violation or nonperformance by Lessee, or any person claiming under Lessee, or the employees, agents, contractors, invitees or visitors of Lessee or any such person, of any term, covenant or provision of this Lease or any law, ordinance or governmental requirement of any kind; or (e) except for loss of use of all or any portion of the Premises or Lessee's property located within the Premises that is directly and solely caused by or results from the negligence of Lessor, any injury or damage to the person, property or business of Lessee, its employees, agents, contractors, invitees, visitors or any other person entering upon the Premises under the express or implied invitation of Lessee. If any action or proceeding is brought against Lessor, its employees or agents by reason of any such claim, Lessee, upon notice from Lessor, will defend the claim at Lessee's expense with counsel reasonably satisfactory to Lessor.
Lessor will indemnify Lessee, its agents and employees against, and hold Lessor, its agents and employees harmless from any and all demands, claims, causes of action, fines, penalties, damages (excluding consequential damages), losses, liabilities, judgments and expenses (including, without limitation, reasonable attorneys' fees and court costs) incurred in connection with or arising from: (a) the cell tower, the construction and use of the Trails and/or New Building(s), if built; (b) any activity, work or thing done by Lessor in or about the Premises; (c) any acts, omissions or negligence of Lessor, or any person claiming under Lessor, or the employees, agents, or contractors of Lessor or any such person; or (d) any breach, violation or nonperformance by Lessor, or any person claiming under Lessor, or the employees, agents, or contractors of any term, covenant or provision of this Lease or any law, ordinance or governmental requirement of any kind. If any action or proceeding is brought against Lessee, its employees or agents by reason of any such claim, Lessor, upon notice from Lessee, will defend the claim at Lessor's expense.

21. CONDEMNATION.

TERMINATION. (i) If all of the Premises are taken by a condemnation; or (ii) if any part of the Premises is taken by a condemnation and the remainder thereof is insufficient for the reasonable operation therein of the Flourtown Country Club; then, in any such event, this Lease shall terminate and all obligations hereunder shall cease as of the date upon which possession is taken by the condemnor. If there is a condemnation and this Lease has not been terminated pursuant to this Section on the date upon which the condemnor takes possession as aforesaid, the obligations of Lessor and Lessee under this Lease shall be unaffected by such condemnation except that the Rentals shall abate in proportion to the percentage of the Premises covered by such condemnation.
AWARD. In the event of a condemnation affecting Lessee, Lessee shall have the right to make a claim against the condemnor for the unamortized cost of its improvements and provided, however, that such claims or payments do not reduce the sums otherwise payable by the condemnor to Lessor, removal expenses, business dislocation damages and moving expenses. Except as aforesaid, Lessee hereby waives all claims against Lessor and against the condemnor, and Lessee hereby assigns to Lessor all claims against the condemnor including, without limitation, all claims for leasehold damages and diminution in value of Lessee's leasehold interest.

22. ACCESS TO PREMISES/QUIET ENJOYMENT. Lessee, upon paying the Rentals and other charges herein provided for, and observing and keeping all covenants, agreements and conditions of this Lease on its part to be kept, shall have twenty-four (24) hours a day, seven (7) days a week access to the Premises and shall quietly have and enjoy the Premises during the Term without hindrance or molestation by anyone claiming by or through Lessor, subject, however, to the exceptions, reservations and conditions of this Lease.

23. ASSIGNMENT AND SUBLETTING.

Lessee shall not assign, mortgage, pledge or encumber this Lease, nor sublet the whole or any part of the Premises without the prior written consent of Lessor. This prohibition against assigning or subletting shall be construed to include a prohibition against any assignment or subletting by operation of law. In the event of any assignment of this Lease made with or without Lessor's consent, Lessee nevertheless shall remain liable for the performance of all of the terms, conditions and covenants of this Lease and shall require any assignee to execute and deliver to Lessor an assumption of liability agreement in form satisfactory to Lessor, including an assumption by the assignee of all of the obligations of Lessee and the assignee's ratification of and agreement to be bound by all the provisions of this Lease. Lessor shall be entitled to, and Lessee shall promptly remit to Lessor any profit which may inure to the benefit of Lessee as a result of any subletting of the Premises or assignment of this Lease, whether or not consented to by Lessor.
In addition any dissolution, merger, consolidation or other reorganization of such company or any pledge of or any issue, sale or other transfer of a controlling percentage of the membership interests of Lessee (whether in a single transaction or cumulatively) shall constitute an assignment of this Lease for all purposes of Section 22(a). The term "controlling percentage", as used herein, shall mean the ownership of membership interests possessing, or having the right to exercise, at least fifty-one percent (51%) of the total combined voting power of such members, whether such ownership be direct ownership, or indirect ownership through ownership of stock or membership interests of another corporation or company.

24. SUBORDINATION, ATTORNMENT AND ASSIGNMENT. This Lease and Lessee's rights hereunder shall be subject and subordinate at all times in lien and priority to any mortgage, lien or other primary encumbrance now or hereafter placed upon or affecting the Property, and to all renewals, modifications, consolidations and extensions thereof, without the necessity of any further instrument or act on the part of Lessee. Lessee shall execute and deliver upon demand any further instrument or instruments confirming the subordination of this Lease to any such mortgage or lien to the any other lien or mortgage if requested to do so by Lessor, or any mortgagee or lienholder, and any further instrument or instruments of attornment that may be desired by any such mortgagee, lienholder or Lessor. In the event of the sale or assignment of Lessor's interest in the Property or in the event of the exercise of the power of sale under any mortgage or security agreement made by Lessor covering the Property, Lessee shall by agreement attorn to the purchaser and recognize such purchaser as Lessor under this Lease. Lessor may assign this Lease as collateral security to any lender without Lessee's consent.

25. RECORDING. Lessee shall not record this Lease, however, Lessee, at its sole cost and expense, shall have the right to record a "memorandum of lease" on a form reasonably acceptable to Lessor. Upon the expiration or sooner termination of this Lease, Lessee agrees to immediately remove/extinguish the memorandum of lease from the records of the Recorder of Deeds Office of Montgomery County.

26. CURING LESSEE'S DEFAULTS. If Lessee shall be in default in the performance of any its obligations hereunder, Lessor, without any obligation to do so, in addition to any other rights it may have in law or equity, may elect to cure such default on behalf of Lessee after ten (10) days written notice (except in the case of emergency) to Lessee. Lessee shall reimburse Lessor upon demand for any sums paid or costs incurred by Lessor in curing such default, including interest thereon from the respective dates of Lessor's making the payments and incurring such costs at the rate of twelve (12%) percent, per annum, which sums and costs together with interest thereon shall be deemed additional rent due and payable promptly upon being billed therefore or Lessor may deduct the same from the Security Deposit.

27. SURRENDER

SURRENDER OF PROPERTY. At the expiration of this Lease or earlier termination of the Term, Lessee shall promptly yield up, clean and neat, and in the same condition, order and repair in which they are required to be kept throughout the Term hereof (reasonable wear and tear excepted), the Premises and all improvements, alterations and additions thereto, all fixtures and equipment servicing the Premises, and all of the Property.
HOLDOVER. If Lessee, or any person claiming through Lessee, shall continue to occupy or remain in possession of the Property after the expiration of the Extension Period or earlier termination of the Term hereof, such occupancy shall be deemed to be under a month to month tenancy under the same terms and conditions set forth in this Lease; except, however, that the minimum monthly rent during such continued occupancy shall be Two Hundred percent (200%) of the minimum monthly rent payable during the immediately preceding lease year. Anything to the contrary notwithstanding, any holding over by Lessee without Lessor's prior written consent shall constitute a default hereunder and shall be subject to all the remedies set forth herein.

28. DEFAULT AND REMEDIES

DEFAULT. It shall be an event of default:

If Lessee does not pay in full when due, any and all installments of Rentals or any other charges or payments whether or not herein included as rent and such failure continues for more than ten (10) business days after Lessee's receipt of written notice, provided, however, if Lessee shall default in the payment of Rentals two (2) or more times in any twelve (12) month period, that notwithstanding such defaults have each been cured by Lessee, any further default in the payment of Rentals shall be deemed an Event of Default without the ability for cure; or
If Lessee fails to cure any violation, failure to perform or breach of any non payment agreement, term, covenant or condition of this Lease after fifteen (15) business days notice of such violation, failure or breach; or
Any assignment or attempted assignment of the Country Club License, without Lessor's prior written consent; or
The Country Club License is suspended for two (2) separate periods during any twelve (12) month period or is suspended for a period in excess of ten (10) days (whether for a single occurrence or in the aggregate), or is revoked (non-renewal shall be considered a revocation), any or all of the foregoing shall be an irrevocable, non-curable event of default under this Lease. Lessee also agrees to execute an irrevocable power of attorney in favor of Lessor (for the purposes set forth in the aforesaid security agreement) ; or
Any material restrictions, material conditions or material impairments are placed on, or occur to, the Country Club License, unless such restrictions, conditions or impairments are universally applied to all similar licenses in Montgomery County; or
If, without the prior consent of Lessor, Lessee abandons the Premises or removes or attempts to remove Lessee's goods or property therefrom other than in the ordinary course of business without having first paid to Lessor in full all minimum annual rent, additional rent and other charges that may have become due as well as all which will become due through the balance of the Term; or
If Lessee shall become insolvent or bankrupt in any sense or shall make an assignment for the benefit of creditors or shall file a petition in bankruptcy, or shall petition or appeal to any tribunal for the appointment of a custodian, receiver or any trustee for it or a substantial part of its assets, or shall commence any proceeding under any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or liquidation law or statute of any jurisdiction, whether now or hereafter in effect; or if there shall have been filed any such petition or application or any such proceeding shall have been commenced against it in which an order for relief is entered or which remains undismissed for a period of sixty (60) days or more; or if Lessee by any act or omission shall indicate its consent to, approval of or acquiescence in any such petition, application or proceeding or order for relief or the appointment of custodian, receiver or any trustee for it or any substantial part of any of its properties, or shall suffer any such custodianship, receivership or trusteeship to continue undischarged for a period of sixty (60) days or more; or if Lessee shall generally not pay its debts as such debts become due; or if Lessee shall have concealed, removed, or permitted to be concealed or removed, any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or made or suffered a transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or shall have made any transfer of its property to or for the benefit of a creditor at a time when other creditors similarly situated have not been paid; or shall have suffered or permitted, while insolvent, any creditor to obtain a lien upon any of its property through legal proceedings or distraint which is not vacated within sixty (60) days from the date thereof.

REMEDIES. Then, and in any such event, Lessor shall have the following rights:

To retake possession of the Property, together with all additions, replacements alterations and improvements thereto, and, at the option of Lessor, remove all persons and all or any property from the Premises, by reasonable force or otherwise, without being liable for prosecution or damages therefor, and repossess and enjoy the Property. Upon recovering possession of the Property as a result of a default on the part of Lessee, Lessor may, at Lessor's option, either terminate this Lease or make such alterations and repairs as may be necessary in order to relet the Property or any part or parts thereof, either in Lessor's name or otherwise, for a term or terms which may, at Lessor's option, be less than or exceed the period which would otherwise have constituted the balance of the Term and at such rent or rents and upon such other terms and conditions as Lessor may decide. If such rentals received from such reletting during any month after deducting all costs incurred by Lessor in exercising its rights hereunder shall be less than that to be paid during that month by Lessee, Lessee shall pay any such deficiency to Lessor. Such deficiency shall be calculated and paid monthly.
To terminate this Lease and the term hereby created without any right on the part of Lessee to cure the forfeiture by payment of any sum due or by other performance of any condition, term or covenant broken except for the opportunity to cure non payment defaults as set forth herein; whereupon Lessor shall be entitled to recover, in addition to any and all sums and damages for violation of Lessee's obligations hereunder in existence at the time of such termination, damages for Lessee's default in an amount equal to the amount of the Rentals reserved for the balance of the Term, as well as all other charges, payments, costs and expenses herein agreed to be paid by Lessee, all of which amount shall be immediately due and payable from Lessee to Lessor.
To exercise any and all rights of a secured party under Section 9 of the Pennsylvania Uniform Commercial Code with respect to any property of the Lessee on which Lessee has granted a lien or security interest to Lessor pursuant to the terms of this Lease, including, without limitation, the Country Club License.
CONFESSION OF JUDGMENT. IN ADDITION, UPON THE OCCURRENCE OF ANY EVENT OF DEFAULT SET FORTH IN THIS LEASE, LESSOR, AT ITS OPTION, MAY TAKE ALL OR ANY OF THE FOLLOWING ACTIONS:

LESSEE HEREBY EMPOWERS ANY PROTHONOTARY OR ATTORNEY OF ANY COURT OF RECORD WITHIN THE UNITED STATES TO APPEAR FOR LESSEE IN ANY AND ALL ACTIONS WHICH MAY BE BROUGHT FOR RENT AND TO ENTER IN ANY COMPETENT COURT AN ACTION OR ACTIONS, FOR THE RECOVERY OF RENT AND, IN SUCH SUITS OR IN SUCH ACTION OR ACTIONS, TO CONFESS JUDGMENT AGAINST LESSEE FOR ALL OR ANY PART OF SUCH RENT INCLUDING, AT LESSOR'S OPTION, THE RENT FOR THE ENTIRE UNEXPIRED BALANCE OF THE TERM, COMPUTED AS AFORESAID, AND ANY OTHER CHARGES, PAYMENTS, COSTS AND EXPENSES RESERVED AS RENT OR AGREED TO BE PAID BY LESSEE, AND WITH INTEREST AND COSTS TOGETHER WITH AN ATTORNEY'S COMMISSION OF NOT LESS THAN FIVE PERCENT (5%) THEREOF. FOR THE CONFESSION AND ENTRY OF SUCH JUDGMENTS, THIS LEASE OR A TRUE AND CORRECT COPY THEREOF SHALL BE SUFFICIENT WARRANT AND AUTHORITY. THE FOREGOING AUTHORITY AND POWER OF ATTORNEY SHALL NOT BE EXHAUSTED BY ANY ONE EXERCISE THEREOF, BUT JUDGMENT MAY BE CONFESSED AS AFORESAID FROM TIME TO TIME AND AS OFTEN AS THERE IS AN EVENT OF DEFAULT HEREUNDER OR ANY OF THE RENT SHALL FALL DUE OR BE IN ARREARS, AND SUCH AUTHORITY AND POWER MAY BE EXERCISED DURING THE TERM OR ANY EXTENSION THEREOF, AS WELL AS AFTER THE EXPIRATION OR OTHER TERMINATION OF THIS LEASE.
Lessee Initial:
LESSEE ACKNOWLEDGES THAT, SUBJECT TO THE APPLICABLE TERMS OF THIS LEASE, LESSOR MAY CONFESS JUDGMENT HEREUNDER AGAINST LESSEE AND LESSEE WAIVES THE RIGHT TO NOTICE AND TO PRIOR JUDICIAL OR OTHER PROCEEDINGS OR HEARINGS BEFORE ENTRY OF THE CONFESSED JUDGMENT TO DETERMINE LESSEE'S RIGHTS AND LIABILITIES. LESSEE ACKNOWLEDGES AND AGREES THAT, UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, LESSOR MAY OBTAIN A JUDGMENT OR JUDGMENTS AGAINST LESSEE WITHOUT LESSEE'S PRIOR KNOWLEDGE, WITHOUT A PRIOR JUDICIAL OR OTHER HEARING, WITHOUT LESSEE'S CONSENT AND WITHOUT LESSEE'S OPPORTUNITY TO RAISE ANY DEFENSE, SET-OFF, COUNTERCLAIM OR OTHER CLAIM THAT LESSEE MAY HAVE. LESSEE ACKNOWLEDGES AND AGREES THAT ONCE A JUDGMENT OR JUDGMENTS ARE OBTAINED UNDER THIS LEASE, WHETHER BY CONFESSION OF JUDGMENT OR OTHERWISE, LESSOR MAY EXECUTE UPON, SEIZE, LEVY OR ATTACH THE PROPERTY OF LESSEE (REAL AND PERSONAL), WHEREVER SUCH PROPERTY IS LOCATED, AND/OR ENTER UPON, POSSESS, EVICT OR EJECT THE LESSEE FROM THE PREMISES, ALL WITHOUT A PRIOR JUDICIAL OR OTHER HEARING AND WITHOUT LESSEE'S PRIOR CONSENT. FURTHER, LESSEE RELEASES LESSOR, AND ITS ATTORNEYS WHO APPEAR FOR LESSOR, FROM ALL PROCEDURAL ERRORS IN ANY AND ALL PROCEEDINGS ENFORCING LESSOR'S RIGHTS AND REMEDIES UNDER THIS LEASE. LESSEE HEREBY EXPRESSLY WAIVES ALL OF THE FOLLOWING RIGHTS AS AN EXPLICIT AND MATERIAL PART OF THE CONSIDERATION FOR THE EXECUTION AND DELIVERY OF THIS LEASE BY LESSOR.
Lessee Initial:
IN ANY ACTION FOR RENT IN ARREARS, LESSOR SHALL FIRST CAUSE TO BE FILED IN SUCH ACTION AN AFFIDAVIT MADE BY IT OR SOMEONE ACTING FOR IT SETTING FORTH THE FACTS NECESSARY TO AUTHORIZE THE ENTRY OF JUDGMENT, OF WHICH FACTS SUCH AFFIDAVIT SHALL BE PRIMA FACIA EVIDENCE, AND IF A TRUE COPY OF THIS LEASE BE FILED IN SUCH ACTION, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL AS A WARRANT OF ATTORNEY, ANY RULE OF COURT, CUSTOM OR PRACTICE TO THE CONTRARY NOTWITHSTANDING.
Lessee Initial:
LESSEE EXPRESSLY WAIVES THE BENEFITS OF LAW, NOW OR HEREAFTER IN FORCE, EXEMPTING ANY GOODS ON THE PREMISES, OR ELSEWHERE, FROM LEVY OR SALE IN ANY LEGAL PROCEEDINGS TAKEN BY THE LESSOR TO ENFORCE ANY RIGHTS UNDER THIS LEASE.
Lessee Initial:
LESSEE WAIVES THE RIGHT TO DELAY EXECUTION ON ANY REAL ESTATE LEVIED UPON TO COLLECT ANY AMOUNT WHICH MAY BECOME DUE UNDER THE TERMS AND CONDITIONS OF THIS LEASE, AND AUTHORIZES THE PROTHONOTARY TO ENTER A WRIT OF EXECUTION OR OTHER PROCESS UPON LESSEE'S VOLUNTARY WAIVER, AND FURTHER AGREES THAT THE SAID REAL ESTATE MAY BE SOLD ON A WRIT OF EXECUTION OR OTHER PROCESS.
Lessee Initial:
IT IS MUTUALLY AGREED BY AND BETWEEN LESSOR AND LESSEE THAT THE RESPECTIVE PARTIES HERETO SHALL AND THEY HEREBY DO WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LESSOR AND LESSEE, LESSEE'S USE OR OCCUPANCY OF SAID PREMISES, AND/OR ANY CLAIM OF INJURY OR DAMAGE, OR FOR THE ENFORCEMENT OF ANY REMEDY UNDER ANY STATUTE, EMERGENCY OR OTHERWISE. IT IS FURTHER MUTUALLY AGREED THAT, IN THE EVENT LESSOR COMMENCES ANY SUMMARY PROCEEDING FOR NON-PAYMENT OF RENT, LESSEE WILL NOT INTERPOSE ANY COUNTERCLAIM OF WHATEVER NATURE OR DESCRIPTION IN ANY SUCH PROCEEDING.
Lessee Initial:
Notwithstanding anything to the contrary contained herein, Lessor acknowledges that in the event it confesses judgment against Lessee it shall not add in Percentage Rent or Additional Rent, for any future Lease Year, as part of the amount being sought by Lessor.

If proceedings shall be commenced by Lessor to recover possession under the Acts of Assembly, either at the end of the Term or upon the occurrence of any Event of Default, Lessee expressly waives all rights to notice in excess of ten (10) business days, and agrees that in either or any such case ten (10) business days notice shall be sufficient. Without limitation of or by the foregoing, the Lessee hereby waives any and all demand, notices of intention and notices of action or proceedings which may be required by law to be given or taken prior to any entry or re entry by summary proceedings, ejectment or otherwise, by Lessor, except as hereinbefore expressly provided with respect to the ten (10) business days notice and provided further that this shall not be construed as a waiver by Lessee of any notices to which this Lease expressly provides Lessee is entitled.
In the event of a termination of this Lease, prior to the date of expiration herein originally fixed, whether by reason of service of a notice as provided herein terminating this Lease or by reason of entry or re entry, summary proceedings, ejectment or other operation of law, Lessee hereby waives all right to recover or regain possession of the Premises, to save forfeiture by payment of Rentals due or by other performance of the conditions, terms or provisions hereof, if such termination occurred by reason of any failure in performance hereof, and without limitation of or by the foregoing, Lessee waives all right to reinstate or redeem this Lease notwithstanding any provisions of any statute, law or decision or hereafter in force or effect, and Lessee waives all right to any second or further trial in summary proceedings, ejectment or in any other action provided by any statute or decision now or thereafter in force or effect. The words "entry" and "re entry", as used in this Lease, shall not be deemed restricted to their technical legal meaning.
In the event of a breach or threatened breach by Lessee of any of the agreements, conditions, covenants or terms hereof, Lessor shall have the right of injunction to restrain the same and the right to invoke any remedy allowed by law or in equity whether or not other remedies, indemnity or reimbursements are herein provided. The rights and remedies given to Lessor in this Lease are distinct, separate and cumulative remedies; and no one of them, whether or not exercised by Lessor, shall be deemed to be in exclusion of any of the others.
NON-WAIVER. No waiver by Lessor of any breach by Lessee of any of Lessee's obligations, agreements or covenants herein shall be a waiver of any subsequent breach or of any obligation, agreement or covenant, nor shall any forbearance by Lessor to seek a remedy for any breach by Lessee be a waiver by Lessor of any rights and remedies with respect to such or any subsequent breach.
RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein conferred upon or reserved to Lessor is intended to be exclusive of any other right or remedy provided herein or by law, but each shall be cumulative and in addition to every other right or remedy given herein, now or hereafter existing at law or in equity or by statute.

29. CONDITION OF PROPERTY. Except as otherwise specifically provided for herein, Lessee represents that the Property, the title thereto, and the present uses and non uses thereof, have been examined by Lessee, and Lessee accepts them in the condition or state in which they now are, or any of them now is, without relying on any representation of Lessor.

30. INTERPRETATION.

CAPTIONS. The captions in this Lease are for convenience only and are not a part of this Lease and do not in any way define, limit, describe or amplify the terms and provisions of this Lease or the scope or intent thereof.
ENTIRE AGREEMENT. This Lease represents the entire agreement between the parties hereto and there are no collateral or oral agreements or understandings between Lessor and Lessee with respect to the Premises. No rights, easements or licenses are acquired in the Premises or any land adjacent to the Premises by Lessee by implication or otherwise except as expressly set forth in the provisions of this Lease. This Lease shall not be modified in any manner except by an instrument in writing executed by the parties. The masculine (or neuter) pronoun, singular number, shall include the masculine, feminine and neuter genders and the singular and plural number.
LIABILITY OF LESSOR. The liability of Lessor under this Lease is limited to the Lessor's interest in the Property and the Security Deposit, and any assets of Lessor or any party or entity constituting Lessor other than its interest in the Property, shall not be affected by any obligation which Lessor may have under this Lease. The term "Lessor" shall refer to the owner of the Property for the time being. Upon delivery of the security deposit to any successor owner of the Property, the transferor of the Property shall have no personal liability to Lessee for return of said security deposit.
SCHEDULES AND EXHIBITS. Each writing or plan referred to herein as being attached hereto as a Schedule is hereby made a part hereof.
INTEREST. Wherever interest is required to be paid hereunder, such interest shall be at the rate of fifteen percent (15%) or the highest rate permitted by law, whichever is less.
PARTIAL INVALIDITY. If any of the provisions this Lease, or the application thereof to any person or circumstances, shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such to provision or provisions to persons or circumstances other than those to whom or which it is held invalid or unenforceable, shall not be affected thereby, and every provision of this Lease shall be valid and enforceable to the fullest extent permitted by law.
GOVERNING LAW. This Lease shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania.
TIME IS OF THE ESSENCE. Time is of the essence of each provision of this Lease.
AUTHORITY OF LESSEE. If Lessee is a corporation, each individual executing this Lease on behalf of said corporation represents and warrants that he is duly authorized to execute and deliver this Lease on behalf of said corporation, in accordance with the by laws and pursuant to a duly enacted resolution of said corporation, and that this Lease is binding upon said corporation.
CONSTRUCTION OF LEASE. Both parties hereto acknowledge that they have had the benefit of independent counsel with regard to this Lease and that this Lease has been prepared as a result of the joint efforts of all parties and their respective counsel. Accordingly both parties agree that the provisions of this Lease shall not be construed or interpreted against any party hereto based upon authorship.

31. DEFINITIONS

"LESSOR". The word "Lessor" is used herein to include the Lessor named above and its successors and assigns, each of whom shall have the same rights, remedies, powers, authorities and privileges as he would have had he originally signed this Lease as Lessor. Any such person, whether or not named herein, shall have no liability hereunder after he ceases to hold title to the Premises except for obligations which may have theretofore accrued. Neither Lessor nor any principal of Lessor nor any owner of the Premises, whether disclosed or undisclosed, shall have any personal liability with respect to any of the provisions of this Lease or the Premises, and if Lessor is in breach or default with respect to Lessor's obligations under this Lease or otherwise, Lessee shall look solely to the equity of Lessor in the Premises for the satisfaction of Lessee's claims.
"LESSEE". The word "Lessee" is used herein to include the Lessee named above as well as its successors and assigns, each of which shall be under the same obligations, liabilities and disabilities and each of which shall have the same rights, privileges and powers as it would have possessed had it originally signed this Lease as Lessee. Each and every one of the persons named above as Lessee shall be bound formally, jointly and severally by the terms, covenants and agreements contained herein. However, no such rights, privileges or powers shall inure to the benefit of any assignee of Lessee immediate or remote, unless the assignment to such assignee is permitted or has been approved in writing by Lessor. Any notice required or permitted by the terms of this Lease may be given by or to any one of the persons named above as Lessee, and shall have the same force and effect as if given by or to all thereof.
"MORTGAGE" AND "MORTGAGEE". The word "mortgage" is used herein to include any lien or encumbrance on the Premises or on any part of or interest in or appurtenance to any of the foregoing, including without limitation any ground rent or ground lease if Lessor's interest is or becomes a leasehold estate. The word "mortgagee" is used herein to include the holder of any mortgage, including any ground lessor if Lessor's interest is or becomes a leasehold estate. Wherever any right is given to a mortgagee, that right may be exercised on behalf of such mortgagee by any representative or servicing agent of such mortgagee.
"PERSON". The word "person" is used herein to include a natural person, a partnership, a corporation, an association, and any other form of business association or entity.
"DATE OF THIS LEASE". The "date of this Lease" shall be the date upon which this Lease has been fully executed by both parties.
"FORCE MAJEURE". Except as otherwise specifically provided herein, in any case where either party hereto is required to do any act, delays caused by or resulting from acts of God, war, civil commotion, fire or other casualty, labor difficulties, shortages of labor, materials or equipment, government regulations, or other causes beyond such party's reasonable control shall not be counted in determining the time during which work shall be completed, whether such time be designated by a fixed date, a fixed time or "a reasonable time." Notwithstanding anything to the contrary contained herein, the provisions contained in this paragraph shall not apply to Lessee's monetary obligations under the Lease.

32. NOTICES. All notices, demands, requests, consents, certificates and waivers required or permitted hereunder from one party to the other shall be in writing and sent by United States certified mail, return receipt requested, postage prepaid or sent by reputable, nationally recognized overnight carrier. Notices shall be addressed to:

Lessor: The Township of Springfield1510 Paper Mill RoadWyndmoor, Pennsylvania 19038 Attn: Township Manager

With a Copy to: Sean Kilkenny, Esquire Friedman, Schuman PC 7848 Old York Road, 2nd Floor, Elkins Park, PA 19027

Lessee: TJKFCC, LLC 124 Azalea Way, Flourtown, Pennsylvania 19031 Attn: Joseph Halligan

With a Copy to: Stephen Simpson, Esquire 8793 Duveen Drive Wyndmoor PA 19038

Any such notice, request, demand or communication shall be deemed to have been given on the date of mailing. Either party may at any time, in the manner set forth for giving notices to the other, specify a different address to which notices to it shall be sent.

33. ESTOPPEL CERTIFICATE. Upon Lessor's written request, Lessee shall execute, acknowledge and deliver to Lessor a written statement certifying: (i) that none of the terms or provisions of this Lease have been changed (or if they have been changed, stating how they have been changed); (ii) that this Lease has not been cancelled or terminated; (iii) the last date of payment of the Rentals and other charges and the time period covered by such payment; (iv) that Lessor is not in default under this Lease (or, if Lessor is claimed to be in default, stating why); and (v) such other matters as may be reasonably required by Lessor or the holder of a mortgage, deed of trust or lien to which the Premises is or becomes subject. Lessee shall deliver such statement to Lessor within ten (10) days after Lessor's request. Any such statement by Lessee may be given by Lessor to any prospective purchaser or encumbrancer of the Premises. Such purchaser or encumbrancer may rely conclusively upon such statement as true and correct. If Lessee does not deliver such statement to Lessor within such ten (10) day period, Lessor, and any prospective purchaser or encumbrancer, may conclusively presume and rely upon the following facts: (i) that the terms and provisions of this Lease have not been changed except as otherwise represented by Lessor; (ii) that this Lease has not been cancelled or terminated except as otherwise represented by Lessor; (iii) that not more than one month's Rentals or other charges have been paid in advance; and (iv) that Lessor is not in default under the Lease. In such event, Lessee shall be estopped from denying the truth of such facts.

34. BROKERS. Lessor and Lessee represent and warrant to each other that they have not dealt with any agents, brokers, finders or other parties in connection with the leasing of the Premises. Each party agrees to indemnify and hold the other harmless from the claims of any brokers, agents, finders or other parties, except those set forth herein, for a commission or fee with respect to the Premises claimed through such indemnifying party.

35. LESSOR'S RECAPTURE RIGHT. Notwithstanding anything else to the contrary contained in this Lease, prior to the expiration of the ninth Lease Year, Lessor shall have the one (1) time right and option (the "Recapture Option"), exercisable by Lessor giving Lessee written notice prior to the expiration of the ninth Lease Year, of terminating this Lease with respect to the Premises, which termination shall be effective upon the expiration of the tenth Lease Year (the "Termination Date"). If Lessor elects to exercise such Recapture Option, all Rentals shall be adjusted as of the date of such termination and the parties shall be released thereby without further obligation to the other party coincident with the surrender of possession of the Premises to Lessor, except for obligations which accrued prior to the date of termination. Lessee and Lessor acknowledge that Lessor shall not exercise the Recapture Option as a means to terminate the Lease and replace Lessee with another tenant who will then run the Flourtown Country Club, but shall only exercise the Recapture Option if it decides to change the Use of the Premises. Upon the Termination Date Lessor shall pay to Lessee a termination fee (the "Termination Fee") equal to the sum of: (i) the unamortized cost of any improvements to the Premises made by Lessee and approved by Lessor (the "Approved Improvements"), provided, that, such improvements shall be amortized over the shorter of fifteen (15) years or their useful life as determined in accordance with Generally Accepted Accounting Principals ("GAAP"); and (ii) two (2) times the average of Lessee's net income (as determined in accordance with GAAP) for Lease Years 7, 8 and 9. Lessor shall have no obligation to pay Lessee the unamortized cost of any Approved Improvements unless the parties agree upon such schedule of payment prior to Lessee commencing the construction of such Approved Improvements.

IN WITNESS WHEREOF, and in consideration of the mutual entry into this Lease and for other good and valuable consideration, and intending to be legally bound, each party hereto has caused this Agreement to be duly executed under seal and the day and year first above written.

LESSOR: TOWNSHIP OF SPRINGFIELD

By: [signature]

Attest: [signature]

LESSEE: TJKFCC, LLC

By: [signature]

Witness: [signature]

SCHEDULE "A" THE PREMISES

SCHEDULE "B" THE EQUIPMENT

SCHEDULE "C" LESSOR IMPROVEMENTS TO BE DISCUSSED. MUST INCLUDE TIMING OF WHEN WORK SHALL BE COMPLETED.

ITEM AND ESTIMATED COST:

Install new golf course back-up well pump — 4,000.00 (Will be completed immediately)

Renovate and improve pool bath facilities — 30,000.00 (Will be completed immediately)

Replace entrance fence to pool — 12,000.00 (Will be completed Spring 07)

Repair pool coping — 5,000.00 (Will be completed immediately)

Resurface parking lot — 80,000.00 (Will be completed after Lessee completes Lessee's Work)

Install entranceway canopy — 3,000.00 (Will be completed after Lessee completes Lessee's Work)

Drill new golf course water supply well — 20,000.00 (Will be completed immediately)

SCHEDULE "D"

DOCUMENTS TO BE EXECUTED BY LESSEE

EXHIBIT "E"

EXISTING INSPECTION REPORT

RULES AND REGULATIONS

Lessee shall open the Flourtown Country Club ("Club"), and all of its facilities, for business not less than six (6) days each week. The Club facilities shall not be closed to members on a Saturday, Sunday or National Holiday, without the prior written consent of Lessor, except for Christmas Day and two weeks of January or February of each Lease year. Lessee shall notify the Lessor thirty (30) days prior to the two-week closure.

From Memorial Day to Labor Day each year, Lessee shall open the swimming pool not less than 7 days per week (provided, that, the pool shall only be open weekends until school is out).

Lessee shall not operate the Premises for any purpose other than the uses set forth in the Lease without the prior written consent of Lessor. Lessee shall not discontinue any facilities or services currently offered at the Club (except for temporary suspension necessary due to change in seasons) without the prior written consent of Lessor. Lessee may not allow the golf course at the Club to be reserved for a private golf outing: (a) where the number of participants will exceed 40 people, unless Lessor has consented in writing; or (b) on a Saturday, Sunday or National Holiday.

Lessee agrees to limit the memberships sold for golf to 400 members and for swimming to ____ members and such memberships may not be increased without Lessor's prior written consent, not to be unreasonably withheld. Other than current members who are renewing their golf membership(s), Lessee shall only accept golf membership requests from residents of Springfield Township when filling open golf club memberships so long as such resident's application is made and paid for in full prior to February 15th of each year. After February 15th of each year Lessee may accept golf membership requests from non-residents of Springfield Township and shall not be required to give any further preference to residents of Springfield Township.

Other than current members who are renewing their swimming membership(s), Lessee shall only accept pool membership requests from residents of Springfield Township when filling open pool memberships so long as such resident's application is made and paid for in full prior to April 15th of each year. After April 15th of each year Lessee may accept pool membership requests from non-residents of Springfield Township and shall not be required to give any further preference to residents of Springfield Township.

During the Term of the Lease, membership fees for residents of Springfield Township for both golf and swimming shall be subject to Lessor's prior written approval. Lessee shall submit any request to increase golf and/or swimming membership fees to Lessor by October 1st of any each and Lessor shall approve or disapprove of such request prior to November 30th of that year. Lessee may sell memberships (for both golf and pool) to non-residents of Springfield Township at whatever rates Lessee deems appropriate, provided that they are not less than the fees charged to Springfield Township residents. Notwithstanding the foregoing, Lessor shall have the right to review membership fees for nonresidents and to increase the membership fees for nonresidents. Lessor shall advise Lessee of any membership fee increase for nonmembers by November 30th of that year.

Lessee shall not establish new membership categories or rates without the prior written consent of Lessor. Before June 1 of each year, Lessee shall provide Lessor with a complete list of current memberships in all categories, including the addresses and membership fees paid, as well as the dates such fees were paid. Lessee shall update such list monthly with any additions or deletions.

Lessee agrees to do mailings to Springfield Township residents, as reasonably requested by the Lessor, advertising the activities and services being provided at the Flourtown Country Club.

Lessee shall at all times keep the walkways and parking lots on the Premises clean and free of snow and ice.

Lessee shall not operate the Club or the Premises in such a way as to cause a nuisance or disturb surrounding property owners. Lessee shall not permit outdoor amplified music on the Premises without the prior written consent of Lessor.

Lessee shall open the golf course to non-member Springfield Township Residents at a fee not to exceed the Club's standard greens fee. Such nonmember residents shall be allowed to use the golf course two (2) times per year. Lessee shall not discriminate against any applicant for membership or any person/group wishing to rent the banquet facilities because of race, color, religion, sex, national original, handicap, or familial status.

Source: Township website page | Web archive version of the page (archive.org)

PDF of the signed lease: _0605100825_001.pdf | Rules document

« Issues « Flourtown Country Club

Contact Doug