Exhibit 10(m)
LEASE AGREEMENT
between
DEVELOPMENT AUTHORITY OF XXXXXX COUNTY
and
ADESA ATLANTA, LLC
Dated as of December 1, 2002
The interest of Development Authority
of Xxxxxx County (the "Issuer") in
this Lease Agreement has been assigned
to SunTrust Bank, as trustee (the
"Trustee") under the Trust Indenture
dated as of December 1, 2002, between
the Issuer and the Trustee as security
for the payment of the principal of,
premium, if any, and interest on those
certain Taxable Economic Development
Revenue Bonds, (ADESA Atlanta, LLC
Project) Series 2002, and any
Additional Bonds issued under the
Indenture.
This Instrument was prepared by:
Xxxxxx & Bird LLP
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
CONTENTS
Page
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ARTICLE I - DEFINITIONS.......................................................1
Section 1.1 Definitions...............................................1
Section 1.2 Certain Rules of Interpretation..........................7
ARTICLE II - REPRESENTATIONS..................................................7
Section 2.1 Representations by the Issuer.............................7
Section 2.2 Representations by the Lessee.............................8
ARTICLE III - DEMISING CLAUSES AND WARRANTY OF TITLE..........................8
Section 3.1 Demise of the Project.....................................8
Section 3.2 Warranty of Title.........................................8
Section 3.3 Quiet Enjoyment...........................................8
ARTICLE IV - COMMENCEMENT AND COMPLETION OF THE
PROJECT; ISSUANCE OF THE BONDS; ADDITIONAL BONDS.........................9
Section 4.1 Agreement to Construct and Equip the Project;
Appointment of Lessee as Construction Agent......................9
Section 4.2 Agreement to Issue the Bonds; Application of Bond
Proceeds; Additional Bonds.......................................10
Section 4.3 Disbursements from the Construction Fund..................11
Section 4.4 Obligation of the Parties to Cooperate in Furnishing
Documents to Trustee.............................................12
Section 4.5 Establishment of Completion Date and Date of Beneficial
Occupancy........................................................12
Section 4.6 Lessee Required to pay Construction and Equipment
Costs in Event Construction Fund Insufficient....................13
Section 4.7 Issuer to Pursue Remedies Against Contractor
and Subcontractors and Their Sureties............................13
Section 4.8 Investment of Construction Fund and Bond Fund
Moneys Permitted.................................................14
ARTICLE V - EFFECTIVE DATE OF THIS LEASE; DURATION OF LEASE TERM; RENTAL
PROVISIONS...............................................................14
Section 5.1 Effective Date of This Lease, Duration of Lease Term..... 14
Section 5.2 Delivery and Acceptance of Possession.....................14
Section 5.3 Rents and Other Amounts Payable...........................15
Section 5.4 Place of Payments.........................................16
Section 5.5 Obligations of Lessee Hereunder Unconditional.............16
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ARTICLE VI - MAINTENANCE, MODIFICATIONS, TAXES AND INSURANCE..................17
Section 6.1 Maintenance and Modification of Project by Lessee.........17
Section 6.2 Removal of Equipment......................................18
Section 6.3 Taxes, Other Governmental Charges and Utility Charges.....19
Section 6.4 Insurance and Indemnity...................................20
Section 6.5 Advances by Issuer to Trustee.............................20
ARTICLE VII - DAMAGE, DESTRUCTION AND CONDEMNATION............................21
Section 7.1 Damage and Destruction....................................21
Section 7.2 Condemnation..............................................21
Section 7.3 Condemnation of Excluded Property.........................22
ARTICLE VIII - SPECIAL COVENANTS..............................................23
Section 8.1 No Warranty of Design, Condition or Suitability
by the Issuer....................................................23
Section 8.2 Inspection of the Project.................................23
Section 8.3 Lessee to Maintain its Existence; Conditions
Under Which Exceptions Permitted.................................23
Section 8.4 Qualification in Georgia..................................23
Section 8.5 Granting of Easements and Leasehold Mortgages.............23
Section 8.6 Waiver of Landlord's Lien.................................28
Section 8.7 Granting of Mortgages by Issuer...........................28
Section 8.8 Estoppel Certificates.....................................28
Section 8.9 Authorized Issuer Representative..........................29
Section 8.10 Authorized Lessee Representative..........................29
ARTICLE IX - ASSIGNMENT, SUBLEASING, PLEDGING, AND SELLING, REDEMPTION;
RENT PREPAYMENT AND ABATEMENT............................................29
Section 9.1 Assignment and Subleasing.................................29
Section 9.2 Assignment and Pledge of Revenues by Issuer...............30
Section 9.3 Restrictions on Sale of Project by Issuer.................30
Section 9.4 Redemption of Bonds.......................................30
Section 9.5 Prepayment of Rents.......................................30
Section 9.6 Presentment of Bonds for Cancellation.....................30
Section 9.7 Lessee Entitled to Certain Rent Abatements if
Bonds Paid Prior to Maturity.....................................31
Section 9.8 Reference to Bonds Ineffective After Bonds Paid...........31
ARTICLE X - EVENTS OF DEFAULT AND REMEDIES....................................31
Section 10.1 Events of Default Defined.................................31
Section 10.2 Remedies on Default.......................................33
Section 10.3 No Remedy Exclusive.......................................34
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Section 10.4 Agreement to Pay Reasonable Attorneys' Fees and
Expenses.........................................................34
Section 10.5 No Additional Waiver Implied by One Waiver................34
Section 10.6 Rescission of Remedies....................................35
ARTICLE XI - OPTIONS IN FAVOR OF LESSEE.......................................35
Section 11.1 General Option to Purchase Project........................35
Section 11.2 Option to Purchase a Portion of the Project...............36
Section 11.3 Conveyance on Purchase....................................37
Section 11.4 Relative Position of Options and Indenture................38
Section 11.5 Lessee's Option to Terminate..............................38
Section 11.6 Conveyance of Project at End of Lease Term................38
ARTICLE XII - MISCELLANEOUS...................................................39
Section 12.1 Notices...................................................39
Section 12.2 Binding Effect............................................39
Section 12.3 Severability..............................................40
Section 12.4 Amounts Remaining in Funds................................40
Section 12.5 Amendments, Changes and Modifications.....................40
Section 12.6 Execution Counterparts....................................41
Section 12.7 Captions..................................................41
Section 12.8 Recording of Lease........................................41
Section 12.9 Law Governing Construction of Lease.......................41
Section 12.10 Net Lease.................................................41
Section 12.11 Survival of Purchase Options..............................41
EXHIBIT A - Land
EXHIBIT B - The Project
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STATE OF GEORGIA
COUNTY OF XXXXXX
THIS LEASE AGREEMENT made and entered into as of December 1, 2002 (this
"Lease") by and between DEVELOPMENT AUTHORITY OF XXXXXX COUNTY (herein called
the "Issuer"), a public body corporate and politic duly organized and existing
under the laws of the State of Georgia, as Lessor, and ADESA ATLANTA, LLC
(herein called the "Lessee"), a limited liability corporation duly organized and
existing under the laws of the State of New Jersey, as Lessee.
WITNESSETH:
WHEREAS, the Issuer was created for the purpose of expanding and
developing trade, commerce, industry and employment opportunities in Xxxxxx
County, Georgia (the "County"), and in furtherance of such purposes, the Issuer
has the power to issue its revenue bonds to provide funds to be used by the
Issuer to finance construction, installation, modification, renovation or
rehabilitation of land, buildings, structures, facilities and other improvements
and fixtures, machinery, equipment, furniture and other property of any nature
whatsoever used in connection therewith, as determined by a majority of the
members of the Issuer for lease or sale to prospective tenants or purchasers;
and
WHEREAS, the Issuer proposes to acquire, construct and equip the
Project (as hereinafter defined) within the Issuer's area of authority and to
lease the same to the Lessee in a manner consistent with its stated purpose of
expanding and developing trade, commerce, industry and employment opportunities
in the County.
NOW, THEREFORE, in consideration of the respective representations and
agreements herein contained and such other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows (provided, that any obligation of the Issuer to pay money
created by or arising out of this Lease shall be payable solely out of the
proceeds derived from this Lease, the sale of the Bonds referred to in Section
2.1 hereof, the insurance and condemnation awards as herein provided and any
other revenues arising out of or in connection with its ownership, leasing or
sale of the Project as hereinafter defined):
ARTICLE I
---------
DEFINITIONS
-----------
Section 1.1 DEFINITIONS. In addition to the words and terms elsewhere
defined herein, the following words and terms as used herein shall have the
following meanings unless the context or use clearly indicates another or
different meaning or intent, and any other words and terms defined in the
Indenture shall have the same meanings when used
herein as assigned them in the Indenture unless the context or use clearly
indicates another or different meaning or intent:
"ACT" means the Development Authorities Law (O.C.G.A. 36-62-1 ET SEQ.),
as now or hereafter amended.
"ADDITIONAL BONDS" means additional parity Bonds authorized to be
issued by the Issuer pursuant to Section 208 of the Indenture.
"ADDITIONS" shall have the meaning given in Section 6.1 hereof.
"AFFILIATE" means, with respect to any Person, any other Person (i)
directly or indirectly controlling or controlled by or under direct or indirect
common control with such Person, or (ii) directly or indirectly owning or
holding five percent (5%) or more of the equity interest in such Person. For
purposes of this definition, "control" when used with respect to any Person
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"AGREEMENT TERM" means the period beginning on the date hereof and
continuing until the expiration of the Lease Term.
"AUTHORIZED ISSUER REPRESENTATIVE" means the person or persons at the
time designated to act on behalf of the Issuer by written certificate furnished
to the Lessee and the Trustee containing the specimen signature of such person
or persons and signed on behalf of the Issuer by its Chairman or Vice Chairman.
Any such person shall be subject to the approval of the Lessee and shall be
replaced by the Issuer upon the written request of the Lessee.
"AUTHORIZED LESSEE REPRESENTATIVE" means the person or persons at the
time designated to act on behalf of the Lessee by written certificate furnished
to the Issuer and the Trustee containing the specimen signature of such person
or persons and signed on behalf of the Lessee by the Chairman of the Board, the
President or any Vice President of the Lessee.
"BONDS" means the 2002 Bonds and any Additional Bonds issued by the
Issuer pursuant to the Indenture.
"BOND FUND" means the fund created by Section 502 of the Indenture.
"CLOSING DATE" means the date of the original issuance and sale of the
Bonds.
"COMPLETION DATE" shall have the meaning given such term in Section 4.5
hereof.
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"CONSTRUCTION FUND" means the fund created by Section 602 of the
Indenture.
"CONSTRUCTION PERIOD" means the period between the beginning of
construction of the Project or the date on which the Bonds are first delivered
to the original purchaser thereof (whichever is earlier) and the Date of
Beneficial Occupancy.
"COUNTY" means Xxxxxx County, Georgia, a political subdivision of the
State of Georgia, and any public entity, body or authority to which is hereafter
transferred or delegated by law the duties, powers, authorities, obligations or
liabilities of the present political subdivision.
"DATE OF BENEFICIAL OCCUPANCY" shall have the meaning given such term
in Section 4.5 hereof.
"EQUIPMENT" means those items of machinery, equipment and other
tangible personal property acquired with the proceeds from the sale of the Bonds
or the proceeds from any payment by the Lessee pursuant to Section 4.6 hereof
and installed as part of the Project and any item of machinery, equipment and
other tangible personal property acquired and installed in substitution thereof
and renewals and replacements thereof pursuant to the provisions of Sections
4.1, 6.2(a), 7.1 and 7.2 hereof, less such machinery, equipment and other
tangible personal property as may be released from this Lease pursuant to
Section 6.2(b) hereof or damaged or destroyed and not restored as provided in
Section 7.1 or taken by the exercise of the power of eminent domain as provided
in Section 7.2 hereof, but not including any Excluded Property or any machinery,
equipment and other tangible personal property installed under the provisions of
Section 6.1(b) hereof.
"EXCLUDED PROPERTY" means all personal property (other than such
property as is included in the definition of Equipment) and all real property
(other than such property as is included in the definition of Land and
Improvements) which is not purchased or acquired, directly or indirectly, with
the proceeds of the Bonds or expressly transferred to the Issuer by a xxxx of
sale or similar instrument, and all renewals and replacements therefor, in each
case whether now owned or hereafter acquired by the Lessee or any other Person,
and whether or not installed or located on the Land as described in Section
6.1(b) hereof.
"FORCE MAJEURE EVENT" means, without limitation, the following: acts of
God; strikes, lockouts or other industrial disturbances; acts of public enemies;
orders of any kind of the government of the United States or of the State of
Georgia or any of their departments, agencies, or officials, or any civil or
military authority; insurrections; riots; epidemics; landslides; lightning;
earthquakes; fire; hurricanes; storms; floods; washouts; droughts; arrests;
restraint of government and people; civil disturbance; explosions; breakage or
accident to machinery, transmission pipes or canals; partial or entire failure
of utilities; or any other cause or event not reasonably within the control of
the Lessee. The settlement of strikes, lockouts and other industrial
disturbances shall be entirely
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within the discretion of the Lessee, and the Lessee shall not be required to
make settlement of strikes, lockouts and other industrial disturbances by
acceding to the demands of the opposing party or parties when such course is in
the judgment of the Lessee unfavorable to the Lessee.
"GOVERNMENT OBLIGATIONS" means (a) direct obligations of the United
States of America for the payment of which the full faith and credit of the
United States of America is pledged, or (b) obligations issued by a person
controlled or supervised by and acting as an instrumentality of the United
States of America, the payment of the principal of, premium, if any, and
interest on which is fully and unconditionally guaranteed as a full faith and
credit obligation by the United States of America.
"GOVERNMENTAL AUTHORITY" means any federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
"IMPROVEMENTS" means those certain buildings, facilities and other
improvements to real property provided for in the Plans and Specifications which
are located on the Land and which do not constitute a part of the Equipment,
including, without limitation, all facilities, roads, parking areas, utilities,
fences, lighting and other site improvements, as such may from time to time
exist.
"ISSUER" means Development Authority of Xxxxxx County, a public body
corporate and politic duly organized and existing under the laws of the State of
Georgia, and its lawful successors and assigns.
"LAND" means the real estate and interests in real estate described in
Exhibit "A" attached hereto and by this reference made a part of this Lease,
plus such real estate and interests in real estate as may be added to the
provisions of this Lease pursuant to Section 12.5 hereof, less such real estate
and interests in real estate as may be released from this Lease pursuant to
Sections 8.5 and 11.3 hereof or taken by the exercise of the power of eminent
domain as provided in Section 7.2 hereof.
"LEASE" means this Lease Agreement as it now exists and as it may
hereafter be amended pursuant to the terms hereof and Article XII of the
Indenture.
"LEASE TERM" means the duration of the Lessee's beneficial occupancy of
the Project as provided in Section 5.1 hereof, including any applicable Extended
Lease Term (as therein defined).
"LEASEHOLD MORTGAGE" shall having the meaning given in Section 8.5(b)
hereof.
"LESSEE" means ADESA Atlanta, LLC, a New Jersey limited liability
company, and its successors and assigns including any surviving, resulting or
transferee corporation as provided in Section 8.3 hereof.
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"MORTGAGE" shall have the meaning given in Section 8.7 hereof.
"NET PROCEEDS" when used with respect to any insurance or condemnation
award, means the gross proceeds from the insurance or condemnation award with
respect to which that term is used remaining after payment of all expenses
incurred in the collection of such gross proceeds.
"PERMITTED ENCUMBRANCES" means, as of any particular time, (a) liens
for ad valorem taxes and special assessments not then delinquent or permitted to
exist as provided in Section 6.3 hereof, (b) the Lease Documents, (c) utility,
access and other easements, licenses, rights-of-way, restrictions, reservations
and exceptions which, according to the certificate of an Authorized Lessee
Representative, will not materially interfere with or impair the operations
being conducted at the Project (or, if no operations are being conducted
therein, the operations for which the Project was designed or last modified),
(d) unfiled and inchoate mechanics', materialmen's or other similar liens for
construction work in progress, (e) mechanics', laborers', materialmen's,
suppliers' and vendors' liens or other similar liens in connection with the
Project Construction or the acquisition, construction and installation of any
Additions (as defined in Section 6.1 hereof), (f) such defects, irregularities,
encumbrances, easements, rights-of-way and clouds on title as do not, in the
aggregate, and in the opinion of the Lessee, materially impair the property
affected thereby for the purpose for which it was acquired or is held by the
Issuer, (g) the rights of sublessees and other tenants having an interest in all
or any portion of the Project, and (h) any Lessee Liens and Issuer Liens (as
such terms are defined in Section 8.5(b) hereof).
"PERSON" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
(whether or not incorporated) or any Governmental Authority.
"PLANS AND SPECIFICATIONS" means the plans and specifications prepared
by or on behalf of the Lessee for the Project, as the same may be amended,
modified or supplemented from time to time by the Lessee in accordance with
Section 4.1 hereof.
"PROJECT" means the facilities, including the Land, the Improvements
and the Equipment, acquired or to be acquired, constructed and installed
pursuant to Plans and Specifications, which facilities, as presently
contemplated, are generally described in Exhibit "B" hereto, and all Additions
described in Section 6.1(b) to the extent the Issuer has received the notice
and/or xxxx of sale or other transfer documents as required by said Section;
provided, however, that the term "Project" and the lesser included terms
"Improvements" and "Equipment" shall not be deemed to include any part of the
Excluded Property except where those terms are used in the definitions of "Date
of Beneficial Occupancy," "Construction Period," "Plans and Specifications," and
"Project Costs," in Sections 2.1(a) and 2.1(d) and Article IV hereof and in any
other provision of this Lease dealing specifically with the acquisition,
construction, installation or equipping of property.
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"PROJECT CONSTRUCTION" means the design, development, acquisition,
construction, installation, equipping and placing into service of the Project,
including, without limitation, the design and construction of all Improvements
and the acquisition, installation and testing of all Equipment.
"PROJECT COSTS" shall include the following:
(a) all costs of construction, purchase, or other forms of
acquisition;
(b) all costs of real or personal property required for the
purpose of the Project and all facilities related thereto, including land and
any rights or undivided interests therein, easements, franchises, water rights,
fees, permits, approvals, licenses, and certificates and the securing of such
franchises, permits, approvals, licenses and certificates and the preparation of
applications therefor;
(c) all machinery, equipment, initial fuel, and other supplies
required for the Project;
(d) financing charges and interest prior to the Date of
Beneficial Occupancy;
(e) costs of engineering, architectural and legal services;
(f) fees paid to fiscal agents for financial and other advice
or supervision;
(g) costs of Plans and Specifications and all expenses
necessary or incidental to the construction, purchase or acquisition of the
Project or to determining the feasibility or practicability of the Project;
(h) any fund or funds for the creation of a debt service
reserve, a renewal or replacement reserve and such other reserves as may be
reasonably required by the Issuer with respect to the financing and operation of
the Project and as may be authorized by the Indenture; and
(i) administrative expenses and such other expenses as may be
necessary or incidental to the financing of the Project as authorized in the
Act.
The foregoing costs and expenses include costs and expenses incurred by
the Issuer or the Lessee pursuant to the Inducement Agreement dated as of
October 22, 2002, between the Issuer and the Lessee (the "Inducement Agreement")
and include repayment of any loans made by the Lessee for the advance payment of
any part of such costs, including interest thereon.
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"2002 BONDS" means the Taxable Economic Development Revenue Bonds
(ADESA Atlanta, LLC Project) Series 2002, issued by the Issuer pursuant to the
Indenture.
Section 1.2 CERTAIN RULES OF INTERPRETATION. The definitions set forth
in Section 1.1 shall be equally applicable to both the singular and plural forms
of the terms therein defined and shall cover all genders.
"Herein," "hereby," "hereunder," "hereof," "hereinbefore," hereinafter"
and other equivalent words refer to this Lease and not solely to the particular
Article, Section or subdivision hereof in which such word is used.
Reference herein to an Article number (e.g., Article IV) or a Section
number (e.g., Section 6.8) shall be construed to be a reference to the
designated Article number or section number hereof unless the context or use
clearly indicates another or different meaning or intent.
The table of contents, titles and headings of the articles and sections
of this Lease Agreement have been inserted for convenience and reference only
and are not to be considered a part hereof and shall not in any way modify or
restrict any of the terms or provisions hereof and shall never be considered or
given any effect in construing this Lease or any provision hereof or in
ascertaining intent, if any question of intent should arise.
This Lease and all the terms and provisions hereof shall be liberally
construed to effectuate the purposes set forth herein and to sustain the
validity of this Lease.
ARTICLE II
----------
REPRESENTATIONS
---------------
Section 2.1 REPRESENTATIONS BY THE ISSUER. The Issuer makes the
following representations as the basis for the undertakings on its part herein
contained:
(a) The Issuer is a public body corporate and politic duly
organized and existing under the provisions of the Act. Under the provisions of
the Act, the Issuer has the power to enter into the transactions contemplated by
this Lease and to carry out its obligations hereunder. The Issuer has determined
by majority vote of its members that the Project constitutes a "project" within
the meaning of the Act. By proper corporate action, the Issuer has duly
authorized the execution and delivery of this Lease.
(b) The Issuer proposes to acquire, construct and equip the
Project in accordance with the Plans and Specifications, and proposes to lease
the Project to the Lessee, all for the purpose of promoting trade, commerce,
industry and employment opportunities in the County and the State of Georgia.
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(c) The Bonds are to be issued under the Indenture, pursuant
to which the Issuer's interest in this Lease and the rents and other revenues
derived by the Issuer from its ownership and leasing of the Project will be
assigned and pledged to the Trustee, all as security for the payment of the
principal of, premium, if any, and interest on the Bonds.
Section 2.2 REPRESENTATIONS BY THE LESSEE. The Lessee makes the
following representations as the basis for the undertakings on its part herein
contained:
(a) The Lessee, a limited liability company duly incorporated,
existing and in good standing under the laws of the State of New Jersey, and
qualified to do business under the laws of the State of Georgia, has the power
to enter into this Lease and to perform its obligations contained herein, and
has been duly authorized to execute and deliver this Lease.
(b) The Lessee is not subject to any provision under its
Certificate of Formation, as amended or its Operating Agreement, as amended, or
any contractual limitation or provision of any nature whatsoever which in any
way limits, restricts or prevents the Lessee from entering into this Lease or
performing any of its obligations hereunder.
(c) All of the Project will be located in the County.
ARTICLE III
-----------
DEMISING CLAUSES
AND WARRANTY OF TITLE
---------------------
Section 3.1 DEMISE OF THE PROJECT. Commencing on the Closing Date and
during the Lease Term, the Issuer agrees to demise and lease to the Lessee, and
the Lessee hereby agrees to lease from the Issuer, the Project at the rental set
forth in Section 5.3 hereof and in accordance with the provisions of this Lease,
subject to Permitted Encumbrances.
Section 3.2 WARRANTY OF TITLE. The Issuer acknowledges that it has
received from the Lessee a Limited Warranty Deed with respect to the Land and
warrants for itself and its successors and assigns to the Lessee, its successors
and assigns, that the Issuer has not and shall not take any actions which would
result in the imposition of any liens or encumbrances on the Land except (i)
Permitted Encumbrances or (ii) those liens or encumbrances created by or with
the written consent of the Lessee.
Section 3.3 QUIET ENJOYMENT. The Issuer covenants and agrees that it
will warrant and defend the Lessee in the quiet enjoyment and peaceable
possession of the
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Project free from all claims of all Persons claiming by or through the Issuer,
throughout the Lease Term, so long as the Lessee shall perform the covenants,
conditions and agreements to be performed by it hereunder, or so long as the
period for remedying any default in such performance shall not have expired.
ARTICLE IV
----------
COMMENCEMENT AND COMPLETION OF THE PROJECT;
ISSUANCE OF THE BONDS; ADDITIONAL BONDS
---------------------------------------
Section 4.1 AGREEMENT TO CONSTRUCT AND EQUIP THE PROJECT; APPOINTMENT
OF LESSEE AND CONSTRUCTION AGENT.
(a) The Issuer, to the maximum extent permitted by law, hereby makes,
constitutes and appoints the Lessee as its true, lawful and exclusive agent for
the Project Construction, and the Lessee hereby accepts such agency to act and
do all things on behalf of the Issuer, to exercise all rights, remedies and
powers of the Issuer in connection therewith, including, without limitation, the
following:
(i) negotiate, enter into, perform and enforce all contracts,
purchase or supply orders and other arrangements with respect to the Project
Construction (collectively, the "Construction Contracts") on such terms and
conditions as are customary and reasonable under the circumstances and as are
reasonably consistent with local and national standards and practices with
respect to similar facilities;
(ii) apply for and obtain in its own name or the name of the
Issuer all necessary permits, licenses, consents, approvals, entitlements and
other authorizations which may be required for the Project Construction and the
use and occupancy of the Project or any part thereof;
(iii) supervise or negotiate, enter into, perform and enforce
contracts for the supervision of the Project Construction;
(iv) prepare, execute and file with the Trustee all requisitions
and other requests required under the terms hereof and of the Indenture and to
obtain and use monies in the Construction Fund for the payment or reimbursement
of Project Costs; and
(v) maintain the Plans and Specifications and adequate books and
records with respect to the Project Construction.
The Issuer hereby ratifies and confirms all actions of the Lessee with
respect to the Project prior to the date hereof. This appointment of the Lessee
to act as agent and all authority hereby conferred or granted is conferred and
granted irrevocably, until all activities in connection with the Project
Construction shall have been completed, and
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shall not be terminated prior thereto unless by the mutual agreement of the
Issuer and the Lessee.
(b) The Issuer agrees that it will enter into, or accept the assignment
of, such Construction Contracts as the Lessee may request in order to effectuate
the purposes of this Section; provided that, unless waived by the Issuer, each
such Construction Contract shall be expressly non-recourse to the Issuer.
(c) The Lessee agrees to use its best efforts to cause the Plans and
Specifications to be prepared and completed as soon as practicable and in
accordance with the requirements of all applicable Governmental Authorities. In
addition, to the extent not covered by said Plans and Specifications, the Lessee
agrees to prepare the list of Equipment for installation in the Project which
Equipment shall be necessary or desirable in the discretion of the Lessee in
connection with the use, occupancy and operation of the Project. The Issuer
agrees that the Lessee may at any time and from time to time, in its sole
discretion, change the Plans and Specifications; provided, however, no such
change or changes shall singly or in the aggregate result in the Project not
constituting a "project" as defined in the Act or shall, without prior written
notice to the Issuer, substantially change the character of the Project or the
type of business operations to be conducted at the Project. The Improvements and
the Equipment shall be titled in the name of the Issuer and subject to the terms
of this Lease.
(d) The Lessee agrees to use its best efforts to (i) cause the Project
Construction to be commenced as promptly as practicable after the Closing Date,
(ii) to continue said Project Construction with all reasonable dispatch
thereafter, and (iii) to cause said Project Construction to be completed as soon
as practicable. Notwithstanding anything else herein contained, the Lessee shall
not be deemed in default of its duties and obligations under this Section 4.1
during any period that the Lessee is unable, in whole or part, to carry out such
duties and obligations by reason of a Force Majeure Event. If said Project
Construction is not completed within the time herein contemplated there shall be
no resulting liability on the part of the Issuer or the Lessee and there shall
be no diminution or postponement in the payment of the rents required in Section
5.3 hereof by the Lessee.
(e) Upon the request of the Lessee, the Issuer will assign to the
Lessee all warranties and guaranties of all contractors, subcontractors,
suppliers, architects and engineers for the furnishing of labor, materials or
equipment or supervision or design in connection with the Project and any rights
or causes of action arising from or against any of the foregoing under the
Construction Contracts or otherwise.
Section 4.2 AGREEMENT TO ISSUE THE BONDS; APPLICATION OF BOND
PROCEEDS; ADDITIONAL BONDS.
(a) In order to provide funds for payment of the Project Costs, the
Issuer agrees that it will sell, issue and cause to be delivered, pursuant to
the Indenture, the 2002
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Bonds, bearing interest, maturing and having the other terms and provisions set
forth in the Indenture. Upon receipt of the proceeds derived from the sale of
2002 Bonds, the Issuer will cause said proceeds to be deposited in the
Construction Fund.
(b) The Issuer agrees to authorize the issuance of Additional Bonds
upon the terms and conditions provided herein and in the Indenture. Additional
Bonds may be authorized for the purpose of financing Project Costs to the extent
such costs exceed the amount in the Construction Fund, such excess to be
evidenced by a certificate signed by the Authorized Lessee Representative,
subject to the limitations contained in Section 208 of the Indenture. If the
Lessee is not in default hereunder, the Issuer agrees, on request of the Lessee,
from time to time, to use its best efforts to issue Additional Bonds in such
amounts, maturing on such dates, bearing such rate or rates of interest and
redeemable at such times and prices as may be specified by the Lessee and as
shall be permitted within the limits and under the conditions specified above
and in the Indenture; provided, that (i) the Lessee and the Issuer shall have
entered into an amendment to this Lease or a separate lease containing
substantially the same terms as this Lease to provide for the lease of any
additional properties not constituting Excluded Property to the Lessee and to
include a description of such additional properties, to provide for rental
payments to be paid by the Lessee to the Issuer as shall be sufficient to pay
the principal of and premium, if any, and interest on the Additional Bonds as
provided to be paid in the supplemental bond resolution with respect to such
Additional Bonds, and to extend the Lease Term or in the case of a separate
lease, provide for a lease term of at least ten years if the maturity of any
Additional Bonds would occur after the expiration of the Lease Term, and (ii)
the Issuer shall have otherwise complied with the provisions of the Indenture
with respect to the issuance of such Additional Bonds. Any amendment to this
Lease entered into pursuant to clause (i) above will provide that any such
additional properties shall be included under this Lease upon terms equivalent
to those pertaining to the Project. The Issuer will deposit the proceeds from
the sale of Additional Bonds in the same manner as provided in paragraph (a)
above.
(c) Upon request of the Lessee, the Issuer agrees to authorize and use
its best efforts to issue, and if issued to deposit the proceeds from the sale
of, any refunding bonds for the purpose of refunding all or a portion of the
outstanding Bonds.
Section 4.3 DISBURSEMENTS FROM THE CONSTRUCTION FUND. In the
Indenture, the Issuer has authorized and directed the Trustee that moneys in the
Construction Fund shall be used to pay the Project Costs, or to reimburse the
Issuer or the Lessee for any Project Costs paid or incurred by the Issuer or the
Lessee either before or after execution of this Lease and delivery of the 2002
Bonds. Such payments shall be made by the Trustee upon receipt of a requisition,
signed by the Authorized Lessee Representative, stating with respect to each
payment to be made:
(1) the requisition number;
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(2) if other than the Lessee, the name and address of the person to
whom payment is due;
(3) the amount to be paid; and
(4) that each obligation mentioned therein constitutes a Project Cost
and has not been the basis of any previous requisition.
In the Indenture, the Issuer has authorized and directed that all
moneys remaining in the Construction Fund (including moneys earned pursuant to
the provisions of Section 4.8 hereof) upon receipt by the Trustee of the
Construction Completion Certificate described in Section 4.5(b) hereof, shall at
the written direction of the Lessee, be (i) used by the Issuer for the purchase
of Bonds for the purpose of cancellation; or (ii) paid into the Bond Fund; or
(iii) a combination of (i) and (ii) as is provided in such direction, provided
that amounts approved by the Authorized Lessee Representative shall be retained
in the Construction Fund (whether or not then on deposit or to be deposited
pursuant to a subsequent requisition) for payment of Project Costs not then due
and payable. Any balance remaining of such retained funds after full payment of
all such Project Costs shall be used by the Trustee as directed by the Lessee in
the manner specified in clauses (i), (ii) and (iii) of this paragraph.
In making any such payment from the Construction Fund, the Trustee may
rely on any such requisitions and certificates delivered to it pursuant to this
Section and the Trustee shall be relieved of all liability with respect to
making such payments in accordance with such requisitions and certificates
without inspection of the Project or any other investigation.
Section 4.4 OBLIGATION OF THE PARTIES TO COOPERATE IN FURNISHING
DOCUMENTS TO TRUSTEE. The Issuer and the Lessee agree to cooperate with each
other in furnishing to the Trustee the documents referred to in Section 4.3
hereof that are required to effect payments out of the Construction Fund, and to
cause such requisitions to be directed to the Trustee as may be necessary to
effect payments out of the Construction Fund in accordance with Section 4.3
hereof.
Section 4.5 ESTABLISHMENT OF COMPLETION DATE AND DATE OF BENEFICIAL
OCCUPANCY. The Completion Date shall be evidenced to the Trustee by a
certificate executed by the Authorized Lessee Representative (the "Construction
Completion Certificate") stating that as of a date certain (the "Completion
Date") the Project Construction was completed and that the Issuer and/or the
Lessee received all consents, approvals or other licenses for applicable
Governmental Authorities required for the use, occupancy and operation of the
Project. The Construction Completion Certificate shall be delivered within ten
(10) days of the Completion Date as determined by the Lessee.
The Date of Beneficial Occupancy shall be evidenced to the Trustee by a
certificate signed by the Authorized Lessee Representative (the "Beneficial
Occupancy
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Certificate") stating that the Date of Beneficial Occupancy has occurred and
specifying said date. The "Date of Beneficial Occupancy" shall mean the earliest
to occur of (i) the Completion Date or (ii) the day on which commercial
operations at the Project have begun. The Beneficial Occupancy Certificate shall
be delivered within ten (10) days of the date of the occurrence of the Date of
Beneficial Occupancy.
Notwithstanding the foregoing, the Construction Completion Certificate
and the Beneficial Occupancy Certificate shall state that they are given without
prejudice to any rights of the Issuer or the Lessee against third parties which
exist on the date of such certificate or which may subsequently come into being.
The Issuer and the Lessee agree to cooperate in causing such certificates to be
furnished to the Trustee.
Section 4.6 LESSEE REQUIRED TO PAY CONSTRUCTION AND EQUIPMENT COSTS IN
EVENT CONSTRUCTION FUND INSUFFICIENT. In the event the moneys in the
Construction Fund available for payment of the Project Costs should not be
sufficient to pay such costs in full and the Lessee has not requested that the
Issuer issue Additional Bonds for such purpose, the Lessee agrees to complete
the Project Construction and to pay all that portion of the Project Costs as may
be in excess of the moneys available therefor or in the Construction Fund by
making payments directly to the construction contractor or contractors or the
suppliers of materials and equipment as the same shall become due or by paying
into the Construction Fund the moneys necessary to complete the Project in which
case the Issuer will proceed to complete the Project Construction and the cost
thereof will be paid from the Construction Fund. The Issuer does not make any
warranty, either express or implied, that the moneys which will be paid into the
Construction Fund and which, under the provisions of this Lease, will be
available for payment of the Project Costs will be sufficient to pay all such
Project Costs. The Lessee agrees that if, after exhaustion of the moneys in the
Construction Fund, the Lessee should pay any portion of the Project Costs
pursuant to the provisions of this Section, it shall not be entitled to any
reimbursement therefor from the Issuer or from the Trustee or from the holders
of any of the Bonds (except to the extent that Additional Bonds may be issued to
pay such excess Project Costs) nor shall it be entitled to any diminution of the
rents payable under Section 5.3 hereof. All Land, Improvements and Equipment
acquired with funds provided by the Lessee as provided herein shall be titled in
the name of the Issuer and subject to the terms of this Lease.
Section 4.7 ISSUER TO PURSUE REMEDIES AGAINST CONTRACTORS AND
SUBCONTRACTORS AND THEIR SURETIES. In the event of any default of any supplier,
contractor or subcontractor under any Construction Contract entered into in
connection with the Project Construction or in the event of breach of warranty
with respect to any material, workmanship or performance guaranty, the Issuer,
at the request and sole cost of the Lessee, will promptly proceed either
separately or in conjunction with others, to exhaust the remedies of the Issuer
against any defaulting supplier, contractor or subcontractor and against any
surety thereof or for the performance of any contract made in connection with
the Project. Unless the Lessee shall request the Issuer to proceed in another
manner, the Issuer shall proceed, in connection with any such default, only
through the Lessee as
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agent for the Issuer; and the Lessee, as such agent and in the name of the
Issuer, shall prosecute, defend or settle any action or proceeding or take any
other action involving any such supplier, contractor, subcontractor or surety
which the Lessee deems reasonably necessary. Any amounts recovered by way of
damages, refunds, adjustments or otherwise in connection with the foregoing
prior to the Completion Date shall be paid into the Construction Fund and after
the Completion Date shall be applied in the manner specified in Section 4.3
hereof.
Section 4.8 INVESTMENT OF CONSTRUCTION FUND AND BOND FUND MONEYS
PERMITTED. Any moneys held as a part of the Construction Fund or the Bond Fund
shall be invested or reinvested by the Trustee upon the written request and
direction of the Lessee in only those investments permitted under the Indenture.
Notwithstanding the foregoing, the Issuer acknowledges and agrees that pursuant
to the Bond Purchase Agreement, payment of the Bonds may be made in installments
commencing on the Closing Date.
ARTICLE V
---------
EFFECTIVE DATE OF THIS LEASE;
DURATION OF LEASE TERM; RENTAL PROVISIONS
-----------------------------------------
Section 5.1 EFFECTIVE DATE OF THIS LEASE, DURATION OF LEASE TERM. The
agreements contained in this Lease shall become effective and the Agreement Term
shall begin as of the dated date hereof. The Lease Term shall not commence until
the Date of Beneficial Occupancy. Unless sooner terminated or extended in
accordance with the provisions of this Lease, this Lease and the Lease Term
shall expire at midnight on the tenth anniversary of the thirty-first day of
December of the year immediately following the year in which the Date of
Beneficial Occupancy occurs; provided, however, if for any reason the entire
Project has not been transferred to the Lessee pursuant to Article XI hereof,
then the Lease Term shall continue until such Project has been so transferred
(such period after the Stated Termination Date shall herein be called the
"Extended Lease Term").
Section 5.2 DELIVERY AND ACCEPTANCE OF POSSESSION. The Issuer agrees
to deliver to the Lessee sole and exclusive possession of the Project (subject
to the right of the Issuer or the Trustee to enter thereon for inspection
purposes and to the other provisions of Section 8.2 hereof) on the Date of
Beneficial Occupancy and the Lessee agrees to accept possession of the Project
upon such delivery; provided, however, that the Lessee shall be permitted to
enter the Project prior to the Date of Beneficial Occupancy for the purpose of
fulfilling its duties and obligations as agent for the Issuer in connection with
the Project Construction as provided in Article IV hereof and to install and
maintain its own equipment..
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Section 5.3 RENTS AND OTHER AMOUNTS PAYABLE.
(a) The Lessee shall make payments to the Trustee during the Agreement
Term for the account of the Issuer in such amounts and at such times as are
sufficient to pay (i) the principal of and premium, if any, on the Bonds
(whether due and payable at maturity or upon the redemption (in whole or in
part) or acceleration of the Bonds) and (ii) accrued interest on the Bonds. In
any event each rental payment under this Section shall be sufficient to pay the
total amount of the principal of, premium, if any, and interest payable on the
Bonds and if at any time the balance in the Bond Fund is insufficient to make
required payments of the principal of, premium, if any, and interest due on the
Bonds on such date, the Lessee shall forthwith pay any such deficiency.
Anything herein to the contrary notwithstanding, any amount at any time
deposited in the Bond Fund shall be credited against the next succeeding payment
and shall reduce the payment to be made by the Lessee to the extent such amount
is in excess of the amount required for payment of the principal of and premium,
if any, on Bonds theretofore called for redemption and past due interest in all
cases where such Bonds have not been presented for payment; and further, if the
amount held by the Trustee in the Bond Fund should be sufficient to pay at the
times required the principal of, premium, if any, and interest on the Bonds then
remaining unpaid, the Lessee shall not be obligated to make any further payments
under the provisions of this Section.
The payments due and payable during the Extended Lease Term (as defined
in Section 5.1 hereof) shall be $1.00 per year.
(b) The Lessee agrees to pay to the Trustee (to the extent not paid
from the Construction Fund) until the principal of, premium, if any, and
interest on the Bonds shall have been fully paid, its reasonable and necessary
fees, charges and expenses (including reasonable fees and expenses of counsel)
as provided in the Indenture, as and when the same become due. In addition, the
Lessee agrees to pay the reasonable and necessary fees, charges and expenses of
the Trustee appointed with the consent of the Lessee in accordance with the
Indenture. The Lessee may, without creating a default hereunder, withhold any
payment required to be made under this subsection (b) in order to contest in
good faith the validity, necessity or reasonableness of any such fees, charges
or expenses.
(c) The Lessee agrees to pay the reasonable and necessary expenses
(including attorneys' fees and expenses) not otherwise provided for in this
Lease, which may be incurred by the Issuer, or for which the Issuer may in any
way become liable, as a result of issuing any of the Bonds, the Project
Construction and the leasing of the Project to the Lessee, or being a party to
this Lease or the Indenture, or issuing the Bonds.
(d) In the event the Lessee should fail to make any of the payments
required in this Section, the item or installment so in default shall continue
as an obligation of the Lessee until the amount in default shall have been fully
paid, and the Lessee agrees to pay
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the same with interest thereon at the rate of interest borne by the Bonds until
paid. The provisions of this Section shall be subject to the provisions of
Section 9.7 hereof.
Section 5.4 PLACE OF PAYMENTS. The payments provided for in Section
5.3(a) hereof shall either be paid directly to the Trustee for the account of
the Issuer and deposited in the Bond Fund or be paid directly to the holder or
holders of Bonds in accordance with a home office payment agreement entered into
pursuant to Section 202(c) of the Indenture. The payments provided for in
Section 5.3(b) and (c) hereof shall be paid directly to the parties to whom such
payments are due.
Section 5.5 OBLIGATIONS OF LESSEE HEREUNDER UNCONDITIONAL. Subject to
the provisions of Section 9.7 hereof, the obligations of the Lessee to make the
payments required in Section 5.3(a) hereof shall be absolute and unconditional
and shall not be subject to diminution by set-off, counterclaim, abatement or
otherwise. Until such time as the principal of, premium, if any, and interest on
the Bonds shall have been fully paid or provision for the payment thereof shall
have been made in accordance with the Indenture, the Lessee (i) will not suspend
or discontinue any payments provided for in Section 5.3(a) hereof except to the
extent the same have been prepaid, and (ii) except as provided in Sections 11.1
and 11.5 hereof, will not terminate the Agreement Term for any cause, including,
without limiting the generality of the foregoing, failure of the Issuer to
complete the Project Construction, failure of the Issuer's title to the Project
or any part thereof, any acts or circumstances that may constitute failure of
consideration, eviction or constructive eviction, destruction of or damage to
the Project, commercial frustration of purpose, any change in the tax or other
laws of the United States of America or of the State of Georgia or any political
subdivision of either thereof or any failure of the Issuer to perform and
observe any agreement, whether express or implied, or any duty, liability or
obligation arising out of or connected with this Lease. Nothing contained in
this Section shall be construed to release the Issuer from the performance of
any of the agreements on its part herein contained; and in the event the Issuer
should fail to perform any such agreement on its part, the Lessee may institute
such action against the Issuer as the Lessee may deem necessary to compel
performance or recover its damages for nonperformance so long as such action
shall not do violence to the agreements on the part of the Lessee contained in
the preceding sentence. The Lessee may, however, at its own cost and expenses
and in its own name or in the name of the Issuer, prosecute or defend any action
or proceeding or take any other action involving third persons which the Lessee
deems reasonably necessary in order to insure the acquisition, construction and
equipping of the Project or to secure or protect its right of possession,
occupancy and use hereunder, and in such event the Issuer hereby agrees to
cooperate fully with the Lessee and to take all action necessary to effect the
substitution of the Lessee for the Issuer in any such action or proceeding if
the Lessee shall so request.
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ARTICLE VI
----------
MAINTENANCE, MODIFICATIONS,
TAXES AND INSURANCE
-------------------
Section 6.1 MAINTENANCE AND MODIFICATIONS OF PROJECT BY LESSEE.
(a) The Lessee agrees that during the Lease Term it will at its own
expense (i) keep the Project in as reasonably safe condition as its operations
shall permit and (ii) keep the Improvements and the Equipment and all other
facilities and improvements forming a part of the Project in reasonably good
repair and in good operating condition.
(b) The Lessee may from time to time, in its sole discretion and at its
own expense, make any additions, modifications or improvements to the Project,
including (i) the acquisition of additional real property or any interests
therein, (ii) the acquisition, construction and equipping of additional
buildings, utilities, parking facilities and other improvements on or under the
Land, and (iii) the installation of additional machinery, equipment and other
tangible personal property in the Project, on the Land or in any additional
buildings and improvements (collectively, the "Additions"); provided, however,
no such Additions shall materially impair the effective use of the Project or
result in any part of the Project not being a "project" within the meaning of
the Act. The Lessee shall furnish to the Issuer the plans for any such
Additions. The Issuer shall not be obligated to pay any costs or expenses in
connection with the design, acquisition, construction or installation of any
such Additions.
At any time and from time to time, the Lessee may elect by giving
notice thereof to the Issuer to include any such Additions or portions thereof
as a part of the Project (collectively, herein called "Project Improvements");
provided that to the extent any such Project Improvements include personal
property, such notice shall be accompanied by a xxxx of sale, assignment or
other instrument transferring title thereof to the Issuer. No transfer
instrument shall be required in the case of the Project Improvements which
constitute real property and upon the giving of such notice to the Issuer such
Project Improvements shall be deemed a part of the Project and titled in the
name of the Issuer. If no such notice is given by the Lessee to the Issuer, such
Additions shall be deemed Excluded Property.
Any such Additions constituting Excluded Property, may be removed by
the Lessee at any time and from time to time; provided that any damage to the
Project occasioned by such removal shall be repaired by the Lessee at its own
expense. All Excluded Property, whether or not installed in the Project or
located on or adjacent to the Land, shall remain the sole property of the owner
thereof in which the Issuer shall not have any interest, and shall not be
subject to the provisions of this Lease or the Indenture. The Issuer agrees to
execute and deliver at the request of the Lessee or any other Person having an
interest in the Project or any part thereof any landlord's waivers and other
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releases in connection with the acquisition, construction and installation of
such Excluded Property.
Nothing contained in the preceding provisions of this Section 6.1(b)
shall prevent the Lessee from granting any deeds to secure debt, mortgages,
security agreements or other similar liens or encumbrances or entering into any
sale/leaseback transactions with respect to any Additions (whether in the form
of a conditional sale, financing lease or otherwise) and the Issuer agrees to
execute and deliver at the request of the Lessee any instruments, waivers,
releases, financing statements or other documents necessary or appropriate to
confirm any such grant. These provisions shall be in addition to the rights of
the Lessee set forth in Sections 8.5 and 8.7 hereof.
(c) Subject to the Lessee's usual safety and security requirements of
persons located on the Land, the Issuer, the Trustee and their respective duly
authorized agents shall have the right, upon giving the Lessee at least 48 hours
prior written notice, to enter upon any part of the Land during normal daylight
business hours, and examine and inspect the same as may be reasonably necessary
for the purpose of determining whether the Lessee is in compliance with its
obligations under this Section 6.1; provided that no such inspection shall
interfere with the business operations at the Project.
Section 6.2 REMOVAL OF EQUIPMENT. The Issuer shall not be under any
obligation to renew, repair or replace any inadequate, obsolete, worn out,
unsuitable, undesirable or unnecessary Equipment. In any instance where the
Lessee in its sole discretion determines that any items of Equipment have become
inadequate, obsolete, worn out, unsuitable, undesirable or unnecessary, the
Lessee may remove such items of Equipment and (on behalf of the Issuer), sell,
trade-in, exchange or otherwise dispose of them (as a whole or in part) and
retain all proceeds or consideration received in connection therewith without
any responsibility or accountability to the Issuer therefor, provided that in
the event that any such removal shall result in the Project not being deemed to
constitute a "project" under the Act, the Lessee shall substitute (either by
direct payment of the costs thereof or by advancing to the Issuer the funds
necessary therefor) and install other machinery or equipment or otherwise take
such additional actions which would cause the Project to constitute a "project"
under the Act.
The removal from the Project of any portion of the Equipment pursuant
to the provisions of this Section shall not entitle the Lessee to any abatement
or diminution in amount of the rents payable under Section 5.3 hereof.
The Lessee will not remove or permit the removal of any of the
Equipment except in accordance with the provisions of this Section. At the
request of the Lessee, the Issuer shall execute such bills of sale, releases or
other documents reasonably required by the Lessee in order to accomplish any
sale, trade-in, exchange or other disposition of Equipment pursuant to this
Section.
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Section 6.3 TAXES, OTHER GOVERNMENTAL CHARGES AND UTILITY CHARGES.
(a) The Issuer and the Lessee acknowledge that under present law no
part of the Project owned by the Issuer will be subject to ad valorem taxation
by the State of Georgia or by any political or taxing subdivision thereof, and
that under present law the income and profits (if any) of the Issuer from the
Project are not subject to either Federal or Georgia taxation. The Issuer
further acknowledges that it has entered into this Lease to enable the Lessee to
enjoy a reduction in ad valorem taxation afforded by the reduced value of
Lessee's interest in the Project, as set forth in that certain Memorandum of
Agreement Regarding Lease Structure and Valuation of Leasehold Interest among
the Issuer, the Lessee and the Xxxxxx County Board of Tax Assessors (the
"Property Tax Memorandum"). Pursuant to the Property Tax Memorandum, the Issuer
agrees that the Lessee will not be required to make any payments in lieu of
taxes or other similar payments, provided that the Lessee will pay, as the same
respectively become lawfully due and payable, (i) all ad valorem taxes assessed
with respect to the Lessee's leasehold interest in the Project during the Lease
Term; (ii) all taxes and governmental charges of any kind whatsoever upon or
with respect to the Project or any machinery, equipment or other property
installed or brought by the Lessee therein or thereon (including, without
limiting the generality of the foregoing, any taxes levied upon or with respect
to the income or profits of the Issuer from the Project which, if not paid, will
become a lien on the Project or a charge on the revenues and receipts therefrom
prior to or on a parity with the lien or charge of the Indenture; (iii) all
utility and other charges incurred in the operation, maintenance, use, occupancy
and upkeep of the Project; and (iv) all assessments and charges lawfully made by
any governmental body for public improvements that may be secured by lien on the
Project; provided, that with respect to special assessments or other
governmental charges that may lawfully be paid in installments over a period of
years, the Lessee shall be obligated to pay only such installments as are
required to be paid during the Lease Term.
(b) It is the understanding and intent of the parties that the Issuer's
acquisition of title to the Project, including but not limited to the Equipment,
shall be solely for the purpose of leasing the same to the Lessee pursuant to
the terms hereof. It is further the understanding and intent of the parties
that, for purposes of the sales and use taxes imposed by Article 8 of Title 48
of the Official Code of Georgia Annotated, the conveyance to the Issuer of title
to the Project or any portion thereof by the Lessee as contemplated herein shall
not be a taxable transaction for sales and use tax purposes in accordance with
the holding of FOOTPRESS CORPORATION X. XXXXXXXXXX, 242 Ga. 686, 251 S.E.2d 278
(1978).
(c) The Lessee may, at its own expense and in its own name and behalf
or in the name and behalf of the Issuer, in good faith contest any such taxes,
assessments and other charges and, in the event of any such contest, may permit
the taxes, assessments or other charges so contested to remain unpaid during the
period of such contest and any appeal therefrom. The Issuer will cooperate fully
with the Lessee in any such contest.
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Section 6.4 INSURANCE AND INDEMNITY.
(a) During the Project Construction and throughout the Agreement Term,
the Lessee shall, in its own name or in the name of the Issuer, keep the Project
continuously insured against such risks and in such amounts as are customarily
insured against by the Lessee and in such amounts as is consistent with the
Lessee's customary practices, paying as the same become due all premiums in
respect thereto; provided that the Lessee may satisfy the requirements of this
Section through self-insurance in accordance with its customary practices at
other locations. Any policies of insurance so obtained by the Lessee shall
include the Issuer as a named insured, as its interest may appear, if such
endorsement is obtainable and customary. The Lessee may, in its own name or in
the name of the Issuer, prosecute or defend any action or proceeding, or take
any other action involving claims against the carrier of the insurance required
hereby, including the settlement of such claims, which the Lessee deems
necessary or desirable under the circumstances.
(b) The Lessee shall also indemnify and defend the Issuer and the
Trustee, and their respective officers, directors, employees and agents
(collectively the "Indemnified Parties" or individually an "Indemnified Party"),
and hold the same harmless against all liabilities, loses, suits, actions,
damages, penalties, costs and expenses (collectively, "Indemnified Losses")
incurred in connection with or with respect to (i) the issuance or sale of the
Bonds, (ii) the Project Construction, or (iii) the operation of the Project by
the Lessee; provided, however, that the indemnification required by this Section
6.4 shall not include indemnification for Indemnified Losses resulting directly
or indirectly from the gross negligence, bad faith or willful misconduct of any
Indemnified Party; and provided, further, that the indemnity provided in this
Section shall be effective only to the extent of any Indemnified Loss in excess
of the Net Proceeds of any insurance carried with respect to the loss sustained.
Unless the Lessee shall request an Indemnified Party to proceed in another
manner, an Indemnified Party shall proceed in connection with any claim against
which indemnification is provided hereunder, only through the Lessee as agent
for such Indemnified Party unless there is a conflict; and the Lessee, as such
agent and in the name of such Indemnified Party, shall defend or settle any such
claim, action or proceeding or take any other action with respect thereto as the
Lessee shall deem reasonably necessary and appropriate.
(c) The provisions of this Section 6.4 shall survive the termination of
this Agreement and the Indenture and the resignation or removal of the Trustee.
Section 6.5 ADVANCES BY ISSUER OR TRUSTEE. In the event the Lessee
shall (i) fail to maintain the insurance coverage required by Section 6.4 hereof
or (ii) fail to correct or repair any hazardous condition at the Project which
poses an immediate threat of injury to or death of any Person, and such failure
shall continue for thirty (30) days after receipt of written notice from the
Issuer or the Trustee demanding that such failure be remedied and indicating the
intent of such party to cure such failure at the expense of the Lessee, the
Issuer or the Trustee may (but unless satisfactorily indemnified shall be under
no
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obligation to) take out the required policies of insurance and pay the premiums
on the same or take appropriate actions to correct such hazardous condition; and
all amounts so advanced therefor, by the Issuer or the Trustee shall become an
additional obligation of the Lessee to said party, which amounts, together with
interest thereon at the rate of interest borne by the Bonds from the date
thereof, the Lessee agrees to pay.
ARTICLE VII
-----------
DAMAGE, DESTRUCTION AND CONDEMNATION
------------------------------------
Section 7.1 DAMAGE AND DESTRUCTION. Unless the Lessee shall elect to
exercise its option to purchase the Project pursuant to the provisions of
Section 11.1 hereof, if prior to full payment of the Bonds (or provision for
payment thereof having been made in accordance with the provisions of the
Indenture) the Project is destroyed (in whole or in part) or is damaged by fire
or other casualty all Net Proceeds of insurance received by the Issuer, the
Lessee or the Trustee resulting from claims for such losses shall be paid to the
Lessee and applied in one or more of the following ways at the sole discretion
of the Lessee:
(a) The restoration by the Lessee, as agent for and on behalf of the
Issuer, of the property damaged or destroyed to substantially the same condition
as it existed prior to the event causing such damage or destruction, with such
changes, alterations, and modifications (including the substitution and addition
of other property) as may be desired by the Lessee and will not impair the
utility of the Project; or
(b) Payment into the Bond Fund to be applied by the Trustee toward the
redemption of the principal of any of the Bonds, in whole or in part, together
with accrued interest thereon to the date of redemption; or
(c) Payment to the Lessee for any other purpose.
The Lessee shall not be obligated to report the use of such proceeds to
the Issuer or the Trustee or to make any accounting with respect to the use of
any such Net Proceeds. The Issuer hereby makes, constitutes and appoints the
Lessee as its agent with power of substitution, and the Lessee hereby accepts
such agency, to repair, rebuild or restore the property damaged as provided
above.
Section 7.2 CONDEMNATION. Unless the Lessee shall elect to exercise
its option to purchase the Project pursuant to the provisions of Section 11.1
hereof, if prior to full payment of the Bonds (or provision for payment having
been made in accordance with the provisions of the Indenture) title to, or the
temporary use of, the Project or any part thereof shall be taken under the
exercise of the power of eminent domain by any governmental body or by any
person, firm or corporation acting under governmental authority, the Net
Proceeds received by the Issuer, the Lessee, the Trustee or any of them,
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from any award made in such eminent domain proceedings, shall be paid to the
Lessee and applied in one or more of the following ways at the sole discretion
of the Lessee:
(a) The restoration of the improvements of the Project to substantially
the same condition as they existed prior to the exercise of the said power of
eminent domain, with such changes, alterations, and modifications (including the
substitution and addition of other property) as may be desired by the Lessee and
will not impair the utility of the Project;
(b) The acquisition, by the Issuer at the request of the Lessee of
other machinery, equipment or other tangible personal property suitable for the
Lessee's operation of the Project (which property shall be deemed a part of the
Project and available for use and occupancy by the Lessee without the payment of
any rent other than herein provided to the same extent as if such other property
were specifically described herein and demised hereby); provided, that such
property shall be acquired by the Issuer subject to no liens or encumbrances
other than those approved by the Lessee.
(c) Payment into the Bond Fund to be applied by the Trustee toward the
redemption of the principal of the Bonds, in whole or in part, together with
accrued interest thereon to the date of redemption; or
(d) Payment to the Lessee for any other purpose.
The Lessee shall not be obligated to report to the Issuer or the
Trustee or to make any accounting therefor.
The Issuer shall cooperate fully with the Lessee in the handling and
conduct of any prospective or pending condemnation proceeding with respect to
the Project or any part thereof and will, to the extent it may lawfully do so,
permit the Lessee to litigate in any such proceeding in the name and behalf of
the Issuer. In no event will the Issuer voluntarily settle, or consent to the
settlement of, any prospective or pending condemnation proceeding with respect
to the Project or any part thereof without the written consent of the Lessee.
Section 7.3 CONDEMNATION OF EXCLUDED PROPERTY. The Lessee shall also
be entitled to the Net Proceeds of any condemnation award or portion thereof
made for damages to or takings of its own property or for damages on account of
the taking of or interference with the Lessee's rights to possession, use or
occupancy of the Project.
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ARTICLE VIII
------------
SPECIAL COVENANTS
-----------------
Section 8.1 NO WARRANTY OF DESIGN, CONDITION OR SUITABILITY BY THE
ISSUER. THE ISSUER MAKES NO WARRANTY, EITHER EXPRESS OR IMPLIED, AS TO THE
DESIGN OR CONDITION OF THE PROJECT OR THAT IT WILL BE SUITABLE FOR THE LESSEE'S
PURPOSES OR NEEDS.
Section 8.2 INSPECTION OF THE PROJECT. During the Lease Term, the
Lessee agrees that upon receipt by the Lessee of at least two days' prior
written notice from the Issuer, the Issuer and its duly authorized agents who
are reasonably acceptable to the Lessee shall have the right at all reasonable
times during business hours, subject to the Lessee's usual safety and security
requirements, to enter upon the Land and to examine and inspect the Project
without interference or prejudice to the Lessee's operations.
Section 8.3 LESSEE TO MAINTAIN ITS EXISTENCE; CONDITIONS UNDER WHICH
EXCEPTIONS PERMITTED. The Lessee agrees that during the Agreement Term it will
maintain its existence, will not dissolve or otherwise dispose of all or
substantially all of its assets and will not consolidate with or merge into
another Person or permit one or more other Persons to consolidate with or merge
into it; provided, that the Lessee may, without violating the agreement
contained in this Section, consolidate with or merge into another Person or
permit one or more other Persons to consolidate with or merge into it, or
transfer all or substantially all of its assets to another Person, but only on
condition that the Person resulting from or surviving such merger (if other than
the Lessee) or consolidation or the Person to which such transfer is made (i)
shall expressly assume and agree in writing to perform all of the Lessee's
obligations under this Lease, and (ii) if an entity, shall be organized and
existing under the laws of one of the states of the United States of America or
the District of Columbia or, if not, shall appoint and maintain a local agent
for service of process in the State of Georgia.
Section 8.4 QUALIFICATION IN GEORGIA. The Lessee covenants that it is
and throughout the Agreement Term it will continue to be either organized or
qualified to do business under the laws of the State of Georgia.
Section 8.5 GRANTING OF EASEMENTS AND LEASEHOLD MORTGAGES.
(a) The Lessee may at any time or times cause to be granted easements,
licenses, rights-of-way (temporary or perpetual and including the dedication of
public highways) and other rights or privileges in the nature of easements with
respect to any property included in the Project, or the Lessee may cause to be
released existing easements, licenses, rights-of-way and other rights or
privileges in the nature of easements, held with respect to any property
included in the Project with or without consideration and the Issuer agrees that
at the request of the Lessee it shall execute and
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deliver any instrument necessary or appropriate to confirm and grant or release
any such easements, license, right-of-way or other right or privilege.
(b) The Lessee shall at all times and from time to time have the right
to encumber all of the Lessee's right, title and interest under this Lease by
mortgage, deed to secure debt, security agreement, assignment or other security
instrument, including, without limitation, assignment of the rents, issues and
profits from the Project, as security for any debt of the Lessee, (such
mortgage, deed to secure debt or other instrument(s) being hereinafter referred
to as a "Leasehold Mortgage", and the holder(s) from time to time of such
Leasehold Mortgage being hereinafter referred to as a "Leasehold Mortgagee").
In the event that a Leasehold Mortgagee shall provide the Issuer and
the Trustee with written notice of its name and address (a "Notice of Leasehold
Mortgage"), then, following receipt by the Issuer of such Notice of Leasehold
Mortgage and for so long as such Leasehold Mortgage shall remain unsatisfied of
record or until written notice of satisfaction of such Leasehold Mortgage is
given by the Leasehold Mortgagee to the Issuer, the provisions of this Section
8.5 shall apply to each such Leasehold Mortgagee. Upon written request of such
Leasehold Mortgagee, the Issuer shall acknowledge receipt of a Notice of
Leasehold Mortgage by an instrument in recordable form provided to the Issuer
and the Trustee by the Leasehold Mortgagee. In the event of any assignment of a
Leasehold Mortgage or in the event of a change of address of a Leasehold
Mortgagee or of an assignee of such Leasehold Mortgagee written notice of such
new name and/or address shall be promptly provided to the Issuer.
No cancellation, rejection, surrender, amendment or modification (other
than by expiration of the Lease Term) of this Lease or release of the Lessee
hereunder shall be effective as to any Leasehold Mortgagee (provided that such
Leasehold Mortgagee has given a Notice of Leasehold Mortgage) unless consented
to in writing by such Leasehold Mortgagee. Without limiting the generality of
the foregoing, no rejection of this Lease by Lessee or by a trustee in
bankruptcy for the Lessee shall be effective as to any Leasehold Mortgagee
(provided that such Leasehold Mortgagee has given a Notice of Leasehold
Mortgage) unless consented to in writing by such Leasehold Mortgagee.
The Issuer and the Trustee shall, on serving the Lessee with any notice
of any default under this Lease, simultaneously serve a copy of such notice upon
each Leasehold Mortgagee (provided that such Leasehold Mortgagee has given a
Notice of Leasehold Mortgage). No such notice by the Issuer to the Lessee shall
be deemed to have been duly given unless and until a copy thereof has been so
provided to every Leasehold Mortgagee in the manner specified herein (provided
that such Leasehold Mortgagee has given a Notice of Leasehold Mortgage). From
and after the date such notice has been given to a Leasehold Mortgagee, each
such Leasehold Mortgagee shall have the same period, after its receipt of such
notice, for remedying any default specified in such notice or causing the same
to be remedied as is given to the Lessee after the giving of such notice to the
Lessee to remedy, commence remedying or cause to be remedied the defaults
specified in
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any such notice, but Leasehold Mortgagee shall in no manner be obligated to do
so. The Issuer and the Trustee shall accept such cure by or at the instigation
of the Leasehold Mortgagee as if the same had been performed by the Lessee. The
Lessee hereby authorizes each Leasehold Mortgagee to take any such action that
such Leasehold Mortgagee deems necessary to cure any such default and does
hereby authorize entry upon the Project by each such Leasehold Mortgagee for the
purpose of curing such defaults.
(c) In the event that the Issuer or the Trustee shall elect to
terminate this Lease by reason of any default of the Lessee under Article X,
such Leasehold Mortgagee shall have the right, which right shall be exercised,
if at all, within fifteen (15) days after such Leasehold Mortgagee is notified
of the Issuer's election to terminate the Lease, to postpone and extend the
specified date for the termination of this Lease as fixed by the Issuer in its
notice of termination for a period of not more than six (6) months, provided
that such Leasehold Mortgagee shall, during such six (6) month period, (A) pay
or cause to be paid any Annual Rental and other payments and charges as the same
become due and continue its good faith efforts to perform all of the Lessee's
other obligations under this Lease, excepting (i) obligations of the Lessee to
satisfy or otherwise discharge any lien, charge or encumbrance against Lessee's
interest in this Lease or the Project provided that such lien, charge or
encumbrance is junior in priority to the lien of the mortgage held by such
Leasehold Mortgagee and does not effect the Issuer's fee simple interest in the
Project, and (ii) past non-monetary obligations then in default and not
reasonably susceptible of being cured by such Leasehold Mortgagee, and (B) if
not enjoined or stayed, take steps to acquire or sell the Lessee's interest in
this Lease by foreclosure of the Leasehold Mortgage or other appropriate means
and prosecute the same to completion with due diligence.
If at the end of such six (6) month period such Leasehold Mortgagee is
complying with the immediately preceding paragraph and such Leasehold Mortgagee
is prohibited by any process or injunction issued by any court of competent
jurisdiction or by reason of any action in any court of competent jurisdiction
from commencing or prosecuting foreclosure or other appropriate proceedings in
the nature thereof, this Lease shall not then terminate, and the time for
completion by such Leasehold Mortgagee of its proceedings shall continue so long
as such Leasehold Mortgagee is enjoined or stayed and thereafter for so long as
such Leasehold Mortgagee proceeds in good faith and with due diligence to
complete steps to acquire or sell the Lessee's interest in this Lease by
foreclosure of the Leasehold Mortgage or by other appropriate means. Nothing in
this paragraph, however, shall be construed to extend this Lease beyond the
original Lease Term, nor to require a Leasehold Mortgagee to continue
foreclosure proceedings after a default has been cured. In the event that such
default shall be cured and the Leasehold Mortgagee shall discontinue such
foreclosure proceedings, this Lease shall continue in full force and effect as
if the Lessee had not defaulted under this Lease.
In the event that a Leasehold Mortgagee complies with this subsection
8.5(c) and Leasehold Mortgagee acquires the Lessee's right title and interest
herein by foreclosure or
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otherwise, then, upon the acquisition of the Lessee's right, title and interest
herein by such Leasehold Mortgagee or its designee, or any other purchaser or
assignee at a foreclosure sale or otherwise, this Lease shall continue in full
force and effect as if the Lessee had not defaulted under this Lease.
The granting of a Leasehold Mortgage shall not be deemed to constitute
an assignment or transfer of this Lease or of the leasehold estate hereby
created, and any conveyance of the leasehold estate created hereby from Lessee
to a Leasehold Mortgagee by foreclosure or otherwise, or from Leasehold
Mortgagee as attorney-in-fact of the Lessee to a purchaser at a foreclosure
sale, shall not be deemed to constitute an assignment or transfer of this Lease
or of the leasehold estate hereby created requiring the assumption of the
obligations of the Lessee hereunder, but such purchaser or assignee of this
Lease and of the leasehold estate hereby created shall be deemed to have agreed
to perform all of the terms, covenants and conditions on the part of the Lessee
to be performed hereunder from and after the date of such purchase and
assignment. Upon such conveyance, the Issuer and the Trustee shall recognize
such Leasehold Mortgagee, or any other purchaser or assignee, as the Lessee
hereunder. From and after the date of such sale or assignment, the holder of any
Leasehold Mortgage then existing or thereafter placed on the leasehold estate
hereby created shall be considered a Leasehold Mortgagee as contemplated by this
Lease, and the Leasehold Mortgagee thereunder shall be entitled to receive the
benefit of any and all provisions of this Lease intended for the benefit of a
Leasehold Mortgagee, subject to the obligations and duties of the Leasehold
Mortgagee under this Lease.
(d) In the event that this Lease is terminated as a result of any
default by the Lessee hereunder or any other cause (including, without
limitation, a rejection of this Lease by the Lessee's trustee in bankruptcy
pursuant to 11 U.S.C. Section 365 or any equivalent provision of law), the
Issuer shall provide each Leasehold Mortgagee (provided that such Leasehold
Mortgagee has given a Notice of Leasehold Mortgage) with written notice that the
Lease has been terminated, together with a statement of all sums which would at
that time be due under this Lease but for such termination, and of all other
defaults, if any, then known to the Issuer. The Issuer shall enter into a new
lease (hereinafter referred to as the "New Lease") of the Project with any
Leasehold Mortgagee or its designee for the remainder of the term of this Lease
with the same covenants, conditions and agreements (including, without
limitation, any and all options to extend or renew the term of this Lease, but
excluding any requirements which have been satisfied by the Lessee prior to
termination) as are contained herein, subject only to (i) the conditions of
title as the Project are subject to on the date of the execution of the original
Lease, (ii) the right, if any, of any parties then in possession of any part of
the Project by, through or under Lessee, and (iii) the lien and encumbrance of
any security instrument encumbering the Issuer's fee simple interest in the
Project upon receipt by the Issuer of a written request from such Leasehold
Mortgagee on or before sixty (60) days after the date of the Issuer's notice of
termination given pursuant to this subsection 8.5(d) and thereafter, the lessee
under the New Lease shall have the same right, title and interest in and to the
Project as
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the Lessee had under this Lease. The obligations of the Issuer to enter into a
New Lease shall be subject to the following conditions:
(i) Such Leasehold Mortgagee or its designee shall pay or cause
to be paid to the Issuer at the time of the execution and delivery of such New
Lease any and all sums which would at the time of execution and delivery thereof
be due pursuant to this Lease but for such termination and, in addition thereto,
all reasonable expenses, including reasonable attorney's fees, which the Issuer
shall have incurred by reason of the Lessee's default of which Leasehold
Mortgagee has been notified and provided an opportunity to cure as required by
this Lease, and such termination and the execution and delivery of the New Lease
and which have not otherwise been received by the Issuer from the Lessee or any
other party in interest under the Lessee. Upon the execution of such New Lease,
the Issuer shall allow the Lessee named therein as an offset against the sums
otherwise due under this subsection 8.5(d), an amount equal to the net income
derived by the Issuer from the Project during the period from the date of
termination of this Lease to the date of beginning of the term of such New
Lease; and
(ii) Such Leasehold Mortgagee or its designees shall agree to
cure any defaults of the Lessee under the terminated Lease of which the Issuer
shall have notified Leasehold Mortgagee other than a default existing under
subsections 10.01(c), (d) or (e) hereof.
The new lessee under such New Lease shall, upon entering into such New
Lease, acquire all of the right, title and interest of the Lessee in and to any
and all subleases of all or any part of the Project.
(e) So long as any Leasehold Mortgage is in existence, unless all
Leasehold Mortgagees shall otherwise expressly consent in writing, the fee title
to the Project and the leasehold estate of the Lessee herein created shall not
merge but shall remain separate and distinct, notwithstanding the acquisition of
said fee title and said leasehold estate by the Issuer or by the Lessee, or by a
third party, by purchase or otherwise.
(f) Notices from the Issuer to the Leasehold Mortgagee shall be mailed
to the address furnished the Issuer pursuant to Notice of Leasehold Mortgage,
and those from the Leasehold Mortgagee to the Issuer shall be mailed to the
address designated pursuant to the provisions of Section 12.1 of this Lease.
Such notices, demands and requests shall be given in the manner described in
Section 12.1 of this Lease and shall in all respects be governed by the
provisions of that section.
(g) The Issuer shall, on request in connection with the financing or
refinancing of the Lessee's leasehold interest in the Project, execute,
acknowledge and deliver to a Leasehold Mortgagee an agreement, prepared at the
sole cost and expense of the Lessee, in form satisfactory to the Leasehold
Mortgagee and the Issuer among the Issuer, the Lessee and the Leasehold
Mortgagee, agreeing to all the provisions of this Article XI. In
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addition, the Lessee shall reimburse the Issuer for any reasonable attorneys'
fees and expenses actually incurred in reviewing such agreement.
Section 8.6 WAIVER OF LANDLORD'S LIEN.
(a) The Issuer hereby waives any right to distrain Excluded Property or
any other personal property of the Lessee or any other Person which does not
constitute a part of the Project, and any landlord's lien or similar lien upon
Lessee and any landlord's lien or similar lien upon Excluded Property, any other
personal property of Lessee or any other Person and any alterations belonging to
any Person, regardless of whether such lien is created by statute or otherwise.
The Issuer agrees, at the request of the Lessee, to execute a waiver of any
landlord's or similar lien for the benefit of any present or future holder of a
security interest in, or lessor of, any of the Excluded Property, any other
personal property of any Person or any alterations belonging to any Person.
(b) The Issuer acknowledges, and agrees in the future to acknowledge
(in a written form reasonably satisfactory to the Lessee), to such Persons, at
such times and for such purposes as the Lessee may reasonably request, that any
property included in Excluded Property is not subject to this Lease and do not
constitute fixtures or improvements (regardless of whether or to what extent
such Excluded Property is affixed to the Project), and that the Issuer has no
right, title or interest in or to any Excluded Property.
Section 8.7 GRANTING OF MORTGAGES BY ISSUER. Upon the written request
of the Lessee and with the consent of the holders of not less than a majority in
the aggregate principal amount of the Bonds then outstanding, the Issuer agrees
to execute and deliver to any Person specified by the Lessee (a "Mortgagee")
with or without receipt of consideration and at all times and from time to time,
any mortgage, deed to secure debt, security agreement, assignment or other
security instrument (herein called a "Mortgage") encumbering the Issuer's fee
simple interest in the Project as security for any debt of Lessee or any other
Person.
In addition, upon the written request of the Lessee and with the
consent of the holders of not less than a majority in aggregate principal amount
of the Bonds then outstanding, the Issuer and the Trustee shall execute and
deliver such subordination agreements, consents or other documents or
instruments in recordable form having the effect of subordinating all or any
part of their respective interests in the Project, this Lease and the Trust
Estate to the interests of the holder or holders of any Mortgage.
Section 8.8 ESTOPPEL CERTIFICATES. The Issuer and the Trustee shall,
without charge, at any time and from time to time hereafter, within five (5)
days after written request of the Lessee to do so, certify by written instrument
duly executed and acknowledged to any Leasehold Mortgagee, Mortgagee or
purchaser, or proposed Leasehold Mortgagee, Mortgagee or proposed purchaser, or
any other Person, firm or corporation specified in such request: (i) as to
whether this Lease has been supplemented
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or amended, and if so, the substance and manner of such supplement or amendment;
(ii) as to the existence of any default hereunder known to the Issuer or the
Trustee; (iii) as to the existence of any offsets, counterclaims or defenses
hereto on the part of the Lessee known to the Issuer or the Trustee; (iv) as to
the commencement and expiration dates of the term of this Lease; and (v) as to
any other matters as may be reasonably so requested. Any such certificate may be
relied upon by the Lessee and any other person, firm or corporation to whom the
same may be addressed, and the contents of such certificate shall be binding on
the Issuer and the Trustee as to the Lessee and the addressee(s) of such
certificate.
Section 8.9 AUTHORIZED ISSUER REPRESENTATIVE. Unless otherwise
specified herein, whenever under the provisions hereof the approval of the
Issuer is required or the Issuer is required to take some action at the request
of the Lessee, such approval may be made or such action may be taken by the
Authorized Issuer Representative; and the Lessee or the Trustee shall be
authorized to act on any such approval or action and the Issuer shall have no
complaint against the Lessee or the Trustee as a result of any such action
taken.
Section 8.10 AUTHORIZED LESSEE REPRESENTATIVE. Unless otherwise
specified herein, whenever under the provisions hereof the approval of the
Lessee is required or the Lessee is required to take some action at the request
of the Issuer, such approval may be made or such action may be taken by the
Authorized Lessee Representative; and the Issuer or the Trustee shall be
authorized to act on any such approval or action and the Lessee shall have no
complaint against the Issuer or the Trustee as a result of any such action
taken.
ARTICLE IX
----------
ASSIGNMENT, SUBLEASING, PLEDGING
AND SELLING; REDEMPTION;
RENT PREPAYMENT AND ABATEMENT
-----------------------------
Section 9.1 ASSIGNMENT AND SUBLEASING. This Lease may be assigned in
whole or in part, and the Project may be subleased as a whole or in part, by the
Lessee without the necessity of obtaining the consent of the Issuer, the Trustee
or any other Person; provided, however, except as provided below no assignment
(other than pursuant to Section 8.3 hereof) or sublease shall relieve the Lessee
from primary liability for any of its obligations hereunder. The Lessee agrees
to cause any sublessee of the Project or any portion thereof to operate the
Project as a "project" as defined in the Act. Notwithstanding the foregoing, the
Lessee shall be relieved of liability hereunder in the event of an assignment of
its interest in this Agreement if (i) the assignee expressly assumes and agrees
in writing to perform all of the Lessee's obligations under this Lease and (ii)
if the assignee is a foreign Person (i.e. a natural Person residing outside the
United States of America or an entity not organized and existing under the laws
of one of
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the states of the United States of America or the District of Columbia), such
Person shall appoint and maintain an agent for service of process in the State
of Georgia.
Section 9.2 ASSIGNMENT AND PLEDGE OF REVENUES BY ISSUER. Pursuant to
the Indenture, the Issuer has assigned and pledged its interest in any moneys
receivable under this Lease, excluding payments pursuant to Sections 5.3(b),
5.3(c) and 6.4 hereof, as security for the payment of the principal of, premium,
if any, and interest on the Bonds, but such assignment and pledge shall be
subject and subordinate to this Lease.
Section 9.3 RESTRICTIONS ON SALE OF PROJECT BY ISSUER. The Issuer
agrees that, except as otherwise expressly permitted under the terms of this
Lease or the Indenture, it will not sell, assign, transfer or convey the Project
during the Agreement Term and that it will not take any other action which may
reasonably be construed as tending to cause or induce the levy or assessment of
additional ad valorem taxes on the Project. If the laws of Georgia at the time
shall permit such action to be taken, nothing contained in this Section shall
prevent the consolidation of the Issuer with, or merger of the Issuer into, or
transfer of the Project as an entirety to, any public corporation whose property
and income are not subject to taxation and which has corporate authority to
carry on the business of owning and leasing the Project; provided, (i) that no
such action shall be taken without the prior written consent of the Lessee,
unless such action shall be required by law, and (ii) that upon any such
consolidation, merger or transfer, the due and punctual payment of the principal
of, premium, if any, and interest on the Bonds according to their tenor, and the
due and punctual performance and observance of all the agreements and conditions
of this Lease to be kept and performed by the Issuer, shall be expressly assumed
in writing by the corporation resulting from such consolidation or surviving
such merger or to which the Project shall be transferred as an entirety.
Section 9.4 REDEMPTION OF BONDS. The Issuer, at the request at any
time of the Lessee and if the same are then redeemable, shall forthwith take all
steps that may be necessary under the applicable redemption provisions of the
Indenture to effect redemption of all or part of the then outstanding Bonds, as
may be specified by the Lessee, on the earliest redemption date on which such
redemption may be made under such provisions or upon the date set for the
redemption by the Lessee pursuant to Sections 7.1, 7.2 or 11.1 hereof or Article
III of the Indenture.
Section 9.5 PREPAYMENT OF RENTS. There is expressly reserved to the
Lessee the right, and the Lessee is authorized and permitted at any time it may
choose, to prepay all or any part of the rents payable under Section 5.3(a)
hereof, and the Issuer agrees to accept such prepayment of rents when the same
are tendered by the Lessee. All rents so prepaid shall be credited on the rental
payments specified in Section 5.3(a) hereof, in the order of their due dates and
at the election of the Lessee shall be used for the redemption of outstanding
Bonds in the manner and to the extent provided in the Indenture.
Section 9.6 PRESENTMENT OF BONDS FOR CANCELLATION. The Lessee
expressly reserves the right and is authorized to present any principal amount
of Bonds to the Issuer
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or the Trustee for cancellation. If all of the outstanding Bonds are presented
to the Issuer or the Trustee for cancellation, then, upon payment to the Issuer
or the Trustee of any amounts payable to the Issuer due hereunder (other than
the payments pursuant to Section 5.3(a) hereof), this Lease may be terminated
upon notice given pursuant to Section 11.5(b) hereof. If a portion of the
Outstanding Bonds are presented to the Issuer or the Trustee for cancellation,
the resulting reduction in the amount of Bonds outstanding shall entitle the
Lessee to an appropriate reduction in the payments required by Section 5.3(a)
hereof on all succeeding rental payment dates. All Bonds so presented and
canceled shall thereafter no longer be considered outstanding for any purpose of
the Indenture or this Lease, including the calculation of payments under Section
5.3(a) hereof. The Lessee may present Bonds for partial cancellation and
reissuance of new Bonds for the portions not canceled, or for partial
cancellation and notation thereof on such Bonds, such notation to be made on the
Table of Partial Redemptions on such Bonds in the same manner as provided for
partial redemptions in Section 306 of the Indenture.
Section 9.7 LESSEE ENTITLED TO CERTAIN RENT ABATEMENTS IF BONDS PAID
PRIOR TO MATURITY. If at any time the aggregate moneys in the Bond Fund shall be
sufficient to retire in accordance with the provisions of the Indenture all of
the Bonds at the time outstanding, and to pay all fees and charges of the
Trustee due or to become due through the date on which the last of the Bonds is
retired under circumstances not resulting in termination of the Lease Term, and
if the Lessee is not at the time otherwise in default under Article VI hereof,
the Lessee shall be entitled to use and occupy the Project from the date on
which such aggregate moneys are in the hands of the Trustee to and including
midnight on the last day of the Lease Term, without the payment of the amounts
required by Section 5.3(a) during that interval (but otherwise on the terms and
conditions hereof).
Section 9.8 REFERENCE TO BONDS INEFFECTIVE AFTER BONDS PAID. Upon
payment in full of the Bonds (or provision for payment thereof having been made
in accordance with the provisions of the Indenture) and all fees and charges of
the Trustee, all references in this Lease to the Bonds shall be ineffective and
the holders of any of the Bonds shall not thereafter have any rights hereunder,
saving and excepting those that shall have theretofore vested. For purposes of
this Lease, the Bonds shall be deemed fully paid when so paid according to the
provisions of Article IX of the Indenture.
ARTICLE X
---------
EVENTS OF DEFAULT AND REMEDIES
------------------------------
Section 10.1 EVENTS OF DEFAULT DEFINED. The following shall be "events
of default" under this Lease and the terms "event of default" or "default" shall
mean, whenever they are used in this Lease, any one or more of the following
events:
(a) Failure by the Lessee to pay when due the portion of the
payments required to be paid under Section 5.3(a) hereof representing payment of
the principal of,
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and premium, if any, on the Bonds and the continuance thereof for a period of
ten (10) calendar days after receipt by the Lessee of written notice of such
failure;
(b) Failure by the Lessee to pay when due the portion of the
payments required to be paid under Section 5.3(a) hereof representing payments
of interest on the Bonds, and the continuance thereof for a period of ten (10)
calendar days after receipt by the Lessee of written notice of such failure;
(c) Failure by the Lessee to observe and perform any covenant,
condition or agreement on its part to be observed or performed, other than as
referred to in subsections (a) and (b) of this Section, for a period of thirty
(30) days after written notice specifying such failure and requesting that it be
remedied, given to the Lessee by the Issuer, unless the Issuer shall agree in
writing to an extension of such time prior to its expiration; provided, however,
if the failure stated in such notice cannot practically be corrected within the
applicable period, it shall not be an event of default if the Lessee initiates
appropriate corrective measures during such period and such measures are
thereafter diligently pursued by the Lessee;
(d) A proceeding or case shall be commenced, without the
application or consent of the Lessee in any court of competent jurisdiction
seeking (i) liquidation, reorganization, dissolution, winding-up or composition
or adjustment of debts of Lessee, (ii) the appointment of a trustee, receiver,
custodian, liquidator or the like of the Lessee or of all or any substantial
part of its assets, or (iii) similar relief under any law relating to
bankruptcy, insolvency, reorganization, winding-up or composition or adjustment
of debts, and such proceeding or cause shall continue undismissed, or an order,
judgment, or decree approving or ordering any of the foregoing shall be entered
and shall continue in effect for a period of ninety (90) days; or an order for
relief against the Lessee shall be entered against the Lessee in an involuntary
case under the United States Bankruptcy Code (as now or hereafter in effect) or
other applicable law and shall continue in effect for a period of ninety (90)
days; or
(e) The Lessee shall admit in writing its inability to pay its
debts generally as they become due or shall file a petition in voluntary
bankruptcy or shall make any general assignment for the benefit of its
creditors, or shall consent to the appointment of a receiver or trustee of all
or substantially all of its property, or shall commence a voluntary case under
the United States Bankruptcy Code (as now or hereafter in effect), or shall file
in any court of competent jurisdiction a petition seeking to take advantage of
any other law relating to bankruptcy, insolvency, reorganization, winding-up or
composition or adjustment of debts, or shall fail to controvert in a timely or
appropriate manner, or acquiesce in writing to, any petition filed against it in
an involuntary case under such United States Bankruptcy Code or other applicable
law.
The term "liquidation, reorganization or dissolution of the Lessee" as
used in this subsection, shall not be construed to include the cessation of the
existence of the Lessee resulting from a merger or consolidation of the Lessee
into or with another Person or a
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dissolution or liquidation of the Lessee following a transfer of all or
substantially all of its assets as an entirety, under the conditions permitting
such actions contained in Section 8.3 hereof.
The foregoing provisions of this Section are subject to the following
limitations: if by reason of a Force Majeure Event the Lessee is unable in whole
or in part to carry out the agreements on its part herein contained, other than
the obligations on the part of the Lessee contained in Article V and Sections
6.3, 6.4 and 8.6 hereof, the Lessee shall not be deemed in default during the
continuance of such inability.
Section 10.2 REMEDIES ON DEFAULT. Whenever any event of default
referred to in Section 10.1 hereof shall have happened and be subsisting and
subject to the provisions of this Section 10.2, the Issuer may take any one or
more of the following remedial steps:
(a) The Issuer may, at its option, declare all amounts payable
under Section 5.3(a) hereof for the remainder of the Agreement Term to be
immediately due and payable, whereupon the same shall become immediately due and
payable. If the Issuer elects to exercise the remedy afforded in this Section
10.2(a) and accelerates all amounts payable under Section 5.3(a) hereof for the
remainder of the Agreement Term, the amount then due and payable by the Lessee
as accelerated rents shall be the sum of (1) the aggregate principal amount of
the outstanding Bonds, and (2) all interest and redemption premium, if any, on
the Bonds accruing to the date of such acceleration. Such sums as may then
become payable shall be paid into the Bond Fund and after the Bonds and accrued
interest thereon have been fully paid and any costs occasioned by such default
have been satisfied, any excess moneys in the Bond Fund shall be returned to the
Lessee as an overpayment of rents; provided, however, upon the occurrence of an
event of default described in subsections (d) or (e) of Section 10.1 hereof, all
amounts payable under Section 5.3(a) hereof for the remainder of the Agreement
Term shall be deemed automatically accelerated without the necessity of any
declaration or the taking of any other action whatsoever.
(b) The Issuer or the Trustee may re-enter and take possession
of the Project without terminating this Lease, and sublease the Project for the
account of the Lessee, holding the Lessee liable for the difference in the rent
and other amounts payable by such sublessee in such subleasing and the rents and
other amounts payable by the Lessee hereunder.
(c) The Issuer may terminate the Lease Term, exclude the
Lessee from possession of the Project and use its best efforts to lease the
Project to another for the account of the Issuer, holding the Lessee liable for
all rent and other payments due up to the effective date of such leasing.
(d) In the event any of the Bonds shall at the time be
outstanding and unpaid, the Issuer or the Trustee may have access to and
inspect, examine and make copies of all books and records of the Lessee to the
Project.
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(e) The Issuer may take whatever action at law or in equity
may appear necessary or desirable to collect the rent then due and thereafter to
become due, or to enforce performance and observance of any obligation,
agreement or covenant of the Lessee under this Lease.
Any amounts collected pursuant to action taken under this Section shall
be paid into the Bond Fund and applied in accordance with the provisions of the
Indenture or, if the Bonds have been fully paid (or provision for payment
thereof has been made in accordance with the provisions of the Indenture), to
the Lessee.
Notwithstanding anything else herein contained, the Issuer and the
Trustee shall be prohibited from accelerating rental payments hereunder and
exercise any other rights or remedies provided herein, at law or otherwise,
unless and until the Issuer or the Trustee shall have given the Lessee not less
than thirty (30) days' prior written notice of its intent to declare an event of
default, accelerate rental payments and/or exercise any such rights or remedies
and the Lessee shall have failed to cure said event of default prior to the
expiration of said 30-day period. Any such notice shall be a separate notice
from any notice given pursuant to Section 10.1 hereof and shall specify with
particularity the event or events of default that have occurred and are
continuing and which actions are proposed to be taken by the Issuer and/or the
Trustee as a result of any such event of default.
Section 10.3 NO REMEDY EXCLUSIVE. No remedy herein conferred upon or
reserved to the Issuer is intended to be exclusive of any other available remedy
or remedies, but each and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Lease or now or hereafter
existing at law or in equity or by statute. No delay or omission to exercise any
right or power accruing upon any default shall impair any such right or power or
shall be construed to be a waiver thereof, but any such right and power may be
exercised from time to time and as often as may be deemed expedient. In order to
entitle the Issuer to exercise any remedy reserved to it in this Article, it
shall not be necessary to give any notice, other than such notice as may be
herein expressly required. Such rights and remedies as are given to the Issuer
hereunder shall also extend to the holders of the Bonds who shall be deemed
third party beneficiaries of all covenants and agreements herein contained.
Section 10.4 AGREEMENT TO PAY REASONABLE ATTORNEYS' FEES AND EXPENSES.
In the event the Lessee should default under any of the provisions of this Lease
and the Issuer or the Trustee should employ attorneys or incur other expenses
for the collection of rent or the enforcement of performance or observance of
any obligation or agreement on the part of the Lessee herein contained, the
Lessee agrees that it will on demand therefor pay to the Issuer the reasonable
fees of such attorneys and such other reasonable expenses so incurred by the
Issuer or the Trustee.
Section 10.5 NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER. In the event
any agreement contained in this Lease should be breached by either party and
thereafter
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waived by the other party, such waiver shall be limited to the particular breach
so waived and shall not be deemed to waive any other breach hereunder.
Section 10.6 RESCISSION OF REMEDIES. Notwithstanding anything else
herein contained, the Lessee may at any time after an event of default under
Section 10.1 hereof, cure said default by the payment of all amounts due and
payable (other than amounts payable as a result of any acceleration) or the
performance of any duty or obligation then in default and upon said cure the
Issuer and the Trustee shall (i) rescind and annul any acceleration of rent
payable hereunder and (ii) cease the exercise of any rights or remedies
initiated as a result of such event of default, and take such steps as may be
necessary to place the Lessee in the same position as it was prior to such event
of default, and the rights of the Lessee hereunder shall be fully restored and
reinstated as if such event of default never occurred.
ARTICLE XI
----------
OPTIONS IN FAVOR OF LESSEE
--------------------------
Section 11.1 GENERAL OPTION TO PURCHASE PROJECT. The Lessee shall have,
and is hereby granted, the option to purchase the entire Project (less those
portions which have already been purchased by Lessee, if any, as provided
herein) at any time during the Agreement Term and whether or not an Event of
Default has occurred and is continuing.
To exercise such option, the Lessee shall give written notice to the
Issuer and to the Trustee, if any of the Bonds shall then be unpaid, and shall
specify therein the date of closing such purchase, which date shall be not less
than fifteen days from the date such notice is mailed. The purchase price which
shall be paid to the Issuer by the Lessee in the event of its exercise of the
option granted in this Section shall be the sum of the following:
(1) an amount of money which will be sufficient (or Government
Obligations the principal of and the interest on which when due will provide
moneys which, together with the moneys, if any, deposited with the Trustee will
be sufficient), when added to any amount already on deposit in the Construction
Fund and the Bond Fund, to pay the interest on the then outstanding Bonds until
the earliest permissible redemption date following the closing of such purchase
and to pay the principal of and interest on all of the Bonds on such redemption
date;
(2) an amount of money equal to the fees and expenses of the
Trustee under the Indenture accrued and to accrue (including counsel fees and
expenses) until such final payment and redemption of the Bonds; plus
(3) the sum of $10.00 which shall be paid by the Lessee to the
Issuer.
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In the event of the exercise of the option granted in this Section, any Net
Proceeds of insurance or condemnation shall be paid directly to the Lessee.
Section 11.2 OPTION TO PURCHASE A PORTION OF THE PROJECT. The Lessee
shall have and is hereby granted an option to purchase any portion of the
Project at any time and from time to time and whether or not an Event of Default
has occurred and is continuing, provided that it furnishes the Issuer with the
following:
(a) A notice in writing containing (i) a description of that
portion of the Project with respect to which such option is to be exercised and
(ii) a statement that the Lessee intends to exercise its option to purchase such
portion of the Project on a date stated, which shall not be less than ten (10)
nor more than ninety (90) days from the date of such notice.
(b) A certificate of the Authorized Lessee Representative,
dated not more than ninety days prior to the date of the purchase and stating
that, in the opinion of the person signing such certificate, (i) the portion of
the Project with respect to which the option is exercised are not needed for the
operation of the remaining portion of the Project or that sufficient right and
title is reserved to the Issuer to fulfill said needs, (ii) the purchase will
not impair the usefulness of the remaining portion of the Project and will not
destroy the means of ingress thereto and egress therefrom.
(c) A statement setting forth the original Project Costs
attributable to such portion of the Project, as depreciated using rates
calculated in accordance with generally accepted accounting principles.
The Issuer agrees that upon receipt of the notice and certificate required in
this Section to be furnished to it by the Lessee and the amount specified in
subsection (c) of this Section, the portion of the Project with respect to which
the Lessee shall have exercised the option granted in this Section shall
automatically cease to be a portion of the Project leased hereunder on the date
stated in such certificate and on such date shall automatically be released from
the provisions of this Lease and the Indenture without the necessity of any
further action by the Issuer or the Lessee. In the event the Lessee shall
exercise the option granted to it under this Section the Lessee shall not be
entitled to any abatement or diminution of the rents payable under Section 5.3
hereof.
If the Lessee purchases any unimproved part of the Project pursuant to
the provisions of the preceding paragraph, the Lessee and the Issuer agree that
all walls presently standing or hereafter erected on or contiguous to the
boundary line of the Land so purchased by the Lessee shall be party walls and
each party grants the other a 10-foot easement adjacent to any such party wall
for the purpose of inspection, maintenance, repair and replacement thereof and
the tying-in of new construction. If the Lessee utilizes any party wall for the
purpose of tying-in new construction that will be utilized under common control
with the Project, the Lessee may also tie-in to the utility facilities on the
Land for the purpose of serving the new construction and may remove any
non-
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loadbearing wall panels in the party wall; provided, however, that if the
property so purchased ceases to be operated under common control with the
Project, the Lessee covenants that it will install non-loadbearing wall panels
similar in quality to those that have been removed and will provide separate
utility services for the new construction. No wall may be so utilized by the
Lessee unless prior thereto the Issuer has been furnished with a certificate of
the Authorized Lessee Representative stating that the proposed utilization will
not impair the usefulness of the Project for the purposes for which it was
designed to be used.
The purchase price payable by the Lessee in connection with the
purchase of a portion of the Project in accordance with this Section shall be
deposited in the Bond Fund and used to pay the principal of the Bonds.
If and to the extent under any particular circumstances there is deemed
any inconsistency between the provisions of this Section and provisions of
Section 6.2, the provisions of Section 6.2 shall be held as controlling and
shall supersede the provisions of this Section.
Section 11.3 CONVEYANCE ON PURCHASE. At the closing of the purchase
pursuant to the exercise of any option to purchase granted in this Article, the
Issuer will, upon receipt of the applicable purchase price (if any), deliver to
the Lessee the following:
(a) If the Indenture shall not at the time have been satisfied
in full, a release by the Issuer from the provisions of the Indenture of the
property with respect to which such option was exercised.
(b) Documents (including, without limitation, a limited
warranty deed and a xxxx of sale) customarily used in commercial real estate
transactions involving improved property conveying to the Lessee good and
marketable title to the Project with respect to which such option was exercised
as such Project then exists, subject to the following: (i) those liens and
encumbrances (if any) to which title to said property was subject when conveyed
to the Issuer; (ii) those liens and encumbrances created by the Lessee or to the
creation or suffering of which the Lessee consented in writing; (iii) those
liens and encumbrances resulting from the failure of the Lessee to perform or
observe any of the agreements on its part contained in this Lease; and (iv) if
the option is exercised while any condemnation proceeding is pending the rights
and title of the condemning authority.
Notwithstanding the foregoing, in order to facilitate the transfer of
the Project to the Lessee upon the Lessee's exercise of an option to purchase
provided in this Article XI, the Issuer agrees to execute and deliver to the
Trustee, as escrow agent, on the date of execution and delivery of this Lease
the documents referred to in subsection (b) above to be held pursuant to a
Documents Escrow Agreement dated as of December 1, 2002 among the Issuer, the
Lessee and the Trustee. The Issuer hereby appoints the Lessee as its
attorney-in-fact for the purpose of dating, completing and filing such documents
upon
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satisfaction by the Lessee of any and all conditions to the exercise of such
purchase option as provided herein, and acknowledges and agrees that such
appointment is irrevocable and coupled with an interest.
Section 11.4 RELATIVE POSITION OF OPTIONS AND INDENTURE. The options
respectively granted to the Lessee in this Article shall be and remain prior and
superior to the Indenture and may be exercised whether or not the Lessee is in
default hereunder, provided that such default will not result in the
nonfulfillment of any condition to the exercise of any such option.
Section 11.5 LESSEE'S OPTION TO TERMINATE. The Lessee shall have the
following options to terminate this Agreement whether or not the Lessee is in
default hereunder or there exists an Event of Default hereunder:
(a) At any time prior to payment in full of the Bonds within
the meaning of the Indenture, and particularly Article IX thereof, the Lessee
may terminate the Agreement Term by irrevocably depositing in the Bond Fund
moneys which will be sufficient, or Government Obligations the principal of and
interest on which when due will provide moneys which, together with any moneys
on deposit in the Bond Fund, will be sufficient, according to the provisions of
Article IX of the Indenture, to pay in full all of the Bonds then outstanding,
and fees and expenses due or to become due to the Trustee and by making adequate
provision for the publication of any redemption notice that may be required by
the Indenture.
(b) At any time after payment in full of the Bonds within the
meaning of the Indenture, and particularly Article IX thereof, the Lessee may
terminate the Agreement Term by giving the Issuer notice in writing, and such
termination shall become effective forthwith.
Notwithstanding anything else herein contained, the purchase of the
Project by the Lessee pursuant to any option provided in this Lease shall
automatically terminate the Lease Term, if not previously terminated.
Section 11.6. CONVEYANCE OF PROJECT AT END OF LEASE TERM.
Notwithstanding anything else herein contained, the Issuer shall have the right
and option on or after the Stated Termination Date to convey the Project to the
Lessee, with or without receipt of any consideration therefor, by executing any
recording documents conveying to the Lessee good and marketable title to the
Project subject to such liens and encumbrances as are described in Section
11.3(b)(i) through (iv).
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ARTICLE XII
-----------
MISCELLANEOUS
-------------
Section 12.1 NOTICES. All notices, certificates or other
communications hereunder shall be sufficiently given and shall be deemed given
when mailed by registered or certified mail return receipt requested, postage
prepaid, addressed as follows:
if to the Issuer: Development Authority of Xxxxxx County
000 Xxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
with a copy to: Nelson, Mullins, Xxxxx & Xxxxxxxxxxx
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxx, Xx., Esq.
if to the Lessee: ADESA Atlanta, LLC
000 X. 00xx Xxxxxx, Xxxxx 000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attn: General Counsel
with a copy to: Xxxxxx & Bird LLP
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxxxx, Esq.
if to the Trustee: SunTrust Bank
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
A duplicate copy of each notice, certificate or other communication
given hereunder by either the Issuer or the Lessee to the other shall also be
given to the Trustee. The Issuer, the Lessee and the Trustee may, by notice
given hereunder, designate any further or different addresses to which
subsequent notices, certificates or other communications shall be sent.
Section 12.2 BINDING EFFECT. Lease shall inure to the benefit of and
shall be binding upon the Issuer, the Lessee and their respective successors and
assigns, subject, however, to the limitations contained in Section 8.3, 9.1, 9.2
and 9.3 hereof.
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Section 12.3 SEVERABILITY. In the event any provision of this Lease
shall be held invalid or unenforceable by any court of competent jurisdiction,
such holding shall not invalidate or render unenforceable any other provision
hereof.
Section 12.4 AMOUNTS REMAINING IN FUNDS. It is agreed by the parties
hereto that any amounts remaining in the Bond Fund and the Project Fund upon
expiration or sooner termination of the Lease Term as provided in this Lease,
after payment in full of the Bonds (or provision for payment thereof having been
made in accordance with the provisions of the Indenture) and the fees, charges
and expenses of the Trustee in accordance with the Indenture shall belong to and
be paid to the Lessee by the Issuer as overpayment of rents.
Section 12.5 AMENDMENTS,CHANGES AND MODIFICATIONS. Except as otherwise
provided in this Lease or in the Indenture, subsequent to the initial issuance
of Bonds and prior to their payment in full (or provision for the payment
thereof having been made in accordance with the provisions of the Indenture),
this Lease may not be effectively amended, changed, modified, altered or
terminated without the concurring written consent of the Trustee, which consent
shall not be unreasonably withheld.
Notwithstanding anything to the contrary contained herein, this Lease
may be amended without the consent of the Trustee or of the holders of any of
the Bonds for the purpose of subjecting additional real or personal property to
the provisions hereof. Any such addition shall become effective upon the
delivery by the Lessee and the acceptance by the Issuer of the following:
(a) a certificate of the Authorized Lessee Representative
setting out a description of the real or personal property to be added to this
Lease and stating that the Lessee owns such real or personal property free and
clear of any and all liens, mortgages, encumbrances and clouds on title except
such as would constitute Permitted Encumbrances; and
(b) documents conveying to the Issuer good and marketable
title to the real or personal property described in the certificate referred to
above and identifying said real or personal property as being subject to the
provisions of this Lease.
Upon the delivery and acceptance of the foregoing documents, the real
or personal property so added shall become part of the Project and this Lease
shall ipso facto be amended to include such property, without the necessity of
any further amendatory instrument, subject to all of the provisions of this
Lease, and the Lessee shall be entitled to the use and occupancy of such
additional property without increase in the amounts payable under Section 5.3
hereof so long as such additional property is acquired without expense to the
Issuer. The Issuer will, however, execute such instruments amendatory hereto as
shall be requested by the Lessee to confirm the addition of any such property to
the provisions hereof.
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Section 12.6 EXECUTION COUNTERPARTS. This Lease may be simultaneously
executed in several counterparts, each of which shall be an original and all of
which shall constitute but one and the same instrument.
Section 12.7 CAPTIONS. The captions or headings in this Lease are for
convenience only and in no way define, limit or describe the scope or intent of
any provisions of this Lease.
Section 12.8 RECORDING OF LEASE. This Lease or at the option of the
Lessee, a memorandum hereof in form and substance satisfactory to the Lessee,
and every assignment hereof shall be recorded in the office of the Clerk of
Superior Court of Xxxxxx County, Georgia, or in such other office as may be at
the time provided by law as the proper place for such recordation.
Section 12.9 LAW GOVERNING CONSTRUCTION OF LEASE. This Lease shall be
governed by, and construed in accordance with, the laws of the State of Georgia.
Section 12.10 NET LEASE. This Lease shall be deemed a "net lease," and
the Lessee shall pay absolutely net during the Lease Term the rent and all other
payments required hereunder, without abatement, deduction or set-off other than
those herein expressly provided.
Section 12.11 SURVIVAL OF PURCHASE OPTIONS. Notwithstanding anything
else herein contained, the purchase options granted to the Lessee hereunder and
the provisions of Sections 5.3(b) and 6.4 hereof shall survive the expiration or
earlier termination of the Agreement Term.
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IN WITNESS WHEREOF, the Issuer and the Lessee have caused this Lease to
be executed in their respective corporate names and their respective corporate
seals to be hereunto affixed and attested by their duly authorized officers, all
as of the date first above written.
Signed, sealed and delivered DEVELOPMENT AUTHORITY OF
in the presence of: XXXXXX COUNTY
/s/ Xxxxxx Xxxxxx By: /s/ Xxxxxx X. Xxxx
--------------------------------- --------------------------
Unofficial Witness Chairman
(SEAL)
/s/ Xxxxxx X. Xxxx
---------------------------------
Notary Attest:
My commission expires /s/ Xxxxx X. Xxxxx, Xx.
-----------------------------
March 20, 2003 Asst. Secretary
---------------------------------
(NOTARIAL SEAL)
[Signature Page - Lease]
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Signed, sealed and delivered ADESA ATLANTA, LLC
in the presence of:
/s/ Xxxxx Xxxxxxxx By: /s/ Xxxx X. Lips
------------------------------------- ----------------------------
Unofficial Witness Xxxx X. Lips, Treasurer
(SEAL)
/s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Notary Attest:
My commission expires /s/ Xxxxx X. Xxxxxx
--------------------------------
9/24/08 Xxxxx X. Xxxxxx, Secretary
-------------------------------------
XXXXXX XXXXXXX, Notary Public
Resident of Xxxxxx County, Indiana
My Commission Expires: 9-24-2008
(NOTARIAL SEAL)
[Signature Page - Lease]
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