INDUSTRIAL SUBLEASE
1. PARTIES and CERTAIN DEFINITIONS. This Sublease, dated for reference purposes
only, October 2, 2000, is made by and between Cavalier Industries, Inc., a
Delaware corporation (herein called "Sublessor") and successor by merger to
Bellcrest Homes, Inc., a Georgia corporation, Alliance Homes, Inc., a Georgia
corporation (herein called "Sublessee"), All-Span Homes, LLC, a Georgia limited
liability company and the majority shareholder of Sublessee (the "Optionee"),
and joined in by X. Xxxxxx Xxxxx, an individual resident of Georgia and the
majority member of Optionee ("Xxxxx") for the purposes of the acknowledgments
and agreements contained in Section 6.1(b) hereof, all of which are aggregately
herein referred to as the "Parties." Reference is herein made to that certain
Trust Indenture dated April 1, 1999, between Development Authority of Xxxxxxx
County, Georgia (the "Issuer") and First Commercial Bank (the "Trustee") (the
"Indenture"), that certain Lease Agreement dated April 1, 1999, by and between
Development Authority of Xxxxxxx County, Georgia and Bellcrest Homes, Inc. (the
"Lease Agreement"), that certain Deed to Secure Debt, Assignment of Leases and
Security Agreement dated April 1, 1999 (the "Credit Obligor Mortgage") from
Development Authority of Xxxxxxx County, Georgia and Bellcrest Homes, Inc. to
First Commercial Bank (the "Credit Obligor") and that certain Credit Agreement
Dated April 1, 1999 from Bellcrest Homes, Inc. to Credit Obligor (the "Credit
Agreement"). The term "Indenture Indebtedness" shall mean the indebtedness of
Issuer at the time secured by the Indenture, including, without limitation (i)
the principal of, premium (if any) and interest payable on the bonds
authenticated and delivered pursuant to the Indenture, and (ii) all reasonable
and proper fees, charges and disbursements of the trustee or of the paying agent
(as defined in the Indenture) for services performed and disbursements made
under the Indenture. Capitalized terms used but not defined herein shall have
the meanings ascribed to them in the Indenture and the Lease Agreement.
2. PREMISES. Sublessor hereby leases and subleases (with respect to such portion
of the Premises as is subject to the Lease Agreement) to Sublessee and Sublessee
leases and subleases (with respect to such portion of the Premises as is subject
to the Lease Agreement) from Sublessor for the term, at the rental, and upon all
of the conditions set forth herein, (a) that certain real property described on
Exhibit A hereto (the "Site"), together with all easements, permits, licenses,
rights-of-way, contracts, leases, tenements, hereditaments, appurtenances,
rights, privileges and immunities pertaining or applicable to said real
property; (b) all buildings, structures and other improvements situated on the
Site (the "Improvements"); and (c) the machinery, equipment, personal property
and fixtures described on Exhibit B attached hereto (the "Equipment") (the Site,
the Improvements and the Equipment being collectively referred to herein as the
"Premises"); subject, however, to Permitted Encumbrances. Permitted Encumbrances
means, as of any particular time, (i) the Financing Documents (as defined in the
Indenture), (ii) liens for taxes, assessments or other governmental charges or
levies not due and payable or which are currently being contested in good faith
by appropriate proceedings, (iii) utility, access and other easements and rights
of way, party walls, restrictions and exceptions that may be granted or are
permitted under the Lease Agreement, provided, however, that any such
encumbrances not in existence as of the date of this Sublease shall require the
consent of the Sublessee, which consent shall not be unreasonably withheld, (iv)
any mechanic's, laborer's, materialman's, supplier's or vendor's lien or right
or purchase money security interest if payment is not yet due and payable under
the contract in question, (v) such minor defects, irregularities, encumbrances,
easements, rights of way and clouds on title as do not, in the opinion of an
independent counsel, materially impair the Premises for the purpose for which it
was acquired or is held by the Issuer or subleased by the Sublessee, (vi) such
encumbrances, and other matters (other than mortgages) which appear of public
record prior to the date hereof and which do not unreasonably interfere with the
use of the Premises as set forth in Section 5.1, and (vii) those items which are
listed in Exhibit C.
3. TERM.
3.1. Term. The term of this Sublease shall be for two years commencing
on October 2, 2000 and ending on October 1, 2002, unless renewed pursuant
to Section hereof or unless sooner terminated pursuant to any provision hereof.
3.2. Delivery of Possession. Sublessee shall be deemed to have taken
possession of the Premises when Sublessor delivers possession of the Premises to
Sublessee at the closing under the Agreement to Sell and Purchase Assets dated
as of the date hereof by and between Sublessor and Sublessee (the "Purchase
Agreement").
3.3. Option to Renew. The Sublessor hereby grants to the Sublessee the
right and option to renew this Sublease for an additional term of three years
and eight months through June 1, 2006. This option can be exercised by the
Sublessee only by the Sublessee delivering written notice of exercise of the
option at least ninety days prior to the end of the initial term hereof, which
notice shall be given in the manner provided for notices herein. The term shall
be extended upon the giving of the notice without the requirement of any action
on the part of the Sublessor and shall be on the terms set forth for the
original term of this Sublease, except as modified below.
4. RENT AND SECURITY DEPOSIT.
4.1. Rent. Sublessee shall pay to Sublessor as rent for the Premises,
monthly payments of Twenty-two Thousand Three Hundred Fifty Dollars ($22,350),
in advance, on the first day of each month of the first six months of the term
hereof (with the first month of the term being October, 2000) and monthly
payments of Thirty-five Thousand One Hundred Seven Dollars ($35,107), in
advance, on the first day of each month of the remainder of the term hereof
(including any renewal hereof), subject to adjustment pursuant to Section 4.3
below. Sublessee shall pay Sublessor upon the execution hereof the sum of
$22,350 dollars as rent for October, 2000. Rent for any period during the term
hereof which is for less than one (1) month (other than rent for October, 2000)
shall be a pro rata portion of the monthly installment. Rent shall be payable
without notice or demand and without any deduction, offset, or abatement, except
as set forth herein, in lawful money of the United States of America to
Sublessor at the address stated herein or to such other persons or at such other
places as Sublessor may designate in writing.
4.2. Additional Charges. This Sublease is what is commonly called a
"net lease", it being agreed that Sublessor shall receive the rent set forth in
Article 4.1 free and clear of any and all impositions, taxes, real estate taxes,
liens, charges or expenses of any nature whatsoever in connection with the
ownership and operation of the Premises except as otherwise expressly set forth
herein. In addition to the rent reserved by 4.1, Sublessee shall pay to the
parties respectively entitled thereto all impositions, insurance premiums,
operating charges, maintenance charges, construction costs, and any other
charges, costs and expenses which arise or may be contemplated under any
provisions of the Sublease during the term hereof. All such charges, costs and
expenses shall constitute additional charges, and upon the failure of Sublessee
to pay any of such costs, charges or expenses, Sublessor shall have the same
right and remedies as otherwise provided in this Sublease for the failure of
Sublessee to pay rent. The Sublessee shall in no event be entitled to any
abatement of or reduction in rent payable hereunder, except as herein expressly
provided.
4.3. Rent Adjustments. The rent due under paragraph 4.1 is to
increase for the renewal term, if any, based on the increases in the Consumer
Price Index in accordance with the formula set forth below:
In applying the formula, the following definitions shall prevail:
(1) "Bureau" means the Federal Bureau of Labor Statistics or
any successor agency that shall issue the indices or data
referred to in subparagraph (2).
(2) "Price Index" means the national Consumer's Price Index
issued from time to time by the Bureau, or any other
measure hereafter employed by the Bureau in lieu of such
price index that measures the cost of
living nationally.
(3) "Base index" is the average price index for the twelve
months prior to the first day of the calendar month in
which the rental commencement date occurs. In making such
average, there shall be excluded any index which itself
is an average.
(4) The "issue" of a price index means the release to the
public of the price index, and the date of issue shall be
the date it is so released whether or not the issued
index is for the current month or period in which the
release occurs or for a prior month or period.
(5) The expression "yearly period" means each yearly period
of the term dating from each anniversary of the rental
commencement date.
If the price index during the first two yearly periods of the initial
term of this Sublease shall increase over the base index, then the fixed monthly
rental of the renewal term, beginning with the first day of such renewal term,
shall be increased in the same proportion that the increase in the price index
over such two year period bears to the base index.
5. USE.
5.1. Use. The Premises shall be used and occupied only for
manufacturing, production, assembling, processing, storing and distribution of
modular homes, modular units, non-residential units and other manufactured
housing units of the kind and nature previously manufactured on the Premises by
Sublessor and only in such a manner that the Premises will constitute a
"project" within the meaning of Paragraph III of Section VI of Article IX of the
Constitution of the State of Georgia and Chapter 62 of Title 36 of the Official
Code of Georgia Annotated (the "Enabling Law").
5.2. Compliance with Law. Sublessee shall, at Sublessee's expense,
comply with all applicable statutes, ordinances, rules, regulations, orders and
requirements in effect during the term or any part of the term hereof regulating
the use by Sublessee of the Premises, including without limitation, the Enabling
Law. Sublessee shall not use or permit the use of the Premises in any manner
that will tend to create waste or a nuisance, or, if there shall be more than
one sublessee of the building containing the Premises, which shall tend to
unreasonably disturb such other sublessees.
5.3. Condition of Premises. Sublessee acknowledges that it has had an
opportunity to inspect and hereby accepts the Premises in their existing
conditions as of the date of the possession hereunder, subject to all applicable
zoning, municipal, county and state laws, ordinances and regulations governing
and regulating the use of the Premises, and accepts the same as is, except to
the extent of Sublessor's structural repair obligations under Section 6.1(a)
hereof. Sublessee acknowledges that neither Sublessor nor Sublessor's agent has
made any representation or warranty as to the suitability of the Premises for
the conduct of the Sublessee's business or intended use of the premises, except
as set forth in the Purchase Agreement.
5.4. Additional Covenants.
(a) The Sublessee shall not do or permit anything to be done
at the Premises that will materially affect, impair or contravene any policies
of insurance that may be carried on the Premises.
(b) The Sublessee shall permit the Sublessor, the Issuer,
the Trustee, the Credit Obligor and their duly authorized agents at all
reasonable times to enter upon, examine and inspect the Premises.
(c) The Sublessee will maintain proper books of record and
account, in which full and correct entries will be made, in accordance with
generally accepted accounting principles, of all its business and affairs. The
Sublessee shall furnish to the Trustee with reasonable promptness such financial
information of the Sublessee as the Trustee shall reasonably request.
(d) The Sublessee will duly pay and discharge all taxes,
assessments and other governmental charges and liens lawfully imposed on the
Sublessee and upon the properties of the Sublessee, and the Premises; provided,
however, the Sublessee will not be required to pay any taxes, assessments or
other governmental charges so long as in good faith it shall contest the
validity thereof by appropriate legal proceedings, the Sublessee has given
notice of such contest to the Sublessor, the Sublessee has established adequate
reserves therefor, and no part of the Premises shall, in the opinion of the
Trustee, be subject to loss or forfeiture; and provided, further, that for any
tax period which includes the commencement date or the termination date of this
Sublease, Sublessee shall pay only a pro rata portion of such taxes for the
period after the commencement date of this Sublease or before the termination
date of this Sublease, as applicable.
(e) The Sublessee will comply with all valid laws, ordinances,
regulations and requirements applicable to it or to its property and the
Premises.
(f) Subject to, and after giving effect to, Sublessor's
indemnification of Sublessee pursuant to the Purchase Agreement, but in addition
to and not in lieu of Sublessee's indemnification of Sublessor pursuant to the
Purchase Agreement, the Sublessee shall (1) not, and shall not permit any other
person to, bring any Hazardous Substances onto the Premises except any such
Hazardous Substances that are used in the ordinary course of the contemplated
business as to be conducted on the Premises and that are handled, stored, used
and disposed of in accordance with applicable Environmental Laws; (2) if any
other Hazardous Substances are brought or found on the Premises and the same
arose out of operations conducted during the term of this Sublease, immediately
remove and properly dispose of the same in accordance with applicable
Environmental Laws; (3) cause the Premises and the operations conducted thereon
(including all operations conducted thereon by other persons) during the term of
this Sublease to comply with all Environmental Laws; (4) permit the Sublessor
and/or the Credit Obligor from time to time to inspect the Premises and observe
the operations thereon; (5) undertake any and all preventive, investigatory and
remedial action (including emergency response, removal, clean up, containment
and other remedial action) that is (A) required by or pursuant to any applicable
Environmental Law or (B) necessary to prevent or minimize any property damage
(including damage to any of the Premises), personal injury, or harm to the
environment, or the threat of any such damage or injury, by releases of or
exposure to Hazardous Substances in connection with the Premises or the
operations on the Premises; (6) give notice to the Sublessor and the Credit
Obligor in writing if the Sublessee should become aware of (A) any material
spill, release or disposal of any Hazardous Substances or imminent threat
thereof, at the Premises, in connection with the operations on the Premises, or
at any adjacent property that could migrate to, through or under the Premises,
(B) any material violation of Environmental Laws regarding the Premises or
operations on the Premises, and (C) any material investigation, claim or
threatened claim under any Environmental Law, or any notice of violation under
any Environmental Law, involving the Sublessee or the Premises; and (7) deliver
to the Sublessor and the Credit Obligor, at the Sublessor's or Credit Obligor's
request, copies of any and all documents in the Sublessee's possession or to
which the Sublessee has access relating to Hazardous Substances or Environmental
Laws and the Premises, and the operations on the Premises, including laboratory
analyses, site assessments or studies, environmental audit reports and other
environmental studies and reports. If the Credit Obligor or the Sublessor at any
time reasonably believes that the Sublessee is not complying with all applicable
Environmental Laws or the requirements hereof regarding the same, or that a
material spill, release or disposal of Hazardous Substances has occurred on or
under the Premises, the Credit Obligor or the Sublessor may require the
Sublessee to furnish the Credit Obligor and/or the Sublessor access to the
Premises for the purpose of obtaining or conducting an environmental audit or
site assessment reasonably satisfactory to the Credit Obligor and Sublessor with
respect to the matters of concern to the Sublessor and/or Credit Obligor. Such
audit or assessment shall be performed at the expense of Sublessor by a
qualified consultant approved by the Credit Obligor. Sublessor and Sublessee
each agree to provide to the other true and complete copies of any and all
environmental audits conducted by either party during the term hereof.
"Environmental Law" shall mean and include all laws, rules, regulations,
ordinances, judgments, decrees, codes, orders, injunctions, notices and demand
letters of any governmental authority applicable to the Sublessee or the
Premises (including the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. Sections 9601, et seq.) relating to
pollution or protection of human health or the environment, including any
relating to Hazardous Substances. "Hazardous Substances" shall mean and include
all pollutants, contaminants, toxic or hazardous wastes and other substances
(including asbestos, urea formaldehyde, foam insulation and materials containing
either petroleum or any of the substances referenced in Section 101(14) of
CERCLA), the removal of which is required or the manufacture, use, maintenance
and handling of which is regulated, restricted, prohibited or penalized by an
Environmental Law, or, even though not so regulated, restricted, prohibited or
penalized, might pose a hazard to the health and safety of the public or the
occupants of the property on which it is located or the occupants of the
property adjacent thereto.
(g) Sublessee shall not take any action or omit to take any
action that would result in an Event of Default or an Event of Taxability under
any of the Financing Documents; provided, however, that, the foregoing
notwithstanding, Sublessee shall not be required to make any Rental Payments (as
defined in the Lease Agreement) due from Sublessor under the Lease Agreement or
to cure any default of Sublessor under the Lease Agreement except as otherwise
expressly provided in this Sublease. Notwithstanding anything in this Sublease
to the contrary, Sublessor shall be entitled at any time and from time to time
during the term of this Sublease to enter upon the Premises and to take or omit
to take any action necessary to prevent or cure any default (or any event which,
with notice or lapse of time or both, would constitute a default), Event of
Default or Event of Taxability under any of the Financing Documents.
(h) Sublessor hereby warrants and covenants to Sublessor and
Optionee that: (1) to its knowledge, Sublessor has not taken any action or
omitted to take any action required to be taken which has the result of
materially adversely affecting the exclusion of the interest on the Bonds from
gross income for federal and state tax purposes, and Sublessor will use all
commercially reasonable efforts during the term of this Sublease to preserve
such exclusion; (2) except for expenditures paid with Bond proceeds, to its
knowledge, neither Sublessor nor any related person, within the meaning of IRC
section 103, has incurred capital expenditures in excess of $1,500,000 within
Xxxxxxx County, Georgia during the period from April 1, 1999 to the date hereof;
(3) Sublessor has obtained the consents required under the Financing Documents
for the execution and delivery of this Sublease including the consent of the
Trustee and the Credit Obligor for the sublease of the Premises contemplated
hereby; and (5) Sublessor has not taken, and Sublessor will not take, any
action, and Sublessor has not omitted and will not omit to take any action,
required to be taken which would result in an Event of Default or Event of
Taxability under any of the Financing Documents, unless such Event of Default or
Event of Taxability is the result of a default by Sublessee under this Sublease.
6. MAINTENANCE, REPAIRS AND ALTERATIONS.
6.1. Sublessee's Obligations. (a) Sublessee shall, during the term of
this Sublease, keep in good order, condition and repair the Premises and every
part thereof, and all adjacent sidewalks, landscaping, driveways, parking lots,
fences and signs located in the areas which are adjacent to and included with
the Premises; provided, however, that, notwithstanding the foregoing, Sublessor
shall, during the term of this Sublease, repair any damage to the structural
steel components of the Premises that is not covered by insurance, provided
further that Sublessor shall have no liability to Sublessee or any other party
for any consequential or incidental damages related thereto. Sublessor shall
incur no expense nor have any obligation of any kind whatsoever in connection
with maintenance of the Premises, except for any aforementioned structural
repairs, and Sublessee expressly waives the benefits of any statute now or
hereafter in effect which would otherwise afford Sublessee the right to make
repairs at Sublessor's expense, other than any aforementioned structural
repairs, or to terminate this Sublease because of Sublessor's failure to keep
the Premises in good order, condition and repair. Without limiting any of the
foregoing, during the term of this Sublease Sublessee shall, at its own expense,
(1) keep the Premises in as reasonably safe condition as its operations permit,
(2) from time to time make all necessary and proper repairs, renewals and
replacements thereto, including external repairs, renewals and replacements, and
(3) pay all gas, electric, water, sewer and other charges for the operation,
maintenance, use and upkeep of the Premises, provided that for any billing
period for any of such utilities or charges which includes the commencement date
or the termination date of this Sublease, Sublessee shall pay only a pro rata
portion of such utilities and other charges as are incurred after the
commencement date of this Sublease or before the termination date of this
Sublease, as applicable.
(b) Xxxxx hereby acknowledges and certifies that, to his
knowledge, by virtue of his involvement in or management of operations at the
Premises by Sublessor prior to the date hereof or otherwise, there are no
structural infirmities, defects, or repair needs or other structural problems
with respect to the Premises. Sublessee and Xxxxx hereby covenant and agree that
neither they nor any of their affiliates, employees, agents, representatives or
independent contractors shall take or omit to take any action which would
damage, weaken or impair the structure or structural soundness of the Premises,
and that Sublessor shall not be responsible for any repairs caused by any such
action or inaction.
6.2. Surrender. On the last day of the term hereof, or on any sooner
termination, Sublessee shall surrender the Premises to Sublessor in good
condition, broom clean, ordinary wear and tear excepted. Sublessee shall repair
any damage to the Premises occasioned by its use thereof, or by removal of
Sublessee's trade fixtures, furnishings and equipment pursuant to Article
6.4(c), which repair shall include the patching and filling of holes and
repair of structural damage (except to the extent of Sublessor's obligation
with respect thereto in Section 6.1(a) above).
6.3. Sublessor's Rights/ Sublessee's Rights. (a) If Sublessee fails to
perform Sublessee's obligations under this Article , Sublessor may at its option
(but shall not be required to) enter upon the Premises after ten (10) days'
prior written notice to Sublessee and put same in good order, condition and
repair, and the cost thereof together with interest thereon at the rate of
eighteen percent (18%) per annum shall become due and payable as additional
rental to Sublessor together with Sublessee's next rental installment.
(b) If Sublessor fails to perform Sublessor's obligations
under this Article 6, Sublessee may at its option (but shall not be required to)
after ten (10) days' prior written notice to Sublessor, put same in good order,
condition and repair, and the cost thereof together with interest thereon at the
rate of eighteen percent (18%) per annum shall become due and payable by
Sublessor to Sublessee fifteen (15) days after such cost is submitted in writing
to Sublessor.
6.4. Alterations and Additions. (a) Sublessee shall not, without
Sublessor's prior written consent, make any alterations, improvements or
additions, in, on or about the Premises, except for nonstructural alterations
not exceeding $10,000.00 in costs. As a condition to giving such consent,
Sublessor may require that Sublessee remove any such alterations, improvements,
additions or utility installations at the expiration of the term, and to restore
the Premises to their prior condition.
(b) Before commencing work relating to alterations, additions
and improvements affecting the Premises, Sublessee shall notify Sublessor in
writing of the expected date of commencement thereof. Sublessor shall then have
the right at any time and from time to time to post and maintain on the Premises
such notices as Sublessor reasonably deems necessary to protect the Premises and
Sublessor from mechanics' liens or any other liens. In any event, Sublessee
shall pay, when due, all claims for labor or materials furnished to or for
Sublessee. Sublessee shall not permit any mechanics' or materialmen's liens
attached or levied against the Premises for any labor or material furnished to
Sublessee or claimed to have been furnished to Sublessee or to Sublessee's
agents or contractors in connection with work of any character performed or
claimed to have been performed on the Premises by or at the direction of
Sublessee.
(c) Unless Sublessor requires their removal, as set forth
in Article 6.4(a), all alterations, improvements, or additions which may be
made on the Premises, shall become the property of Sublessor and remain
upon and be surrendered with the Premises at the expiration of the term.
Notwithstanding the provisions of this Article 6.4(c), Sublessee's machinery and
equipment, other than that which is affixed to the Premises so that it
cannot be removed without material damage to the Premises or which is subject
to this Sublease as of the beginning of the term hereof, shall remain the
property of Sublessee and may be removed by Sublessee subject to the provisions
of Article 6.2.
(d) Notwithstanding any of the foregoing, Sublessee shall
not make any alterations, improvements or additions that would change the
character of the Premises as a "project" under the Enabling Law or that would
adversely affect the utility of the Premises or substantially reduce its value
or that would adversely affect the ability of Sublessor or any other third party
from continuing to use the Premises in the manner they were being used as of the
beginning of the term hereof.
(e) Notwithstanding any of the foregoing, Sublessee may not
remove any item of Equipment for any reason without the prior written consent of
Sublessor which consent may be given or withheld in Sublessor's sole discretion,
except as follows: If the Sublessor determines that any item of Equipment has
become damaged or obsolete, for the purposes permitted herein, and Sublessor
concurs in that determination, the Sublessee may remove such Equipment from the
Improvements or the Site and (on behalf of Sublessor, in the case of Equipment
that is not subject to the Lease Agreement, or the Issuer, in the case of
Equipment that is subject to the Lease Agreement) sell, trade in, exchange or
otherwise dispose of it without any responsibility or accountability to the
Sublessor, the Issuer or the Trustee therefor, provided that the Sublessee shall
substitute and install in or on the Site other personal property or fixtures
which shall (1) have equal or greater utility in the operation of the Premises
for purposes permitted herein, (2) be free of all liens or encumbrances
reasonably acceptable to the Trustee in the case of Equipment that is subject to
the Lease Agreement or to the Sublessor in the case of Equipment that is not
subject to the Lease Agreement, (3) be the sole property of the Issuer, subject
to the demise of the Lease Agreement, in the case of Equipment that is subject
to the Lease Agreement, or of the Sublessor in the case of Equipment that is not
subject to the Lease Agreement, (4) be held by the Sublessee as leased equipment
under this Sublease on the same terms and conditions as the items originally
comprising the Equipment, and (5) not impair the Premises or change the nature
of the operation of the Premises as a "project" under the Enabling Law.
7. INSURANCE INDEMNITY.
7.1. Insuring Party. As used in this Article, the term "insuring
party" shall mean the party who has the obligation to obtain the insurance
required hereunder. The insuring party shall be Sublessee. Sublessee shall, as
additional rent for Premises, pay the cost of all insurance required hereunder.
7.2. Liability Insurance. Sublessee shall obtain and keep in force
during the term of this Sublease a policy of comprehensive public liability
insurance insuring Sublessor and Sublessee against any liability arising out of
the ownership, use, occupancy or maintenance of the Premises and all areas
appurtenant thereto. Such insurance shall be in an amount of not less than
$1,000,000.00 for injury to or death of one person in any one accident or
occurrence and in an amount of not less than $3,000,000.00 for injury to or
death of more than one person in any one accident or occurrence. Such insurance
shall further insure Sublessor and Sublessee against liability for property
damage of at least $1,000,000.00. The limits of said insurance shall not,
however, limit the liability of Sublessee hereunder. If the Sublessee shall fail
to procure and maintain said insurance the Sublessor may, but shall not be
required to, procure and maintain the same, but at the expense of Sublessee.
7.3. Property Insurance. The insuring party shall obtain and keep in
force during the term of this Sublease a policy or policies of insurance to the
extent of the full insurable value of the Premises (and in no event less than to
the extent of full replacement cost coverage), against loss or damage by fire,
tornado, windstorm, flood and other hazards and casualties with uniform standard
extended coverage endorsement limited only as may be provided in the standard
form of extended coverage endorsement at the time in use in the State of
Georgia. Said insurance shall provide for payment for loss thereunder to
Sublessor, the Credit Obligor, the Trustee and the Issuer (as their interests
may appear). If the insuring party shall fail to procure and maintain said
insurance the other party may, but shall not be obligated to, procure such
insurance, but at the expense of Sublessee. All policies shall be in form and
content acceptable to the Issuer, Trustee, Credit Obligor and Sublessor.
7.4. Flood Insurance. The insuring party shall obtain and keep in force
during the term of this Sublease a policy or policies of flood insurance under
the national flood insurance program established by the Flood Disaster
Protection Act of 1973, as at any time amended, only during such times while the
Premises are eligible under such program, in an amount at least equal to the
principal amount of the Bonds Outstanding (as defined in the Indenture), with
information as to such amount to be provided by Sublessor to Sublessee when
necessary, or to the maximum limit of coverage made available with respect to
the Premises under said Act, whichever is less.
7.5. Use and Occupancy Insurance. Sublessee shall obtain and keep in
force during the term of this Sublease a policy or policies of use and occupancy
insurance (or business interruption or risk insurance) covering suspension or
interruption of the Sublessee's operations at the Premises in whole or in part,
with such exemptions as are customarily imposed by insurers, covering a period
of suspension or interruption of at least six months with a minimum limit in an
amount equal to 100% of the maximum amount to be paid as debt service under the
Indenture or rent payments under this Sublease, whichever is greater.
7.6. Insurance Policies. (a) The insuring party shall deliver to the
other party copies of policies of such insurance or certificate evidencing the
existence and amounts of such insurance with loss payable clauses satisfactory
to Sublessor. No such policy shall be cancelable or subject to reduction of
coverage or other modifications except after thirty (30) days prior written
notice to Sublessor. If Sublessee is the insuring party, Sublessee shall, within
thirty (30) days prior to the expiration of such policies, furnish Sublessor
with renewals or "binders" thereof, or Sublessor may order such insurance and
charge the cost thereof to Sublessee, which amount shall be payable forthwith,
upon Sublessor's demand, reimburse Sublessor for any additional premiums
attributable to any act or omission or operation of Sublessee causing such
increase in the cost of insurance.
(b) All policies evidencing the insurance required herein
shall be taken out and maintained in generally recognized responsible insurance
companies, qualified under the laws of the State of Georgia to assume to
respective risks undertaken. All such insurance policies shall name as either
loss payee or additional insureds the Sublessor, the Credit Obligor, the Issuer
and the Trustee (as their respective interests shall appear) and shall contain,
where appropriate, standard mortgage clauses providing for (i) all losses
thereunder in excess of $50,000 to be paid to the Trustee or, if applicable
under the Financing Documents, the Credit Obligor; provided that all losses
(including those in excess of $50,000) may be adjusted by Sublessor, subject to
the approval of the Sublessee which shall not be unreasonably withheld, and
subject, in the case of any single loss in excess of $50,000, to the approval of
the Trustee and the Credit Obligor to the extent required under the Financing
Documents; (ii) all losses thereunder relating to property that is subject to
this Sublease but not subject to the Lease Agreement to be paid to the Sublessor
(to the extent permitted under the Financing Documents); and (iii) all losses
thereunder relating to personal property of Sublessee that is not subject to
this Sublease to be paid to the Sublessee. The Sublessee may insure under a
blanket policy or policies.
(c) Each insurance policy required to be carried hereunder
shall contain, to the extent obtainable, an agreement by the insurer that (1)
Sublessee may not, without the consent of the Sublessor, Credit Obligor, the
Issuer and the Trustee, cancel such insurance or sell, assign or dispose of any
interest in such insurance, policy or any proceeds thereof, (2) such insurer
shall notify the Sublessor, the Credit Obligor, the Issuer and the Trustee if
any premium is not paid when due or if any such policy is not renewed prior to
the expiration thereof, and (3) such insurer shall not materially amend or
cancel any such policy except on 30 day's prior written notice to the Sublessor,
the Credit Obligor, the Issuer and the Trustee.
(d) The Sublessee shall deposit with the Sublessor, Trustee
and Credit Obligor a certificate or certificates of the respective insurers
attesting the fact that all policies evidencing the insurance required to be
carried hereunder are in force and effect. Upon the expiration of any such
policy, the Sublessee shall furnish to the Credit Obligor, the Trustee and the
Sublessor evidence reasonably satisfactory to the Credit Obligor, the Trustee
and the Sublessor that such policy has been renewed or replaced by another
policy or that there is no necessity therefor under this Sublease.
7.7. Waiver of Subrogation. Sublessee and Sublessor each waives any and
all rights against the other, or against the officers, employees, agents and
representatives of the other, for loss or damage to such waiving party or its
property or the property of others under its control, where such loss or damage
is insured against under an insurance policy in force at the time of such loss
or damage. Sublessee and Sublessor shall, upon obtaining the policies of
insurance required hereunder, give notice to the insurance carriers that the
foregoing mutual waiver of subrogation is contained in this Sublease.
7.8. Hold Harmless. Subject to any rights to indemnification which
Sublessee may have against Sublessor under the Purchase Agreement, but in
addition to and not in lieu of any rights to indemnification which Sublessor may
have against Sublessee under the Purchasing Agreement, Sublessee shall
indemnify, defend and hold Sublessor, its officers, directors and partners
harmless from any and all claims (including any claims for indemnity under the
Lease Agreement (as defined in Section 1 hereof) and/or related documents)
arising from Sublessee's use of the Premises or from the conduct of its business
or from any activity, work or things which may be permitted or suffered by
Sublessee in or about the Premises and shall further indemnify, defend and hold
Sublessor, its officers, directors and partners harmless from and against any
and all claims (including any claims for indemnity under the Lease Agreement
and/or related documents) arising from any breach or default in the performance
of any obligation on Sublessee's part to be performed under the provisions of
this Sublease or arising from any negligence of Sublessee or any of its agents,
contractors, employees or invitees and from any and all direct out-of-pocket
costs, attorney's fees, expenses and liabilities incurred in the defense of any
such claim or any action or proceeding brought thereon. Subject to any rights to
indemnification which Sublessee may have against Sublessor under the Purchase
Agreement, but in addition to and not in lieu of any rights to indemnification
which Sublessor may have against Sublessee under the Purchasing Agreement,
Sublessee hereby assumes all risk of damage to property or injury to persons in
or about the Premises from any cause, and Sublessee hereby waives all claims in
respect thereof against Sublessor, excepting where said damage arises out of the
negligence of Sublessor, its officers, directors and partners.
7.9. Exemptions of Sublessor from Liability. Subject to any rights to
indemnification which Sublessee may have against Sublessor under the Purchase
Agreement, but in addition to and not in lieu of any rights to indemnification
which Sublessor may have against Sublessee under the Purchasing Agreement,
Sublessee hereby agrees that Sublessor shall not be liable for injury to
Sublessee's business or any loss of income therefrom or for damage to the goods,
wares, merchandise or other property of Sublessee, Sublessee's employees,
invitees, customers, or any other person in or about the Premises; nor, unless
through its active negligence, shall Sublessor be liable for injury to the
person of Sublessee, Sublessee's employees, agents or contractors and invitees,
whether such damage or injury is caused by or results from fire, steam,
electricity, gas, water or rain, or from the breakage, leakage, obstruction or
other defects of pipes, sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures, or from any other cause, whether the said
damage or injury results from conditions arising upon the Premises or upon other
portions of the building of which the Premises are a part, or from other sources
or places and regardless of whether the cause of such damage or injury or the
means of repairing the same is inaccessible to Sublessor or Sublessee. Sublessor
shall not be liable for any damages arising from any act or neglect of any other
sublessee, if any, of the building in which the Premises are located.
8. DAMAGE OR DESTRUCTION.
8.1. Damage or Destruction. (a) In the event the improvements on the
Premises or any part thereof shall have been damaged or destroyed, partially or
totally, from any cause whatsoever, whether or not such damage or destruction is
covered by any insurance required to be maintained under Article 7, (A) to such
extent that, in the reasonable opinion of Sublessor, the Premises cannot be
reasonably restored within a period of four consecutive months substantially to
the condition thereof immediately preceding such damage or destruction, or (B)
to such extent that, in the reasonable opinion of Sublessor, the Sublessee is
thereby prevented from carrying on its normal operations at the Premises for a
period of four consecutive months, or (C) to such extent that the cost of
restoration thereof would exceed by more than $50,000 the net proceeds of
insurance carried thereon pursuant to the requirements of this Sublease, and
Sublessor thereby has the option to purchase the Premises under the Lease
Agreement, then Sublessee shall have the following options, provided that if
Sublessee has not provided written notice of the option it has elected within
twenty (20) days following the event giving rise to these options, then
Sublessee shall be deemed to have elected the first option:
(1) Sublessee may elect to terminate this Sublease upon thirty
(30) days written notice, shall surrender the Premises to
Sublessor in accordance with the terms of this Sublease,
and Sublessor shall be entitled to all proceeds of any
insurance maintained under Section 7.3, and Sublessee
shall do all things necessary, and cooperate fully with
Sublessor, to provide that the proceeds of any insurance
maintained under Section 7.3 are paid to Sublessor.
(2) Optionee may elect to exercise its Option under Article 12
of this Sublease to purchase the Premises or exercise the
Leasehold Option, in accordance with the terms and
conditions of Article 12; and the proceeds of any
insurance maintained under Section 7.3 shall be paid to
the Sublessor to the extent of the Option Price and
thereafter to the Optionee, subject to any requirements to
the contrary under the Indenture, Lease Agreement, Credit
Obligor Mortgage or other Financing Documents;
(3) Sublessee may elect to have Sublessor repair, restore, and
rebuild the Premises substantially to their condition
existing immediately prior to such damage or destruction
out of available insurance proceeds, and the parties
hereto shall enter into an amended and restated sublease
agreement containing substantially the same terms and
conditions contained herein, subject to the following:
(i) the term of such amended and restated
sublease agreement shall be six years from
the date of the event giving rise to this
option;
(ii) Sublessee shall pay to Sublessor as
rent for the Premises monthly payments in an
amount equal to the rent payment due under
this Sublease for the month in which the
event giving rise to this option occurs,
provided that the rent payment due for April
2001 and each month thereafter shall not be
less than $35,107, and provided further that
such rent payments due shall increase for
each two year period, beginning on October
2, 2002 if the event giving rise to this
option occurs prior thereto or otherwise on
the date that is two years after the date of
the event giving rise to this option and
each two-year anniversary date thereafter,
according to the following formula, applying
the definitions set forth in Section 4.3
hereof except that the expression "yearly
period" shall mean each yearly period of the
term dating from each anniversary of the
effective date of such amended and restated
sublease if the event giving rise to this
option occurs on or after October 2, 2000:
If the price index during the two
immediately preceding yearly periods shall
increase over the base index, then the fixed
monthly rental for the two succeeding yearly
periods, beginning with the first day of the
first succeeding yearly period, shall be
increased in the same proportion that the
increase in the price index over such two
year period bears to the base index;
(iii) Xxxxx and each other member of
Optionee shall each personally and
unconditionally guarantee the payment of all
rent payments due from Sublessee in the
first four years of the term of such amended
and restated sublease in a form of guaranty
substantially similar to the guaranty
executed by Optionee in connection with the
Purchase Agreement;
(iv) such amended and restated sublease
shall thereby grant to Optionee the options
set forth in Article 12 of this Sublease on
the terms and conditions set forth in
Article 12 of this Sublease except that the
Option Price shall be as follows: an amount
equal to (I) $3,593,000 plus (II) the amount
of any premium paid or to be paid by
Sublessor on any optional redemption of the
Bonds under the Indenture made prior to
April 1, 2006, in connection with
Sublessor's exercise of its option to
purchase the Premises pursuant to Article 11
of the Lease Agreement, and less (III) an
amount equal to seventy-five percent (75%)
of the aggregate rental payments paid by
Sublessee to Sublessor under the Sublease or
the amended and restated sublease prior to
the date giving rise to the option, and
twenty-five percent (25%) of the aggregate
rental payments paid by Sublessee to
Sublessor under the amended and restated
sublease after the effective date of the
event giving rise to this option and prior
to the exercise of the Option.
In the event that Sublessee elects
this option (3), such repair, restoration
and rebuilding (all of which are herein
called "repair") shall be commenced within a
reasonable time after such damage and
destruction and shall be diligently
prosecuted to completion, and Sublessor
shall cooperate with and give good faith
consideration to requests from Sublessee
with respect to such repair, restoration and
rebuilding, provided that the foregoing
shall not be construed to obligate Sublessor
in any way to take or omit any action in
connection therewith which would cause
Sublessor to incur any liability, or to
incur repair expense or other expenses in
excess of available insurance proceeds.
There shall be no abatement of rent or of
any other obligation of Sublessee hereunder
by reason of such damage or destruction. The
proceeds of any insurance maintained under
Section 7.3 shall be paid to Sublessor for
payment of the cost and expense of the
repair. In the event that the insurance
proceeds are insufficient to cover the total
cost of repair, then any amounts in excess
thereof required to complete the repair
shall be paid by the Sublessee and such
payment obligation shall be part of the
personal guaranty of Xxxxx and each other
member of Optionee.
Notwithstanding any of the foregoing, in the event and to the extent that the
Indenture, the Lease Agreement, the Credit Obligor Mortgage or any of the
Financing Documents do not permit the effectuation of the foregoing
arrangements, then the provisions of the Indenture, the Lease Agreement, the
Credit Obligor Mortgage and such other Financing Documents shall control.
(b) In the event the improvements on the Premises or any part
thereof are damaged or destroyed, partially or totally, from any cause
whatsoever, whether or not such damage or destruction is covered by any
insurance required to be maintained under Article 7, but such damage or
destruction is not to such extent described in clause (A), (B) or (C) of
subsection 8.1(a) above, then the Sublessor shall repair, restore and rebuild
the Premises to substantially their condition existing immediately prior to such
damage or destruction and this Sublease shall continue in full force and effect.
Such repair, restoration and rebuilding (all of which are herein called
"repair") shall be commenced within a reasonable time after such damage or
destruction and shall be diligently prosecuted to completion, and Sublessor
shall cooperate with and give good faith consideration to requests from
Sublessee with respect to such repair, restoration and rebuilding, provided that
the foregoing shall not be construed to obligate Sublessor in any way to take or
omit any action in connection therewith which would cause Sublessor to incur any
liability, or to incur any repair expense or other expense in excess of
available insurance proceeds. There shall be no abatement of rent or of any
other obligation of Sublessee hereunder by reason of such damage or destruction.
The proceeds of any insurance maintained under Section 7.3 shall be paid to
Sublessor for payment of the cost and expense of the repair. In the event the
insurance proceeds are insufficient to cover the total cost of repair, then any
excess thereof required to complete the repair shall be paid by the Sublessee.
Notwithstanding the foregoing, in the event and to the extent that the
Indenture, the Lease Agreement, the Credit Obligor Mortgage or any of the
Financing Documents do not permit the effectuation of the foregoing
arrangements, then the provisions of the Indenture, the Lease Agreement, the
Credit Obligor Mortgage and such other Financing Documents shall control.
8.2. Damage Near End of Term. If the Premises are partially destroyed
or damaged during the last ninety (90) days of the initial term or renewal term
of this Sublease, Sublessor may, at Sublessor's option, cancel and terminate
this Lease as of the date of occurrence of such damage by giving written notice
to Sublessee of Sublessor's election to do so within thirty (30) days after the
date of occurrence of such damage; provided, however, that in the case of such
damage or destruction during the last ninety (90) days of the initial term of
this Sublease, if Sublessee has delivered written notice of its exercise of its
option to renew pursuant to Section 3.3 hereof prior to the occurrence of such
damage or destruction, then Section 8.1 shall apply; provided further, however,
that in the case of such damage or destruction during the last ninety (90) days
of the renewal term of this Sublease, if Sublessee has delivered written notice
of its exercise of the Option or Leasehold Option under Section 12, then Section
8.1(a)(2) shall apply.
8.3. Prorations. Upon termination of this Sublease pursuant to this
Article, a pro rata adjustment of rent based upon a thirty (30) day month shall
be made.
9. REAL PROPERTY TAXES.
9.1. Payment of Taxes. Sublessee shall pay all real property taxes
applicable to the Premises during the term of this Sublease, subject to
proration as provided in Section 5.4(d) above. All such payments shall be made
on a current year's basis on or before the date such taxes are due under state
law for such year. If Sublessee shall fail to pay any such taxes, Sublessor
shall have the right to pay the same, in which case Sublessee shall repay such
amount to Sublessor with Sublessee's next rent installment together with
interest at the rate of eighteen (18%) percent per annum.
9.2. Definition of "Real Property Tax". As used herein, the term "real
property tax" shall include any form of assessment, license fee, rent tax, levy,
penalty or tax (other than income, inheritance or estate taxes), imposed by any
authority having the direct or indirect power to tax, including any city, state
or federal government, or any school, agricultural, lighting, drainage, fire
protection, library or other improvement district thereof, as against any legal
or equitable interest of Sublessor in the Premises or in the real property of
which the Premises are a part, and Sublessee shall pay any and all charges and
fees which may be imposed by the EPA or other similar government regulatory
authority, except to the extent such charges and fees are subject to
indemnification by Sublessor under the Purchase Agreement.
9.3. Joint Assessment. If the Premises are not separately assessed,
Sublessee's liability shall be an equitable proportion of the real property
taxes for all of the land and improvements included with the tax parcel
assessed, such proportion to be determined by Sublessor from the respective
valuations assigned in the assessor's work sheets or such other information as
may be reasonably available. Sublessor's reasonable determination thereof, in
good faith, shall be conclusive.
9.4. Personal Property Taxes. (a) Sublessee shall pay on a current
year's basis on or before the date such taxes are due each year all taxes
assessed against and levied upon leasehold improvements, trade fixtures,
furnishings, equipment and all other personal property of Sublessee contained in
the Premises or elsewhere subject to proration as provided in Section 5.4(d)
above. Sublessee shall cause said leasehold improvements, trade fixtures,
furnishings, equipment and all other personal property to be assessed and billed
separately from the real property of Sublessor.
(b) If any of Sublessee's said personal property shall be
assessed with Sublessor's real property, Sublessee shall pay Sublessor the taxes
attributable to Sublessee within ten (10) days after receipt of a written
statement setting forth the taxes applicable to Sublessee's property.
10.UTILITIES. Sublessee shall pay for all water, gas, heat, light, power,
telephone, sewer, refuse disposal, and other utilities and services supplied to
the Premises, together with any taxes thereon, subject to proration as provided
in Section 6.1 above. If any such services are not separately metered to
Sublessee, Sublessee shall pay a reasonable proportion to be determined by
Sublessor of all charges jointly metered with other premises. The Sublessor's
good faith determination of the proportion of jointly metered utilities to be
paid by the Sublessee shall be conclusive.
11.ASSIGNMENT AND SUBLETTING.
11.1. Sublessor's Consent Required. Neither Sublessee nor Optionee
shall voluntarily or by operation of law assign, transfer, mortgage, sublet, or
otherwise transfer or encumber all or any part of Sublessee's or Optionee's
interest in this Sublease, the Premises, the Option or the Leasehold Option
without Sublessor's prior written consent, which Sublessor may withhold in its
sole discretion. Any transfer of Sublessee's or Optionee's interest in this
Sublease, the Premises, the Option or the Leasehold Option from Sublessee or
Optionee by merger, consolidation, or liquidation, or by any subsequent change
in the direct or indirect ownership of thirty (30%) percent or more of the
capital stock of Sublessee or Optionee shall be deemed a prohibited assignment
within the meaning of this Article. Sublessee, Optionee and Xxxxx agree to
notify Sublessor in the event that any other manufacturer of modular homes,
modular units, non-residential units or manufactured homes is or becomes,
directly or indirectly, an equity owner of Sublessee or Optionee.
11.2. No Release of Sublessee. Unless Sublessor's consent is obtained
under Section 11.1 above, no subletting or assignment shall release Sublessee of
Sublessee's obligations to pay the rent and to perform all other obligations to
be performed by Sublessee hereunder for the term of this Sublease or release any
person from obligations under the guaranty contemplated by Section
8.1(a)(3)(iii). The acceptance of rent by Sublessor from any other person shall
not be deemed to be a waiver by Sublessor of any provision hereof. Consent to
one assignment or subletting shall not be deemed consent to any subsequent
assignment or subletting.
12.OPTION TO PURCHASE. (a) Optionee is hereby granted an option to purchase the
Premises by giving ninety (90) days written notice of the exercise of such
option to Sublessor on or after the earlier of the date that is ninety (90) days
prior to April 1, 2004 or the date on which the Sublessor acquires fee simple
title to the Premises, provided that this Sublease is then in effect in its
original term or any renewal thereof (said option to purchase the Premises being
hereinafter referred to as the "Option"). The purchase price to be paid by
Optionee to Sublessor at the closing in the event the Option is exercised and
the sale of the Premises is consummated pursuant thereto shall be an amount
equal to (i) Three Million Five Hundred Ninety-three Thousand Dollars
($3,593,000) plus (ii) the amount of any premium paid or to be paid by Sublessor
on any optional redemption of the Bonds under the Indenture made prior to April
1, 2006, in connection with Sublessor's exercise of its option to purchase the
Premises pursuant to Article 11 of the Lease Agreement, and less (iii) an amount
equal to fifty percent (50%) of the aggregate rental payments paid by Sublessee
to Sublessor hereunder prior to the exercise of the Option (the "Option Price"),
payable in cash at the closing (the "Closing") of such sale, and shall be in
addition to any rent or other sums theretofore paid or payable by Sublessee to
Sublessor under this Sublease through the period ending on the date of the
Closing (the "Closing Date").
(b) In the event Optionee gives notice to Sublessor of the
exercise of the Option, Sublessor agrees to use its commercially reasonable
efforts to acquire title to the Premises, which shall be fee simple title in the
case of the Premises, from the Issuer, including, without limitation, curing any
defaults under the Lease Agreement, taking such steps as may be necessary to
provide for the payment in full of the Indenture Indebtedness, thereafter
exercising its option to purchase the Premises under Article 11 of the Lease
Agreement, terminating the Lease Agreement and otherwise taking such actions as
may be necessary to provide for the payment in full of the Indenture
Indebtedness and the discharge of the Indenture. Sublessor shall be entitled to
make its obligations to acquire such title contingent upon a contemporaneous
closing of the purchase of the Premises pursuant to the Option. In the event
Sublessor exercises its commercially reasonable efforts as aforesaid, such
acquisition of title shall be a condition precedent to the enforceability
against either Sublessor or Optionee of the Option granted hereunder or the
exercise thereof. In the event that Optionee exercises this Option after April
1, 2004, and Sublessor exercises its commercially reasonable efforts as
aforesaid but does not acquire such title within a reasonable time, then, at the
election of Sublessee, Sublessor and Sublessee shall amend this Sublease,
effective as of the date that is 90 days after the date on which Sublessor
notifies Sublessee of the inability to acquire such title, to: (1) extend the
term of this Sublease to April 1, 2009, (2) adjust the rent due each month under
this Sublease, as amended, to equal the monthly rent payment due by Sublessor to
Issuer or such other party as provided under the Lease Agreement as and when
due, and (3) delete the language currently set forth in Article 12(a)(iii) and
insert the following in its place: "an amount equal to fifty percent (50%) of
the aggregate rental payments paid by Sublessee to Sublessor hereunder prior to
the effective date of such amendment to this Sublease and one hundred percent
(100%) of the aggregate rental payments paid by the Sublessee to Sublessor
hereunder after the effective date of such amendment to this Sublease and prior
to the subsequent effective exercise of the Option (the "Option Price")."
(c) Optionee shall have the right, at its expense (except as
provided in Subsection (d) hereof), to conduct an examination of Sublessor's
title to the Premises and, in the judgment of Optionee, exercised in good faith
and based upon such examination, if such title is not at any time in a condition
satisfactory to Optionee, Optionee shall have the right to elect not to
consummate the purchase of the Premises by written notice given to Sublessor at
any time prior to the consummation of said purchase; provided, however, that
Optionee shall be deemed satisfied with the Permitted Encumbrances (other than
the Financing Documents). Optionee agrees to give Sublessor prompt notice in the
event it obtains knowledge of any fact or matter constituting a defect in
Sublessor's title, and in the event the title is defective, Sublessor agrees to
use its best efforts to promptly correct such defect. Optionee's election not to
consummate the purchase of the Premises as herein provided shall not affect this
Sublease nor in any way limit or affect Optionee's right to exercise the Option
at a later time during the term of this Sublease or any renewal thereof as
provided in subsection (a) of this Section 12.
(d) The Closing of the purchase of the Premises provided for
in this Section 12 shall take place at the end of the ninety (90) day notice
period provided for herein, or at the election of Sublessor at any time within
thirty (30) days thereafter, or at such other time as the parties may mutually
agree upon in writing. At the Closing of the purchase pursuant to the exercise
of the Option, the Sublessor shall upon receipt of the Option Price deliver to
the Optionee a deed, xxxx of sale and such other documents conveying to the
Optionee the Premises as such Premises then exists, subject to the following:
(i) all easements or other rights, if any, required to be reserved by the Issuer
under the terms and provisions of the option to purchase exercised by the
Sublessor, or required to be reserved by the Sublessor under the terms and
provisions of the Option being exercised by the Optionee; (ii) those liens and
encumbrances, if any, to which title to the Premises was subject when conveyed
to the Sublessor; (iii) those liens and encumbrances created by the Sublessee or
Optionee or to the creation or suffering of which the Sublessee or Optionee
consented; (iv) those liens and encumbrances resulting from the failure of the
Sublessee or Optionee to perform or observe any of the agreements on its part
contained in this Sublease; and (v) the Permitted Encumbrances (other than the
Financing Documents).
(e) The right to exercise the Option shall expire upon the
expiration or earlier termination of the original term of this Sublease if not
renewed, and if renewed, upon the expiration or earlier termination of the
renewal term of this Sublease.
(f) In the alternative to exercising the Option provided for
in subparagraphs (a) through (e) hereof, Optionee shall have the right and
option (the "Leasehold Option") herein granted by the Sublessor to acquire
subject to the terms and conditions of Article 8 of the Lease Agreement, the
leasehold interest of the Sublessor in the Lease Agreement (including the option
to purchase) by giving ninety (90) days written notice of the exercise of the
Leasehold Option to the Sublessor during the original term of this Sublease or
during any renewal thereof. The purchase price payable by the Optionee in the
event of the exercise of the Leasehold Option, which shall be payable in cash at
the Closing, shall be the difference between (a) the Option Price and (b) an
amount which, when added to the amount on deposit in the Bond Fund created under
the Indenture, would be sufficient to pay in full, as of the date of the
Closing, the principal amount and all accrued but unpaid interest with respect
to the Indenture Indebtedness (but excluding any premium payable upon early
redemption of the Bonds and any interest on the Bonds which has not yet
accrued). Upon the consummation of such purchase, the Sublessor will assign to
Optionee all its right, title and interest in the Lease Agreement, and the
Optionee will assume all the obligations of Sublessor under the Lease Agreement
that accrue after the Closing and indemnify and hold harmless Sublessor on
account thereof. Optionee further shall be entitled to the benefit of the title
matters set forth in subparagraphs (c) and (d) hereof. Notwithstanding the
foregoing, Sublessor shall be entitled to make the exercise of the Leasehold
Option and its obligations to assign its leasehold interest in the Lease
Agreement contingent upon (1) the release of Sublessor and its affiliates
(including Cavalier Homes, Inc.) from any and all obligations it or they may
have under that certain Credit Guaranty Agreement dated April 1, 1999 by
Cavalier Homes, Inc. in favor of First Commercial Bank, that certain Bond
Guaranty and Continuing Disclosure Agreement dated April 1, 1999 by Sublessor in
favor of First Commercial Bank as Trustee, and any other guaranty or guaranties
by Sublessor or any of its affiliates relating to the Indenture Indebtedness
and/or the Premises, (2) the assumption by Sublessee of all obligations under
that certain Credit Agreement dated April 1, 1999 from Bellcrest Homes, Inc. to
First Commercial Bank and the release of Sublessor and its affiliates (including
Cavalier Homes, Inc.) from any and all obligations it or they may have under
such Credit Agreement, and (3) the release or indemnification of Sublessor (on
terms and conditions satisfactory to Sublessor in its sole discretion) from any
and all liabilities or obligations under the Lease Agreement, the Indenture, the
Credit Agreement and any other agreement(s) related thereto. The Closing of the
exercise of the Leasehold Option shall take place at the end of the ninety (90)
day notice period provided for herein, or at the election of Sublessor at any
time within thirty (30) days thereafter, or at such other time as the parties
may mutually agree upon in writing. At the Closing of the exercise of the
Leasehold Option, Optionee shall deliver to Sublessor the purchase price payable
in the event of exercise of the Leasehold Option as provided herein, and shall
deliver all releases of guaranties, indemnification agreements and other
documents and instruments required by Sublessor pursuant to the immediately
preceding sentence of this subsection (f).
(g) The right to exercise the Leasehold Option shall expire
upon the expiration or earlier termination of the original term of this Sublease
if not renewed, and, if renewed, upon the expiration or earlier termination of
the renewal term of this Sublease.
(h) In connection with the Closing of the Option, Optionee and
Sublessor each agree to execute any and all documents reasonably requested by
counsel to the parties to effectuate the transactions contemplated in the
foregoing subparagraphs.
(i) The Sublessee, the Optionee and Xxxxx each hereby
stipulate and agree that the net book value of the Premises exceeds the
Indenture indebtedness under the Financing Documents, and the Letter of Credit.
the Sublessee, the Optionee and Xxxxx each hereby further covenant and agree
that:
(1) neither the Sublessee, the Optionee nor Xxxxx,
nor any other person or entity acting by, on behalf of, in conjunction
with or through them, nor any other person or entity in which the
Sublessee, Optionee or Xxxxx has an ownership interest or management
position or is an officer, director, or manager (or has a similar
interest or position), will acquire or relet, directly or indirectly,
the Premises or any portion thereof from any person or entity under any
circumstances whatsoever, including, without limitation, an acquisition
or reletting of the Premises from the Credit Obligor, the Trustee, or
the Issuer (or any one or more of their successors or assigns) upon
foreclosure (or a transfer in lieu of foreclosure) or termination of
the Mortgage or the Lease Agreement or otherwise, without payment
simultaneously therewith to or for the benefit of the Sublessor of the
Option Price as determined in Article 12(a) (less the amount of any
payment obligations under the Financing Documents with respect to which
Sublessor has been discharged) hereof that would be payable if the
Optionee exercised such Option and closed the exercise of the Option on
the date of such lease, acquisition, reletting or termination;
(2) neither the Sublessee, the Optionee nor Xxxxx,
nor any other person or entity acting by, on behalf of, in conjunction
with or through them, nor any other person or entity in which the
Sublessee, Optionee or Xxxxx has an ownership interest or management
position or is an officer, director or manager (or has a similar
interest or position), will lease the Premises or any portion thereof
from any person or entity, including, without limitation, the Credit
Obligor, the Trustee, or the Issuer (or any one or more of their
successors or assigns) upon exercise of remedies under the Mortgage or
otherwise, for rentals less than the amounts provided for in Article
4.1 hereof or for purchase options less than the amounts provided for
in Article 12 hereof, without payment simultaneously therewith to or
for the benefit of the Sublessor of the Option Price as determined in
Article 12(a) (less the amount of any payment obligations under the
Financing Documents with respect to which Sublessor has been
discharged) hereof that would be payable if the Optionee exercised such
Option and closed the exercise of the Option on the date of such lease;
(3) The Sublessee, the Optionee and Xxxxx agree that
in the event of a foreclosure (or transfer in lieu of foreclosure) of
the Mortgage or termination of the Lease Agreement or any other event
which results in the Sublessor, Optionee or Xxxxx attorning to any
other person under the terms of this Sublease, the Sublessee, the
Optionee and Xxxxx shall use their commercially reasonable best efforts
to ensure that Sublessor shall be entitled to receive any lease
payments payable under this Sublease and any amount of the Option Price
payable upon exercise of the Option or the Leasehold Option in excess
of the amounts necessary to satisfy the Indenture Indebtedness and the
Sublessor's obligations under the Lease Agreement, subject to any
rights of the Credit Obligor under the Financing Documents;
(4) The intent of this Section 12(i) is to ensure
that Sublessor will realize the benefits of the Option Price in the
event of any foreclosure (or transfer in lieu of foreclosure) of the
Premises, reletting of the Premises or termination of the Lease
Agreement or any other event which causes Sublessor to no longer have
either an ownership interest in the Premises or a leasehold interest in
the Lease Agreement, and each party to this Agreement agrees to use
their best efforts to accomplish such result; and
(5) The provisions of this Section 12(i) shall
survive the termination of this Sublease and shall remain in full force
and effect until commencement of an action with respect thereto shall
be prohibited by law.
13.DEFAULTS; REMEDIES.
13.1 Defaults. The occurrence of any one or more of the following
events shall constitute a default and breach of this Sublease by Sublessee:
(a) The vacating or abandonment of the Premises by Sublessee.
(b) The failure by Sublessee to make any payment of rent or
any other payment required to be made by Sublessee hereunder, as and when due,
where such failure shall continue for a period of five (5) days after written
notice thereof from Sublessor to Sublessee.
(c) The failure by Sublessee to observe or perform any of
the covenants, conditions or provisions of this Sublease to be observed or
performed by Sublessee, other than described in Paragraph (b) above, where such
failure shall continue for a period of thirty (30) days after written notice
thereof from Sublessor to Sublessee, specifying wherein Sublessee has failed to
perform such obligation, provided, however, that if the nature of the
Sublessee's obligation is such that more than thirty (30) days are required for
performance then Sublessee shall not be in default if Sublessee commences
performance within such 30-day period and thereafter diligently prosecutes the
same to completion, provided that such completion must be accomplished not more
than sixty (60) days after such written notice from Sublessor.
(d) (i) The making by Sublessee of any general assignment or
general arrangement for the benefits of creditors; (ii) the filing by or
against Sublessee of a petition to have Sublessee adjudged a debtor or a
petition for reorganization or arrangement under any law relating to bankruptcy
(unless, in the case of a petition filed against Sublessee, the same is
dismissed within sixty (60) days, (iii) the appointment of a trustee or
receiver to take possession of substantially all of Sublessee's assets located
at the Premises or of Sublessee's interest in this Sublease, where possession is
not restored to Sublessee within thirty (30) days; or (iv) the attachment,
execution or other judicial seizure of substantially all of Sublessee's assets
located at the Premises or of Sublessee's interest in this Sublease, where such
seizure is not discharged within thirty (30) days.
13.2. Remedies on Default. In the event of any such default or breach
by Sublessee, Sublessor may at any time thereafter, with or without notice or
demand and without limiting Sublessor in the exercise of any right or remedy
which Sublessor may have by reason of such default or breach:
(a) Terminate Sublessee's right to possession of the Premises
by any lawful means, in which case this Sublease shall terminate and Sublessee
shall immediately surrender possession of Premises to Sublessor. In such event
Sublessor shall be entitled to recover from Sublessee all damages incurred by
Sublessor by reason of Sublessee's default including, but not limited to, the
cost of recovering possession of the Premises; expenses of reletting, including
necessary renovation and alteration of the Premises, reasonable attorney's fees,
and any real estate commission actually paid; and the worth at the time of award
by the court having jurisdiction thereof of the amount by which the unpaid rent
for the balance of the term after the time of such award exceeds the amount of
such rental loss for the same period that Sublessee proves could be reasonably
avoided. Unpaid installments of rent or other sums shall bear interest from the
date due at the rate of eighteen (18%) percent per annum. In the event Sublessee
shall have abandoned the Premises, Sublessor shall have the option of (i)
retaking possession of the Premises and recovering from Sublessee the amount
specified in this Article 13.2(a) or (ii) proceeding under Article 13.2(b).
(b) Maintain Sublessee's right to possession in which case
this Sublease shall continue in effect whether or not Sublessee shall have
abandoned the Premises. In such event, Sublessor shall be entitled to enforce
all of Sublessor's rights and remedies under this Sublease, including the right
to recover the rent as it becomes due hereunder.
(c) Pursue any other remedy now or hereafter available to
Sublessor under the laws of judicial decisions of the state wherein the Premises
are located.
(d) In the event this Sublease terminates by reason of
Sublessor's re-entry under the terms and covenants contained in this Sublease or
by the ejectment of Sublessee by summary proceedings or otherwise, or after the
abandonment of the premises by Sublessee, or for any other reason, it is hereby
agreed Sublessee shall remain liable and shall pay in monthly installments the
rent which accrues subsequent to any such transaction. Sublessee expressly
agrees to pay as damages for the breach of the covenants herein contained, the
difference between the rent due hereunder and the rent collected and received,
if any, by Sublessor during the remainder of the unexpired term, as the amounts
of such difference or deficiency shall from time to time be ascertained and
written notice thereof given to Sublessee at its last known address. Unless
otherwise specifically acknowledged by Sublessor, in writing, no exercise of
right hereunder by Sublessor shall be deemed an acceptance of surrender of the
Premises or a termination of Sublessee's liability for payment of money due
hereunder.
(e) Upon default and after expiration of all applicable grace
periods, Sublessee hereby irrevocably appoints Sublessor as agent and
attorney-in-fact of Sublessee, to enter upon the Premises in event of default by
Sublessee in the payment of any rent herein reserved, or in the performance of
any term, covenant or condition herein contained to be kept or performed by
Sublessee, and to remove any and all furniture and personal property whatsoever
situated upon the Premises. Any and all property which may be removed from the
Premises by the Sublessor pursuant to the authority of this Sublease or law, to
which Sublessee is or may be entitled, may be handled, removed or stored by
Sublessor at the risk, cost and expense of Sublessee, and Sublessor shall in no
event be responsible for the value, preservation or safekeeping thereof.
Sublessee shall pay to Sublessor, upon demand, all expenses incurred in such
removal and all storage charges against such property so long as the same shall
be in Sublessor's possession or under Sublessor's control. Sublessor may place
such property in storage for the account of, and at the expense of Sublessee,
and if Sublessee fails to pay the cost of storing such property after it has
been stored for a period of ninety (90) days or more, Sublessor may sell any or
all of such property in such manner and at such times and places as Sublessor in
its sole discretion may deem proper, without notice to or demand upon Sublessee
for all payment of any part of such charges or the removal of any such property
and shall apply the proceeds of such sale first to the cost of expenses of such
sale, including reasonable attorney's fees; second, to the payment of the costs
and charges of storing property; third, to the payment of any other sums of
money which may then or thereafter be due to Sublessor from Sublessee under any
of the terms hereof; and fourth, the balance, if any, to Sublessee. The removal
and storage of Sublessee's property, as above provided, shall not constitute a
waiver of Sublessor's lien thereon.
13.3. Default by Sublessor. Sublessor shall not be in default under
this Sublease unless Sublessor fails to perform obligations required by
Sublessor within a reasonable time, but in no event later than thirty (30) days
after written notice by Sublessee to Sublessor, specifying wherein Sublessor has
failed to perform such obligation, provided, however, that if the nature of
Sublessor's obligation is such that more than thirty (30) days are required for
performance then Sublessor shall not be in default if Sublessor commences
performance within such 30-day period and thereafter diligently prosecutes the
same to completion, provided that such completion must be accomplished not more
than sixty (60) days after such written notice from Sublessee.
14. CONDEMNATION. If the Premises or any portion thereof are taken under the
power of eminent domain, or sold by the owner under the threat of the exercise
of said power (all of which is herein referred to as "condemnation"), this
Sublease shall terminate as to the part so taken as of the date the condemning
authority takes title or possession, whichever first occurs. If more than
twenty-five percent (25%) of the floor area of the building on the Premises, or
more than fifty percent (50%) of the land area of the Premises not covered with
buildings, is taken by condemnation, Sublessor may terminate this sublease as of
the date the condemning authority takes possession by notice in writing of such
election within twenty (20) days after Sublessor shall have notified Sublessee
of the taking or, in the absence of such notice, then within twenty (20) days
after the condemning authority shall have taken possession. If this Sublease is
not terminated by Sublessor then it shall remain in full force and effect as to
the portion of the Premises remaining, provided the rental shall be reduced in
proportion to the floor area of the buildings taken within the Premises together
with the exterior land area of the Premises used by Sublessee in its operations
and taken in condemnation as bears to the total floor area of all buildings
located on the Premises together with all exterior land areas of the Premises.
In the event this sublease is not so terminated then Sublessor agrees, at
Sublessor's sole cost, to as soon as reasonably possible restore the Premises as
nearly as practicable to a like quality and character as existed prior to the
condemnation, and Sublessor shall cooperate with and give good faith
consideration to requests from Sublessor with respect to such restoration,
provided that the foregoing shall not be construed to obligate Sublessor in any
way to take or omit any action in connection therewith which would cause
Sublessor to incur any liability, or to incur any repair expense or other
expense in excess of available condemnation proceeds. All awards for the taking
of any part of the Premises or any payment made under the threat of the exercise
of the power of eminent domain shall be the property of Sublessor, Trustee,
Credit Obligor, or such other party (other than Sublessee) as determined
pursuant to the terms of the Lease Agreement and related documents, whether made
as compensation for the diminution of value of the leasehold or for the taking
of the fee or as severance damages; provided, however, that Sublessee shall be
entitled to any award for loss or damage to Sublessee's removable personal
property and to Sublessee's business. All damages and compensation arising out
of the condemnation of the subleased premises and/or the Sublessee's or
Sublessor's leasehold interests therein shall be payable to the Sublessor,
Trustee, Credit Obligor, or such other party (other than Sublessee) as
determined pursuant to the terms of the Lease Agreement and related documents.
15.GENERAL PROVISIONS.
15.1. Statements. (a) Sublessee shall at any time upon not less than
ten (10) days prior notice from Sublessor execute, acknowledge and deliver to
Sublessor a statement in writing (i) certifying that this Sublease is unmodified
and in full force and effect (or, if modified, stating the nature of such
modification and certifying that this Sublease, as so modified, is in full force
and effect) and the date to which the rent, security deposit, and other charges
are paid in advance, if any, and (ii) acknowledging that there are not, to
Sublessee's knowledge, any uncured defaults on the part of Sublessor hereunder,
or specifying such defaults, if any, which are claimed. Any such statement may
be conclusively relied upon by any prospective purchaser or encumbrancer of the
Premises.
(b) Sublessee's failure to deliver such statement within such
time shall be conclusive upon Sublessee (i) that this Lease is in full force and
effect, without modification except as may be represented by Sublessor,(ii) that
there are no uncured defaults in Sublessor's performance, and (iii) that not
more than one (1) month's rent has been paid in advance.
(c) If Sublessor, Trustee, Issuer or Credit Obligor, as
applicable, desires to finance or refinance the Premises, or any part thereof,
Sublessee hereby agrees to deliver to any lender designated by Sublessor,
Trustee, Issuer or Credit Obligor, as applicable, such financial statements of
Sublessee as may be reasonably required by such lender. Such statements shall
include the past three (3) years' financial statements of Sublessee or such
shorter time as Sublessee has been in existence. All such financial statements
shall be received by Sublessor, Trustee, Issuer or Credit Obligor, as
applicable, in confidence and shall be used only for the purposes herein set
forth.
15.2. Severability. The invalidity of any provision of this Sublease
as determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.
15.3. Interest on Past-due Obligations. Except as expressly herein
provided, any amount due to Sublessee or Sublessor not paid when due shall bear
interest at the lesser of eighteen percent (18%) per annum or the maximum rate
permitted by applicable law from the date due. Payment of such interest shall
not excuse or cure any default by Sublessee or Sublessor under this Sublease.
15.4. Time of Essence. Time is of the essence.
15.5. Captions. Article and paragraph captions are not a part hereof
and are included solely for reference purposes.
15.6. Incorporation of Prior Agreements. This Sublease, the Purchase
Agreement and the documents executed in connection with the Closing under the
Purchasing Agreement contain all agreements of the parties with respect to the
Premises. No prior agreement or understanding or representations pertaining to
the Premises shall be effective except as set forth herein. This Sublease may be
modified in writing only, signed by the parties in interest at the time of the
modification.
15.7. Waivers. No waiver by Sublessor of any provision hereof shall be
deemed a waiver of any other provision hereof or of any subsequent breach by
Sublessee of the same or any other provision. Sublessor's consent to, or
approval of, any act shall not be deemed to render unnecessary the obtaining of
Sublessor's consent to or approval of any subsequent act by Sublessee. The
acceptance of rent hereunder by Sublessor shall not be a waiver of any preceding
breach by Sublessee of any provision hereof, other than the failure of Sublessee
to pay the particular rent so accepted, regardless of Sublessor's knowledge of
such preceding breach at the time of acceptance of such rent.
15.8. Holding Over. If Sublessee remains in possession of the Premises
or any part thereof after the expiration of the term hereof with the express
written consent of Sublessor, such occupancy shall be a tenancy from month to
month at a rental in the amount of 125% of the last monthly rental, plus all
other charges payable hereunder, and upon the terms hereof applicable to
month-to-month tenancy.
15.9. Cumulative Remedies. No remedy or election hereunder shall be
deemed exclusive but shall, wherever possible, be cumulative with all other
remedies at law or in equity.
15.10.Covenants and Conditions. Each provision of this Sublease
performable by Sublessee shall be deemed both a covenant and a condition.
15.11.Binding Effect; Choice of Law. This Sublease shall be binding
upon the parties and their successors in interest and shall be construed under
the laws of the State of Georgia.
15.12.Subordination. (a) This Sublease, at Sublessor's option, shall be
subordinate to any ground lease, mortgage, deed of trust, or any other
hypothecation for security now or hereafter placed upon the real property of
which the Premises are a part and to any and all advances made on the security
thereof and to all renewals, modifications, consolidations, replacements and
extensions thereof. Without limiting the foregoing, Sublessee acknowledges that
this Sublease is subordinate to the liens, mortgages and leases created under
the Financing Documents. Notwithstanding such subordination, Sublessee's right
to quiet possession of the Premises shall not be disturbed if Sublessee is not
in default and so long as Sublessee shall pay the rent and observe and perform
all of the provisions of this Sublease, unless this Sublease is otherwise
terminated pursuant to its terms. If any mortgage, trustee or ground lessor
shall elect to have this Sublease prior to the lien of its mortgage, deed of
trust or ground lease, and shall give written notice thereof to Sublessee, this
Sublease shall be deemed prior to such mortgage, deed of trust, or ground lease,
whether this Sublease is dated prior or subsequent to the date of said mortgage,
deed of trust or ground lease or the date of recording thereof.
(b) Sublessee agrees to execute any documents required to
effectuate such subordination or to make this Sublease prior to the lien of any
mortgage, deed of trust or ground lease, as the case may be and failing to do so
within ten (10) days after written demand does hereby make, constitute and
irrevocably appoint Sublessor as Sublessee's attorney in fact and in Sublessee's
name, place and stead, to do so.
00.00.Xxxxxxxx's Fees. If either party named herein brings an action
to enforce the terms hereof or declare rights hereunder, the prevailing party in
any such action, on trial or appeal, shall be entitled in addition to all costs
and expenses incurred, to his reasonable attorney's fees to be paid by the
losing party as fixed by the court.
15.14.Sublessor's Access. Sublessor and Sublessor's agents and Issuer,
Trustee, Credit Obligor and their agents shall have the right to enter the
Premises at reasonable times for the purpose of inspecting the same, showing the
same to prospective purchasers or lenders, and making such alterations, repairs,
improvements or additions to the Premises or to the building of which they are a
part as Sublessor may deem necessary or desirable. Sublessor, Issuer, Trustee or
Credit Obligor may at any time place on or about the Premises any ordinary "For
Sale" and/or identification signs and Sublessor may at any time during the last
one hundred twenty (120) days of the term hereof place on or about the Premises
any ordinary "For Sale or Lease" signs, all without rebate of rent or liability
to Sublessee.
15.15.Auctions. Sublessee shall not place any auction sign upon the
Premises or conduct any auction thereon without Sublessor's prior written
consent.
15.16.Merger. The voluntary surrender of this Sublease by Sublessee,
or a mutual cancellation thereof, shall not work a merger, and shall, at the
option of Sublessor, terminate all or any existing subtenancies or may, at the
option of Sublessor, operate as an assignment to Sublessor of any or all of such
subtenancies.
15.17.Corporate Authority. If Sublessee is a corporation, each
individual executing this Sublease on behalf of said corporation represents and
warrants that he is duly authorized to execute and deliver this Sublease on
behalf of said corporation in accordance with a duly adopted resolution of the
Board of Directors of said corporation or in accordance with the Bylaws of said
corporation, and that this Sublease is binding upon said corporation in
accordance with its terms.
15.18.Sublessor's Liability. The liability of the Sublessor pursuant
to this Sublease shall be limited to the greater of $750,000 or Sublessor's
interest in the Premises; and Sublessee, its successors and assigns hereby waive
all rights to proceed under this Sublease against Sublessor, or the officers,
shareholders, directors or partners of Sublessor, except to the extent of the
greater of $750,000 or their interest in the Premises. The term "Sublessor", as
used in this Article, shall mean only the owner or owners at the time in
question of the fee title or its interest in a lease of the Premises, and in the
event of any transfer of such title or interest Sublessor herein named (and in
case of any subsequent transfers the then grantor) shall be relieved from and
after the date of such transfer of all liability as respects Sublessor's
obligations thereafter to be performed, provided that Sublessee has consented to
such transfer, which consent will not be unreasonably withheld, and provided
further that any funds in the hands of Sublessor or the then grantor at the time
of such transfer, in which Sublessee has an interest, shall be delivered to the
grantee. The obligations contained in this Sublease to be performed by Sublessor
shall, subject as aforesaid, be binding on Sublessor's successors and assigns,
only during their respective periods of ownership.
15.19.INTENTIONALLY LEFT BLANK
00.00.Xxxxxxxx Pursuant to Purchase Agreement. This Sublease is
executed and delivered pursuant to the Purchase Agreement, and is subject to all
of the terms and conditions thereof, including without limitation the
indemnification provisions therein.
15.21.Consents. Whenever in this Agreement any party has a right to
consent to any action or matter, such party shall be entitled to withhold its
consent in its sole and absolute discretion unless otherwise expressly provided.
15.22.Memorandum of Sublease in Recordable Form. At the request of any
party hereto at any time during the term of this Sublease, the parties hereto
shall execute a Memorandum of Sublease in Recordable Form in a mutually
agreeable form which may be recorded at any time during the term of this
Sublease at the election of any party hereto.
16. NOTICES.
Whenever under this Sublease provision is made for any demand, notice
or declaration of any kind, or where it is deemed desirable or necessary by
either party to give or serve any such notice, demand or declaration to the
other party, it shall be in writing and served either personally or sent by
United States mail, postage prepaid, by reputable overnight courier service or
by facsimile with electronic confirmation, addressed to the addresses set forth
herein below
the Sublessor at: Cavalier Industries, Inc.
X.X. Xxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
To the Sublessee at: Alliance Homes, Inc.
X.X. Xxx 000
Xxxxxx, Xxxxxxx 00000
Attention: X. Xxxxxx Xxxxx
With a copy to:
Xxxxxx Xxxxx Xxxxxx & Xxxxxxx, LLP
X.X. Xxxxxx 0000
Xxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: G. Xxxx Xxxxxx
To the Optionee at: All-Span Homes, LLC
X.X. Xxx 000
Xxxxxx, Xxxxxxx 00000
Attention: X. Xxxxxx Xxxxx
17. SIGNATURES.
The parties hereto have executed this Sublease at the place on the
dates specified immediately adjacent to their respective signatures.
"SUBLESSOR"
Executed at Birmingham, Alabama CAVALIER INDUSTRIES, INC.
---------------------------
on 10/2/00 By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------- -----------------------------
Witness by: /s/ G. Xxxx Xxxxxx Its: President
---------------------------- ----------------------------
"SUBLESSEE"
Executed at Birmingham, Alabama ALLIANCE HOMES, INC.
----------------------------
on 10/2/00 By: /s/ X. Xxxxxx Xxxxx
------------------------------------- -----------------------------
Witness by: /s/ G. Xxxx Xxxxxx Its: President
---------------------------- ----------------------------
"OPTIONEE"
Executed at Birmingham, Alabama AL-SPAN HOMES, LLC
----------------------------
on 10/2/00 By: /s/ X. Xxxxxx Xxxxx
------------------------------------- -----------------------------
Witness by: /s/ G. Xxxx Xxxxxx Its: Manager
---------------------------- ----------------------------
"XXXXX"
Executed at Birmingham, Alabama
----------------------------
on 10/2/00
------------------------------------- /s/ X. Xxxxxx Xxxxx
Witness by: /s/ G. Xxxx Xxxxxx ------------------------------
---------------------------- X. Xxxxxx Xxxxx
