1
EXHIBIT 10.22
[STAMP]
STATE OF ALABAMA )
COUNTY OF XXXXXX )
LEASE AGREEMENT
Lease Agreement between THE INDUSTRIAL DEVELOPMENT BOARD OF THE CITY OF
DECATUR, A public corporation and instrumentality under the laws of the State of
Alabama (herein called "The Board"), and FRUEHAUF TRAILER COMPANY, a corporation
organized and existing under the laws of the State of Michigan and authorized to
do business in the State of Alabama (herein called "the Company"),
R E C I T A L S:
The Board proposes to acquire the real property hereinafter described,
and to construct thereon and to equip and furnish an aluminum rolling mill and
fabricating plant with appurtenant facilities and machinery and equipment for
use in the operation thereof and proposes to lease said real property, plant,
facilities, machinery and equipment to the Company. To finance the acquisition
of said real property, the construction of said plant and facilities and the
purchase and installation therein of said machinery and equipment, all for the
promotion of local manufacturing and industrial development, the Board proposes
to authorize the issuance of $5,700,000 principal amount of its First Mortgage
Industrial Revenue Bonds, to be dated May 1, 1963 (herein called "the Bonds"),
which are more particularly described in the Mortgage hereinafter referred to.
The Bonds are to be secured by a pledge and assignment of the Board's interest
in this Lease Agreement and by a pledge and assignment of the revenues and
receipts derived by the Board from the leasing or sale of the Project
hereinafter referred to and will be issued under and additionally secured by a
Mortgage and Indenture of Trust dated as of May 1, 1963 (herein called "the
Mortgage"), from the Board to the State National Bank of Decatur, Decatur,
Alabama (herein called "the Trustee"), under which the revenues and receipts
derived by the Board from the leasing or sale of the said Project will be
pledged for the payment of the principal of and
2
the interest on the Bonds and under which the said Project will be mortgaged and
conveyed to the Trustee as additional security for payment of said principal and
interest. The Mortgage is to be in substantially the form attached hereto as
Exhibit A.
The acquisition of said real property, the construction thereon of said
plant and facilities, the purchase and installation of said machinery and
equipment therein, the issuance and sale of the Bonds and the lease of said real
property, plant, facilities, machinery and equipment to the Company will promote
industry and develop trade by inducing manufacturing, industrial and commercial
enterprises to locate in the State of Alabama and further the use of its
agricultural products and natural resources. Under the provisions of Act No. 648
enacted at the 1949 Regular Session of the Legislature of Alabama, as amended,
the Board has the power to acquire said real property, to construct said plant
and facilities thereon, to purchase and install said machinery and equipment
therein, to issue and sell the Bonds and to lease said property, plant,
facilities, machinery and equipment to the Company. To achieve the objectives
mentioned above, the Board and the Company have entered into this Lease
Agreement.
Now, Therefore, this Agreement
W I T N E S S E T H:
That in consideration of the respective agreements on the part of the Board
and the Company hereinafter contained, the Board does hereby lease to the
Company, and the Company does hereby rent from the Board, for and during the
Primary Term hereinafter referred to and upon and subject to the terms and
conditions hereinafter specified, the following described real property situated
in Xxxxxx County, Alabama (the said real property being herein called "the
Leased Realty"):
A part of the Xxx xx Xxxxx Xx. 00 being in Sections 13 and 14 in Township
5 South, Range 5 West, said tract being according to the subdivision of
the X. X. Xxxxxx Farm, as surveyed and platted by X. X. Xxxx, Surveyor,
as shown by map or plat of said Subdivision filed in the Probate Office
of Xxxxxx County, Alabama, March 3, 1928,
-2-
3
in Plat Book at page 62 and being more particularly described as follows:
Beginning at a point on the Southerly right of way line of Alabama
Xxxxxxx Xx. 00, which is 41.5 feet East of a point 30 feet South of the
Northeast corner of Section 14, Township 5 South, Range 5 West, and
running thence South 0 degrees 54 minutes West 230 feet; thence North 89
degrees 06 minutes West 68 feet; thence South 0 degrees 54 minutes West
70 feet; thence South 89 degrees 06 minutes East 68 feet; thence South 0
degrees 54 minutes West 122 feet; thence North 89 degrees 06 minutes West
60 feet; thence South 0 degrees 54 minutes West 60 feet; thence South 89
degrees 06 minutes East 60 feet; thence South 0 degrees 54 minutes West
1122.04 feet; thence South 76 degrees 49 minutes West 341.76 feet;
thence North 0 degrees 57 minutes East 1139.77 feet; thence South 89
degrees 03 minutes East 69 feet; thence North 0 degrees 57 minutes East
125 feet; thence South 89 degrees 03 minutes East 151 feet; thence North
0 degrees 57 minutes east 422.70 feet to a point on the South margin of
Alabama Xxxxxxx Xx. 00; thence South 89 degrees 03 minutes East along the
South margin of Alabama Highway No. 20, 110 feet to the point of
beginning, containing 9.967 acres, more or less, subject, however, to the
right of way over the South 30 feet thereof as provided in the deed from
X. X. Xxxxxx to X. X. Xxxxxxxx dated March 1, 1928, and recorded in Deed
Book 256, page 328, in the Probate Office of Xxxxxx County, Alabama
together with the Plant and the Leased Equipment, both hereinafter referred to,
and all other improvements thereto now or hereafter made (the said real
property, plant, machinery equipment and improvements, as they may at any time
exist, being herein together called the "Project"). This Lease Agreement is
made, however, upon and subject to the following terms and conditions, to each
of which the Board and the Company hereby agree:
-3-
4
ARTICLE I
Constructing and Financing the Plant
and the Leased Equipment
Section 1.1 Agreement to Construct Plant and to Purchase and Install
Leased Equipment. Promptly following the issuance and sale of $5,200,000
principal amount of the Bonds (referred to in the mortgage as the Initial Bonds)
and out of the principal proceeds derived therefrom, the Board (a) will acquire
the Leased Realty and construct an aluminum rolling mill and fabricating plant,
described in "The Industrial Development Board of the City of Decatur, Alabama
Aluminum Sheet Rolling Mill Project," dated April 9, 1963, heretofore approved
by the parties hereto and a copy thereof filed with the Trustee (said plant to
consist of a main building, together with appurtenant buildings, facilities and
other improvements, all of which are herein together called "the Plant"),
substantially in accordance with plans and specifications therefor to be
prepared by the Company for the account of the Board and to be furnished to the
Board by the Company, and (b) will purchase and install in the Plant such items
of machinery and equipment described generally in the aforesaid Aluminum Sheet
Rolling Mill Project dated April 9, 1963, as shall from time to time be
specified in written orders from the Company to the Board (said machinery and
equipment being herein together called "the Leased Equipment"), such purchases
and installations to be made substantially in accordance with orders and
directions from the Company prepared for the account of the Board. All contracts
and orders for such construction, purchase and installation, which contracts and
orders may provide for progress payments, and all request for payments out of
the Construction Fund (to be created in the Mortgage and herein called "the
Construction Fund") shall be signed on behalf of the Board, subject to written
approval by the Company in all respects. If after the exercise of due diligence
by the Board, it is impossible for the Board to construct any part of the Plant
which the Company duly orders and directs the Board so to construct or to
purchase and install in the Plan any item of the Leased Equipment which the
Company duly orders and directs the Board so to purchase and install, the
Company (a) will withdraw the
-4-
5
order and direction in question, or (b) will itself effect the construction or
purchase and installation ordered thereby, for and in the name and behalf of the
Board, in which case the Company shall be entitled to reimbursement from the
Construction Fund for the costs incurred by it in effecting such construction or
purchase and installation, as the case may be.
The Board and the Company shall from time to time each appoint by
written instrument an agent or agents authorized to act for each respectively in
any or all matters relating to the construction of the Plant, the purchase and
installation of the Leased Equipment and payments out of the Construction Fund.
One of the agents appointed by the Company shall be designated its "Project
Manager". Either the Board or the Company may from time to time revoke, amend or
otherwise limit the authorization of any agent appointed by it to act on its
behalf and designate another agent or agents to act on its behalf, provided that
there shall be at all times at least one agent authorized to act on behalf of
the Board, and at least one agent (who shall be the Project Manager) authorized
to act on behalf of the Company, with reference to all the foregoing matters. In
the event that after reasonable request made to the Board by the Company, the
Board fails or refuses to enter into or execute any contract or order for such
construction, purchase or installation and fails or refuses to issue or execute
a payment requisition from the Construction Fund for payment of any item that
may under the terms of the Mortgage be paid from the Construction Fund, the
Project Manager then designated by the Company, who is hereby irrevocably
appointed as agent for the Board for such purposes, (a) may enter into, execute
and deliver any such contract or order, for and in the name and on behalf of the
Board, or (b) may issue and execute, also for and in the name and behalf of the
Board and without any approval of any officer, employee or other agent thereof,
payment requisition on the Construction Fund, as the case may be.
Section 1.2 Development and Design Expenses Insured by Company. In
order to expedite the construction of the Plant, the Board has heretofore
authorized the Company to go forward with the planning, development and design
thereof and with the planning, development and design of the items of Leased
-5-
6
Equipment to be installed in the Plant. The Board acknowledges that all
reasonable costs, expenses and fees (including, without limitation, engineering,
legal, procurement, accounting and auditing fees and expenses) incurred by the
Company in connection with such planning, development and design (whether before
or after the execution and delivery of this Lease Agreement or before or after
the issuance and sale of the Bonds) constitute a part of the project costs, for
which the Company shall be entitled to reimbursement from the Construction Fund.
Section 1.3 No Warranty of Suitability by Board. The Company
recognizes that since the plans and specifications for the Plant are to be
prepared by it and that since the items of Leased Equipment are to be selected
by it, the Board can make no warranty, either express or implied, or offer any
assurances that the Plant or the Leased Equipment will be suitable for the
Company's purposes or needs or that the proceeds derived from the sale of the
Bonds will be sufficient to pay in full all the project costs.
Section 1.4 Completion of the Project. Bonds in the principal amount of
$500,000, referred to in the mortgage as the "Additional Bonds" will not be sold
and delivered except as required by, and subject to, the provisions of this
section. In the event that for any reason the amount on deposit in the
Construction Fund is insufficient to pay all costs of completing the Project,
the Company shall nevertheless complete the Project without delay and pay all
costs thereof in excess of the amount available therefor in the Construction
Fund; and the Company may in such event, at its option, elect to have all or any
part of the Additional Bonds (but not exceeding an amount sufficient to produce
monies required to pay the cost of completing the Project) offered for sale and
the net sale proceeds (less interest to May 1, 1965) deposited in the
Construction Fund. Such option may be exercised by the Company by notifying the
Board and the Trustee in writing, on or before May 1, 1965, that it desires to
have a specified amount of the Additional Bonds offered for sale. The Board and
the Trustee will promptly take all action required to have the amount of
Additional Bonds so designated offered for sale. In the event that any such
Additional Bonds are issued and sold, the proceeds of the sale of such
Additional Bonds (less the expenses of
-6-
7
issuance and sale, which shall be paid therefrom, and an amount equal to the
interest to become due on such Additional Bonds to and including May 1, 1965,
which shall be deposited in the Bond and Interest Fund provided in the Mortgage)
shall be deposited in the Construction Fund. The Company may be reimbursed from
the Construction Fund for all monies necessarily expended by the Company in the
acquisition of the Project after the monies in the Construction Fund were
exhausted and before the proceeds of the sale of the Additional Bonds were
deposited in the Construction Fund. Any Bonds not sold and delivered on or
before November 1, 1965, will be cancelled and will not thereafter be issued or
reissued. The obligation of the Company to complete the Project without delay
shall not be contingent upon the sale or delivery of any of the Additional
Bonds; and the Company shall be obligated to continue the construction and
acquisition of the Project without interruption, at its own expense, regardless
of its notice to the Board and the Trustee, or any delay in the sale or delivery
of the Bonds or the inability of the Board to sell the same. The Company shall
not by reason of the payment of such excess costs from its own funds be entitled
to any diminution in the payment of the rents hereunder.
Should the Company fail to comply with the foregoing provisions of this
section, the Board shall have any one or more of the following remedies:
(a) The Trustee shall be entitled to retain all payments made as rent
under this Lease Agreement by the Company, and the Company shall be obligated to
pay to the Trustee the rental payments as they become due as liquidated damages,
subject, however, to a credit for the net proceeds which the Trustee may receive
from the sale of the Project or any part thereof, or from the lease or sublease
of the Project or any part thereof to others than the Company herein, during and
for the unexpired term of this Lease Agreement; or
(b) The Board may take possession of the, Lease Realty and complete the
Project at the expense of the Company, which expense with six per cent interest
and a reasonable attorney's fee, if the services of an attorney are required
for the collection thereof, the Company hereby agrees to pay; or
-7-
8
(c) The Board may terminate this Lease Agreement and xxx for damages
for breach thereof.
Section 1.5 Supplemental Agreement on Completion. Upon completion of
construction of the Plant and the purchase and installation of the Leased
Equipment therein, the Board will, on written request of the Company or the
Trustee, enter into a supplemental agreement with the Company identifying the
items of Leased Equipment installed in the Plant and confirming the lease
thereof to the Company hereunder.
ARTICLE II
Duration of Lease Term and Rental Provision
Section 2.1 Duration of Term. The primary term of this Lease Agreement
and of the lease herein made (herein called "the Primary Term") shall begin on
the date the construction of the Plant and the installation of the Leased
Equipment are completed or on May 1, 1965, whichever date is earlier, and,
subject to the provisions of this Lease Agreement, shall continue until midnight
of April 30, 1983, but the Company will be permitted to have such possession of
the Project prior to the beginning of the Primary Term as shall not interfere
with the construction of the Plant and the installation of the Leased Equipment
therein. The Board will deliver to the Company sole and exclusive possession of
the Project on the commencement date of the Primary Term, subject to the
inspection and other rights reserved in Section 6.2 hereof, and the Company will
accept possession thereof at such time; provided, however, that in the event the
Primary Term begins prior to the date the construction of the Plant and the
installation of the Leased Equipment therein are completed, the Board will be
permitted such possession of the Project as shall be necessary and convenient
for it to complete the construction of the Plant and the installation of the
Leased Equipment therein, and provided further, that the Board will be permitted
such possession of the Project as shall be necessary and convenient for it to
construct or install any additions or improvements and to make any repairs or
restorations required or permitted to be constructed, installed or made by the
Board pursuant to the
-8-
9
provisions hereof or pursuant to the provisions of any agreement between the
Company and the Board supplemental hereto.
Section 2.2 Rental Provisions. For and during the Primary Term, the
Company will pay to the Board not less than the following basic rental (herein
called "Basic Rent") for use and occupancy of the Project:
(a) On or before the 20th day of each month beginning May 20, 1965, an
amount equal to one sixth (1/6) of the interest becoming due on all outstanding
Bonds on the next succeeding interest payment date, and;
(b) On October 20, 1965 and on each April 20 and October 20,
thereafter, an amount equal to the principal of the outstanding Bonds due and
payable on the then next succeeding semiannual principal payment date.
All Basic Rent payments shall be made directly to the Trustee, or to
its successor as Trustee under the Mortgage, for the account of the Board and
shall be deposited in the Bond and Interest Fund established under the Mortgage.
The monthly and semiannual installment of Basic Rent shall continue until the
amount in the Bond and Interest Fund shall have become sufficient to pay in full
the principal of (including redemption premium), and interest on all
outstanding Bonds either at maturity or on earlier redemption. Any payment of
Basic Rent due hereunder that is not made within ten (10) days of the due date
thereof shall bear interest from that date until paid at the rate of 6% per
annum.
The Company will also pay, as additional rental, the reasonable fees,
charges and expenses of the Trustee under the Mortgage (other than the initial
fee or charge of the Trustee) and of the paying agents for the Bonds, such fees,
charges and reimbursement for expenses to be paid directly to the Trustee and
such paying agents for their own account as and when such fees, charges and
expenses become due and payable.
Section 2.3 Obligations of Company Unconditional. The obligation of
the Company to pay the Basic Rent, to make all other payments provided for
herein and to perform and observe the other agreements and covenants on its part
herein contained shall be absolute and unconditional, irrespective of any rights
of set-off, recoupment or counterclaim it might otherwise have against
-9-
10
the Board. The Company will not suspend or discontinue any such payment or fail
to perform and observe any of its other agreements and covenants contained
herein or terminate this Lease Agreement for any cause, including, without
limiting the generality of the foregoing, any acts or circumstances that may
constitute an eviction or constructive eviction, failure of consideration or
commercial frustration of purpose, or any damage to or destruction of the
Project, or the taking by eminent domain of title to or the right to temporary
use of all or any of the Project, or any change in the tax or other laws of the
United States of America, the State of Alabama or any political subdivision of
either thereof, or any failure of the Board to perform and observe any agreement
or covenant, whether express or implied, or any duty, liability or obligation
arising out of or connected with this Lease Agreement. Notwithstanding the
foregoing, the Company may, at its own cost and expense and in its own name or
in the name of the Board, prosecute or defend any action or proceeding or take
any other action involving third persons which the Company deems reasonably
necessary in order to secure or protect its rights of use and occupancy and
other rights hereunder. The provisions of the first and second sentences of this
section shall apply only so long as any part of the principal of and the
interest on the Bonds remains outstanding and unpaid, and nothing contained
therein shall be construed to affect adversely or to impair the option to
terminate this Lease Agreement granted in Section 8.2 hereof. Furthermore,
except as provided in the first and second sentences of this section, nothing
contained herein shall be construed to be a waiver of any rights which the
Company may have against the Board under this Lease Agreement or under any
provision of law.
Section 2.4 Investment of Funds. The Board shall cause the Trustee to
invest and reinvest the monies from time to time in the Construction Fund and
the monies from time to time in the Bond and Interest Fund in the manner and
to the extent and with such application of the income therefrom as is provided
in the Mortgage.
-10-
11
ARTICLE III
Maintenance, Taxes and Insurance
Section 3.1 Maintenance, Alterations and Improvements. (a) The Company
will, at its own expense, (i) keep the Project in as reasonably safe condition
as its operations permit, and (ii) keep the Plant, the Leased Equipment and the
other improvements located on the Leased Realty in good order and repair, and
from time to time make all needful and proper repairs, renewals and replacements
thereto. The Company agrees to pay all gas, electric light and power, water,
sewer and all other charges for the operation, maintenance, use and upkeep of
the Plant, Leased Equipment and Project.
(b) The Company may, also at its own expense, make any additions,
improvements or alternations to the Project that it may deem desirable for its
business purposes, provided that such additions, improvements or alterations do
not adversely affect the value or utility of the Project or its character as a
"project" under said Act No. 648. In lieu of making such additions, improvements
or alterations itself, the Company may, if it so desires, furnish to the Board
the funds necessary therefor, in which case the Board will proceed to make such
additions, improvements or alterations.
(c) All such additions, improvements and alterations whether made by
the Company or the Board shall become a part of the Project and shall be covered
by the Mortgage; provided however, that any machinery, equipment, furniture or
fixtures installed by the Company (not the Board) on the Project without expense
to the Board and not constituting a part of the Leased Equipment or repairs,
renewals or replacements of the Leased Equipment or the Plant may be removed by
the Company at any time and from time to time while it is not in default under
the terms of this Lease Agreement; and provided further that any damage to the
Project occasioned by such removal shall be repaired by the Company at its own
expense. The Company will not permit any mechanics or other liens to stand
against the Project for labor or material furnished it in connection with any
additions, improvements, alterations or repairs so made by it. The Company may,
however, in good faith contest any such mechanics' or other liens and in
-11-
12
such event may permit any such liens to remain unsatisfied and undischarged
during the period of such contest and any appeal therefrom unless by such action
the lien of the Mortgage on the Project or any part thereof, or the Project or
any part thereof shall be subject to lose or forfeiture, in either of which
events such mechanics' or other liens shall be promptly satisfied.
(d) The Company may, also at its own expense, connect or "tie-in" walls
and utility and other facilities located on the Leased Realty to other
facilities owned or leased by it on real property adjacent to the Leased Realty
or partly on such adjacent real property and partly on the Leased Realty but
only if the Company furnishes the Board and the Trustee a certificate of a
nationally recognized independent consulting engineering firm that such
connection and "tie-in" of walls and facilities will not impair the operating
unity of the Plant (that is, the operating unity of that portion of said Plant,
as extended, that is located wholly within the boundary lines of the Leased
Realty).
Section 3.2 Taxes. Other Governmental Charges and Utility Charges. The
Board and the Company acknowledge (a) that under present law no part of the
Project owned by the Board will be subject to ad valorem taxation by the State
of Alabama or by any political or taxing subdivision thereof and that under
present law the income and profits (if any) of the Board from the Project are,
not subject to either Federal or Alabama taxation, and (b) that these factors,
among others, induce the Company to enter into this Lease Agreement. However,
the Company will pay, as the same respectively become due, all taxes and
governmental charges of any kind whatsoever that may at any time be lawfully
assessed or levied against or with respect to the Project or any machinery,
equipment or other property installed or brought by the Company therein or
thereon (including, without limiting the generality of the foregoing, any taxes
levied upon or with respect to the income or profits of the Board from the
Project which, if not paid, will become a lien on the Project prior to the lien
of the Mortgage or a charge on the revenues and receipts therefrom prior to the
charge thereon and pledge or assignment thereof to be created and made in the
Mortgage), all utility and other charges incurred in the operation, maintenance,
use, occupancy and upkeep of
-12-
13
the Project, and all assessments and charges lawfully made by any governmental
body for public improvements that may be secured by lien on the Project;
provided, that with respect to special assessments or other governmental charges
that may lawfully be paid in installments over a period of years, the Company
shall be obligated to pay only such installments as are required to be paid
during the term hereof. The foregoing provisions of this section shall be
effective only so long as any part of the principal of or the interest on the
Bonds remains outstanding and unpaid.
The Company may, at its own expense and in its own name and behalf or
in the name and behalf of the Board, in good faith contest any such taxes,
assessments and other charges and, in the event of any such contest, may permit
the taxes, assessments or other charges so contested to remain unpaid during the
period of such contest and any appeal therefrom unless by such action the title
of the Board to any part of the Project shall be materially endangered or the
Project or any part thereof shall become subject to loss or forfeiture, in which
event such taxes, assessments or charges shall be paid prior to becoming
delinquent. The Board will cooperate fully with the Company in any such contest.
Section 3.3 Insurance. (a) The Company will cause the Project to be
insured and at all times keep the Project insured, even during the construction
thereof, against loss and/or damage to the Project, under a policy or policies
in form and amount covering such risks as are ordinarily insured against by
similar manufacturing plants, including, without limiting the generality of the
foregoing, fire and other perils customarily covered by the extended coverage
clause of fire insurance policies, windstorm, explosion, tornado, lightning,
riots, strikes, civil commotion and malicious damage. The Company will pay all
premiums on such insurance. All such policies shall be for the benefit of the
Board, the Company and the Trustee as their interests shall appear, shall be
made payable to the Trustee and shall be deposited with the Trustee, and the
Trustee shall have the sole right to receive the proceeds from such policies and
to collect and receipt for claims thereunder. All such insurance policies shall
be taken out and maintained in generally recognized responsible insurance
-13-
14
companies, each of which is qualified and authorized to assume the respective
risks undertaken, and shall be in the amount of (a) the full insurable value of
the Project, or (b) the amount required to pay the principal of and interest on
the Bonds as they mature and come due, or (c) the redemption price thereof,
whichever is less. No policy of insurance shall be so written that the proceeds
thereof will produce less than the minimum coverage required by the preceding
sentence, by reason of co-insurance provisions or otherwise, without the prior
consent thereto in writing by the Trustee. In lieu of depositing the policy or
policies of insurance with the Trustee, the Company may deposit with the Trustee
a certificate or certificates of the respective insurers attesting the fact that
such insurance is in force and effect. Prior to the expiration or cancellation
of any such policy, the Company will furnish the Trustee satisfactory evidence
that such policy has been renewed or replaced by another policy. The Company may
insure under a blanket insurance policy or policies, and in the event the
insurance coverage is by such blanket insurance coverage, it shall be sufficient
to furnish to the Trustee a certificate or duplicate copy of each such blanket
policy of insurance.
(b) The Company shall also take out and at all times maintain and pay
the premium on policies of insurance in generally recognized responsible
insurance companies, each of which in qualified to assume the risks, for the
benefit of the Trustee, the Board and the Company as their interest may appear,
against liability for injuries to persons and property or death or accidental
injuries occurring on or about the Project, or in or about adjoining streets and
passageways, in the minimum amount of $100,000 liability to any one person for
personal injury or death, $25,000 liability to any one person for property
damage, and $500,000 liability for any one accident. Such insurance shall be
provided from the date any of the Bonds are sold and delivered by the Board and
shall be effective while the Project is being constructed as well as thereafter
during the entire term of the lease. The insurance policies or certificates
evidencing the same shall be filed with the Trustee so long as any of the Bonds
shall be outstanding and thereafter with the Board. Such policies or
certificates shall be
-14-
15
filed with the Trustee on or before the delivery and sale of any of the Bonds.
Such insurance may also be provided under a blanket insurance policy or policies
as hereinabove provided.
Section 3.4 Advances by Board or Trustee. In the event the Company
fails to take out or maintain the full insurance coverage required by this Lease
Agreement, fails to pay the taxes and other charges referred to in Section 3.2
hereof at or prior to the time they are there required to be paid, or fails to
keep the Project in as reasonably safe condition as its operating conditions
permit and the Plant, the Leased Equipment and the other improvements located on
the Leased Realty in good order and repair, the Board or the Trustee, after
first notifying the Company of any such failure on its part, may (but shall not
be obligated to) take out the required policies of insurance and pay the
premiums on the same, pay such taxes or other charges or make such repairs,
renewals and replacements as may be necessary to maintain the Project in as
reasonably safe condition as the Company's operations permit and the Plant, the
Leased Equipment and the other improvements located on the Leased Realty in good
order and repair, respectively; and all amounts so advanced therefor by the
Board or the Trustee shall become an additional obligation of the Company to the
Board or to the Trustee, as the case may be, which amounts, together with
interest thereon at the rate of 6% per annum from the date thereof, the Company
will pay. Any remedy herein vested in the Board or the Trustee for the
collection of the rental payments shall also be available to the Board and the
Trustee for the collection of all such amounts so advanced.
Section 3.5 Indemnity of Board. The Board shall not be liable for any
damage or personal injury to the Company, its officers, employees or the public,
caused by or growing out of any breakage, leakage, getting out of order, or
defective condition of any water or sewer pipe, fixtures, toilets, plumbing,
electric wires, gas pipes, apparatus, or connections, or machinery or equipment
or any of them, on the Leased Realty, or caused by or growing out of any defects
in the Project or any part thereof, even if such defect occurred or existed
prior to the delivery of possession of the Leased Realty and the Project to the
Company. The
-15-
16
Company shall save the Board harmless from any action, suit, judgment, or
liability against the Board on account of any defects in the condition of the
premises for any personal injury or property damage occasioned or claimed to
have been occasioned thereon or thereby and shall defend the Board against all
such claims at Company's expense. The Board shall promptly notify Company of any
and all such claims and shall cooperate with the Company in the defense thereof.
Failure of the Board to notify the Company of such claim within time to permit
the Company to defend against such claim will release the Company of the
liability to defend against such claim.
ARTICLE IV
Provisions Respecting Damage,
Destruction and Condemnation
Section 4.1. Damage and Destruction Provisions. In the event that the
Project is destroyed or damaged, by whatever cause, the Company shall have the
option (a) to continue to pay the rent and to cause the Project to be repaired
or rebuilt in the same condition and value as immediately preceding the event
causing such loss, or (b) to pay to the Trustee for the account of the Bond and
Interest Fund, held by the Trustee under the Mortgage, a sum which, when added
to all insurance proceeds which the Trustee has collected on account of such
destruction or damage, shall be sufficient to pay the principal of and interest
on the Bonds as they mature and come due or to redeem the same. In the event
that the Company shall elect to cause the Project to be repaired or rebuilt, the
Company shall continue to make the rental payments provided for in this Lease
Agreement shall cause an estimate to be made of the expense of repairing and
rebuilding the Project in the same condition and value as immediately preceding
the event causing such loss, by a capable and reputable architect or engineer,
or both, acceptable to the Board and the Trustee, and the Company shall
forthwith pay to the Trustee for the account of the Construction Fund the amount
by which such estimate exceeds the insurance proceeds collected by the Trustee
on account of such damage or destruction; and the Company
-16-
17
shall forthwith proceed with all practicable dispatch to cause the Project to be
repaired and rebuilt in the same condition and value as immediately preceding
the event causing such loss, and the Board shall cause the expenses thereof to
be paid by the Trustee out of the Construction Fund, as in the Mortgage
provided. If the actual cost of repairing and rebuilding the Project shall
exceed the amount available therefor in the Construction Fund, the Company shall
pay any deficiency from its own funds. In the event that the Company shall elect
not to cause the Project to be repaired or rebuilt, the Company shall forthwith
pay to the Trustee a sum of money which, when added to the insurance proceeds,
will be sufficient to pay the principal of and interest on the Bonds an they
mature and come due or to redeem the same; and upon the payment or retirement of
all Bonds and interest thereon and all other obligations under the Mortgage, the
Basic Rent for the Primary Term of the lease shall xxxxx. Payment to the Trustee
of insurance proceeds in excess of the amounts used to repair or rebuild the
Project in the same condition and value as immediately preceding the event
causing the loss or destruction, or if insurance proceeds are paid to the
Trustee to pay or redeem the Bonds, shall be credited as follows:
(1) To the abatement of Basic Rents which will thereafter be due and
payable as herein provided and the latest installment thereof shall be first
abated; and when all Bonds and interest thereon shall have been paid in full,
whether at maturity or by call for prior redemption, and all other obligations
under the Mortgage, including the payment of the Trustee's fees, charging and
expenses, shall have been paid and discharged,
(2) The Company shall be entitled to the excess, if any, then remaining
uncredited.
Section 4.2 Condemnation Provisions. In the event the Project and the
Leased Realty or any part of either shall be taken under the exercise of the
power of eminent domain, the award of compensation, except such portion as is
allocable to the Company for damages, shall be paid to the Trustee to be applied
to the payment of principal of and interest on all Bonds then outstanding or to
redeem the same, with any excess to be paid to the Board, unless the Company
-17-
18
shall have notified the Board of its desire to utilize the award for the purpose
of adapting the Project to Company's continued use. In the event Company elects
to cause the Project to be repaired or rebuilt for its continued use, the
Company shall continue to make the rental payments provided for in this Lease
Agreement and shall cause an estimate to be made of the expenses of such work by
a capable and reputable architect or engineer, or both, acceptable to the Board
and the Trustee, and the Company shall, prior to the commencement of
construction, pay to the Trustee for the account of the Construction Fund the
amount, if any, by which such estimate exceeds the condemnation award; and
Company shall forthwith proceed with all practicable dispatch to cause the
Project to be repaired or rebuilt as aforesaid, and the Board shall cause the
expenses thereof to be paid by the Trustee out of the Construction Fund. If the
cost of repairing or rebuilding the Project exceeds the amount available
therefor in the Construction Fund, the Company shall pay any deficiency from its
own funds. In the event Company elects to redeem the outstanding Bonds and the
award (or portion thereof after use by the Company as above provided) is
insufficient to pay or redeem all outstanding Bonds, the Company shall either
(a) pay to the Trustee, for the account of the Bond and Interest Fund held by
the Trustee under the Mortgage, a sum which, when added to the proceeds of the
condemnation award which shall be paid to the Trustee, shall be sufficient to
pay the principal of and interest on the Bonds as they mature and come due or to
redeem the same, or (b) continue to occupy the Leased Realty or any part thereof
then remaining and cause the Board to apply the proceeds of the award of
condemnation paid to the Trustee to the redemption of Bonds, whereupon the basic
rental payments will be reduced to the amount required to pay the principal of
and interest on the remaining outstanding Bonds as such principal and interest
become due and payable.
ARTICLE V
Certain Provisions Relating to Assignment,
Subleasing and Mortgaging and to the Bonds
Section 5.1 Provisions Relating to Assignment and Subleasing. The
Company may assign this Lease Agreement, and may sublet the Project or any
-18-
19
part thereof, without the necessity of obtaining the consent of either the Board
or the Trustee. No such assignment or subleasing shall, however, in any way
relieve the Company from primary liability for any of its obligations hereunder,
and in the event of any such assignment or subleasing the Company shall continue
to remain primarily liable for payment of all rentals herein provided to be paid
by it and for performance and observance of the other agreements and covenants
on its part herein provided to be performed and observed by it.
Section 5.2 Mortgaging of Project by Board. The Board may mortgage the
Project to the Trustee as security for the payment of the Bonds, subject to this
Lease Agreement (which shall be superior to the Mortgage), all as provided in
the Mortgage, and may assign its interest in and pledge any monies receivable
under this Lease Agreement to the Trustee an security for payment of the
principal of and the interest on the Bonds. The Board may in the Mortgage
obligate itself to follow the instructions of the Trustee or the holders of the
Bonds or a certain percentage thereof in the election or pursuit of any remedies
herein vested in it. In the event the Board's interest in this Lease Agreement
is so assigned and pledged to the Trustee, the Trustee shall have all rights and
remedies herein accorded the Board and any reference herein to the Board shall
be deemed, with the necessary changes in detail, to include the Trustee, and the
Trustee and the holders of the Bonds shall be deemed to be third party
beneficiaries of the covenants and agreements of the Company herein contained.
Subsequent to the issuance of the Bonds and prior to their payment in full, the
Board and the Company shall have no power to modify, alter, amend or terminate
this Lease Agreement without the prior written consent of the Trustee and then
only as provided in the Mortgage, provided that the Board and the Company may,
without any such consent, make such modifications, alterations and amendments of
this Lease Agreement an are specifically authorized in or contemplated by this
Lease Agreement or the Mortgage. The Board will not amend the Mortgage or any
mortgage supplemental thereto without the prior written concent of the Company.
Neither, the Board nor the Company will unreasonably withhold any consent herein
or in the Mortgage required of either of them. The Company shall
-19-
20
not be deemed to be a party to the Mortgage or the Bonds issued thereunder and
reference in this Lease Agreement to said Mortgage and Bonds shall not impose
any liability or obligation upon the Company other than its specific obligations
and liabilities undertaken in this Lease Agreement.
Section 5.3 Redemption of Bonds. It is understood and agreed by the
parties hereto that the amount necessary to redeem Bonds shall include, in
addition to the redemption price, all expenses necessary to effect the
redemption and interest on the Bonds to be redeemed to the next ensuing date on
which they can be redeemed, and, if all Bonds are redeemed, all other
obligations under the Mortgage, including the Trustee's fees, charges and
expenses. Any payment made by the Company to be applied to the redemption of
Bonds shall be made at least 45 days prior to the proposed redemption date and
at the time of such payment the Company shall notify the Board, the Trustee and
the original purchasers of the Bonds, in writing, as to the purpose of such
payment, and the Board, upon receiving such notice, shall be obligated and
hereby agrees to take all necessary action to have the payment made by Company
for the purpose of redeeming Bonds applied to the redemption of as many Bonds as
such payment will permit under the Bond redemption provisions of the Bonds and
the Mortgage.
Section 5.4 References to Bonds Ineffective after Bonds Paid. Upon
full payment of the Bonds, all references in this Lease Agreement to the Bonds
and the Trustee shall be ineffective and neither the Trustee nor the holders of
any of the Bonds shall thereafter have any rights hereunder, saving and
excepting those that shall have theretofore vested. For purposes of this Lease
Agreement, the Bonds shall be deemed fully paid:
(a) If there is on deposit in the Bond and Interest Fund a total amount
sufficient to pay the principal of all the then outstanding Bonds plus the
interest due thereon until and at their respective maturities and provision for
payment of all Trustee's and paying agents' fees, accured and to accrue, has
been made in a manner satisfactory to the Trustee and such paying agents, or
(b) if there have been irrevocable deposited with the Trustee (i)
monies sufficient to pay, redeem and retire all the then outstanding Bonds
(including,
-20-
21
without limitation, principal, premium, interest to maturity or earliest
practicable redemption date, as the case may be, expenses of redemption and
Trustee's and paying agents' fees), and (ii) evidence satisfactory to the
Trustee that all redemption notices required by the Mortgage have been duly
given by the Board or irrevocable powers authorizing the Trustee to give such
redemption notices.
In the event the Bonds are fully paid prior to the last maturity
thereof, or an amount sufficient to pay, redeem and retire all the then
outstanding Bonds including principal, premium, interest to maturity or earliest
practicable redemption date (as the case may be), expenses of redemption and
Trustee's and paying agents' fees have been irrevocably deposited with the
Trustee in the Bond and Interest Fund for such purpose, the Company shall be
entitled to use and occupancy of the Project from the date of such payment until
the expiration of the Primary Term without the payment of any further Basic Rent
but otherwise on all the same terms and conditions hereof. If, after full
payment of the Bonds, there is any surplus remaining in the Bond and Interest
Fund, the Board will promptly pay such surplus to the Company.
ARTICLE VI
Particular Covenants of The Company
Section 6.1 General Covenants. The Company will not do or permit
anything to be done on or about the Project that will affect, impair or
contravene any policies of insurance that may be carried on the Project or any
part thereof against loss or damage by fire, casualty or otherwise. The Company
will, in the use of the Leased Realty and the Plant, the public ways abutting
the same and the Leased Equipment, comply with all lawful requirements of all
governmental bodies.
Section 6.2 Inspection of Project. The Company will permit the Board,
the Trustee, any holder of not less than $50,000 principal amount of Bonds and
their duly authorized agents, (subject to the restrictions and requirements
imposed by contracts with the United States Government or agencies thereof, or
by subcontracts governed by such contracts, being performed by the Company, or
its subtenant or subtenants, in any part of the Leased Realty
-21-
22
or the Project, at all reasonable times to enter upon, examine, inspect and
photograph the Leased Realty, the Leased Equipment, the Plant and the Project;
and in the event of default as hereinafter provided, the Company will permit any
nationally recognized firm of certified public accountants designated by the
Trustee, to have access to, inspect, examine and make copies of the books and
records, accounts and data of the Company.
Section 6.3 Special Covenants. In order that the Board may be
reasonably assured of the full payment of rent over the full primary term of the
Lease,
(a) The Company shall install and maintain proper books of record and
account, in which full and correct entries shall be made in accordance with
standard accounting practice, of all business and affairs of the Company, and
shall furnish to the Board, to the Trustee and to the original purchasers of the
Bonds quarterly and annual balance sheets and income and expense statements
showing, respectively, in reasonable detail, the financial condition of the
Company at the close of each such period and its financial operations during
each such period. The annual balance sheet and income and expense statement
shall be certified in accordance with the standard form of opinion adopted by
the American Institute of Accountants, by a certified public accountant who is a
member of the said American Institute of Accountants and against whom the
Trustee makes no reasonable objection. The profit and loss statements shall
accurately reflect gross income and the net earnings of the Company.
(b) The Company will at all times keep an office or agency in the City
of Decatur, State of Alabama, where notices, requests and demands in respect of
this Lease Agreement may be served, and it will in writing notify the Board and
the Trustee of the location of each such office or agency. In default of any
such office or agency or such notification thereof, such notices, requests and
demands may be served at the principal office of the Trustee.
(c) The Company will duly pay and discharge all taxes, assessments and
other governmental charges and liens lawfully imposed upon the Leased Reality
and the Project and upon the properties of the Company, provided, how-
-22-
23
ever, the Company shall 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.
(d) the Company will maintain and preserve its Certificate of
Incorporation or Charter and its corporate existence and organization, and its
authority to do business in the State of Alabama, and will not voluntarily
dissolve without first discharging its obligations under this Lease Agreement,
and will comply with all valid laws, ordinances, regulations and requirements
applicable to it or to its property and the Project.
(e) The Company will not merge or consolidate with any other
corporation and will not transfer or convey all of its property, assets and
licenses, or any substantial portion thereof, except (i) upon terms and
conditions that will fully protect the interest of the Board and the holders of
the Bonds, and (ii) upon the execution and delivery to the Board and to the
Trustee of an agreement supplemental hereto which will obligate the successor
corporation or transferee to assume and perform and abide by all the terms and
conditions of this Lease Agreement. In case the Company or any successor
corporation or transferee shall be consolidated or merged with or into any other
corporation or shall make a conveyance, as permitted under the provisions of
this subsection, the corporation formed by or resulting from such consolidation
or merger, or the transferee to which such conveyance shall have been made as
aforesaid, upon complying with the provisions of this subsection, shall succeed
to and be substituted for the Company with the same force and effect as if it
had been named in and had executed this Lease Agreement as a party thereto, and
shall have and possess and may exercise, subject to the terms and conditions of
this Lease Agreement and of the Mortgage, each and every power, authority and
right herein reserved to and conferred upon the Company. The term "Company"
includes and means, unless the context otherwise requires, not only the
Fruehauf Trailer Company but also any such successor corporation or transferee.
The supplemental Lease Agreement provided for in this subsection shall never be
construed as a novation, alteration or amendment of or to this Lease Agreement,
but as part of this Lease Agreement
-23-
24
and pursuant to its terms, and nothing herein contained shall be construed as
authorizing or permitting the execution of any agreement which shall impair, or
have the effect of impairing, the obligations intended to be imposed upon the
Company by this Lease Agreement, and no such consolidation, merger or
conveyance, and no such Lease Agreement or assumption of obligations, shall
release the Company from its liability under this Lease Agreement or from the
covenants in this Lease Agreement.
ARTICLE VII
Events of Default and Remedies
Section 7.1 Events of Default Defined. The following shall be "events
of default" under this Lease Agreement, and the terms "events of default" or
"default" shall mean, whenever they are used in this Lease Agreement, any one or
more of the following events:
(a) Failure to pay any installment of Basic Rent that has become due
and payable by the terms of this Lease Agreement;
(b) Failure of the Company to perform any of its obligations under this
Lease Agreement or to duly observe any covenant, condition or agreement on its
part required to be performed, provided such failure shall have continued for a
period of thirty days after written notice by the Board of the Trustee
specifying such non-performance or breach and requiring the same to be remedied,
unless the Trustee shall have agreed in writing to an extension of such time
prior to its expiration;
(c) The filing of a voluntary petition in bankruptcy or the commission
of any act of bankruptcy by the Company, or the adjudication of the Company as a
bankrupt, or the making by the Company of an assignment for the benefit of
creditors, or the appointment by final order, judgment or decree of a court of
competent jurisdiction of a receiver for the whole or any substantial part of
the properties of the Company, provided such receiver shall not have been
removed or discharged within sixty days of the date of his qualification, unless
the Trustee shall have agreed in writing to an extension of the time within
which to remove or discharge said receiver.
-24-
25
Section 7.2 Remedies on Default. Whenever any such event or default
shall have happened and be continuing, the Board of the Trustee may take any of
the following remedial steps:
(a) The Board or the Trustee may, at their option, declare all
installments of Basic Rent payable under this Lease Agreement for the remainder
of the Primary Term immediately due and payable;
(b) The Board or the Trustee may reenter and take possession of the
Leased Realty, exclude the Company from possession thereof and rent the same for
the account of the Company;
(c) The Board or the Trustee may, at their option. terminate the Lease
Agreement, exclude the Company from possession of the Leased Realty and. if the
Board or Trustee elect so to do, lease the same for the account of the Board,
holding the Company liable for all rent due up to the date such lease is made
for the account of the Board;
(d) The Board or the Trustee may take whatever action at law or in
equity may appear necessary or desirable to collect the rent then due, whether
by declaration or otherwise, or to enforce any obligation or covenant or
agreement of the Company under this Lease Agreement or by law.
Section 7.3 No Remedy Exclusive. No remedy herein conferred upon or
reserved to the Board or the Trustee is intended to be exclusive of any other
available remedy or remedies, but each and every such remedy shall be cumulative
and shall be in addition to every other remedy given under this Lease Agreement
or now or hereafter existing at law or in equity or by statute. No delay or
omission to exercise any right or power accruing upon any default shall impair
any such right or power or shall be construed to be a waiver thereof but any
such right or power may be exercised from time to time and as often as may be
deemed expedient. In order to entitle the Board or the Trustee to exercise any
remedy reserved to it in this Article VII, it shall not be necessary to give any
notice, other than such notice as is herein expressly required.
Section 7.4 Agreement to Pay Attorneys' Fees. In the event the Trustee
(in its own name or in the name and behalf of the Board) files
-25-
26
court proceedings to collect Basic Rent due hereunder or to enforce any other
obligation, covenant, agreement, term or condition of this Lease Agreement, the
Company will pay to the Trustee reasonable attorneys' fees and other expenses so
incurred by the Trustee in connection with such court proceedings.
ARTICLE VIII
Options
Section 8.1 Option to Renew. If the Company pays the rental herein
reserved to the Board and is not otherwise in default hereunder, it shall have
the right and option, herein granted by the Board, to renew the Primary Term for
a period of twenty (20) additional years from midnight of April 30, 1983 (that
is. for an additional term expiring on midnight of April 30, 2003) by giving
written notice of such renewal to the Board at least sixty (60) days prior to
the expiration of the Primary Term. The cash rental payable by the Company
during any such renewal term shall be the sum of $20,000.00 per year, payable
annually in advance, but otherwise all the terms and conditions herein contained
shall apply during such renewal term.
Section 8.2 Options to Terminate. The Company shall have, if it is not
in default hereunder, the following options to cancel or terminate the term of
this Lease Agreement:
(a) At any time prior to full payment of the Bonds. the Company may
terminate this Lease Agreement by paying to the Board and the Trustee, as
additional or prepaid rental, in bankable funds an amount which. when added to
the amount on deposit in the Bond and Interest Fund. will be sufficient to pay,
retire and redeem all the outstanding Bonds in accordance with the provisions of
the Mortgage (including, without limiting the generality of the foregoing,
principal, interest to maturity or earliest practicable redemption date, as the
case may be, premium, expenses of redemption and Trustee's and paying agents'
fees);
(b) After full payment of the Bonds, the Company may terminate this
Lease Agreement as of any then succeeding anniversary date by giving the Board
-26-
27
notice in writing not less than one hundred eighty (180) days prior to the
anniversary date on which such termination is to become effective.
ARTICLE IX
Release of Unimproved Leased Realty
Section 9.1 Any part of the Leased Realty may be released from the
provisions of this Lease Agreement and the lien of the Mortgage subject to
compliance with the terms, provisions and conditions of this section. Such
release shall be effected in the following manner:
(a) The Company shall deliver to the Board and to the Trustee its
certificate (i) describing the Leased Realty to the released, which property to
be released shall not include any existing building or structure except rights
granted in party walls, the right to "tie into" existing utilities, the right to
connect and join any building, structure or improvement with existing
structures, facilities and improvements on the Leased Realty, and the right of
ingress or egress to and from the public highway which shall not interfere with
the use and occupancy of existing structures, improvements and buildings, (ii)
describing the buildings, structures, or improvements to be erected on the
property to be released and (iii) stating that such buildings, structures or
improvements are necessary to the productivity of the Company's business and
(iv) requesting that the property be so released.
(b) The Company shall also deliver to the Board and to the Trustee a
certificate by an architect registered in the State of Alabama with experience
in the design and construction of industrial buildings and structures reasonably
satisfactory to the Trustee certifying that the buildings, structures or
improvements described in the above certificate by the Company can be
constructed on the real property to be released and will not unreasonably
interfere with the use and occupancy of the existing buildings, structures and
improvements on the Leased Realty, and
(c) The Company shall pay to the Board, or if any Bonds are
outstanding, to the Trustee, an amount equal to the original cost of the Leased
Realty to be released (calculated on the basis of the average per acre cost
thereof to the
-27-
28
Board) plus an additional sum equal to One Hundred Dollars ($100.00) for each
twelve months period between May 1, 1963, and the date of the release multiplied
by the number of acres to be released.
(d) The written consent of the Board to the release of such Realty
shall be delivered to the Company and to the Trustee which consent shall not be
unreasonably withheld if the two certificates hereinabove referred to have been
furnished and the Board does not have reasonable cause to believe any statement
set forth in any of said certificates are incorrect. Any realty so released from
this Lease Agreement and the lien of the Mortgage shall be the unencumbered
realty of the Board and may be leased by it under separate lease, may be
mortgaged by it under separate mortgage which may be a first lien thereon and
may be held. conveyed and otherwise used for any of the purpose or purposes for
which the Board is incorporated subject to such terms and provisions as may be
agreed upon between the Company and the Board. No release or releases effected
under the provisions of this section of any realty shall affect the liability or
the obligation of the Company for the payment of Basic Rent in the amounts and
at the times provided in this Lease Agreement and there shall be no abatement or
adjustment in the Basic Rent by reason of the release of any such realty and the
obligation and the liability of the Company shall continue in all respects as
provided in this Lease Agreement, excluding, however, any realty so released.
ARTICLE X
Miscellaneous
Section 10.1 Covenant of Quiet Enjoyment, Surrender of Project. So long
as the Company performs and observes all the covenants and agreements on its
part herein contained, it shall peaceably and quietly have, hold and enjoy the
Project during the Primary Term, subject to all the terms and provisions hereof.
At the end of the term hereof, or upon any prior termination of this Lease
Agreement, the Company will surrender possession of the Project peaceably and
promptly to the Board in good order and repair, loss by fire or other casualty
and ordinary wear and tear only excepted.
-28-
29
Section 10.2 Representations. The Company represents that it has
corporate power to enter into this Lease Agreement and to perform all acts
herein required to be performed by it and that its execution and delivery hereof
have been duly authorized by all necessary corporate action. The Board
represents that it has corporate power to enter into this Lease Agreement and
that its execution and delivery hereof have been duly authorized by all
necessary corporate action.
Section 10.3 Retention of Title to Project by Board, Grant of Utility
Easements and "Tie-In" of Utility Facilities. The Board will not itself sell,
convey or otherwise dispose of all or any part of the Project during the term of
this Lease Agreement without the prior written consent of the Company. Neither
will the Board dissolve or do anything that will result in the termination of
its corporate existence. The Board will, however, grant such utility and other
similar easements over, across or under the Leased Realty as shall be requested
by the Company and as are necessary or convenient for the efficient operation of
the Project. The Board will also, upon request of the Company, (a) grant such
utility and other similar easements over, across or under the Leased Realty as
shall be necessary or convenient for the furnishing of utility and other similar
services to real property adjacent to or near the Leased Realty and owned or
leased by the Company. provided that such easements shall not adversely affect
the operations of the facilities forming a part of the Project, and (b) in
addition to the rights granted the Company in subsection (d) of Section 3.1
hereof, permit any utility and other similar facilities serving the Project to
be "tied-into" utility and other similar facilities serving real property
adjacent to or near the Leased Realty and owned or leased by the Company,
provided that such "tie-in" shall not adversely affect the operation of the
facilities forming a part of the Project and shall be so effected as to be
subject to prompt disconnection at minimum expense.
Section 10.4 This Lease a Net Lease. The Company recognizes,
understands and acknowledges that it is the intention hereof that this Lease be
a net lease and that all the Basic Rent be available for payment of debt service
-29-
30
on the Bonds. This Lease Agreement shall be construed to effectuate such intent.
Section 10.5 Installation of New Equipment By Board In the event that
at any time the Company desires to install in the Project additional machinery
and equipment the Board will, on request of the Company and upon being furnished
by the Company with the necessary funds, purchase and install in the Project
such additional machinery and equipment, which shall then become and constitute
a part of the Project, subject to the lease hereof.
Section 10.6 Notices. All notices hereunder shall be sufficient if sent
by United States registered or certified mail, postage prepaid, addressed, if to
the Board, at Decatur, Alabama; if to the Company, Detroit 32, Michigan
(Attention, President), with a duplicate copy to the address of the Project; and
if to the Trustee, Decatur, Alabama (Attention, Trust Officer). The Board, the
Company and the Trustee may, by like notice, designate any further or different
addresses to which subsequent notices shall be sent.
Section 10.7 Prior Agreements Cancelled. This Lease Agreement shall
completely and fully supersede all other prior agreements, both written and
oral, between the Board and the Company relating to the construction of the
Plant, the purchase and installation therein of the Leased Equipment. the
leasing of the Project and any options to renew. No party to any such prior
agreement shall hereafter have any rights thereunder but shall look solely to
this Lease Agreement for definition and determination of all of its rights,
liabilities and responsibilities relating to the construction of the Plant, the
purchase and installation therein of the Leased Equipment, the leasing of the
Project and any options to renew.
Section 10.8 Board's Liabilities Limited. It is understood and agreed
by and between the parties hereto that this Lease Agreement is entered into
under and pursuant to the provisions of the aforesaid Act No. 648, adopted at
the 1949 regular session of the Legislature of the State of Alabama and that no
provision of this Lease Agreement shall be construed so as to give rise to a
pecuniary liability of the Board or a charge against its
-30-
31
general credit. All obligations of the Board arising in connection with this
Lease Agreement are limited to the proper application of the proceeds of the
sale of the Bonds and revenues and receipts of the Project.
Section 10.9 Binding Effect. This Lease Agreement shall inure to the
benefit of, and shall be binding upon, the Board, the Company and their
respective successors and assigns.
Section 10.10 Severability. In the event any provision of this Lease
Agreement shall be held invalid or unenforceable by any court of competent
jurisdiction, such holding shall not invalidate or render unenforceable any
other provision hereof.
Section 10.11 Article and Section Captions. The article and section
headings and captions contained herein are included for convenience only and
shall not be considered a part hereof or affect in any manner the construction
or interpretation hereof.
IN WITNESS WHEREOF, the Board and the Company have caused this Lease
Agreement to be executed in their respective corporate names, have caused their
respective corporate seals to be hereunto affixed, and have caused this Lease
Agreement to be attested, all by their duly authorized officers, and have caused
this lease agreement to be dated as of May 1, 1963.
THE INDUSTRIAL DEVELOPMENT
BOARD OF THE CITY OF DECATUR
By /s/ X.X. XXXXX
--------------------------------------
Chairman of its Board of Directors
[SEAL]
Attest::
/s/ [ILLEGIBLE]
---------------------------------
Its Secretary
FRUEHAUF TRAILER COMPANY
By /s/ W.E. GRACE
--------------------------------------
Its President
[Seal]
Attest:
/s/ [ILLEGIBLE]
---------------------------------
SECRETARY
-31-
32
STATE OF ALABAMA )
) ss.
COUNTY OF JEFFERSON )
I, the undersigned Notary Public in and for said County in said State,
hereby certify that X. X. Xxxxx whose name as Chairman of/the Board of
Directors of THE INDUSTRIAL DEVELOPMENT BOARD OF THE CITY OF DECATUR, a public
corporation and instrumentality under the laws of Alabama, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this day
that, being informed of the contents of the within instrument, he as such
officer and with full authority, executed the same voluntarily for and as the
act of said public corporation and instrumentality.
Given under my hand and official seal of office this 13 day of May,
1963.
/s/ [ILLEGIBLE]
------------------------------
Notary Public
(My Commission Expires 2-8-64)
[NOTARIAL SEAL]
STATE OF MICHIGAN )
) ss.
COUNTY OF XXXXX )
I, the undersigned Notary Public in and for said County in said State,
hereby certify that W. E. Grace, whose name as President of FRUEHAUF TRAILER
COMPANY, organized under the laws of the State of Michigan, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this day
that, being informed of the contents of the within instrument, he as such
officer and with full authority, executed the same voluntarily for and as the
act of said company.
Given under my hand and official seal of office this 10th day of May,
1963.
/s/ X.X. XXXXX
------------------------------
NOTARIAL SEAL Notary Public
(My Commission Expires Oct. 15, 1963)
X.X. XXXXX
[SEAL] Notary Public, Xxxxx County, Michigan
My Commission Expires Oct. 15, 1963
33
EXHIBIT A
to this Lease Agreement is the Mortgage
and Indenture of Trust by and between
The Industrial Development Board of the
City of Decatur and State National Bank
of Decatur, dated as of May 1, 1963,
which is recorded in Volume 709, pages 568
et seq., in the office of the Judge of
Probate of Xxxxxx County, Alabama.
[STAMP] [STAMP]
34
STATE OF ALABAMA )
COUNTY OF XXXXXX ) SUPPLEMENTAL LEASE AGREEMENT
SUPPLEMENTAL LEASE AGREEMENT between THE INDUSTRIAL DEVELOPMENT BOARD
OF THE CITY OF DECATUR, a public corporation and instrumentality under the laws
of the State of Alabama (herein called the "Board") and FRUEHAUF CORPORATION,
whose name was changed from Fruehauf Trailer Company, a corporation organized
and existing under the laws of the State of Michigan and authorized to do
business in the State of Alabama (herein called the "Company").
R E C I T A L S
WHEREAS, the Board and the Company have heretofore entered into a
Lease Agreement dated May 1, 1963 (the "Lease Agreement") recorded in the office
of the Judge of Probate of Xxxxxx County in Deed Book Volume 709, pages 630 et
seq., with respect to certain real property (the "Leased Realty"), an aluminum
rolling mill and fabricating plant (the "Plant") and machinery and equipment
(the "Leased Equipment"), which realty, plant, machinery and equipment and
improvements are together therein called the Project; and
WHEREAS, the Project was acquired by the Board from the proceeds of the
sale of $5,700,000 principal amount of its First Mortgage Industrial Revenue
Bonds dated May 1, 1963, issued under and secured by a Mortgage and Indenture of
Trust dated May 1, 1963, between the Board and the State National Bank of
Decatur, as trustee, whose name has been changed to State National Bank of
Alabama, recorded in the office of the Judge of Probate
35
-2-
of Xxxxxx County in Mortgage Book Volume 709a pages 568 et seq.( the
"Mortgage"); and
WHEREAS, Section 1.5 of the Lease Agreement provides that, upon
completion of the construction of the Plant and the purchase and installation of
the Leased Equipment therein, the Board will, on written request of the Company
or the Trustee Under the Mortgage, enter into a supplemental agreement with the
Company identifying the items of Leased Equipment installed in the Plant and
confirming the lease thereof to the Company thereunder; and
WHEREAS, the construction of the Plant and the purchase and
installation of the Leased Equipment therein has been completed and the Company
and the Trustee has each requested the Board in writing to enter into a
supplemental agreement with the Company identifying the items of Leased
Equipment installed in the Plant and confirming the lease thereof to the Company
under the Lease Agreement.
NOW, THEREFORE, THIS SUPPLEMENTAL AGREEMENT:
1. The Leased Equipment consists of the following items which may be
further identified by the following Serial Numbers physically attached thereto
by the Company in the manner hereinafter referred to:
36
-3-
Serial
Number Item
------ ----
1-63A Continuous casting line for casting sheets 58 inches wide, and
including a 50,000 pound capacity melting furnace
2-63A Continuous casting line for casting sheets 58 inches wide, and
including a 50,000 pound capacity melting furnace
3-63A Marinite tip milling machine and drying oven
4-63A Rolling mill for processing sheets 60 inches wide, together with
electric motor for power drive
5-63A Cut-to-length line
6-63A Cleaning and leveling line
7-63A Double paint coat line for continuous painting of 56 inch aluminum
coil, including cleaning tanks, baking oven and paint storage
tanks
8-63A Slitting line for slitting materials up to 56 inches wide
9-63A Squaring shears for cutting sheets 144 inches wide
10-63A Roll Grinder
11-63A Annealing furnace with 80,000 pound capacity
12-63A Annealing furnace with 80,000 pound capacity
13-63A C02 gas generator
14-63A Cooling towers
15-63A Propane standby equipment
16-63A Air compressor
17-63A Truck scales
37
-4-
2. The Company warrants and represents that it has plainly, distinctly,
permanently and conspicuously placed and fastened on each of the aforesaid items
of Leased Equipment a metal plate, readily visible, bearing the following words:
"This equipment is the property of The Industrial Development Board of the City
of Decatur, subject to the Mortgage and Indenture of Trust dated May 1, 1963,
Serial No.___", and that the respective serial numbers set forth in paragraph 1
of this Supplemental Lease Agreement appear on each such metal plate. In case
any such plate shall at any time be removed, defaced or destroyed, the Company
covenants and agrees that it will immediately cause the same to be restored and
replaced.
3. The Leased Equipment has been installed in the Plant as shown on the
following plat or drawing of the Plant and the location of each item on said
plat or drawing is identified by the respective serial number of such item:
38
[MAP]
39
-5-
4. The Board does hereby confirm the lease of the above-described
Leased Equipment to the Company under the Lease Agreement.
IN WITNESS WHEREOF, the Board has caused this Supplemental Lease
Agreement to be executed in its name and on its behalf by the Chairman of its
Board of Directors and its corporate seal to be hereunto affixed and attested by
its Secretary, and the Company has caused this Supplemental Lease Agreement to
be executed in its name and on its behalf by one of its officers and its
corporate seal to be hereunto affixed and attested by one of its officers, all
as of the 12 day of June, 1964.
THE INDUSTRIAL DEVELOPMENT BOARD OF
THE CITY OF DECATUR
By /s/ X.X. XXXXX
--------------------------------------
Chairman of its Board of Directors
X.X. Xxxxx
[Seal]
Attest: /s/ [ILLEGIBLE]
---------------------------------
Secretary
FRUEHAUF CORPORATION
By /s/ W. E. GRACE
-------------------------------------
Its President
----------------------------------
[Seal]
Attest: /s/ [ILLEGIBLE]
---------------------------------
Its Secretary
---------------------------------
40
-6-
STATE OF ALABAMA )
) ss.
COUNTY OF XXXXXX )
I, the undersigned Notary Public in and for said County in said State,
hereby certify that X. X. Xxxxx whose name as Chairman of THE INDUSTRIAL
DEVELOPMENT BOARD OF THE CITY OF DECATUR, a public corporation and
instrumentality under the laws of Alabama, is signed to the foregoing
instrument and who is known to me, acknowledged before me on this day that,
being Informed of the contents of the within instrument, he as such officer and
with full authority, executed the same voluntarily for and as the act of said
public corporation and instrumentality.
Given under my hand and official seal of office this 11th day of June,
1964.
[SEAL]
/s/ [ILLEGIBLE]
----------------------------
Notary Public
NOTARIAL SEAL
My commission expires: July 6th, 0000
XXXXX XX XXXXXXXX )
) ss.
COUNTY OF XXXXX )
I, the undersigned Notary Public in and for Macomb County in said
State, hereby certify that W.E. GRACE, whose name as President of FRUEHAUF
CORPORATION, organized under the laws of the State of Michigan, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this day
that, being informed of the contents of the within instrument, he as such
officer and with full authority, executed the same voluntarily for and as the
act of said corporation.
Given under my hand and official seal of office this 8th day of June,
1964.
/s/ XXXXX X. XXXXXXXXX
----------------------------
Notary Public
NOTARIAL SEAL
XXXXX X. XXXXXXXXX
[STAMP]
My commission expires: Jan. 28, 1968
41
STATE OF ALABAMA )
)
COUNTY OF XXXXXX )
THIS AGREEMENT entered into by and between The Industrial Development
Board of the City of Decatur, a public corporation and instrumentality under the
laws of the State of Alabama (the "Board") and Fruehauf Corporation, a
corporation organized and existing under the laws of the State of Michigan and
authorized to do business in the State of Alabama, formerly Fruehauf Trailer
Company, the name of which corporation has been changed to Fruehauf Corporation
(the "Company"), on and as of April 30, 1983, WITNESSETH THAT:
R E C I T A L S
As of May 1, 1963, the Board and the Company entered into a lease
agreement which is recorded in the Office of the Judge of Probate of Xxxxxx
County, Alabama, in Book 709, at Pages 630, et seq., to which reference is here
made for the description of the property leased thereby. On May 21, 1963, the
Board sold and conveyed to the Company an option to purchase the premises
described and referred to in said lease of May 1, 1963, at and for the sum of
Thirty Thousand and no/100 Dollars ($30,000.00), at such time as no further rent
was payable for the original term of said lease. Said lease contained an option
to renew the primary term thereof for a period of twenty additional years from
midnight of April 30, 1983, at a cash rental payable by the Company during such
renewal term in the sum of Twenty Thousand and no/100 Dollars ($20,000.00) per
year, payable annually in advance, but otherwise under all of the terms and
conditions therein contained. As of May 1, 1964, a part of the land described in
said lease of May 1, 1963, was released from that lease and was released from
said option of May 21, 1963, to the Company and a lease agreement of such part
of said property so released was entered into between the Board and the
Company, dated as of May 1, 1964, and which is recorded in the Probate Office of
Xxxxxx County, Alabama, in Book 727, at Pages 797, et seq., to which
reference is here made for the description of the property so released from
the May 1, 1963 lease and the May 21, 1963 option. The Company has notified
the Board that it desires to renew the lease of May 1, 1963, as to the
property described therein less and except the
42
property described in the lease of May 1, 1964, for an additional period of
twenty years from May 1, 1983, to April 30, 2003, at and for a cash rental
during said renewal term of Twenty Thousand and no/100 Dollars ($20,000.00) per
year, payable annually in advance, but otherwise upon all the terms and
conditions contained in said May 1, 1963, lease, which terms and conditions
shall apply during such renewal term. Also, the Company has notified the Board
that it desires to purchase an option from the Board to purchase said premises
upon which said renewal lease is to be made at any time during said renewal
period at and for the sum of Thirty Thousand and no/100 Dollars ($30,000.00)
payable in cash, with the provision that upon exercise of such option to
purchase that no further or additional rents shall be payable for any unexpired
portion of such renewal term of said lease.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements and undertakings of the parties hereinafter contained
and of the sum of One and no/100 Dollars ($1.00) cash to each of the parties in
hand paid by the other, the receipt of which is hereby acknowledged, it is
agreed, by and between the parties as follows:
1. The primary term of the above identified lease of May 1, 1963, as to
the property described therein, less and except the property described in the
above identified lease of May 1, 1964, is hereby renewed and extended for a
period of twenty additional years from midnight of April 30, 1983 to midnight of
April 30, 2003, at and for cash rental payable by the Company during such
renewal term in the amount of Twenty Thousand and no/100 Dollars ($20,000.00)
per year, payable annually in advance, but otherwise under all of the terms and
conditions contained in said lease of May 1, 1963, which shall apply during such
renewal term. The rental in the amount of Twenty Thousand and no/100 Dollars
($20,000.00) for the lease year beginning May 1, 1983, and ending April 30,
1984, in the sum of Twenty Thousand and no/100 Dollars ($20,000.00) is paid in
cash by the Company to the Board upon the execution and delivery of this
agreement, the receipt is hereby acknowledged by the Board.
-2-
43
2. In consideration of the sum of One Hundred and no/100 Dollars
($100.00) cash to the Board in hand paid by the Company, the receipt of which is
hereby acknowledged, the Board hereby agrees that the Company, not being in
default under the aforementioned lease, shall have the option at any time, on
written notice to the Board of its election to exercise such option, to purchase
the premises described and referred to in said lease of May 1, 1963, except that
part thereof described in said lease of May 1, 1964, together with all
improvements thereon, including the buildings, machinery and equipment and all
other items of real or personal property referred to collectively in said lease
as "the project" for the sum of Thirty Thousand and no/100 Dollars ($30,000.00)
in cash and provided that such option shall become null and void and of no
effect if not exercised by the Company by written notice served on the Board by
delivery to the President or Secretary of the Board in person or by registered
or certified mail on or before 12:00 noon on April 30, 2003. In the event of the
exercise of such option, the property shall be conveyed to the Company, or its
nominee, by proper deed of conveyance, without special covenants of warranty,
and if such option is exercised prior to the expiration of the renewal term of
said lease, no further rental shall be payable for the unexpired portion of the
said additional or renewal term.
IN WITNESS WHEREOF, the Board and the Company have caused this
agreement to be executed in their respective corporate names and have caused
their respective corporate seals to be hereunto affixed and have caused this
agreement to be attested by their duly authorized officers and have caused this
agreement to be dated as of April 30, 1983.
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE CITY OF DECATUR
[SEAL]
By: /s/ [ILLEGIBLE]
-----------------------------------
Chairman of Its Board of Directors
By: /s/ ILLEGIBLE
----------------------------
Secretary
44
FRUEHAUF CORPORATION
BY: /s/ XXXXXXX X. XXXXXX
---------------------------------
Its Vice President
[SEAL]
ATTEST:
[ILLEGIBLE] [STAMP]
-----------------------------
Its Assistant Secretary
STATE OF ALABAMA )
)
COUNTY OF XXXXXX )
I, the undersigned authority, in and for said county in said state,
hereby certify that X. X. Xxxxxxx, Xx., whose name as Chairman of the Board of
Directors of The Industrial Development Board of the City of Decatur, a public
corporation and instrumentality under the laws of Alabama, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this day
that, being informed of the contents of said instrument, he, as such officer
and with full authority, executed the same voluntarily for and as the act of
said public corporation and instrumentality.
Given under my hand and official seal this 27th day of May, 1983.
[SEAL]
/s/ ILLEGIBLE
----------------------------
Notary Public
NOTARIAL SEAL
STATE OF MICHIGAN )
)
COUNTY OF XXXXX )
I, the undersigned authority, in and for said county in said state,
hereby certify that Xxxxxxx X. Xxxxxx, whose name as Vice President of Fruehauf
Corporation, a corporation organized under the laws of the State of Michigan,
is signed to the foregoing instrument, and who is known to me, acknowledged
before me on this day that, being informed of the contents of said instrument,
he, as such officer and with full authority, executed the same voluntarily for
and as the act of said corporation.
GIVEN under my hand and official seal this 24th day of June, 1983.
/s/ XXXX XXXXXXXX
[SEAL] ----------------------------
Notary Public
[STAMP]
[STAMP]
