SECOND AMENDMENT TO GROUND LEASE
SECOND
AMENDMENT TO GROUND LEASE
This
Second Amendment to Ground Lease (the “Second Amendment”) is entered into as of
October 12, 2006 (the “Effective Date”) between I-4 LAND HOLDING LIMITED
COMPANY, a Florida limited liability company (“Landlord”), and LAZY DAYS’ R.V.
CENTER, INC., a Florida corporation (“Tenant”).
RECITALS:
WHEREAS,
Landlord and Tenant entered into that certain Ground Lease dated July 15, 1999
(the “Original Lease”) with respect to the Demised Premises and Improvements
located in Seffner, Florida, as more particularly described in the Lease;
WHEREAS,
Landlord and Tenant entered into that certain First Amendment to Lease dated
May
14, 2004 (the “First Amendment”) (the Original Lease and the First Amendment are
hereinafter referred to collectively as the “Lease”); and
WHEREAS,
the
parties have agreed to further amend the Lease pursuant to the terms hereof;
NOW
THEREFORE,
in
consideration of the covenants set forth in the Lease and this Second Amendment,
the sum of Ten Dollars ($10.00) and other good and valuable consideration,
the
receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant
agree as follows:
1. Recitals;
Defined Terms.
The
recitals above are true and correct and are incorporated into this Second
Amendment by this reference. Capitalized terms not defined herein shall have
the
meaning ascribed to them in the Lease.
2. Purchase
of Tenant Improvements.
Pursuant to the terms of that certain Asset Purchase Agreement executed between
the parties hereto on September 26, 2006 (the “Purchase Agreement”), Landlord is
purchasing the Purchased Assets (as defined in the Purchase Agreement) from
Tenant. From and after the date hereof, the term “Landlord Improvements” as used
in the Lease shall be deemed to include all of the Purchased Assets, and the
term “Tenant Improvements” shall exclude the Purchased Assets.
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3. Purchase
Option.
A.
Section 33.3 of the Lease is hereby amended in part to revise the method for
determining the purchase price to be paid by Tenant to Landlord in the event
Tenant exercises its option to purchase the Demised Premises and Landlord
Improvements. If Tenant exercises its purchase option pursuant to the terms
of
Section 33.3 of the Lease, the purchase price to be paid by Tenant to Landlord
at closing shall be the then fair market value for the fee simple interest
in
the Demised Premises and Landlord Improvements, without taking into account
the
existence of the Lease (the “Fair Market Value”), as such Fair Market Value
shall be determined in accordance with the terms of this Section 3. During
the
thirty (30) day period following the delivery of Tenant’s written notice to
Landlord exercising its purchase option, Landlord and Tenant shall negotiate
in
good faith in an attempt to agree on the Fair Market Value. If Landlord and
Tenant are unable to agree as to the Fair Market Value within such thirty (30)
day period, then Landlord and Tenant shall within 15 days of the expiration
of
said 30 day period each designate an MAI appraiser with a minimum of ten (10)
years of experience in appraising commercial property in the county in which
the
Demised Premises and Improvements are located and shall notify each other of
the
appraiser so selected. Within fifteen (15) days thereafter, the two appraisers
so selected shall select a third appraiser who is similarly qualified, and
each
of the three appraisers shall determine the Fair Market Value of the Demised
Premises and Landlord Improvements within thirty (30) days after the selection
of the third appraiser. The Fair Market Value shall be determined by taking
the
average of the two (2) closest amounts determined by the three (3) appraisers
to
be the Fair Market Value. Each appraiser shall notify Landlord and Tenant in
writing of such appraiser’s determination. Each party shall bear the costs of
the appraiser selected by it, and the cost of the third appraisal shall be
divided equally between Landlord and Tenant. The closing of the purchase and
sale of the Demised Premises and Improvements shall occur within ninety (90)
days after the determination of the Fair Market Value as set forth
herein.
B. Notwithstanding
any provision in the Lease to the contrary, Tenant shall have the right, if
necessary to qualify for sale-leaseback accounting with respect to the Purchase
Agreement for financial accounting purposes, at any time during the term of
the
Lease to waive and terminate its purchase option set forth in Section 33.3
of
the Lease by providing no less than thirty (30) days’ advance written notice to
Landlord (“Tenant’s Waiver Notice”). If Tenant waives and terminates its
purchase option right under Section 33.3 of the Lease, Section 2.2 of the Lease
shall automatically be deemed amended by deleting the first sentence of Section
2.2 and replacing it with the following sentences: “Tenant shall have the option
at the end of the Initial Term to extend the term of this Lease for up to six
(6) additional five (5) year periods (each, an “Option
Term”)
upon
giving Landlord written notice of such election not less than three hundred
sixty five (365) days prior to the expiration of the Initial Term or any Option
Term. With respect to the fifth and sixth Option Terms only, Tenant shall pay
to
Landlord fifteen (15%) percent of the Minimum Annual Rent due and payable for
the Lease Year immediately preceding the first year of such Option Term per
each
Option Term exercised, such payment to be in addition to Tenant’s obligation to
pay rent under Section 5 of the Lease and to be made to Landlord at the time
Tenant gives written notice to Landlord exercising such Option Term(s).” If
Tenant waives and terminates its purchase option right under Section 33.3 of
the
Lease, Landlord shall have the right, exercisable in writing within ninety
(90)
days of Landlord’s receipt of Tenant’s Waiver Notice (time being strictly of the
essence), but not the obligation, to require Tenant to exercise its first option
to extend the Initial Term of the Lease for five (5) years as a condition to
granting the additional Option Terms. Notwithstanding the foregoing, if Tenant
does not exercise its rights under this Section 3(B) by June 1, 2012, time
being
strictly of the essence, such rights shall be automatically terminated and
of no
further force or effect.
C. The
first
sentence of Section 33.3 of the Lease is hereby amended in part by deleting
“February 14, 2011” and replacing it with “January 15, 2023.”
D. Section
33.5 of the Lease is hereby amended in part by deleting all references to “May
14, 2011” and replacing all such references with “January 15,
2023.”
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4. Minimum
Annual Rent Abatement.
The
following provision is hereby added as a new Section 5.4 to the
Lease:
Landlord
grants Tenant Minimum Annual Rent abatement in the following total amounts:
$1,000,000 to be applied in monthly amounts of $333,333.33 for each of the
last
three (3) calendar months of calendar year 2006 (or refund to Tenant such
amounts if Tenant’s Minimum Annual Rent has previously been paid for any such
months); $900,000.00 to be applied in monthly amounts of $75,000.00 for each
of
the twelve (12) calendar months of calendar year 2007; and $800,000.00 to be
applied in monthly amounts of $66,666.66 for each of the twelve (12) calendar
months of calendar year 2008. Notwithstanding anything contained herein to
the
contrary, the cost of living adjustments to Minimum Annual Rent shall be
calculated in all instances on each Adjustment Date without taking into account
the Minimum Annual Rent abatement set forth herein. Such adjustments shall
be
calculated using the scheduled, unabated Minimum Annual Rent payments as set
forth in Section 5.1 of the Lease.
5. Assignment
of Percentage Rent.
Section
36.8 of the Lease is hereby amended in part to clarify Landlord’s obligations
with respect to the payment to Tenant of Percentage Rent coming due under the
Camping World Lease. Landlord hereby irrevocably assigns to Tenant any and
all
rights that Landlord has in and to Percentage Rent as set forth in Section
36.8
of the Lease to the extent payable to Landlord under the current terms of the
Camping World Lease, including extensions provided for in the Camping World
Lease. In the event of the expiration or early termination of the Camping World
Lease pursuant to the current terms thereof, Tenant’s right to receive such
Percentage Rent shall terminate and be of no further force or effect upon such
expiration or termination becoming effective.
6. Camping
World Property.
The
following is added as a new Section 36.10 to the Lease:
“A. Provided
that: (i) the Lease has not been assigned or sublet by Tenant other than
pursuant to Section 13.2 of the Lease, (ii) an Event of Default has not occurred
and is continuing, and (iii) the Lease, as hereby amended, is in full force
and
effect, Landlord agrees not to further lease (after the early termination or
“Early Expiration” of the Camping World Lease) or sell the “Leased Premises” (as
such term is defined in the Camping World Lease) to any recreational vehicle
dealership other than Tenant, subject to the terms and conditions contained
in
this Section 36.10. For the purposes hereof, the term “Early Expiration” shall
mean the expiration of the Camping World Lease prior to the end of the full
term
thereof calculated to include all of the automatic extension options currently
granted to CWI, Inc., a Kentucky Corporation (“CWI”) under the Camping World
Lease. In the event CWI vacates the Leased Premises or defaults under the
Camping World Lease such that the Camping World Lease will be terminated, or
if
CWI provides written notice to Landlord that it will not extend the term of
the
Camping World Lease pursuant to Section 4 thereof, Landlord shall give prompt
written notice of same to Tenant. Within thirty (30) days of receipt of
Landlord’s notice (“Tenant’s Response Period”), Tenant shall have the option to
elect to: (a) enter into a lease with Landlord for the Leased Premises on terms
substantially the same as those contained in this Lease, as amended as of this
date, excluding any options to extend the lease term and excluding the rights
enumerated in Sections 33.1, 33.2, 33.3, 33.5, 36.8 and 36.9 of the Lease (other
than as provided in Subsection B below), except that Tenant agrees to lease
the
Leased Premises until June 30, 2026 and pay base rent in the amount of $750,000
per year for the first year of the lease, provided that in the event Tenant
leases the Leased Premises after June 1, 2012 (the “Rent Escalation Date”), base
rent payable for the first year of the lease shall be increased on a cumulative
basis by three (3%) percent on each anniversary of the Rent Escalation Date
(in
addition to the annual 3% base rent increases as hereinafter provided for),
with
three (3%) percent annual increases on the prior year rent on each anniversary
of the first day of the first year of the lease term thereafter, or (b) elect
to
purchase the Leased Premises at fair market value as determined by the method
set forth in Section 3 of this Second Amendment. Notwithstanding the foregoing,
Tenant shall not be obligated to lease the Leased Premises or to close on the
purchase of the Leased Premises until such time as the then tenant under the
Camping World Lease vacates the Leased Premises. In the event Tenant elects
option (b), the parties shall promptly commence the process for determining
the
fair market value of the Leased Premises pursuant to the terms hereof, and
the
closing of the purchase and sale of the Leased Premises shall occur within
ninety (90) days after such determination is made or within ten days after
the
Early Expiration of the Camping World Lease, whichever is later. The place
of
closing, documents to be delivered at closing and payment of closing costs
shall
be determined in the manner set forth in Section 33.3 of the Lease. In the
event
Tenant does not provide written notice to Landlord electing option (a) or option
(b) within the Tenant Response Period, time being strictly of the essence,
Landlord’s obligations under the first sentence of this Section 36.10 shall be
automatically terminated and of no further force or effect. Notwithstanding
anything contained herein to the contrary, in the event: (x) the Camping World
Lease expires after CWI has exercised all of its extension options (the date
of
such expiration is hereinafter referred to as the “CW Lease Expiration Date”),
or (y) the Camping World Lease expires and CWI enters a new lease with Landlord,
then Tenant’s rights under this Section 36.10 shall terminate and be of no
further force or effect; provided, however, in the event Landlord enters a
new
lease with CWI pursuant to subsection (y) above, Tenant’s rights under this
Section shall apply to such new lease through the CW Lease Expiration Date
only.
For purposes of clause (y) in the immediately preceding sentence, the references
to “CWI” shall mean CWI, Inc., a Kentucky corporation, only and shall not
include any other person, entity, or successor or assign of CWI, except for
an
affiliate of CWI (i.e., a person controlling, controlled by or under common
control with CWI) or a successor by merger or a purchaser of all or
substantially all of the assets of CWI.
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B. Provided
that: (i) Tenant has elected option (a) in Section 36.10(A) above, and (ii)
Tenant has exercised its option to purchase the Demised Premises and the
Landlord Improvements pursuant to Section 33.3 of the Lease, as hereby amended,
Tenant shall have the option, exercisable by written notice to Landlord given
at
any time prior to January 15, 2023 only, to purchase the Leased Premises on
the
same terms and conditions as set forth in Section 33.3 of the Lease, as hereby
amended. Tenant’s rights under this Section 36.10(B) shall apply until January
15, 2023 only and shall thereafter be deemed terminated and of no further force
or effect.”
C. If
Tenant
exercises its right to lease the Leased Premises pursuant to Section 36.10(A)
or
if Tenant exercises its right to purchase the Leased Premises pursuant to
Section 36.10, Landlord shall have the right, at its sole discretion, to
sublease or lease the Leased Premises, as the case may be, from Tenant on terms
substantially the same as those contained in this Lease, excluding any options
to extend the lease term and excluding the rights enumerated in Sections 33,
36.1, 36.8 and 36.9 of this Lease, except that Landlord shall lease the Leased
Premises for a period of five (5) years. If Tenant leases the Leased Premises
and sublets the same to Landlord, notwithstanding any provision in this Lease
to
the contrary, Tenant shall only pay Landlord, during the term of such
subtenancy, rent of one dollar ($1.00) per year, and Landlord, as subtenant,
shall only pay Tenant, as sublandlord, rent of one dollar ($1.00) per year.
If
Tenant exercises its rights to purchase the Leased Premises and the same are
leased to Landlord, the rent shall be the “Fair Market Rent.” “Fair Market Rent”
shall be determined using the three (3) party appraiser process under Section
3
of this Second Amendment if Landlord and Tenant cannot agree upon the fair
market rental value of the Leased Premises for the five (5) year term after
good
faith negotiations for thirty (30) days after Tenant’s receipt of Landlord’s
notice to lease the Leased Premises. In the event Landlord exercises any of
its
rights under this Section it shall do so by delivering to Tenant written notice
no later than thirty (30) days after receipt of Tenant’s written notice under
Section 36.10(A) (time being strictly of the essence), and Landlord’s use of the
Leased Premises shall be subject to Tenant’s approval, which approval shall not
be unreasonably withheld, conditioned or delayed.
7. Notices.
Section
28 of the Lease is hereby amended in part to provide the following new notice
address for Landlord and Tenant:
If
to
Landlord:
I-4
Land
Holding Limited Company
c/o
Xxxxx, Xxxxx & Xxxxxx, CPA's, P.A.
Attention:
J. Xxxxxxx Xxxxxx, C.P.A.
0000
Xxxx
Xxxxxx Xxxxxx
Xxxxx,
Xxxxxxx 00000
Telecopier
No.: (000) 000-0000
Telephone
No.: (000) 000-0000, ext. 114
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With
copy
to:
Broad
and
Xxxxxx
Attention:
Xxxxxx Xxxxxx, Xx., P.A.
One
Biscayne Tower, 21st
Floor
0
Xxxxx
Xxxxxxxx Xxxx.
Xxxxx,
Xxxxxxx 00000
Telecopier
No.: (000) 000-0000
Telephone
No.: (000) 000-0000
If
to
Tenant:
LAZY
DAYS’ R.V. CENTER, INC.
0000
Xxxx
Xxxx Xxxxxxxxx
Xxxxxxx,
Xxxxxxx 00000
Attention:
Xxxx Xxxxxx
Telephone
No.: (000) 000-0000
Telecopier
No.: (000) 000-0000
With
a
copy to:
Xxx
Xxxxxx, Esq.
Xxxxxxxx
& Xxxxx LLP
000
Xxxx
00xx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Telephone
No.: (000) 000-0000
8. Effective
Date; Conflict; Delivery.
This
Second Amendment shall be effective as of the Effective Date, as set forth
in
the 1st
paragraph. In the event of any conflict between the terms of the Lease and
this
Second Amendment, the terms of this Second Amendment shall govern. Except as
modified herein, the Lease remains in full force and effect and is ratified
by
the parties. Articles 30 and 35 of the Lease are incorporated into this Second
Amendment by this reference. This Second Amendment may be executed and delivered
in counterparts, and all such counterparts shall constitute one and the same
agreement. Signatures delivered by facsimile or email shall constitute
originals.
9. Employment.
Section
36.1 of the Lease is hereby deleted in its entirety and shall be of no further
force and effect.
10. Intent
of the Parties.
The
following is added as a new Section 36.11 to the Lease:
“Intent
of the Parties:
In the
event that it is necessary to amend this Lease in order to permit Tenant to
treat the Lease as an operating lease for financial accounting purposes,
Landlord agrees to cooperate with Tenant in such regard and undertake such
amendments to this Lease, provided: (i) Landlord’s rights, interests and
obligations under the Lease are not adversely affected, and (ii) Tenant pays
all
of Landlord’s costs, including reasonable attorneys’ fees, incurred by Landlord
in connection with the Landlord’s review of the proposed amendment, whether
consent to the proposed amendment is ultimately granted by Landlord or not.”
(SIGNATURES
APPEAR ON THE FOLLOWING PAGE)
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IN
WITNESS WHEREOF,
the
parties have executed this Second Amendment as of the Effective Date by their
duly authorized representatives.
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(TWO
WITNESSES FOR EACH SIGNATURE)
/s/ Xxxxx Xxxxx
Print Name: Xxxxx Xxxxx
/s/ Xxxx X. Xxxxxxx
Print Name: Xxxx X. Xxxxxxx
|
LANDLORD:
I-4
LAND HOLDING LIMITED
COMPANY,
a Florida limilted liability
company
By:
/s/ Xxxxxx X. Xxxxxxx
Print
Name: Xxxxxx X. Xxxxxxx
Title:
Member
Date:
October 12, 2006
|
|
/s/Xxxxx Xxxxxxxx
Print Name: Xxxxx Xxxxxxxx
/s/ Xxxx X. Xxxxx
Print Name: Xxxx X.Xxxxx
|
TENANT:
LAZYDAYS
R.V. CENTER, INC., a
Florida corporation
By:
/s/ Xxxx Xxxxxx
Print
Name: Xxxx Xxxxxx
Title:
CEO/President
Date:
September 26, 2006
|
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