Registration of Securities Issued in a Business-Combination Transaction — Form S-4
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-4 Registration of Securities Issued in a 156 860K
Business-Combination Transaction
2: EX-1.1 Purchase Agreement Dated 1/23/97 34 141K
3: EX-3.1 (Amended and Restated Cert of Incorp.) 6 23K
4: EX-3.2 By Laws 20 77K
5: EX-4.1 Indenture Dated 1/28/97 122 456K
6: EX-4.2 Registration Rights Agreement Dated 1/28/97 27 93K
7: EX-4.3 Amended and Restated Credit Agreement Dated 171 677K
8: EX-10.1 Securities Purchase Agreement 102 342K
16: EX-10.10 Leases 14 84K
17: EX-10.11 Lease Between Altshuler & Ctr of the Plate Foods 23± 93K
18: EX-10.12 Lease Between Cfp and Custom Food 127 365K
9: EX-10.2 Employment Agmt Dated 12/31/96 (D. Cohen) 18 69K
10: EX-10.3 Employment Agmt Dated 12/31/96 (Erick Ek) 15 57K
11: EX-10.4 Employment Agmt Dated 12/31/96 (R. Gioia) 17 69K
12: EX-10.5 Employment Agmt Dated 12/31/96 (R. Griffith) 19 72K
13: EX-10.7 Management Consulting Agreement 5 23K
14: EX-10.8 Investment Banking Agreement 2 14K
15: EX-10.9 Stockholders Agreement Dated 12/31/96 24 81K
19: EX-12.1 Computation of Ratio of Earnings to Fixed Charges 1 11K
20: EX-21 List of Subsidiaries 1 8K
21: EX-24.2 Officer's Certificate 1 12K
22: EX-25 Form T-1 5 23K
23: EX-99.1 Letter of Transmittal 12 54K
24: EX-99.2 Notice of Guranteed Delivery 2 16K
25: EX-99.3 Broker, Dealer Letter 2 14K
26: EX-99.4 Client Letter 3 17K
EXHIBIT 10.12
LEASE AGREEMENT
by and between
CFP ASSOCIATES,
A KENTUCKY PARTNERSHIP,
as LANDLORD
and
CUSTOM FOOD PRODUCTS, INC.,
A CALIFORNIA CORPORATION,
as TENANT
Premises: Owingsville, Kentucky
Dated as of: September 30, 1994
TABLE OF CONTENTS
PAGE
Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Demise of Premises . . . . . . . . . . . . . . . . . . . . . . 1
2. Certain Definitions. . . . . . . . . . . . . . . . . . . . . . 1
3. Title and Condition. . . . . . . . . . . . . . . . . . . . . . 12
4. Use of Leased Premises; Quiet Enjoyment. . . . . . . . . . . . 14
5. Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
6. Basic Rent . . . . . . . . . . . . . . . . . . . . . . . . . . 16
7. Additional Rent. . . . . . . . . . . . . . . . . . . . . . . . 16
8. Net Lease; Non-Terminability . . . . . . . . . . . . . . . . . 19
9. Payment of Impositions . . . . . . . . . . . . . . . . . . . . 20
10. Compliance with Laws and Easement Agreements;
Environmental Matters. . . . . . . . . . . . . . . . . . . . . 21
11. Liens; Recording . . . . . . . . . . . . . . . . . . . . . . . 23
12. Maintenance and Repair . . . . . . . . . . . . . . . . . . . . 24
13. Alterations and Improvements . . . . . . . . . . . . . . . . . 25
14. Permitted Contests . . . . . . . . . . . . . . . . . . . . . . 27
15. Indemnification. . . . . . . . . . . . . . . . . . . . . . . . 28
16. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . 29
17. Casualty and Condemnation. . . . . . . . . . . . . . . . . . . 32
18. Termination Events . . . . . . . . . . . . . . . . . . . . . . 34
19. Restoration; Reduction of Rent . . . . . . . . . . . . . . . . 36
20. Procedures Upon Purchase . . . . . . . . . . . . . . . . . . . 38
21. Assignment and Subletting; Prohibition
against Leasehold Financing. . . . . . . . . . . . . . . . . . 39
22. Events of Default. . . . . . . . . . . . . . . . . . . . . . . 42
23. Remedies and Damages Upon Default. . . . . . . . . . . . . . . 44
24. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
25. Estoppel Certificate . . . . . . . . . . . . . . . . . . . . . 49
26. Surrender. . . . . . . . . . . . . . . . . . . . . . . . . . . 49
27. No Merger of Title . . . . . . . . . . . . . . . . . . . . . . 49
28. Books and Records. . . . . . . . . . . . . . . . . . . . . . . 50
29. Determination of Value . . . . . . . . . . . . . . . . . . . . 51
30. Non-Recourse as to Landlord. . . . . . . . . . . . . . . . . . 52
31. Financing. . . . . . . . . . . . . . . . . . . . . . . . . . . 53
32. Subordination. . . . . . . . . . . . . . . . . . . . . . . . . 53
33. Tax Treatment; Reporting . . . . . . . . . . . . . . . . . . . 54
34. Option to Purchase . . . . . . . . . . . . . . . . . . . . . . 54
35. Obligation to Purchase . . . . . . . . . . . . . . . . . . . . 55
36. Financing Major Alterations. . . . . . . . . . . . . . . . . . 55
37. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . 56
Exhibit "A" - Legal Description of Land
Exhibit "B" - Description of Building Systems Equipment
Exhibit "C" - Schedule of Permitted Encumbrances
Exhibit "D" - Basic Rent Schedule
Exhibit "E" - Tenant Estoppel Certificate
-i-
LEASE AGREEMENT, made as of this 30th day of September, 1994, between
CFP ASSOCIATES, a Kentucky partnership ("LANDLORD"), with an address c/o W. P.
Carey & Co., Inc., 620 Fifth Avenue, New York, New York 10020, and CUSTOM FOOD
PRODUCTS, INC., a California corporation ("TENANT") with an address at 1117 West
Olympic Boulevard, Montebello, California 90640.
In consideration of the rents and provisions herein stipulated to be
paid and performed, Landlord and Tenant hereby covenant and agree as follows:
1. DEMISE OF PREMISES. Landlord hereby demises and lets to Tenant,
and Tenant hereby takes and leases from Landlord, for the term and upon the
provisions hereinafter specified, all right, title and interest of Landlord in
and to the following described property (collectively, the "LEASED PREMISES"):
(a) the premises described in EXHIBIT "A" hereto, together with the
Appurtenances (collectively, the "LAND"); (b) the buildings, structures and
other improvements hereinafter constructed on the Land (collectively, the
"STRUCTURES"); and (c) the Building Systems Equipment (as defined in Paragraph
2).
2. CERTAIN DEFINITIONS.
"Additional Rent" shall mean Additional Rent as defined in
Paragraph 7.
"Adjoining Property" shall mean all appurtenant sidewalks,
driveways, curbs, gores and vault spaces which are located on and adjoining the
Land and which Tenant is entitled to use and responsible to repair.
"Affiliate" with respect to Tenant shall mean any other Person
controlling, controlled by or under common control with Tenant and "control"
shall mean the power to direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.
"Alterations" shall mean all changes, additions, improvements or
repairs to, all alterations, reconstructions, renewals, replacements or removals
of and all substitutions or replacements for any of the Improvements, both
interior and exterior, structural and non-structural, and ordinary and
extraordinary.
"Appurtenances" shall mean all tenements, hereditaments,
easements, rights-of-way, rights, privileges in and to the Land, including (a)
easements over other lands granted by any Easement Agreement and (b) right to
use any streets, ways, alleys, vaults, gores or strips of land adjoining the
Land.
"Assignment" shall mean any assignment of rents and leases from
Landlord to a Lender which (a) encumbers any of the Leased Premises and (b)
secures Landlord's obligation to repay a Loan, as the same may be amended,
supplemented or modified from time to time.
"Basic Rent" shall mean Basic Rent as defined in Paragraph 6 and
determined in accordance with EXHIBIT "D" hereto.
"Basic Rent Commencement Date" shall mean the first day of the
first month following the date hereof.
"Basic Rent Payment Dates" shall mean the Basic Rent Payment
Dates as defined in Paragraph 6.
"Building Systems Equipment" shall mean the Building Systems
Equipment described on EXHIBIT "B" that are installed or located in or on the
Structures on the date hereof and paid for by Landlord and that includes two (2)
built-in steam ovens (Enviro-Pac 8-Truck Smoke House ovens bearing serial
numbers 89B-5467-035 and 89B-5467-036). Building Systems Equipment shall
include Alterations to the Building Systems Equipment whether paid for by
Landlord or, if required by the terms of this Lease, Tenant.
"Business Day" shall mean any day other than a Saturday, Sunday
or a day on which banking institutions are authorized or obligated to close in
the States of Connecticut, Kentucky or New York.
"Casualty" shall mean any loss of or damage to any property
included within the Leased Premises except Tenant's personal property or to any
property in which Landlord has an ownership interest.
"Competitor" shall mean any Person competing with Tenant in the
meat processing business and whose primary business is to engage in the meat
processing industry.
"Condemnation" shall mean a Taking and/or a Requisition.
"Condemnation Notice" shall mean notice or knowledge of the
institution of or intention to institute any proceeding for Condemnation.
"Construction Agency Agreement" shall mean that certain
Construction Agency Agreement of even date among Landlord, as owner, Tenant, as
agent for Landlord in connection with the construction of the Improvements and
guaranteed by Corporate Property Associates 11 Incorporated, a Maryland
corporation.
"Construction Contracts" shall mean those certain Construction
Contracts described in the Construction Agency Agreement and any other contracts
between Tenant, as construction manager for Landlord, and Contractors, pursuant
to which the Improvements will be constructed.
"Contractors" shall mean those contractors who are parties to the
Construction Contracts.
"Costs" of a Person or associated with a specified transaction
shall mean all reasonable costs and expenses incurred by such Person or
associated with such transaction, including without limitation, attorneys' fees
and expenses, court costs, brokerage fees, escrow fees, title insurance
premiums, mortgage commitment fees, mortgage points, recording fees and transfer
taxes, as the circumstances require.
"CPI" shall mean the CPI as defined in EXHIBIT "D".
"Default Rate" shall mean the Default Rate as defined in
Paragraph 7(a)(iv).
"Default Termination Amount" shall mean the Default Termination
Amount as defined in Paragraph 23(a)(i).
"Direct Costs" shall mean Direct Costs as defined in Section 1.01
of the Construction Agency Agreement.
"Early Termination Amount" shall mean the sum of (a) one hundred
ten percent (110%) of Landlord's Share of Project Costs and (b) any Prepayment
Premium which Landlord will be required to pay in prepaying any Loan with
proceeds of the Early Termination Amount.
"Early Termination Date" shall mean Early Termination Date as
defined in Paragraph 18.
"Early Termination Event" shall mean an Early Termination Event
as defined in Paragraph 18.
"Early Termination Notice" shall mean Early Termination Notice as
defined in Paragraph 18(a).
"Easement Agreements" shall mean any conditions, covenants,
restrictions, easements, declarations, licenses and other agreements listed as
Permitted Encumbrances or as may hereafter affect the Leased Premises. Neither
party hereto shall negotiate or execute any Easement Agreement without the prior
written approval of the other party hereto, which prior approval shall not be
unreasonably withheld and shall be deemed given if no response is received by
the requesting party within fifteen (15) days following receipt of such request.
If Tenant or Landlord negotiates and the other party approves any Easement
Agreements, such Easement Agreements shall be deemed to be included as Easement
Agreements to which this Lease applies. Neither Tenant nor Landlord shall be
bound by any Easement Agreements unless Landlord and Tenant expressly agree in
writing to be bound thereby. If either Landlord or Tenant do not so agree to be
bound by any Easement Agreements (the "EXCLUDED EASEMENT AGREEMENTS"), the
Excluded Easement Agreements shall not be included as Easement Agreements or
Permitted Encumbrances. Easement Agreements are Permitted Encumbrances.
"Environmental Law" shall mean (i) whenever enacted or
promulgated, any applicable federal, state, foreign and local law, statute,
ordinance, rule, regulation, license, permit, authorization, approval, consent,
court order, judgment, decree, injunction, code, requirement or agreement with
any governmental entity, (x) relating to pollution (or the cleanup thereof), or
the protection of air, water vapor, surface water, groundwater, drinking water
supply, land (including land surface or subsurface), plant, aquatic and animal
life from injury caused
by a Hazardous Substance or (y) concerning exposure to, or the use, containment,
storage, recycling, reclamation, reuse, treatment, generation, discharge,
transportation, processing, handling, labeling, production, disposal or
remediation of Hazardous Substances, Hazardous Conditions or Hazardous
Activities, in each case as amended and as now or hereafter in effect, and (ii)
any common law or equitable doctrine (including, without limitation, injunctive
relief and tort doctrines such as negligence, nuisance, trespass and strict
liability) that may impose liability or obligations or injuries or damages due
to or threatened as a result of the presence of, exposure to, or ingestion of,
any Hazardous Substance. The term Environmental Law includes, without
limitation, the federal Comprehensive Environmental Response Compensation and
Liability Act of 1980, the Superfund Amendments and Reauthorization Act, the
federal Water Pollution Control Act, the federal Clean Air Act, the federal
Clean Water Act, the federal Resources Conservation and Recovery Act of 1976
(including the Hazardous and Solid Waste Amendments to RCRA), the federal Solid
Waste Disposal Act, the federal Toxic Substance Control Act, the federal
Insecticide, Fungicide and Rodenticide Act, the federal Occupational Safety and
Health Act of 1970, the federal National Environmental Policy Act and the
federal Hazardous Materials Transportation Act, each as amended and as now or
hereafter in effect and any similar state or local Law.
"Environmental Violation" shall mean (a) any direct or indirect
discharge, disposal, spillage, emission, escape, pumping, pouring, injection,
leaching, release, seepage, filtration or transporting of any Hazardous
Substance at, upon, under, onto or within the Leased Premises, or from the
Leased Premises to the environment, in violation of any Environmental Law or in
excess of any reportable quantity established under any Environmental Law or
which could result in any liability to Landlord, Tenant or Lender, any Federal,
state or local government or any other Person for the costs of any removal or
remedial action or natural resources damage or for bodily injury or property
damage, (b) any deposit, storage, dumping, placement or use of any Hazardous
Substance at, upon, under or within the Leased Premises or which extends to any
Adjoining Property in violation of any Environmental Law or in excess of any
reportable quantity established under any Environmental Law or which could
result in any liability to any Federal, state or local government or to any
other Person for the costs of any removal or remedial action or natural
resources damage or for bodily injury or property damage, (c) the abandonment or
discarding of any barrels, containers or other receptacles containing any
Hazardous Substances in violation of any Environmental Laws, (d) any activity,
occurrence or condition which could result in any liability, cost or expense to
Landlord or Lender or any other owner or occupier of the Leased Premises, or
which could result in a creation of a lien on the Leased Premises under any
Environmental Law, or (e) any violation of or noncompliance with any
Environmental Law.
"Event of Default" shall mean an Event of Default as defined in
Paragraph 22(a).
"Expansion" shall mean the Expansion as defined in
Paragraph 13(a).
"Expansion Improvements" shall mean the Expansion
Improvements as defined in Paragraph 13(a).
"Expansion Parcel" shall mean the Expansion Parcel as defined in
Paragraph 13(a).
"Fair Market Value" with respect to the Leased Premises shall
mean the higher of (a) the fair market value of the Leased Premises as of the
Relevant Date as if unaffected and unencumbered by this Lease or (b) the fair
market value of the Leased Premises as of the Relevant Date as affected and
encumbered by this Lease and assuming that the Term has been extended for all
extension periods provided for herein. For all purposes of this Lease, Fair
Market Value shall be determined in accordance with the procedure specified in
Paragraph 29.
"Fair Market Value Date" shall mean the date when the Fair Market
Value is determined in accordance with Paragraph 29.
"Federal Funds" shall mean federal or other immediately available
funds which at the time of payment are legal tender for the payment of public
and private debts in the United States of America.
"Final Completion Date" shall mean Final Completion Date as
defined in Section 1.01 of the Construction Agency Agreement.
"Force Majeure" shall mean Force Majeure as defined in
Paragraph 1.01 of the Construction Agency Agreement.
"Funding Deadline" shall mean the earliest to occur of (a) thirty
(30) days following the Occupancy Date, (b) the day on which Landlord has
disbursed the full amount of Landlord's Share of Project Costs and (c) June 30,
1995, subject to Force Majeure.
"GAAP" shall mean generally accepted accounting principles
consistently applied.
"Guarantor" shall mean Holdings.
"Guaranty" shall mean that certain Guaranty and Suretyship
Agreement of even date from Guarantor to Landlord.
"Hazardous Activity" means any activity, process, procedure or
undertaking which directly or indirectly (i) procures, generates or creates any
Hazardous Substance; (ii) causes or results in (or threatens to cause or result
in) the release, seepage, spill, leak, flow, discharge or emission of any
Hazardous Substance into the environment (including the air, ground water,
watercourses or water systems), (iii) involves the containment or storage of any
Hazardous Substance; or (iv) would cause the Leased Premises or any portion
thereof to become a hazardous waste treatment, recycling, reclamation,
processing, storage or disposal facility within the meaning of any Environmental
Law; provided, however, that notwithstanding anything in this sentence or this
Lease to the contrary, Tenant
shall not be deemed to be engaged in a Hazardous Activity if the subject
activity, process, procedure or undertaking is done or performed in accordance
with applicable Law and/or governmental permit.
"Hazardous Condition" means any condition which would support any
claim or liability under any Environmental Law, including the presence of
underground storage tanks.
"Hazardous Substance" means (i) any substance, material, product,
petroleum, petroleum product, derivative, compound or mixture, mineral
(including asbestos), chemical, gas, medical waste, or other pollutant, in each
case whether naturally occurring, man-made or the by-product of any process,
that is toxic, harmful or hazardous or acutely hazardous to the environment or
public health or safety or (ii) any substance supporting a claim under any
Environmental Law, whether or not defined as hazardous as such under any
Environmental Law. Hazardous Substances include, without limitation, any toxic
or hazardous waste, pollutant, contaminant, industrial waste, petroleum or
petroleum-derived substances or waste, radon, radioactive materials, asbestos,
asbestos containing materials, urea formaldehyde foam insulation, lead and
polychlorinated biphenyls.
"Holdings" shall mean CFP Holdings, Inc., a Delaware corporation.
"Impositions" shall mean the Impositions as defined in Paragraph
9(a).
"Improvements" shall mean the Structures as defined in Paragraph
1 and Building Systems Equipment (as defined above).
"Indemnitee" shall mean an Indemnitee as defined in Paragraph 15.
"Indirect Costs" shall mean Indirect Costs as defined in Section
1.01 of the Construction Agency Agreement.
"Initial Lender" shall mean Greyrock Capital Group Inc., as
Agent.
"Initial Loan" shall mean the $2,200,000 loan from Initial Lender
to Landlord.
"Initial Loan Funding Date" shall mean the date on which the
Initial Lender funds the Initial Loan.
"Initial Term" shall mean Initial Term as defined in Paragraph 5.
"Initial Term Commencement Date" shall mean Initial Term
Commencement Date as defined in Paragraph 5(a).
"Initial Term Expiration Date" shall mean Initial Term Expiration
Date as defined in Paragraph 5(a).
"Insurance Requirements" shall mean the requirements of all
insurance policies required to be maintained in accordance with this Lease.
"Land" shall mean the Land as defined in Paragraph 1 and
described in EXHIBIT "A".
"Landlord's Cash Contribution" shall mean $2,200,000.
"Landlord's Maximum Contribution" shall mean $4,200,000.
"Landlord's Share of Project Costs" shall mean the lesser of (i)
the Project Costs or (ii) the amount actually advanced by or on behalf of
Landlord for Direct Costs and Indirect Costs, but in no event more than
Landlord's Maximum Contribution.
"Law" shall mean any constitution, statute, rule of law, code,
ordinance, order, judgment, decree, injunction, rule, regulation, policy,
requirement or administrative or judicial determination, even if unforeseen or
extraordinary, of every duly constituted governmental authority, court or
agency, now or hereafter enacted or in effect.
"Lease" shall mean this Lease Agreement.
"Lease Year" shall mean each successive twelve (12) calendar
month period during the Term except that the first Lease Year shall commence on
the Primary Term Commencement Date and shall end at midnight on the last day of
the twelfth (12th) full calendar month hereafter.
"Leased Premises" shall mean the Leased Premises as defined in
Paragraph 1.
"Legal Requirements" shall mean all present and future Laws
(including but not limited to Environmental Laws and Laws relating to
accessibility to, usability by, and discrimination against, disabled
individuals) and all covenants, restrictions and conditions now or hereafter of
record which may be applicable to Tenant or to any of the Leased Premises, or to
the use, manner of use, occupancy, possession, operation, maintenance,
alteration, repair or restoration of any of the Leased Premises, even if
compliance therewith necessitates structural changes or improvements or results
in interference with the use or enjoyment of any of the Leased Premises.
"Lender" shall mean (a) Initial Lender, its successors and
assigns, and (b) any other person (and their respective successors and assigns)
which may, after the date hereof, make a Loan to Landlord or is the holder of
any Note.
"Loan" shall mean the Initial Loan and any other loan made by one
or more Lenders to Landlord, which Initial Loan or other loan is secured by a
Mortgage and an Assignment and evidenced by a Note. For purposes of this Lease,
"Loan" shall not include the Tenant Loan.
"Monetary Event of Default" shall mean a failure by Tenant to pay
Rent or any other Monetary Obligation within the
cure period, if any, as provided in this Lease.
"Monetary Obligations" shall mean Rent and all other sums payable
by Tenant under this Lease to Landlord, to any third party on behalf of Landlord
or to any Indemnitee pursuant to the provisions of this Lease.
"Mortgage" shall mean any mortgage or deed of trust from Landlord
to a Lender which (a) encumbers any of the Leased Premises and (b) secures
Landlord's obligation to repay a Loan, as the same may be amended, supplemented
or modified.
"Net Award" shall mean (a) the entire award payable to Landlord
or Lender by reason of a Condemnation whether pursuant to a judgment or by
agreement or otherwise, or (b) the entire proceeds of any insurance required
under clauses (i), (ii) (to the extent payable to Landlord or Lender), (iv), (v)
or (vi) of Paragraph 16(a) (to the extent payable to Landlord, Tenant or
Lender), as the case may be, less any expenses incurred by Tenant, Landlord and
Lender in collecting such award or proceeds.
"Note" shall mean any promissory note evidencing Landlord's
obligation to repay a Loan, as the same may be amended, supplemented or
modified.
"Occupancy Date" shall mean the date on which all of the
following events have occurred: (i) the Improvements have been substantially
completed in accordance with the Plans, as certified to by the Architect (as
defined in the Construction Agency Agreement), (ii) the Architect has provided
to Landlord a list of "punch list" items together with the cost of, and schedule
for, completion of such items, and (iii) all permanent permits and licenses
required for the occupancy of the Improvements have been obtained, but in no
event later than June 30, 1995, as the same may be extended by Force Majeure.
"Offer" shall mean Offer as defined in Paragraph 8(d).
"Offer Rejection" shall mean Offer Rejection as defined in
Paragraph 10(h).
"Partial Casualty" shall mean any Casualty which does not
constitute an Early Termination Event.
"Partial Condemnation" shall mean any Condemnation which does not
constitute an Early Termination Event.
"Payment Date" shall mean the Payment Date as defined in
Paragraph 23(a)(i).
"Permitted Encumbrances" shall mean the existing state of title
to the Leased Premises, including those covenants, restrictions, reservations,
liens, conditions and easements and other encumbrances, other than any Mortgage
or Assignment and other than the Tenant Mortgage, listed on EXHIBIT "C" hereto.
It is agreed that such listing shall not be deemed to revive any such
encumbrances that have expired or terminated or are otherwise invalid or
unenforceable.
"Person" shall mean an individual, partnership, association,
corporation or other entity.
"Plans" shall mean the plans and specifications prepared and to
be prepared by Suhar & Associates for the construction of the Improvements. A
list of the existing Plans is attached to the Construction Agency Agreement.
Any amendments, modifications or additions to the Plans shall be approved as
provided in the Construction Agency Agreement.
"Prepayment Premium" shall mean any payment (other than a payment
of principal and/or interest which Landlord is required to make under a Note or
a Mortgage) by reason of any prepayment by Landlord of any principal due under a
Note or Mortgage as the result of the occurrence of an Early Termination Event
or an Event of Default, and which may be (in lieu of such prepayment premium or
prepayment penalty) a "make whole" clause requiring a prepayment premium in an
amount sufficient to compensate the Lender for the loss of the benefit of the
Loan due to a prepayment.
"Present Value" of any amount shall mean such amount discounted
by a rate per annum which is the lower of (a) the Prime Rate at the time such
present value is determined or (b) eight percent (8%) per annum. As used
herein, "Present Value" shall apply only to the calculations set forth in
Paragraph 23.
"Primary Term" shall mean Primary Term as defined in Paragraph 5.
"Primary Term Commencement Date" shall mean Primary Term
Commencement Date as defined in Paragraph 5.
"Primary Term Expiration Date" shall mean Primary Term Expiration
Date as defined in Paragraph 5.
"Prime Rate" shall mean the annual interest rate as published,
from time to time, in the WALL STREET JOURNAL as the "Prime Rate" in its column
entitled "Money Rates". The Prime Rate may not be the lowest rate of interest
charged by any "large U.S. money center commercial banks" and Landlord makes no
representations or warranties to that effect. In the event the WALL STREET
JOURNAL ceases publication or ceases to publish the "Prime Rate" as described
above, the Prime Rate shall be the average per annum discount rate (the
"DISCOUNT RATE") on ninety-one (91) day bills ("TREASURY BILLS") issued from
time to time by the United States Treasury at is most recent auction, plus three
hundred (300) basis points. If no such 91-day Treasury Bills are then being
issued, the Discount Rate shall be the discount rate on Treasury Bills then
being issued for the period of time closest to ninety-one (91) days.
"Project Cost" shall mean the sum of all Direct Costs and
Indirect Costs incurred or to be incurred for the acquisition of the Land and
the acquisition, construction and/or installation of the Improvements.
"Relevant Amount" shall mean the Early Termination Amount, or the
Default Termination Amount or the Option Purchase Price, as the case may be.
"Relevant Date" shall mean (a) the date on which Tenant exercises
its option to purchase the Leased Premises pursuant to Paragraph 34, (b) the
date which is six (6) months prior to the expiration of the Term for purposes of
determining the purchase price under Paragraph 35 hereof and (c) the date when
Fair Market Value is redetermined, in the event of a redetermination of Fair
Market Value pursuant to Paragraph 20(c).
"Remaining Obligations" shall mean Remaining Obligations as
defined in Paragraph 18(c).
"Remaining Sum" shall mean Remaining Sum as defined in Paragraph
19(c).
"Renewal Term" shall mean Renewal Term as defined in Paragraph 5.
"Rent" shall mean, collectively, Basic Rent and Additional Rent.
"Requisition" shall mean any temporary requisition or
confiscation of the use or occupancy of any of the Leased Premises by any
governmental authority, civil or military, whether pursuant to an agreement with
such governmental authority in settlement of or under threat of any such
requisition or confiscation, or otherwise.
"Retention Date" shall mean the later of the date on which the
amount of the Remaining Sum is finally determined or the date on which
Landlord's right to the Remaining Sum is finally determined.
"Site Assessment" shall mean a Site Assessment as defined in
Paragraph 10(c).
"State" shall mean the State of Kentucky.
"Structures" shall mean the Structures as defined in Paragraph 1.
"subject to adjustment" following any amount stated as a specific
number in this Lease, shall mean that such number is deemed to be increased on
the first day of each Lease Year commencing with the second Lease Year by an
amount determined by multiplying the number by a fraction, the numerator of
which is the difference between the CPI for the month prior to the first day of
such Lease Year and the CPI occurring one (1) year earlier and the denominator
of which shall be the CPI occurring one (1) year earlier and adding the product
of such multiplication to such number.
"Surviving Obligations" shall mean any obligations of Tenant
under this Lease, actual or contingent, which arise on or prior to the
expiration or prior termination of this Lease or which survive such expiration
or termination by their own terms.
"Taking" shall mean (a) any taking or damaging of all or a
portion of any of the Leased Premises (i) in or by condemnation or other eminent
domain proceedings pursuant to any Law, general or special, or (ii) by reason of
any agreement with any condemnor in settlement of or under threat of any such
condemnation or other eminent domain proceeding, or (b) any de
facto condemnation. The Taking shall be considered to have taken place as of
the later of the date actual physical possession is taken by the condemnor, or
the date on which the right to compensation and damages accrues under the law
applicable to the Leased Premises.
"Tenant Loan" shall mean the non-recourse loan in the maximum
amount of $200,000 from Tenant to Landlord that is secured by the Tenant
Mortgage.
"Tenant Mortgage" shall mean the non-recourse second priority
mortgage and security agreement from Landlord to Tenant that secures the Tenant
Loan.
"Term" shall mean the Primary Term and the Initial Term, plus any
exercised Renewal Terms.
"Third Party Purchaser" shall mean Third Party Purchaser as
defined in Paragraph 21(f).
"Warrant Agreement" shall mean that certain Warrant Agreement of
even date between Landlord and Tenant.
3. TITLE AND CONDITION.
(a) The Leased Premises are demised and let subject to (i) the
Mortgage and Assignment presently in effect, (ii) the Tenant Mortgage, (iii) the
rights of any Persons in possession of the Leased Premises, (iv) the existing
state of title of any of the Leased Premises, including any Permitted
Encumbrances, (v) any state of facts which an accurate survey or physical
inspection of the Leased Premises might show, (vi) all Legal Requirements,
including any existing violation of any thereof, and (vii) the condition of the
Leased Premises as of the commencement of the Term, without representation or
warranty by Landlord.
(b) LANDLORD LEASES AND WILL LEASE AND TENANT TAKES AND WILL TAKE
THE LEASED PREMISES AS IS. TENANT ACKNOWLEDGES THAT LANDLORD (WHETHER ACTING AS
LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT MADE AND WILL NOT MAKE, NOR
SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS
OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES, INCLUDING ANY WARRANTY
OR REPRESENTATION AS TO (i) ITS FITNESS, DESIGN OR CONDITION FOR ANY PARTICULAR
USE OR PURPOSE, (ii) THE QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, (iii)
THE EXISTENCE OF ANY DEFECT, LATENT OR PATENT, (iv) LANDLORD'S TITLE THERETO,
(v) VALUE, (vi) COMPLIANCE WITH SPECIFICATIONS, (vii) LOCATION, (viii) USE, (ix)
CONDITION, (x) MERCHANTABILITY, (xi) QUALITY, (xii) DESCRIPTION, (xiii)
DURABILITY (xiv) OPERATION (xv) THE EXISTENCE OF ANY HAZARDOUS SUBSTANCE,
HAZARDOUS CONDITION OR HAZARDOUS ACTIVITY OR (xvi) COMPLIANCE OF THE LEASED
PREMISES WITH ANY LAW OR LEGAL REQUIREMENT; AND ALL RISKS INCIDENT THERETO ARE
TO BE BORNE BY TENANT. TENANT ACKNOWLEDGES THAT THE LEASED PREMISES IS OF ITS
SELECTION AND TO ITS SPECIFICATIONS AND THAT THE LEASED PREMISES HAS BEEN
INSPECTED BY TENANT AND IS SATISFACTORY TO IT. IN THE EVENT OF ANY DEFECT OR
DEFICIENCY IN ANY OF THE LEASED PREMISES OF ANY NATURE, WHETHER
LATENT OR PATENT, LANDLORD SHALL NOT HAVE ANY RESPONSIBILITY OR LIABILITY WITH
RESPECT THERETO OR FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING STRICT
LIABILITY IN TORT). THE PROVISIONS OF THIS PARAGRAPH 3(b) HAVE BEEN NEGOTIATED,
AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY WARRANTIES BY
LANDLORD, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES,
ARISING PURSUANT TO THE UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW OR
HEREAFTER IN EFFECT OR ARISING OTHERWISE.
(c) Tenant represents to Landlord that Tenant has examined the title
to the Leased Premises prior to the execution and delivery of this Lease and has
found the same to be satisfactory for the purposes contemplated hereby. Tenant
represents and warrants to Landlord that (i) Tenant has only the leasehold right
of possession and use of the Leased Premises as provided herein, (ii) on the
Final Completion Date the Improvements will substantially conform to all Legal
Requirements and all Insurance Requirements, (iii) all easements necessary or
appropriate for the use or operation of the Leased Premises have been obtained,
(iv) as of the Final Completion Date all contractors and subcontractors who have
performed work on or supplied materials to the Improvements will have been fully
paid unless Landlord or Tenant is contesting any such payment in accordance with
Paragraph 14 hereof, and all materials and supplies have been fully paid for,
(v) as of the Final Completion Date the Improvements will have been fully
completed in a workmanlike manner of first class quality, and (vi) as of the
Final Completion Date all Equipment necessary or appropriate for the use or
operation of the Improvements will have been installed and will be fully
operative in all material respects.
(d) Landlord hereby assigns to Tenant, without recourse or warranty
whatsoever, all warranties, guaranties, indemnities and similar rights which
Landlord may have against any manufacturer, seller, engineer, contractor or
builder in respect of any of the Leased Premises. Such assignment shall remain
in effect until an Event of Default occurs or until the expiration or earlier
termination of this Lease, whereupon such assignment shall cease and all of said
warranties, guaranties, indemnities and other rights shall automatically revert
to Landlord.
(e) Pursuant to the Construction Agency Agreement, and so long as
Landlord is not in default of its obligations under the Construction Agency
Agreement, Tenant will cause the Improvements to be constructed with funds to be
provided by or on behalf of Landlord, all as more particularly described in the
Construction Agency Agreement. The Improvements will be owned by Landlord and
are included within the Leased Premises. Tenant acknowledges that the
Improvements have not yet been constructed and that, pursuant to the
Construction Agency Agreement, Tenant has the responsibility for causing the
Improvements to be completed in accordance with the terms of the Construction
Agency Agreement. Landlord acknowledges that, to the extent and subject to the
terms and conditions specified in the Construction Agency Agreement, it is
obligated to and shall provide funds for the construction of the Improvements.
Landlord will not make any representations or warranties with respect to the
Improvements. Tenant further acknowledges that, upon occurrence of an Event of
Default, Landlord may terminate the Construction Agency Agreement, and in
addition to all other remedies of Landlord
under this Lease, Landlord shall have the right but not the obligation to
complete construction of the Improvements in accordance with the Plans. If
Landlord so completes construction of the Improvements, Tenant will not be
excused from paying all Rent due pursuant to the terms of this Lease, and,
whether or not Landlord completes the Improvements, Landlord shall have the
right to exercise any or all of its remedies hereunder following an Event of
Default. All acknowledgments of Tenant regarding the Leased Premises contained
in Paragraph 3(b) shall be deemed to have been made again as of the Final
Completion Date.
(f) Tenant, at its sole cost and expense, shall promptly and
diligently enforce any third party warranties, guaranties and indemnities from
contractors, materialmen and manufacturers with respect to the construction and
installation of the Improvements, including any rights and remedies existing
under contract or pursuant to the Uniform Commercial Code.
(g) In the event Landlord fails to provide funds for construction and
installation of the Improvements in accordance with and subject to the terms of
the Construction Agency Agreement, Tenant shall have the right to pursue any
rights and remedies available to it at law or in equity, but shall have no right
of offset hereunder.
4. USE OF LEASED PREMISES; QUIET ENJOYMENT.
(a) Tenant may occupy and use the Leased Premises for food
processing, cold storage, blast freezing, packaging, distribution, warehousing
and related office uses and for no other purpose. Tenant shall not use or
occupy or permit any of the Leased Premises to be used or occupied, nor do or
permit anything to be done in or on any of the Leased Premises, in a manner
which would or might be reasonably expected to (i) violate any Law or Legal
Requirement, (ii) make void or voidable or cause any insurer to cancel any
insurance required by this Lease, or make it difficult or impossible to obtain
any such insurance at commercially reasonable rates, (iii) cause structural
injury to any of the Improvements or (iv) constitute a public or private
nuisance or waste.
(b) Subject to the provisions hereof, so long as no Event of Default
has occurred and is continuing, Tenant shall quietly hold, occupy and enjoy the
Leased Premises throughout the Term, without any hindrance, ejection or
molestation by Landlord with respect to matters that arise after the date
hereof, provided that Landlord may enter upon and examine any of the Leased
Premises at such reasonable times as Landlord may select for the purpose of
inspecting the Leased Premises, verifying compliance or non-compliance by Tenant
with its obligations hereunder and the existence or non-existence of an Event of
Default or event which with the passage of time and/or notice would constitute
an Event of Default, showing the Leased Premises to prospective Lenders and
purchasers and taking such other action with respect to the Leased Premises as
is permitted by any provision hereof.
5. TERM.
(a) Subject to the provisions hereof, Tenant shall have and hold the
Leased Premises for a primary term (the "PRIMARY TERM") commencing on the date
hereof (the "PRIMARY TERM COMMENCEMENT DATE") and ending on the last day of the
calendar month in which the Funding Deadline occurs (the "PRIMARY TERM
EXPIRATION DATE") and for an initial term (the "INITIAL TERM") commencing on the
first day following the Primary Term Expiration Date (the "INITIAL TERM
COMMENCEMENT DATE") and ending on the last day of the three hundredth (300th)
calendar month next following the date on which the Initial Term commences (the
"INITIAL TERM EXPIRATION DATE"). Promptly following the Initial Term
Commencement Date, Landlord and Tenant shall execute an Addendum to this Lease
setting forth the Initial Term Commencement Date and the Initial Term Expiration
Date. If all Rent and all other sums due hereunder shall not have been fully
paid by the end of the Term, Landlord may, at its option, extend the Term until
all said sums shall have been fully paid.
(b) Provided that if, on or prior to the Initial Term Expiration Date
or any other Renewal Date (as hereinafter defined) this Lease shall not have
been terminated pursuant to any provision hereof, then on the Initial Term
Expiration Date and on the fifth (5th) and tenth (10th) anniversaries of the
Initial Term Expiration Date (the Initial Term Expiration Date and each such
anniversary being a "RENEWAL DATE"), the Term shall be deemed to have been
automatically extended for an additional period of five (5) years (each such
five (5) year period, a "RENEWAL TERM"), unless Tenant shall notify Landlord in
writing at least four hundred twenty five (425) days prior to the next Renewal
Date that Tenant is terminating this Lease as of the next Renewal Date. Any
such extension of the Term shall be subject to all of the provisions of this
Lease, as the same may be amended, supplemented or modified.
(c) If Tenant exercises its option not to extend or further extend
the Term, or if an Event of Default occurs, then Landlord shall have the right
during the remainder of the Term then in effect and, in any event, Landlord
shall have the right during the last year of the Term, to (i) advertise the
availability of the Leased Premises for sale or reletting and to erect upon the
Leased Premises signs indicating such availability and (ii) show the Leased
Premises to prospective purchasers or tenants or their agents at such reasonable
times as Landlord may select.
6. BASIC RENT. Tenant shall pay to Landlord, as annual rent for the
Leased Premises during the Term, the amounts determined in accordance with
EXHIBIT "D" hereto ("BASIC RENT"). Basic Rent shall begin accruing on the
Primary Term Commencement Date. Commencing on the Basic Rent Commencement Date
and continuing on the first day of each month thereafter to and including the
month following the month in which the Initial Loan Funding Date occurs, Basic
Rent shall be payable monthly in arrears. Commencing on the first day of the
first month following the Initial Loan Funding Date and continuing on the first
day of each month thereafter for the balance of the Term, Basic Rent shall be
payable monthly in advance (each such monthly day being a "BASIC RENT PAYMENT
DATE"). Each such rental payment shall be made to Landlord at its address set
forth above and/or to such one or more other Persons, at such addresses and in
such proportions as Landlord may direct by fifteen (15) days' prior written
notice to Tenant (in which event Tenant shall give
Landlord notice of each such payment concurrent with the making thereof), and in
Federal Funds. Tenant shall receive as a credit against monthly installments of
Basic Rent (a) amounts, if any, paid to Landlord from the proceeds of the
Business Income-Interruption Insurance described in Paragraph 16(v) hereof, and
(b) so long as no Event of Default exists and remains continuing, monthly
interest received by Landlord on that portion of the principal balance of the
Initial Loan which has been advanced to Landlord by the Initial Lender but not
further advanced by Landlord to Tenant pursuant to the Construction Agency
Agreement (the "UNADVANCED PROCEEDS"). Landlord hereby agrees to invest such
Unadvanced Proceeds as directed by Tenant, unless otherwise directed by the
Initial Lender.
7. ADDITIONAL RENT.
(a) Subject to any specific provisions of this Lease to the contrary,
Tenant shall pay and discharge, as additional rent (collectively, "ADDITIONAL
RENT"):
(i) except as otherwise specifically provided herein, all costs
and expenses of Tenant, Landlord and Lender which are incurred in connection or
associated with:
(A) the ownership, use, non-use, occupancy, possession,
operation, condition, design, construction, maintenance, alteration, repair or
restoration of any of the Leased Premises,
(B) the performance of any of Tenant's obligations under
this Lease,
(C) any sale or other transfer of any of the Leased Premises
to Tenant under this Lease,
(D) any Condemnation proceedings,
(E) the adjustment, settlement or compromise of any
insurance claims involving or arising from any of the Leased Premises,
(F) the prosecution, defense or settlement of any litigation
involving or arising from any of the Leased Premises, this Lease, or the sale of
the Leased Premises to Landlord (except and to the extent, in the case of
litigation commenced by Landlord, a court of competent jurisdiction rules,
pursuant to a final, non-appealable order, that Landlord has wrongfully sued the
defendant in such litigation),
(G) the exercise or enforcement by Landlord, its successors
and assigns, of any of its rights under this Lease,
(H) any amendment to or modification or termination of this
Lease made at the request of Tenant,
(I) Costs of Landlord's counsel actually incurred in
connection with the preparation, negotiation and
execution of this Lease, and Costs of Initial Lender's counsel actually incurred
in connection with the preparation, negotiation and execution of the Initial
Loan documentation and review of and comment on related documentation, or
actually incurred in connection with any act undertaken by Landlord (or its
counsel) or Lender (or its counsel) at the request of Tenant, or actually
incurred in connection with any act of Landlord (or Lender) performed on behalf
of Tenant, if Tenant fails to perform such act after notice from Landlord (or
Lender) that Tenant is required to perform such act pursuant to the terms of
this Lease, and
(J) any other items specifically required to be paid by
Tenant under this Lease, which costs and expenses shall include, without
limitation, all Costs, judgments, settlement amounts, Impositions, insurance
premiums, appraisal fees, the cost of performing and reporting all Site
Assessments to the extent provided in Paragraph 10(c) (unless and to the extent
the Site Assessment reveals an Environmental Violation which is conclusively
demonstrated, in the reasonable judgment of the Site Reviewers, to be the direct
result of Landlord entering upon the Leased Premises and performing activities
thereon), the cost of curing any Environmental Violation (unless and to the
extent Landlord enters upon the Leased Premises and performs activities which
are conclusively demonstrated, in the reasonably judgment of the Site Reviewers,
to be the sole and direct cause of such Environmental Violation), and the cost
of complying with all Legal Requirements, fines, penalties and interest;
(ii) after the date all or any portion of any installment of
Basic Rent is due and not paid, an amount equal to five percent (5%) of the
amount of such unpaid installment or portion thereof ("LATE CHARGE"), provided,
however, that with respect to the first two late payments of all or any portion
of any installment of Basic Rent in any consecutive twelve (12) month period the
Late Charge shall not be due and payable unless the Basic Rent has not been paid
within five (5) days following the due date thereof;
(iii) a sum equal to any additional sums (including any late
charge, default penalties, interest and fees of Lender's counsel) which are
payable by Landlord to any Lender under any Note by reason of Tenant's late
payment or non-payment of Basic Rent or by reason of an Event of Default; and
(iv) interest at the rate (the "DEFAULT RATE") equal to the lower
of (A) the maximum rate permitted by Law and (B) of twelve and one-half percent
(12.5%) per annum on the following sums until paid in full: (1) all overdue
installments of Basic Rent from the respective due dates thereof, (2) all
overdue amounts of Additional Rent relating to obligations which Landlord shall
have paid on behalf of Tenant, beginning five (5) Business Days after notice of
payment thereof by Landlord, and (3) all other overdue amounts of Additional
Rent, from the date when any such amount becomes overdue;
(v) provided, that in no event shall amounts payable under
Paragraphs 7(a)(ii), (iii) and (iv) above exceed the maximum rate permitted by
applicable Law.
(b) Subject to any specific provisions of this Lease
to the contrary, Tenant shall pay and discharge (i) any Additional Rent referred
to in Paragraph 7(a)(i) when the same shall become due, provided that amounts
which are billed to Landlord or any third party, but not to Tenant, shall be
paid within ten (10) days after Landlord's written demand for payment thereof,
and (ii) any other Additional Rent, within fifteen (15) days following
Landlord's written demand for payment thereof. At the time Landlord makes
written demand for payment, Landlord shall furnish to Tenant reasonably detailed
invoices or statements for all items of Additional Rent paid by Landlord or
Lender.
(c) Notwithstanding anything in this Paragraph 7 to the contrary,
Tenant shall not be responsible for paying any costs of Landlord and/or any
Lender incurred with respect to any sale, transfer, or financing of the Leased
Premises by Landlord unless Tenant purchases the Leased Premises from Landlord
pursuant to any provision of this Lease which requires Tenant to pay such costs.
8. NET LEASE; NON-TERMINABILITY.
(a) This Lease is a net lease and all Monetary Obligations shall be
paid without notice or demand and without set-off, counterclaim, recoupment,
abatement, suspension, deferment, diminution, deduction, reduction or defense,
except as otherwise expressly provided in this Lease (collectively, a
"SET-OFF").
(b) Except as otherwise expressly provided herein, this Lease and the
rights of Landlord and the obligations of Tenant hereunder shall not be affected
by any event or for any reason, including the following: (i) any damage to or
theft, loss or destruction of any of the Leased Premises, (ii) any Condemnation,
(iii) the prohibition, limitation or restriction of Tenant's use of any of the
Leased Premises, (iv) any eviction by paramount title or otherwise, (v) Tenant's
acquisition of ownership of any of the Leased Premises other than pursuant to an
express provision of this Lease, (vi) any default on the part of Landlord
hereunder or under any Note, Mortgage, Assignment or any other agreement, (vii)
any latent or other defect in any of the Leased Premises, (viii) the breach of
any warranty of any seller or manufacturer of any of the Building Systems
Equipment, (ix) any violation of Paragraph 4(b) or any other provision of this
Lease by Landlord, (x) the bankruptcy, insolvency, reorganization, composition,
readjustment, liquidation, dissolution or winding-up of, or other proceeding
affecting Landlord so long as such proceeding does not terminate Tenant's right
to possession of the Leased Premises pursuant to the provisions of this Lease,
(xi) the exercise of any remedy, including foreclosure, under any Mortgage or
Assignment, (xii) any action with respect to this Lease (including the
disaffirmance hereof) which may be taken by Landlord, any trustee, receiver or
liquidator of Landlord or any court under the Federal Bankruptcy Code or
otherwise, (xiii) any interference with Tenant's use of the Leased Premises,
(xiv) market or economic changes or (xv) any other cause, whether similar or
dissimilar to the foregoing, any present or future Law to the
contrary notwithstanding.
(c) Except as may be specifically provided herein to the contrary,
the obligations of Tenant hereunder shall be separate and independent covenants
and agreements, all Monetary Obligations shall continue to be payable in all
events (or, in lieu thereof, Tenant shall pay amounts equal thereto), and the
obligations of Tenant hereunder shall continue unaffected unless the requirement
to pay or perform the same shall have been terminated pursuant to an express
provision of this Lease. All Rent payable by Tenant hereunder shall constitute
"rent" for all purposes (including Section 502(b)(6) of the Bankruptcy Code).
(d) Except as otherwise expressly provided herein, Tenant shall have
no right and hereby waives all rights which it may have under any Law (i) to
quit, terminate or surrender this Lease or any of the Leased Premises, or
(ii) to any Set-Off of any Monetary Obligations.
9. PAYMENT OF IMPOSITIONS.
(a) Subject to the provisions of Paragraph 14 hereof, Tenant shall,
before interest or penalties are due thereon, pay and discharge all taxes
(including real and personal property, franchise, sales and rent taxes), all
charges for any easement or agreement maintained for the benefit of any of the
Leased Premises, all assessments and levies, all permit, inspection and license
fees, all rents and charges for water, sewer, utility and communication services
relating to any of the Leased Premises, all ground rents and all other public
charges whether of a like or different nature, even if unforeseen or
extraordinary, imposed upon or assessed against (i) Tenant, (ii) any of the
Leased Premises, (iii) Landlord as a result of or arising in respect of the
acquisition, ownership, occupancy, leasing, use, possession or sale of any of
the Leased Premises, any activity conducted on any of the Leased Premises, or
the Rent, or (iv) any Lender by reason of any Note, Mortgage, Assignment or
other document evidencing or securing a Loan and which (as to this clause (iv))
Landlord has agreed to pay (collectively, the "IMPOSITIONS"); provided, that
nothing herein shall obligate Tenant to pay (A) income, excess profits or other
taxes of Landlord (or Lender) which are determined on the basis of Landlord's
(or Lender's) net income or net worth (unless such taxes are in lieu of or a
substitute for any other tax, assessment or other charge upon or with respect to
the Leased Premises which, if it were in effect, would be payable by Tenant
under the provisions hereof or by the terms of such tax, assessment or other
charge), (B) any estate, inheritance, succession, gift or similar tax imposed on
Landlord, (C) any capital gains tax imposed on Landlord in connection with the
sale of the Leased Premises to any Person, (D) installments of principal and/or
interest payable by Landlord on any Loan, or (E) property management fees
payable by Landlord. If any Imposition may be paid in installments without
interest or penalty, Tenant shall have the option to pay such Imposition in
installments; in such event, Tenant shall be liable only for those installments
which accrue or become due and payable during the Term. Tenant shall prepare
and file all tax reports required by governmental authorities which relate to
the Impositions. Tenant shall deliver to Landlord (1) copies of all settlements
and notices pertaining to the Impositions which may be issued by any
governmental authority within ten (10) days after Tenant's receipt thereof,
(2) receipts for payment of all taxes required
to be paid by Tenant hereunder within thirty (30) days after the due date
thereof and (3) receipts for payment of all other Impositions within ten (10)
days after Landlord's request therefor.
(b) At any time (i) that a Lender so requires or (ii) following the
occurrence and during the continuation of a Monetary Event of Default, Landlord
shall have the right to require Tenant to pay to Landlord an additional monthly
sum (each an "ESCROW PAYMENT") sufficient to pay the Escrow Charges (as
hereinafter defined) as they become due; PROVIDED, that should any subsequent
Monetary Event of Default occur, Landlord shall have the right to require Tenant
to pay to Landlord Escrow Payments in accordance with the terms of this
Paragraph 9(b) for the remainder of the Term. As used herein, "ESCROW CHARGES"
shall mean real estate taxes on the Leased Premises or payments in lieu thereof
and premiums on any insurance required by this Lease. Landlord shall determine
the amount of the Escrow Charges and of each Escrow Payment. If the Escrow
Payments are held by Lender, the Escrow Payments may be commingled with other
funds of Lender. If the Escrow Payments are held by Landlord, the Escrow
Payments shall not be commingled with other funds of Landlord, shall be invested
and interest thereon shall accrue to the benefit of Tenant. Landlord shall
apply the Escrow Payments to the payment of the Escrow Charges in such order or
priority as Landlord shall determine or as required by law. If at any time the
Escrow Payments theretofore paid to Landlord shall be insufficient for the
payment of the Escrow Charges, Tenant, within ten (10) days after Landlord's
demand therefor, shall pay the amount of the deficiency to Landlord.
10. COMPLIANCE WITH LAWS AND EASEMENT AGREEMENTS; ENVIRONMENTAL
MATTERS.
(a) Tenant shall, at its expense, comply with and conform to, in all
material respects, and cause any other Person occupying any part of the Leased
Premises to comply with and conform to, in all material respects, all Insurance
Requirements and Legal Requirements (including all applicable Environmental
Laws). Tenant shall not at any time (i) cause, permit or suffer to occur any
Environmental Violation or (ii) permit any sublessee, assignee or other Person
occupying the Leased Premises under or through Tenant to cause, permit or suffer
to occur any Environmental Violation.
(b) Tenant, at its sole cost and expense, will at all times promptly
and faithfully abide by, discharge and perform all of the covenants, conditions
and agreements contained in any Easement Agreement on the part of Landlord or
the occupier to be kept and performed thereunder. If and to the extent
necessary to enable Tenant to comply with its obligations set forth in the
preceding sentence, Landlord shall grant Tenant a license to enforce Landlord's
rights under any such Easement Agreement. Tenant will not alter, modify, amend
or terminate any Easement Agreement, give any consent or approval thereunder, or
enter into any new Easement Agreement without, in each case, the prior written
consent of Landlord.
(c) Upon prior written notice from Landlord, Tenant shall permit such
persons as Landlord may designate ("SITE REVIEWERS") to visit the Leased
Premises and perform, as agents of Tenant, environmental site investigations and
assessments ("SITE ASSESSMENTS") on the Leased Premises for the purpose of
determining whether there exists on the Leased Premises any Environmental
Violation or any condition which could result in any Environmental Violation.
Such Site Assessments may include both above and below the ground testing for
Environmental Violations and such other tests as may be necessary, in the
opinion of the Site Reviewers, to conduct the Site Assessments. Tenant shall
supply to the Site Reviewers such historical and operational information
regarding the Leased Premises as may be reasonably requested by the Site
Reviewers to facilitate the Site Assessments, and shall make available for
meetings with the Site Reviewers appropriate personnel having knowledge of such
matters. Landlord shall not have the right to conduct a Site Assessment more
than one time every three years during the Term except that such limitation
shall not apply to any Site Assessment conducted in connection with a financing,
refinancing or sale of the Leased Premises or if Landlord has reasonable cause
to believe that an Environmental Violation exists in violation of Law or if
Landlord is required to conduct a Site Assessment by any governmental agency or
in order to monitor an existing Environmental Violation. Provided that no
Monetary Event of Default shall have occurred and be continuing, Tenant shall
have the right to consent to the selection of the Site Reviewers, which consent
not be unreasonably withheld or delayed. If a Monetary Event of Default exists,
Tenant shall not have any right to consent to the selection of the Site
Reviewers so long as the Site Reviewers shall be a nationally recognized firm of
licensed engineers.
(d) If an Environmental Violation occurs or is found to exist and, in
the reasonable judgment of the Site Reviewer, the cost of remediation of the
same is likely to exceed $100,000, Tenant shall provide to Landlord, within
thirty (30) days after Landlord's written request therefor, adequate financial
assurances that Tenant will effect such remediation in accordance with
applicable Environmental Laws. Such financial assurances shall be a bond or
letter of credit satisfactory to Landlord in form and substance and in an amount
equal to or greater than Landlord's reasonable estimate, based upon a Site
Assessment performed pursuant to Paragraph 10(c), of the anticipated cost of
such remedial action.
(e) Notwithstanding any other provision of this Lease, if an
Environmental Violation occurs or is found to exist and the Term would otherwise
terminate or expire, then, at the option of Landlord, the Term shall be
automatically extended beyond the date of termination or expiration and this
Lease shall remain in full force and effect beyond such date until the earlier
to occur of (i) the completion of all remedial action in accordance with
applicable Environmental Laws or (ii) the date specified in a written notice
from Landlord to Tenant terminating this Lease.
(f) Tenant shall notify Landlord immediately after becoming aware of
any Environmental Violation (or alleged Environmental Violation) or
noncompliance with any of the covenants contained in this Paragraph 10 and shall
forward to Landlord immediately upon receipt thereof copies of all orders,
reports, notices, permits, applications or other communications relating to any
such violation or noncompliance.
(g) All future leases, subleases or concession agreements relating to
the Leased Premises entered into by Tenant shall require the other Person
thereto to comply with all Environmental Laws with respect to its use and
occupancy of the Leased Premises.
(h) Upon the occurrence of an Environmental Violation whose
remediation costs are estimated by the Site Reviewers to exceed $500,000, Tenant
shall have the right (but not the obligation) to make an Offer to purchase the
Leased Premises for a purchase price equal to the Early Termination Amount,
which Offer must be given, if at all, no later than thirty (30) days following
receipt by Landlord and Tenant of the Site Reviewer's estimate of remediation
costs. If a rejection (an "OFFER REJECTION") shall be given by Landlord, which
Offer Rejection shall contain the written consent of Lender, within thirty (30)
days following receipt of such offer, this Lease shall remain in full force and
effect in accordance with its terms, and Tenant shall promptly commence
remediation of the Environmental Violation. Unless Tenant shall have received
an Offer Rejection on or before the thirtieth (30th) day following receipt of
the Offer, Landlord shall be conclusively presumed to have rejected the Offer.
If the Offer is accepted by Landlord, then Tenant shall have no obligation to
provide the financial assurances pursuant to Paragraph 10(d) and on the first
Basic Rent Payment Date which occurs at least sixty (60) days following receipt
of the Offer, Tenant shall pay to Landlord the Early Termination Amount and all
Remaining Obligations and Landlord shall convey the Leased Premises to Tenant in
accordance with the provisions of Paragraph 20.
11. LIENS; RECORDING.
(a) Tenant shall not, directly or indirectly, create or permit to be
created or to remain and shall promptly discharge or remove any lien, levy or
encumbrance on any of the Leased Premises or on any Rent or any other sums
payable by Tenant under this Lease, other than any Mortgage or Assignment, the
Tenant Mortgage, the Permitted Encumbrances and any mortgage, lien, encumbrance
or other charge created by or resulting solely from any act or omission of
Landlord. NOTICE IS HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE FOR ANY
LABOR, SERVICES OR MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT OR TO ANYONE
HOLDING OR OCCUPYING ANY OF THE LEASED PREMISES THROUGH OR UNDER TENANT, AND
THAT NO MECHANICS' OR OTHER LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS
SHALL ATTACH TO OR AFFECT THE INTEREST OF LANDLORD IN AND TO ANY OF THE LEASED
PREMISES. LANDLORD MAY AT ANY TIME, AND AT LANDLORD'S REQUEST TENANT SHALL
PROMPTLY, POST ANY NOTICES ON THE LEASED PREMISES REGARDING SUCH NON-LIABILITY
OF LANDLORD.
(b) Landlord and Tenant shall execute, deliver and record, file or
register (collectively, "RECORD") all such instruments as may be required or
permitted by any present or future Law in order to evidence the respective
interests of Landlord and Tenant in the Leased Premises, and shall cause a
memorandum of this Lease (or, if such a memorandum cannot be recorded, this
Lease), and any supplement hereto or thereto, to
be recorded in such manner and in such places as may be required or permitted by
any present or future Law in order to protect the validity and priority of this
Lease.
12. MAINTENANCE AND REPAIR.
(a) Except for ordinary wear and tear, Tenant shall at all times
maintain the Leased Premises and the Adjoining Property in as good repair and
appearance as they are in on the Final Completion Date and fit to be used for
their intended use in accordance with the better of the practices generally
recognized as then acceptable by other companies in its industry or observed by
Tenant with respect to the other real properties owned or operated by it, and,
in the case of the Building Systems Equipment, in as good mechanical condition
as it was on the later of the Final Completion Date or the date of its
installation, except for ordinary wear and tear. Tenant shall take such other
action or actions as may be necessary or appropriate for the preservation and
safety of the Leased Premises. Tenant shall promptly make all Alterations of
every kind and nature, whether foreseen or unforeseen, which may be required to
comply with the foregoing requirements of this Paragraph 12(a). Landlord shall
not be required to make any Alteration, whether foreseen or unforeseen, or to
maintain any of the Leased Premises or Adjoining Property in any way, and Tenant
hereby expressly waives any right which may be provided for in any Law now or
hereafter in effect to make Alterations at the expense of Landlord or to require
Landlord to make Alterations. Any Alteration made by Tenant pursuant to this
Paragraph 12 shall be made in conformity with the provisions of Paragraph 13.
(b) If any Improvement, now or hereafter constructed, shall
(i) encroach upon any setback or any property, street or right-of-way adjoining
the Leased Premises, (ii) violate the provisions of any restrictive covenant
affecting the Leased Premises, (iii) hinder or obstruct any easement or
right-of-way to which any of the Leased Premises is subject or (iv) impair the
rights of others in, to or under any of the foregoing, Tenant shall, promptly
after receiving notice or otherwise acquiring knowledge thereof, either
(A) obtain from all necessary parties waivers or settlements of all claims,
liabilities and damages resulting from each such encroachment, violation,
hindrance, obstruction or impairment, whether the same shall affect Landlord,
Tenant or both, or (B) take such action as shall be necessary to remove all such
encroachments, hindrances or obstructions and to end all such violations or
impairments, including, if necessary, making Alterations.
13. ALTERATIONS AND IMPROVEMENTS.
(a) In addition to Alterations required by Paragraph 12 and 17,
Tenant shall have the right without having obtained the prior written consent of
Landlord and Lender, to (i) make any Alterations or series of related
Alterations to the Structures for a cost of not more than Five Hundred Thousand
Dollars ($500,000) in any one instance, or (ii) install Building Systems
Equipment, in the Structures or accessions to the Building Systems Equipment,
the cost of which as to such Building Systems Equipment or series of related
Building Systems Equipment does not exceed Five Hundred Thousand Dollars
($500,000), subject to adjustment.
In connection with the construction of improvements (the "EXPANSION
IMPROVEMENTS") on real property owned or to be owned by Tenant and immediately
adjacent to and contiguous with the Land (the "EXPANSION PARCEL"), Tenant shall
have the right to integrate the Expansion Improvements, for the duration of the
Term only, with the Improvements (such actions being referred to herein as the
"EXPANSION"); provided, that (a) any Expansion Improvements shall be used for
purposes consistent with the uses permitted in Paragraph 4 of this Lease, and
shall be located entirely on the Expansion Parcel, (b) the Expansion, the
Expansion Parcel, the Expansion Improvements and the Leased Premises, both
before and after giving effect to the Expansion, shall comply with all necessary
zoning, setback, building, subdivision and other Legal Requirements, and Tenant
shall obtain all variances necessary therefor, including any variance necessary
to permit the Improvements and the Expansion Improvements to be constructed so
as to abut the property line common to the Land and the Expansion Parcel,
(c) prior to the Expansion, reciprocal easement agreements for pedestrian and
vehicular access, utilities, parking, party walls, lateral and subjacent
support, maintenance and shared systems and such other matters as may be deemed
necessary or advisable by Landlord or Lender, must be executed, delivered and
recorded by Landlord, Tenant and any party having an ownership or equitable
interest in the Land and the Expansion Parcel, (d) Tenant shall submit all plans
and specifications relating to the Expansion to Landlord and Lender, and
Landlord and Lender shall have approved such plans and specifications which
approval shall not be unreasonably withheld and shall be deemed given if no
response is received by Tenant within thirty (30) days following receipt by
Landlord and Lender of said plans and specifications, (e) the Expansion must be
constructed in such a way that upon expiration of the Term, the Improvements and
any Expansion Improvements may be separated into two, separately functioning and
independent buildings, Tenant hereby agreeing that Paragraph 26 of this Lease
shall be construed to require Tenant to restore the Improvements to be a
separately functioning and independent building, in the same condition it was in
prior to the Expansion, without any legal or functional reliance on the
Expansion Parcel or any Expansion Improvements or any building systems installed
therein, (f) during the course of constructing the Expansion, Tenant shall have
obtained and paid for such insurance, from such carriers, and in such amounts as
Landlord and Lender shall require in their sole discretion, (g) Tenant shall
obtain such endorsements to Landlord's and Lender's policies of title insurance
and such additional title insurance coverages as Landlord or Lender may require
in their sole discretion, (h) an amendment to this Lease shall be executed and
delivered by the parties hereto, which amendment shall, inter alia, add to the
Leased Premises any reciprocal easements agreements created pursuant to clause
(b) above and which shall address such other matters as Landlord shall
reasonably require to reflect the construction of the Expansion, and (i) Tenant
shall bear all costs and expenses related to the Expansion, such costs and
expenses to include, but not be limited to, attorney's fees and costs of
Landlord's and Lender's counsel, the cost of executing and delivering all
necessary amendments to this Lease, the Construction Agency Agreement, any
memorandum of this Lease and other related
documentation, obtaining and documenting the consent of Guarantor to the
Expansion, title policy endorsements and recording fees, and otherwise complying
with the provisions of this Paragraph 13(a).
The consent of Landlord and Lender shall be required (A) if a Monetary
Event of Default exists, or (B) if the Alterations (or a series of related
Alterations) exceeds Five Hundred Thousand Dollars ($500,000), or (C) if Tenant
desires to remove and not upgrade or replace during the Term any Improvements,
or (D) if Tenant desires to construct upon the Land any additional Improvements;
provided that, with respect to (D) and (E) above, such consent shall not be
unreasonably withheld and shall be deemed given if no response is received by
Tenant within thirty (30) days following receipt by Landlord and Lender of such
request.
(b) If Tenant makes any Alterations pursuant to this Paragraph 13 or
as required by Paragraph 12 or 17 (such Alterations and actions being
hereinafter collectively referred to as "WORK"), whether or not Landlord's
consent is required, then (i) the market value of the Leased Premises shall not
be lessened by any such Work or its usefulness impaired, (ii) all such Work
shall be performed by Tenant in a good and workmanlike manner, (iii) all such
Work shall be expeditiously completed in compliance with all Legal Requirements,
(iv) all such Work shall comply with the Insurance Requirements, (v) if any such
Work involves the replacement of Building Systems Equipment because of additions
or changes to the Structures (as opposed to repairs or replacements of Building
Systems Equipment or parts thereto as part of an on-going maintenance program)
all Building Systems Equipment shall have a value and useful life equal to the
greater of (A) the value and useful life on the Final Completion Date of the
Building Systems Equipment being replaced or (B) the value and useful life of
the Building Systems Equipment being replaced immediately prior to the
occurrence of the event which required its replacement, (vi) if any such Work
involves the replacement of Building Systems Equipment parts thereof in
connection with an on-going maintenance program, reconditioned equipment and
parts may be used and upon completion the Building Systems Equipment need not
have a value and useful life greater than the value and useful life of the
Building Systems Equipment or parts being replaced immediately prior to the
occurrence of the event which requires its replacement, (vii) Tenant shall
promptly discharge or remove all liens filed against any of the Leased Premises
arising out of such Work, (viii) Tenant shall procure and pay for all permits
and licenses required in connection with any such Work, (ix) all such Work shall
be subject to this Lease, and (x) Tenant shall comply, to the extent requested
by Landlord or required by this Lease, with the provisions of Paragraph 19(a),
whether or not such Work involves restoration of the Leased Premises.
(c) If, after the Final Completion Date, Tenant makes any Alterations
to existing equipment that are not Alterations to the Structures or Building
Systems Equipment, Tenant shall retain title to such Alterations and to such
equipment ("TENANT ALTERATIONS") and shall have the right to remove the same
upon the expiration or earlier termination of this Lease, provided that (1) such
removal will not cause material damage to the Leased Premises, and (2) Tenant
promptly repairs any damage caused by such removal. Title to any Alterations
which are not
Tenant Alterations shall vest in Landlord, and Tenant shall not be entitled to
remove the same upon the expiration or earlier termination of this Lease.
14. PERMITTED CONTESTS.
(a) Notwithstanding any other provision of this Lease, Tenant shall
not be required to (a) pay any Imposition, (b) comply with any Legal
Requirement, (c) discharge or remove any lien referred to in Paragraph 11 or 13,
(d) take any action with respect to any encroachment, violation, hindrance,
obstruction or impairment referred to in Paragraph 12(b) or (e) pay contractors
and subcontractors who have performed work on or supplied materials to the
Improvements or pay for materials and supplies (such non-compliance with the
terms hereof being hereinafter referred to collectively as "PERMITTED
VIOLATIONS"), so long as at the time of such contest no Monetary Event of
Default exists and so long as Tenant shall contest, in good faith, the
existence, amount or validity thereof, the amount of the damages caused thereby,
or the extent of its or Landlord's liability therefor by appropriate proceedings
which shall operate during the pendency thereof to prevent or stay (i) the
collection of, or other realization upon, the Permitted Violation so contested,
(ii) the sale, forfeiture or loss of any of the Leased Premises or any Rent to
satisfy or to pay any damages caused by any Permitted Violation, (iii) any
interference with the use or occupancy of any of the Leased Premises, (iv) any
interference with the payment of any Rent, (v) the cancellation or increase in
the rate of any insurance policy or a statement by the carrier that coverage
will be denied, (vi) the enforcement or execution of any injunction, order or
Legal Requirement with respect to the Permitted Violation or (vii) the
attachment of any mechanics' or materialman's lien to all or any portion of the
Leased Premises or the Rent payable hereunder.
(b) Tenant shall provide Landlord security which is satisfactory, in
Landlord's reasonable judgment, to assure that such Permitted Violation is
corrected, including all Costs, interest and penalties that may be incurred or
become due in connection therewith. While any proceedings which comply with the
requirements of this Paragraph 14 are pending and the required security is held
by Landlord, Landlord shall not have the right to correct any Permitted
Violation thereby being contested unless Landlord is required by law to correct
such Permitted Violation and Tenant's contest does not prevent or stay such
requirement as to Landlord. Each such contest shall be promptly and diligently
prosecuted by Tenant to a final conclusion, except that Tenant, so long as the
conditions of this Paragraph 14 are at all times complied with, has the right to
attempt to settle or compromise such contest through negotiations. Tenant shall
pay any and all losses, judgments, decrees and Costs in connection with any such
contest and shall, promptly after the final determination of such contest, fully
pay and discharge the amounts which shall be levied, assessed, charged or
imposed or be determined to be payable therein or in connection therewith,
together with all penalties, fines, interest and Costs thereof or in connection
therewith, and perform all acts the performance of which shall be ordered or
decreed as a result thereof.
(c) Notwithstanding the foregoing, no provision of this Lease shall
allow the Tenant to continue any contest or other activity which shall subject
Landlord to the risk of any civil or criminal liability.
15. INDEMNIFICATION.
(a) Tenant shall pay, protect, indemnify, save and hold harmless
Landlord, Lender and all other Persons described in clauses (i), (ii), (iii) and
the parenthetical clause in clause (iv) of Paragraph 30 (each an "INDEMNITEE")
from and against any and all liabilities, losses, damages (including punitive
damages), penalties, Costs, causes of action, suits, claims, demands or
judgments of any nature whatsoever, howsoever caused, without regard to the form
of action and whether based on strict liability, gross or any other theory of
recovery at law or in equity, arising from (i) any matter pertaining to the
acquisition (or the negotiations leading thereto), ownership, use, non-use,
occupancy, operation, condition, design, construction, maintenance, repair or
restoration of the Leased Premises or Adjoining Property, (ii) any casualty in
any manner arising from the Leased Premises or Adjoining Property, whether or
not Landlord has or should have knowledge or notice of any defect or condition
causing or contributing to said casualty, (iii) any violation by Tenant of any
provision of this Lease, any contract or agreement to which Tenant is a party,
any Legal Requirement or any Permitted Encumbrance or (iv) any alleged,
threatened or actual Environmental Violation, including (A) liability for
response costs and for costs of removal and remedial action incurred by the
United States Government, any state or local governmental unit or any other
Person, or damages from injury to or destruction or loss of natural resources,
including the reasonable costs of assessing such injury, destruction or loss,
incurred pursuant to Section 107 of CERCLA, or any successor section or act or
provision of any similar state or local Law, (B) liability for costs and
expenses of abatement, correction or clean-up, fines, damages, response costs or
penalties which arise from the provisions of any of the other Environmental Laws
and (C) liability for personal injury or property damage arising under any
statutory or common-law tort theory, including damages assessed for the
maintenance of a public or private nuisance or for carrying on of a dangerous
activity. The foregoing indemnity shall not apply to losses to the extent that
they are caused by the gross negligence or willful misconduct of the Indemnified
Party requesting the benefit of this Paragraph 15.
(b) In case any action or proceeding is brought against any
Indemnitee by reason of any such claim, such Indemnitee shall promptly notify
Tenant in writing of any such action or proceeding. If an Indemnitee fails to
give Tenant prompt notice of any such claim and Tenant is prejudiced as a result
of Indemnitee's delay, Tenant shall not be obligated to indemnify such
Indemnitee to the extent Tenant is thereby prejudiced. Upon receipt of notice
from any Indemnitee, Tenant shall, subject to the preceding sentence, resist or
defend such action or proceeding by retaining counsel reasonably satisfactory to
such Indemnitee, and such Indemnitee will cooperate and assist in the defense of
such action or proceeding if reasonably requested so to do by Tenant. Any
Indemnitee may retain separate counsel to represent Indemnitee, but only at such
Indemnitee's
sole cost and expense.
(c) The obligations of Tenant under this Paragraph 15 shall survive
any termination or expiration of this Lease.
16. INSURANCE.
(a) Tenant shall maintain the following insurance on or in connection
with the Leased Premises:
(i) Insurance against physical loss or damage to the
Improvements as provided under a standard "All Risk" property policy including
but not limited to flood (if the Leased Premises is in a flood zone) and
earthquake coverage in amounts not less than the actual replacement cost of the
Improvements and Equipment. Such policies shall contain replacement cost and
agreed amount endorsements and shall contain deductibles not more than
$10,000.00 per occurrence.
(ii) Commercial General Liability Insurance against claims for
personal and bodily injury, death or property damage occurring on, in or as a
result of the use of the Leased Premises, in an amount not less than $15,000,000
per occurrence/annual aggregate including but not limited to Incidental Medical
Malpractice, Host Liquor Liability, Non-Owned and Hired Automobile Liability and
all other coverage extensions that are usual and customary for properties of
this size and type provided, however, that the Landlord shall have the right to
require such higher limits as may be reasonable and customary for properties of
this size and type.
(iii) Worker's Compensation Insurance covering all persons
employed by Tenant in connection with any work done on or about any of the
Leased Premises for which claims for death, disease or bodily injury may be
asserted against Landlord, Tenant or any of the Leased Premises or, in lieu of
such Worker's Compensation Insurance, a program of self-insurance complying with
the rules, regulations and requirements of the appropriate agency of the State.
(iv) Comprehensive Boiler and Machinery Insurance on any of the
Building Systems Equipment or any other equipment on or in the Leased Premises
including but not limited to Service Interruption, Expediting Expenses, Ammonia
Contamination, Hazardous Clean-Up and Comprehensive Object Definition, in an
amount not less than $5,000,000 for damage to property, bodily injury or death
resulting from such covered perils as found in a standard Comprehensive Boiler &
Machinery Policy. Such policies may contain a deductible not in excess of
$10,000.
(v) Business Income/Interruption Insurance to include Loss of
Rents on an Actual Loss Sustained basis with a period of indemnity not less than
one year from the time of loss. Such insurance shall name Landlord and Lender
as "loss payee" solely with respect to Rent payable to or for the benefit of
Landlord under this Lease.
(vi) During construction of the Improvements and
during any period in which substantial Alterations at the Leased Premises are
being undertaken, (A) Builder's Risk insurance covering the total completed
value including any "soft costs" with respect to the Improvements being
constructed, altered or repaired (on a completed value, non-reporting basis),
replacement cost of work performed and equipment, supplies and materials
furnished in connection with such construction or repair of Improvements, and
(B) General Liability, Worker's Compensation and Automobile Liability Insurance
with respect to the Improvements being constructed, altered or repaired.
(vii) Such other insurance (or other terms with respect to any
insurance required pursuant to this Paragraph 16, including without limitation
amounts of coverage, deductibles, form of mortgagee clause) on or in connection
with any of the Leased Premises as Landlord or Lender may reasonably require,
which at the time is usual and commonly obtained in connection with properties
located in the Louisville, Kentucky area and similar in type of building size
and use to the Leased Premises.
(b) The insurance required by Paragraph 16(a) shall be written by
companies which have a Best's rating of A:X or above and are admitted in, and
approved to write insurance policies by, the State Insurance Department for the
State. The insurance policies (i) shall be in amounts sufficient at all times
to satisfy any coinsurance requirements thereof and (ii) shall (except for the
worker's compensation insurance referred to in Paragraph 16(a)(iii) hereof) name
Landlord, Tenant and Lender as insured parties, as their respective interests
may appear. If said insurance or any part thereof shall expire, be withdrawn or
become void, for any reason, Tenant shall immediately obtain new or additional
insurance reasonably satisfactory to Landlord.
(c) Subject to the provisions of Paragraph 19, all proceeds of any
insurance required under clauses (i), (ii) (except proceeds payable to a Person
other than Tenant, Landlord or Lender), (iv) and (v) of Paragraph 16(a) shall be
payable to Landlord or, if required by the Mortgage, to Lender. Each insurance
policy referred to in clauses (i), (iv), (v) and (vi) of Paragraph 16(a) shall
contain standard non-contributory mortgagee clauses in favor of and acceptable
to Lender. Tenant shall receive a credit against installments of Basic Rent to
the extent proceeds of insurance described in Paragraph (a)(v) are paid to
Landlord. Each policy required by any provision of Paragraph 16(a), except
clause (iii) thereof, shall provide that it may not be cancelled except after
thirty (30) days' prior notice to Landlord and Lender. Each such policy shall
also provide that any loss otherwise payable thereunder shall be payable
notwithstanding (i) any act or omission of Landlord or Tenant which might,
absent such provision, result in a forfeiture of all or a part of such insurance
payment, (ii) the occupation or use of any of the Leased Premises for purposes
more hazardous than those permitted by the provisions of such policy, (iii) any
foreclosure or other action or proceeding taken by Lender pursuant to any
provision of the Mortgage, Note, Assignment or other document evidencing or
securing the Loan upon the happening of an event of default therein or (iv) any
change in title to or ownership of any of the Leased Premises.
(d) Tenant shall pay as they become due all premiums for the
insurance required by Paragraph 16(a), shall renew or replace each policy and
deliver to Landlord evidence of the
payment of the full premium therefor or installment then due at least thirty
(30) days prior to the expiration date of such policy, and shall promptly
deliver to Landlord certificates evidencing such insurance or, if requested by
Landlord, all original policies or certified copies thereof.
(e) Anything in this Paragraph 16 to the contrary notwithstanding,
any insurance which Tenant is required to obtain pursuant to Paragraph 16(a) may
be carried under a "blanket" or umbrella policy or policies covering other
properties or liabilities of Tenant, provided that such "blanket" or umbrella
policy or policies otherwise comply with the provisions of this Paragraph 16 and
provided further that such policies shall provide for a reserved amount
thereunder with respect to the Leased Premises so as to assure that the amount
of insurance required by this Paragraph 16 will be available notwithstanding any
losses with respect to other property covered by such blanket policies. The
amount of the total insurance allocated to the Leased Premises, which amount
shall be not less than the amounts required pursuant to this Paragraph 16, shall
be specified either (i) in each such "blanket" or umbrella policy or (ii) in a
written statement, which Tenant shall deliver to Landlord, from the insurer
thereunder. The original or a certified copy of each such "blanket" or umbrella
policy shall promptly be delivered to Landlord.
(f) Tenant shall promptly comply with and conform to (i) all
provisions of each insurance policy required by this Paragraph 16 and (ii) all
requirements of the insurers thereunder applicable to Landlord, Tenant or any of
the Leased Premises or to the use, manner of use, occupancy, possession,
operation, maintenance, alteration or repair of any of the Leased Premises, even
if such compliance necessitates Alterations or results in interference with the
use or enjoyment of any of the Leased Premises.
(g) Tenant shall not carry separate insurance concurrent in form or
contributing in the event of a Casualty with that required in this Paragraph 16
unless (i) Landlord and Lender are included therein as named insureds, with loss
payable as provided herein, and (ii) such separate insurance complies with the
other provisions of this Paragraph 16. Tenant shall immediately notify Landlord
of such separate insurance and shall deliver to Landlord the original policies
therefor.
(h) All policies shall contain effective waivers by the carrier
against all claims for insurance premiums against Landlord and shall contain
full waivers of subrogation against the Landlord.
17. CASUALTY AND CONDEMNATION.
(a) Subject to Paragraph 17(b) and the immediately following
sentence, Landlord and/or Lender shall be entitled to adjust, collect and
compromise insurance claims which relate to any Casualty involving property
damage to the Leased Premises. Notwithstanding anything in this Lease to the
contrary, Tenant shall be entitled to adjust, collect and compromise all
insurance
claims which relate to: (i) the Business Income/Interruption Insurance provided
for in Paragraph 16(a)(v), subject, however, to Landlord's rights to Rent; (ii)
any furniture, fixtures or equipment owned by Tenant; and (iii) any other
insurance claim not involving property damage to the Leased Premises.
(b) If any Casualty in excess of Twenty-five Thousand Dollars
($25,000) occurs, Tenant shall give Landlord and Lender immediate notice
thereof. Provided that no Monetary Event of Default has occurred and is
continuing, Tenant shall be entitled to adjust, collect and compromise any Net
Award that is less than Twenty-five Thousand Dollars ($25,000), subject to
adjustment, without any notice to or consent of Landlord or Lender and shall be
entitled to participate with Landlord and Lender in any adjustment, collection
and compromise of the Net Award payable in connection with a Casualty that is
reasonably estimated by Landlord and Lender to be Twenty-five Thousand Dollars
($25,000), subject to adjustment, or more. Tenant agrees to sign, upon the
request of Landlord or Lender, all such proofs of loss, receipts, vouchers and
releases. If Landlord or Lender so requests, Tenant shall adjust, collect and
compromise any and all such claims equal to or in excess of Twenty-five Thousand
Dollars ($25,000), subject to adjustment, and Landlord and Lender shall have the
right to join with Tenant therein. Any adjustment, settlement or compromise of
any such claim equal to or in excess of Twenty-five Thousand Dollars ($25,000),
subject to adjustment, shall be subject to the prior written approval of
Landlord and Lender, and Landlord and Lender shall have the right to prosecute
or contest, or to require Tenant to prosecute or contest, any such claim,
adjustment, settlement or compromise. Each insurer is hereby authorized and
directed to make payment under said policies of Twenty-five Thousand Dollars
($25,000), subject to adjustment, or more, directly to Landlord or, if required
by the Mortgage, to Lender instead of to Landlord and Tenant jointly. Tenant
hereby appoints each of Landlord and Lender as Tenant's attorneys-in-fact to
endorse any draft for payments to be made to Landlord and/or Lender. Any
payment of a Net Award of less than Twenty-five Thousand Dollars ($25,000),
subject to adjustment, shall be paid directly to Tenant by the insurance
company.
(c) Tenant, immediately upon receiving a Condemnation Notice, shall
notify Landlord and Lender thereof. If Landlord receives a Condemnation Notice,
Landlord shall give Tenant and Lender prompt notice thereof. Except as
specifically provided in the following sentence, Landlord and Lender are
authorized to collect, settle and compromise, in their discretion (and, if no
Monetary Event of Default exists, upon notice to Tenant), the amount of any Net
Award. Provided that no Monetary Event of Default has occurred and is
continuing, Tenant shall be entitled to participate with Landlord and Lender in
any Condemnation proceeding or negotiations under threat thereof and to contest
the Condemnation or the amount of the Net Award therefor. No agreement with any
condemnor in settlement or under threat of any Condemnation shall be made by
Tenant without the written consent of Landlord and Lender. Subject to the
provisions of this Paragraph 17(c), Tenant hereby irrevocably assigns to
Landlord any award or payment to which Tenant is or may be entitled by reason of
any Condemnation, whether the same shall be paid or payable for Tenant's
leasehold interest hereunder or otherwise; but nothing in this Lease shall
impair Tenant's right to any award or payment on account of Tenant's personal
property, moving expenses or loss of business, if available, to the extent that
and so long as (i) Tenant shall have the right to make, and does make, a
separate claim therefor against the condemnor and (ii) such claim does not in
any way reduce either the amount of the award otherwise payable to Landlord for
the Condemnation of Landlord's leasehold interest in the Leased Premises or the
amount of the award (if any) otherwise payable for the Condemnation of Tenant's
leasehold interest hereunder.
(d) If any Partial Casualty (whether or not insured against) or
Partial Condemnation shall occur, this Lease shall continue, notwithstanding
such event, and there shall be no abatement or reduction of any Monetary
Obligations, except as provided in Paragraph 17(d) and 19(c). Promptly after
such Partial Casualty or Partial Condemnation, Tenant, as required in Paragraph
12(a), shall commence and diligently continue to restore the Leased Premises as
nearly as possible to its value, condition and character immediately prior to
such event. Upon the receipt by Landlord of the entire Net Award of such
Partial Casualty or Partial Condemnation, Landlord shall make such Net Award
available to Tenant for restoration in accordance with and subject to the
provisions of Paragraph 19(a). If any Casualty or Condemnation which is not a
Partial Casualty or Partial Condemnation shall occur, Tenant shall comply with
the terms and conditions of Paragraph 18.
(e) In the event of a Requisition of any of the Leased Premises the
Net Award payable by reason of such Requisition shall, at the election of
Landlord, either be (i) retained by Landlord and credited against installments
of Basic Rent for the period of such Requisition as the same shall become due
and payable or (ii) paid to Tenant on a monthly basis in an amount equal to the
installment of Basic Rent then due and payable until such Net Award has been
applied in full or until the Term has expired, whichever first occurs. Any
portion of such Net Award which is allocable to any period after the expiration
of the Term shall be retained by Landlord.
18. TERMINATION EVENTS.
(a) If (i) the Leased Premises shall be taken in its entirety by a
Taking or (ii) any substantial portion of the Leased Premises shall be taken by
a Taking or all or any substantial portion of the Improvements shall be damaged
or destroyed by a Casualty and, in the case of (ii) above, Tenant certifies and
covenants to Landlord that it will forever abandon operations at the Leased
Premises (each of the events described in the above clauses (i) and (ii) shall
hereinafter be referred to as a "EARLY TERMINATION EVENT"), then (x) in the case
of (i) above, Tenant shall be obligated, within thirty (30) days after Tenant
receives a Condemnation Notice and (y) in the case of (ii) above, Tenant shall
have the option, within thirty (30) days after Tenant receives a Condemnation
Notice or thirty (30) days after the Casualty, as the case may be, to give to
Landlord written notice of the Tenant's option to terminate this Lease (an
"EARLY TERMINATION NOTICE") in the form described in Paragraph 18(b).
(b) An Early Termination Notice shall contain
(i) notice of Tenant's intention to terminate this Lease on the first Basic Rent
Payment Date (the "EARLY TERMINATION DATE") which occurs at least forty-five
(45) days after receipt by Landlord of the Early Termination Notice, (ii) a
binding and irrevocable offer of Tenant to pay the Early Termination Amount and
(iii) if the Early Termination Event is an event described in
Paragraph 18(a)(ii), the certification and covenants described therein and a
certified resolution of the Board of Directors of Tenant authorizing the same.
(c) If Landlord shall reject such offer to terminate this Lease by
written notice to Tenant (a "REJECTION"), which Rejection shall contain the
written consent of Lender, not later than thirty (30) days following the date on
which Landlord receives the Early Termination Notice from Tenant, then this
Lease shall terminate on the Early Termination Date; provided that, if Tenant
has not satisfied all Monetary Obligations and all other obligations and
liabilities under this Lease which have arisen on or prior to the Termination
Date (collectively, "REMAINING OBLIGATIONS") on the Termination Date, then
Landlord may, at its option, extend the date on which this Lease may terminate
to a date which is no later than the first Basic Rent Payment Date after the
Early Termination Date on which Tenant has satisfied all Remaining Obligations.
Upon such termination (i) all obligations of Tenant hereunder shall terminate
except for any Surviving Obligations, (ii) Tenant shall immediately vacate and
shall have no further right, title or interest in or to any of the Leased
Premises and (iii) the Net Award shall be retained by Landlord. Notwithstanding
anything to the contrary hereinabove contained, if Tenant shall have received a
Rejection and, on the date when this Lease would otherwise terminate as provided
above, Landlord shall not have received the full amount of the Net Award payable
by reason of the applicable Early Termination Event, then the date on which this
Lease is to terminate automatically shall be extended to the first Basic Rent
Payment Date after the receipt by Landlord of the full amount of the Net Award
provided that, if Tenant has not satisfied all Remaining Obligations on such
date, then Landlord may, at its option, extend the date on which this Lease may
terminate to a date which is no later than the first Basic Rent Payment Date
after such date on which Tenant has satisfied all such Remaining Obligations.
(d) Unless Tenant shall have received a Rejection not later than the
forty-fifth (45th) day following the Fair Market Value Date, Landlord shall be
conclusively presumed to have accepted such offer. If such offer is accepted by
Landlord then, on the Termination Date, Tenant shall pay to Landlord the
Termination Amount and all Remaining Obligations and, if requested by Tenant,
Landlord shall (i) convey to Tenant the Leased Premises or the remaining portion
thereof, if any, and (ii) pay to or assign to Tenant its entire interest in and
to the Net Award, all in accordance with Paragraph 20.
19. RESTORATION; REDUCTION OF RENT.
(a) The Net Award shall, promptly upon receipt, be made available by
Landlord for the restoration of the Leased Premises, and, if the Net Award is
less than Two Hundred Thousand Dollars ($200,000), subject to adjustment, and at
the date of payment no Monetary Event of Default exists, the Net Award shall be
paid directly to Tenant in which event Tenant shall comply
with the provisions of Paragraph 13(b) and Paragraph 19(a)(iii) in connection
with such restoration. If the Net Award is Two Hundred Thousand Dollars
($200,000), subject to adjustment, or more such Net Award in a fund (the
"RESTORATION FUND") and disburse amounts from the Restoration Fund only in
accordance with the following conditions:
(i) prior to commencement of restoration, the architects,
contracts, contractors, plans and specifications for the restoration shall have
been approved by Landlord, such approval not to be unreasonably withheld or
delayed, it being understood that if Landlord has not indicated to Tenant,
within sixty (60) days of the submission of such items to Landlord for approval,
whether such items have been approved or disapproved, Landlord shall be deemed
to have disapproved such items;
(ii) at the time of any disbursement, no Event of Default shall
exist and, subject to Tenant's right to contest pursuant to Paragraph 14 hereof
no mechanics' or materialmen's liens shall have been filed against any of the
Leased Premises and remain undischarged;
(iii) disbursements shall be made from time to time in an amount
not exceeding the cost of the work completed since the last disbursement, upon
receipt of (A) satisfactory evidence, including architects' certificates, of the
stage of completion, the estimated total cost of completion and performance of
the work to date in a good and workmanlike manner in accordance with the
contracts, plans and specifications, (B) waivers of liens, (C) contractors' and
subcontractors' sworn statements as to completed work and the cost thereof for
which payment is requested, (D) other evidence of cost and payment so that
Landlord can verify that the amounts disbursed from time to time are represented
by work that is completed, in place and free and clear of mechanics' and
materialmen's lien claims, and (E) an endorsement to Landlord's and Lender's
title insurance policies insuring against any liens arising from the
restoration;
(iv) each request for disbursement shall be accompanied by a
certificate of Tenant, signed by the president or a vice president of Tenant,
describing the work for which payment is requested, stating the cost incurred in
connection therewith, stating that Tenant has not previously received payment
for such work and, upon completion of the work, also stating that the work has
been fully completed and complies with the applicable requirements of this
Lease;
(v) Landlord may retain ten percent (10%) of the restoration
fund until the restoration is fully completed;
(vi) the Restoration Fund shall be held in a separate account and
invested in any of the following investments and for such maturities as Landlord
and Tenant shall agree: obligations of the United States, its agencies, or
United States Government sponsored enterprises or obligations, the principal of
and interest on which are guaranteed by the United States or its agencies or
obligations of a state, a territory, or a possession of the United States, or
any political subdivision of any of the
foregoing or of the District of Columbia, which investment shall be graded in
the highest of three (3) major grades as determined by at least one (1) national
rating service, or banker's acceptances, commercial accounts, certificates of
deposit, or depository receipts issued by a bank, trust company, savings and
loan association, savings bank, credit union or other financial institution
whose deposits are, as appropriate, insured by the Federal Deposit Insurance
Corporation or the National Credit Union Administration or any successor entity,
which investment shall be rated at the time of purchase within the two (2)
highest classifications established by at least one (1) national rating service,
and which matures within one hundred eighty (180) days; and
(vii) such other reasonable and customary conditions as Landlord
or Lender may impose.
(b) Prior to commencement of restoration and at any time during
restoration, if the estimated cost of completing the restoration work free and
clear of all liens, as determined by Landlord, exceeds the amount of the Net
Award available for such restoration, the amount of such excess shall, upon
demand by Landlord, be paid by Tenant to Landlord to be added to the Restoration
Fund. Any sum so added by Tenant which remains in the Restoration Fund upon
completion of restoration shall be refunded to Tenant. For purposes of
determining the source of funds with respect to the disposition of funds
remaining after the completion of restoration, the Net Award shall be deemed to
be disbursed prior to any amount added by Tenant.
(c) If any sum remains in the Restoration Fund after completion of
the restoration and any refund to Tenant pursuant to Paragraph 19(b), such sum
(the "REMAINING SUM") shall be retained by Landlord or, if required by a Note or
Mortgage, paid by Landlord to a Lender. If the Remaining Sum is (i) retained by
Landlord, Tenant shall receive a monthly credit against Basic Rent until the
amount of the Remaining Sum is credited in full, or (ii) paid to Lender, then
each installment of Basic Rent thereafter payable shall be reduced in the same
amount as payments are reduced under any Note if the Loan corresponding to such
Note is reamortized to reflect such payment, in each case until such Remaining
Sum has been applied in full or until the Term has expired, whichever occurs
first. Upon the expiration of the Term, any portion of the Remaining Sum which
has not been so applied shall be retained by Landlord.
20. PROCEDURES UPON PURCHASE.
(a) If the Leased Premises are purchased by Tenant pursuant to any
provision of this Lease, Landlord shall convey such title thereto as was
conveyed to Landlord, and Tenant shall accept such title, subject, however, to
the Permitted Encumbrances and to all other liens, exceptions and restrictions
on, against or relating to any of the Leased Premises and to all applicable
Laws, but free of the lien of and security interest created by any Mortgage or
Assignment and liens, exceptions and restrictions on, against or relating to the
Leased Premises which have been created by or resulted solely from acts of
Landlord after the date of this Lease, unless the same are Permitted
Encumbrances or customary utility easements benefiting the Leased Premises or
were created with the concurrence of Tenant or as a result of a default by
Tenant under this Lease.
(b) Upon the date fixed for any such purchase of the Leased Premises
pursuant to any provision of this Lease (any such date the "PURCHASE DATE"),
Tenant shall pay to Landlord, or to any Person to whom Landlord directs payment,
the Relevant Amount therefor specified herein, in Federal Funds, less any credit
of the Net Award received and retained by Landlord or a Lender allowed against
the Relevant Amount, and Landlord shall deliver to Tenant (i) a special warranty
deed, which describes the premises being conveyed and conveys the title thereto
as provided in Paragraph 20(a), (ii) such other instruments as shall be
necessary to transfer to Tenant or its designee any other property (or rights to
any Net Award not yet received by Landlord or a Lender) then required to be sold
by Landlord to Tenant pursuant to this Lease, such as bills of sale, assignments
of warranties and guaranties relating to the Building Systems Equipment, and the
like, and (iii) any Net Award received by Landlord, not credited to Tenant
against the Relevant Amount and required to be delivered by Landlord to Tenant
pursuant to this Lease; provided, that if any Monetary Obligations remain
outstanding on such date, then Landlord may deduct from the Net Award the amount
of such Monetary Obligations; and further provided, that if any event has
occurred which, in Landlord's reasonable judgment, is likely to subject any
Indemnitee to any liability which Tenant is required to indemnify against
pursuant to Paragraph 15, then an amount shall be deducted from the Net Award
which, in Landlord's reasonable judgment, is sufficient to satisfy such
liability, which amount shall be deposited in an escrow account with a financial
institution reasonably satisfactory to Landlord and Tenant pending resolution of
such matter. If on the Purchase Date any Monetary Obligations remain
outstanding and no Net Award is payable to Tenant by Landlord or the amount of
such Net Award is less than the amount of the Monetary Obligations, then Tenant
shall pay to Landlord on the Purchase Date the amount of such Monetary
Obligations. Upon the completion of such purchase, this Lease and all
obligations and liabilities of Tenant hereunder shall terminate, except any
Surviving Obligations.
(c) Unless solely and directly caused by the gross negligence or
willful misconduct of Landlord, if the completion of such purchase shall be
delayed after (i) the Early Termination Date, in the event of a purchase
pursuant to Paragraph 18 or, (ii) the date scheduled for such purchase, in the
event of a purchase under any other provision of this Lease then (x) Rent shall
continue to be due and payable until completion of such purchase and (y) at
Landlord's sole option, Fair Market Value shall be redetermined and the Relevant
Amount payable by Tenant pursuant to the applicable provision of this Lease
shall be adjusted to reflect such redetermination.
(d) Any prepaid Monetary Obligations paid to Landlord shall be
prorated as of the Purchase Date, and the prorated unapplied balance shall be
deducted from the Relevant Amount due to Landlord; provided, that no
apportionment of any Impositions shall be made upon any such purchase.
21. ASSIGNMENT AND SUBLETTING; PROHIBITION AGAINST LEASEHOLD
FINANCING.
(a) Except as provided in this Paragraph 21(a), Tenant may not assign
this Lease, whether by operation of law or otherwise, at any time to any other
Person without the prior written consent of Landlord and Lender, which consent,
in the event of an assignment, shall not be unreasonably withheld. In
determining whether to withhold its consent, Landlord shall have the right to
consider the following criteria as they relate to the proposed assignee, and
Landlord and Lender shall be deemed to have acted in good faith in granting or
withholding consent if they consider such criteria:
(i) its credit history;
(ii) its capital structure, net worth and unsecured senior debt
rating;
(iii) its management and real estate management record;
(iv) its operating history;
(v) its intended use of the Leased Premises; and
(vi) other factors associated with the proposed assignee's
business as it relates to the use of the Leased Premises, including potential
environmental concerns and liabilities;
provided, that if Landlord and Lender have not indicated to Tenant, within
thirty (30) days following the date on which Landlord and Lender receive all
information necessary for Landlord and Lender to analyze the factors set forth
in clauses (i) through (vii) above, whether such proposed assignee is acceptable
to Landlord and Lender, Landlord and Lender shall be deemed to have disapproved
such proposed assignee.
If Tenant assigns all its rights and interest under this Lease, the
assignee under such assignment shall expressly assume all the obligations of
Tenant hereunder, actual or contingent, including obligations of Tenant which
may have arisen on or prior to the date of such assignment, by a written
instrument delivered to Landlord at the time of such assignment. No assignment
made as permitted by this Paragraph 21 shall affect or reduce any of the
obligations of Tenant hereunder, and all such obligations shall continue in full
force and effect as obligations of a principal and not as obligations of a
guarantor, as if no assignment had been made. No assignment shall impose any
additional obligations on Landlord under this Lease.
(b) Tenant shall have the right, upon thirty (30) days' prior written
notice to Landlord and Lender to sublet up to, but not in excess of fifty
percent (50%) of the leasable space in the Leased Premises. No additional
subletting shall be permitted without the prior written consent of Landlord,
which consent may be withheld by Landlord for any or no reason, it being
understood that Landlord shall be deemed to have disapproved any proposed
additional subletting if Landlord has not indicated to Tenant whether such
proposed additional subletting is approved or not within fifteen (15) days of
Tenant's written request for such approval. Each sublease of any of the Leased
Premises shall be subject and subordinate to the provisions of this Lease. No
sublease made as permitted by this
Paragraph 21 shall affect or reduce any of the obligations of Tenant hereunder,
and all such obligations shall continue in full force and effect as obligations
of a principal and not as obligations of a guarantor, as if no assignment had
been made. No sublease shall impose any additional obligations on Landlord
under this Lease.
(c) Tenant shall, within ten (10) days after the execution and
delivery of any assignment or sublease consented to by Landlord, deliver a
duplicate original copy thereof to Landlord which, in the event of an
assignment, shall be in recordable form.
(d) As security for performance of its obligations under this Lease,
Tenant hereby grants, conveys and assigns to Landlord all right, title and
interest of Tenant in and to all subleases hereinafter entered into for any or
all of the Leased Premises (the "SUBLEASES"), any and all extensions,
modifications and renewals thereof and all rents, issues and profits therefrom.
Landlord hereby grants to Tenant a license to collect and enjoy all rents and
other sums of money payable under any Sublease of any of the Leased Premises;
provided, however, that following the occurrence of any Event of Default
Landlord shall have the absolute right at any time upon notice to Tenant and any
subtenants to revoke said license and to collect such rents and sums of money
and to retain the same. If Landlord collects such rents and sums of money,
Tenant shall receive a credit against installments of Basic Rent or against
damages (as the case may be) an amount equal to any basic rent collected by
Landlord under the Subleases, less reasonable Costs incurred by Landlord in
connection with collecting from defaulting tenants or subtenants which are not
paid or reimbursed by such tenants. Tenant shall not consent to, cause or allow
any extension of the terms of any of the Subleases beyond the Term then in
effect, or, as to Subleases requiring Landlord approval, any reduction in the
rentals payable thereunder, without the prior written approval of Landlord,
which consent shall not be unreasonably withheld. In addition, Tenant shall not
accept any rents more than thirty (30) days in advance of the accrual thereof
(other than security deposits and first month's rent), permit anything to be
done, the doing of which, or omit or refrain from doing anything, the omission
of which, will or could be a breach of or default in the terms of any of the
Subleases.
(e) Tenant shall not have the power to mortgage, pledge or otherwise
encumber its interest under this Lease or any sublease of the Leased Premises,
and any such mortgage, pledge or encumbrance made in violation of this
Paragraph 21 shall be void. Nothing provided in Paragraph 21(e) shall be deemed
to prohibit or limit financing by Tenant of equipment used in the operation of
Tenant's business at the Leased Premises, and, so long as no Event of Default
has occurred and is continuing, Landlord shall provide to lenders for such
equipment waivers in form and substance reasonably acceptable to Landlord
waiving Landlord's lien rights in and to such equipment.
(f) Subject to Tenant's rights under Paragraph 35 and the prohibition
set forth in the following sentence, Landlord may
sell or transfer the Leased Premises at any time without Tenant's consent to any
third party (each a "THIRD PARTY PURCHASER"). During the Term and provided no
Event of Default exists Landlord shall not sell the Leased Premises to a
Competitor without having first received the prior written consent of Tenant
which consent shall be deemed given if Tenant has elected to terminate the Lease
under Paragraph 5(b) hereof. In the event of any such transfer, Tenant shall
attorn to any Third Party Purchaser as Landlord so long as such Third Party
Purchaser and Landlord notify Tenant in writing of such transfer. At the
request of Landlord, Tenant will execute such documents confirming the agreement
referred to above and such other agreements as Landlord may reasonably request,
provided that such agreements do not increase the liabilities and obligations of
Tenant hereunder.
22. EVENTS OF DEFAULT.
(a) The occurrence of any one or more of the following (after
expiration of any applicable cure period as provided in Paragraph 22(c)) shall,
at the sole option of Landlord, constitute an "EVENT OF DEFAULT" under this
Lease:
(i) a failure by Tenant to make any payment of any Monetary
Obligation, regardless of the reason for such failure;
(ii) subject to the provisions of Paragraph 14, a failure by
Tenant duly to perform and observe, or a violation or breach of, any other
provision hereof not otherwise specifically mentioned in this Paragraph 22(a);
(iii) any representation or warranty made by Tenant herein or in
any certificate, demand or request made pursuant hereto proves to be incorrect,
now or hereafter, in any material respect;
(iv) a default beyond any applicable cure period by Tenant in any
payment of principal or interest on any obligations for borrowed money having an
original principal balance of $2,000,000 or more in the aggregate, or in the
performance of any other provision contained in any instrument under which any
such obligation is created or secured (including the breach of any covenant
thereunder), (x) if such payment is a payment at maturity or a final payment or
(y) if the effect of such default is to cause the holder of such obligation to
accelerate such obligation prior to its stated maturity or if by the terms of
such instrument, such obligation automatically becomes due prior to its stated
maturity;
(v) a default by Tenant beyond any applicable cure period in the
payment of rent or any other Monetary Obligation under any other leases with
rental obligations over the terms thereof of $1,000,000 or more in the
aggregate, if the effect of such default is to cause such rental to become due
prior to its due date;
(vi) a final, non-appealable judgment or judgments for the
payment of money in excess of $1,000,000 in the aggregate shall be rendered
against Tenant and the same shall remain undischarged or unbonded for a period
of ninety (90) consecutive days;
(vii) Tenant shall (A) voluntarily be adjudicated a bankrupt or
insolvent, (B) seek or consent to the appointment of a receiver or trustee for
itself or for the Leased Premises, (C) file a petition seeking relief under the
bankruptcy or other similar laws of the United States, any state or any
jurisdiction, (D) make a general assignment for the benefit of creditors, or (E)
be unable to pay its debts as they mature;
(viii) a court shall enter an order, judgment or decree appointing,
without the consent of Tenant, a receiver or trustee for it or for any of the
Leased Premises or approving a petition filed against Tenant which seeks relief
under the bankruptcy or other similar laws of the United States, any state or
any jurisdiction, and such order, judgment or decree shall remain undischarged
or unstayed ninety (90) days after it is entered;
(ix) the Leased Premises shall have been vacated for one hundred
twenty (120) days or abandoned or Tenant shall fail to occupy the Leased
Premises for normal business operations within sixty (60) days after the
Occupancy Date;
(x) Tenant shall be liquidated or dissolved or shall begin
proceedings towards its liquidation or dissolution;
(xi) except and to the extent the same is being contested
pursuant to Paragraph 14 hereof, the estate or interest of Tenant in any of the
Leased Premises shall be levied upon or attached in any proceeding and such
estate or interest is about to be sold or transferred or such process shall not
be vacated or discharged within ninety (90) days after it is made;
(xii) a failure by Tenant to perform or observe, or a violation or
breach of, any provision of any Assignment or any other document between Tenant
and Lender, if such failure, violation or breach gives rise to a default beyond
any applicable cure period with respect to any Loan;
(xiii) a failure by Tenant to maintain in effect any other license
or permit necessary for the use, occupancy or operation of the Leased Premises;
(xiv) an Event of Default (as defined in the Construction Agency
Agreement) shall exist under the Construction Agency Agreement beyond any
applicable cure period; or
(xv) an Event of Default (as defined in the Guaranty) shall exist
under the Guaranty beyond any applicable cure period or Tenant shall fail to
perform its obligations under the Warrant Agreement beyond any applicable cure
period.
(b) No notice or cure period shall be required in any one or more of
the following events:
(i) the occurrence of an Event of Default under clause (i)
(except as otherwise set forth below) (iv), (v), (vi), (vii), (viii), (ix), (x),
(xi), (xii) or (xiv) of Paragraph 22(a);
(ii) the default consists of a failure to provide any insurance
required by Paragraph 16 or an assignment or sublease entered into in violation
of Paragraph 21; or
(iii) the default is such that any delay in the exercise of a
remedy by Landlord could reasonably be expected to cause irreparable harm to
Landlord.
(c) If the default consists of the failure to pay any Monetary
Obligation under clause (i) of Paragraph 22(a), the applicable cure period shall
be five (5) days from the date on which notice is given, but Landlord shall not
be obligated to give notice of, or allow any cure period for, any such default
more than once within any Lease Year. If the default consists of a default
under clause (ii) or clause (xiii) of Paragraph 22(a) other than the events
specified in clauses (ii) and (iii) of Paragraph 22(b) above, the applicable
cure period shall be thirty (30) days from the date on which notice is given or,
if the default cannot be cured within such thirty (30) day period and delay in
the exercise of a remedy would not (in Landlord's reasonable judgment) cause any
material adverse harm to Landlord or any of the Leased Premises, the cure period
shall be extended for the period required to cure the default (but such cure
period, including any extension, shall not in the aggregate exceed one hundred
twenty (120) days), provided that Tenant shall commence to cure the default
within the said thirty-day period and shall actively, diligently and in good
faith proceed with and continue the curing of the default until it shall be
fully cured. If the default consists of a default under clause (iii) of
Paragraph 22(a) the applicable cure period shall be fifteen (15) days from the
date which is the earlier of the date on which Tenant is aware of the
misrepresentation or breach of warranty or the date on which Tenant receives
notice of such misrepresentation or breach from Landlord.
23. REMEDIES AND DAMAGES UPON DEFAULT.
(a) (i) If at any time after the first day of the third Lease Year
the breach of a Financial Covenant or a Change in Control (as such terms are
defined in the Guaranty) shall have occurred (either such event a "COVENANT
DEFAULT"), Tenant shall have the right, within thirty (30) days following the
existence of a Covenant Default, to make an irrevocable offer to terminate this
Lease by paying to Landlord simultaneously with such offer an amount (the
"DEFAULT TERMINATION AMOUNT") equal to one hundred ten percent (110%) of the sum
of Landlord's Share of Project Costs and the applicable Prepayment Premium, less
the then outstanding principal amount of any Loan then encumbering the Leased
Premises, but only if and to the extent Tenant assumes and becomes liable for,
to the exclusion of Landlord, payment and performance of all obligations arising
under or in connection with such Loan. In no event shall this right be
construed as granting to Tenant any cure period or additional cure period with
respect to any Event of Default, and Tenant's sole right with respect to the
Covenant Default in question shall be to make an irrevocable offer to terminate
this Lease by paying the Default Termination Amount. Within fifteen (15) days
after receipt of such offer and the Default Termination Amount, Landlord shall
accept or reject such offer, and if such offer is rejected the Landlord shall
return the Default Termination Amount in the rejection notice. Any rejection by
Landlord of such offer shall be deemed to be a cure of such Covenant Breach. In
no event
shall Tenant have any rights under this Paragraph 23(a) if the Covenant Breach
occurs prior to the first day of the third Lease Year.
(ii) Should Tenant pay the Default Termination Amount to
Landlord, Landlord agrees that (x) it shall forbear from exercising its remedies
set forth in Paragraph 23(b) and Paragraph 23(c), (y) this Lease shall terminate
and Tenant shall have no further obligations hereunder, except for Surviving
Obligations, and (z) if requested by Tenant, Landlord shall convey all of its
right, title and interest in the Leased Premises to Tenant or its designee in
accordance with Paragraph 20. If Tenant fails to make such offer and include
the Default Termination Amount therein or if such payment is required to be
returned or paid to Tenant, to Tenant's estate, or to any court, trustee,
representative or administrator of Tenant's estate, Landlord shall not be in any
way precluded from exercising its rights and remedies set forth in the following
Paragraph 23(b) and Paragraph 23(c).
(b) If a Covenant Breach shall have occurred and Tenant shall fail to
make the offer and pay the Default Termination Amount within the period
specified in Paragraph 23(a) above, Landlord shall have the right, at its sole
option, then or at any time thereafter, to exercise any or all of the remedies
set forth below and to collect damages from Tenant in accordance with this
Paragraph 23, without demand upon or notice to Tenant except as otherwise
provided in Paragraph 22(b) and this Paragraph 23.
(i) Landlord may give Tenant notice of Landlord's intention to
terminate this Lease on a date specified in such notice. Upon such date, this
Lease, the estate hereby granted and all rights of Tenant hereunder shall expire
and terminate. Upon such termination, Tenant shall immediately surrender and
deliver possession of the Leased Premises to Landlord in accordance with
Paragraph 26. If Tenant does not so surrender and deliver possession of the
Leased Premises, Landlord may re-enter and repossess the Leased Premises, with
or without legal process, by peaceably entering the Leased Premises and changing
locks or by summary proceedings, ejectment or any other lawful means or
procedure. Upon or at any time after taking possession of the Leased Premises,
Landlord may, by peaceable means or legal process, remove any Persons or
property therefrom. Landlord shall be under no liability for or by reason of
any such entry, repossession or removal. Notwithstanding such entry or
repossession, Landlord may collect the damages set forth in Paragraph 23(c)(i)
or 23(c)(ii).
(ii) After repossession of the Leased Premises pursuant to clause
(i) above, Landlord shall have the right to relet any of the Leased Premises to
such tenant or tenants, for such term or terms, for such rent, on such
conditions and for such uses as Landlord in its sole discretion may determine,
and collect and receive any rents payable by reason of such reletting. Landlord
may make such Alterations in connection with such reletting as it may deem
advisable in its sole discretion. Notwithstanding any such reletting, Landlord
may collect the
damages set forth in Paragraph 23(c)(ii).
(iii) Landlord may declare by notice to Tenant the entire Basic
Rent (in the amount of Basic Rent then in effect) for the remainder of the then
current Term to be immediately due and payable. Tenant shall immediately pay to
Landlord all such Basic Rent discounted to its Present Value, all accrued Rent
then due and unpaid, all other Monetary Obligations which are then due and
unpaid and all Monetary Obligations which arise or become due by reason of such
Event of Default (including any Costs of Landlord). Upon receipt by Landlord of
all such accelerated Basic Rent and Monetary Obligations, this Lease shall
remain in full force and effect and Tenant shall have the right to possession of
the Leased Premises from the date of such receipt by Landlord to the end of the
Term, and subject to all the provisions of this Lease, including the obligation
to pay all increases in Basic Rent and all Monetary Obligations that
subsequently become due, except that (A) no Basic Rent which has been prepaid
hereunder shall be due thereafter during the said Term, and (B) Tenant shall
have no option to extend or renew the Term.
(c) The following constitute damages to which Landlord shall be
entitled if Landlord exercises its remedies under Paragraph 23(b)(i) or
23(b)(ii):
(i) If Landlord exercises its remedy under Paragraph 23(b)(i)
but not its remedy under Paragraph 23(b)(ii) (or attempts to exercise such
remedy and is unsuccessful in reletting the Leased Premises) then, upon written
demand from Landlord, Tenant shall pay to Landlord, as liquidated and agreed
final damages for Tenant's default and in lieu of all current damages beyond the
date of such demand (it being agreed that it would be impracticable or extremely
difficult to fix the actual damages), an amount equal to the Present Value of
the excess, if any, of (A) all Basic Rent from the date of such demand to the
date on which the Term is scheduled to expire hereunder in the absence of any
earlier termination, re-entry or repossession over (B) the then fair market
rental value of the Leased Premises for the same period. Tenant shall also pay
to Landlord all of Landlord's Costs in connection with the repossession of the
Leased Premises and any attempted reletting thereof, including all brokerage
commissions, legal expenses attorneys' fees, employees' expenses, costs of
Alterations up to a maximum of $250,000 and expenses and preparation for
reletting.
(ii) If Landlord exercises its remedy under Paragraph 23(b)(i) or
its remedies under Paragraph 23(b)(i) and 23(b)(ii), then Tenant shall, until
the end of what would have been the Term in the absence of the termination of
the Lease, and whether or not any of the Leased Premises shall have been relet,
be liable to Landlord for, and shall pay to Landlord, as liquidated and agreed
current damages all Monetary Obligations which would be payable under this Lease
by Tenant in the absence of such termination less the net proceeds, if any, of
any reletting pursuant to Paragraph 23(c)(ii), after deducting from such
proceeds all of Landlord's Costs (including the items listed in the last
sentence of Paragraph 23(b)(i) hereof) incurred in connection with such
repossessing and reletting; provided, that if Landlord has not relet the Leased
Premises, such Costs of Landlord shall be considered to be Monetary Obligations
payable by Tenant. Tenant shall be and remain liable for all sums
aforesaid, and Landlord may recover such damages from Tenant and institute and
maintain successive actions or legal proceedings against Tenant for the recovery
of such damages. Nothing herein contained shall be deemed to require Landlord
to wait to begin such action or other legal proceedings until the date when the
Term would have expired by its own terms had there been no such Event of
Default.
(d) Notwithstanding anything to the contrary herein contained, in
lieu of or in addition to any of the foregoing remedies and damages, Landlord
may exercise any remedies and collect any damages available to it at law or in
equity. If Landlord is unable to obtain full satisfaction pursuant to the
exercise of any remedy, it may pursue any other remedy which it has hereunder or
at law or in equity.
(e) Landlord shall not be required to mitigate any of its damages
hereunder unless required to by applicable Law. If any Law shall validly limit
the amount of any damages provided for herein to an amount which is less than
the amount agreed to herein, Landlord shall be entitled to the maximum amount
available under such Law.
(f) No termination of this Lease, repossession or reletting of the
Leased Premises, exercise of any remedy or collection of any damages pursuant to
this Paragraph 23 shall relieve Tenant of any Surviving Obligations.
(g) WITH RESPECT TO ANY REMEDY OR PROCEEDING OF LANDLORD HEREUNDER,
TENANT WAIVES ANY RIGHT TO A TRIAL BY JURY.
(h) Upon the occurrence of any Event of Default, Landlord shall have
the right (but no obligation) to perform any act required of Tenant hereunder
and, if performance of such act requires that Landlord enter the Leased
Premises, Landlord may enter the Leased Premises for such purpose.
(i) No failure of Landlord (i) to insist at any time upon the strict
performance of any provision of this Lease or (ii) to exercise any option,
right, power or remedy contained in this Lease shall be construed as a waiver,
modification or relinquishment thereof. A receipt by Landlord of any sum in
satisfaction of any Monetary Obligation with knowledge of the breach of any
provision hereof shall not be deemed a waiver of such breach, and no waiver by
Landlord of any provision hereof shall be deemed to have been made unless
expressed in a writing signed by Landlord.
(j) Tenant hereby waives and surrenders, for itself and all those
claiming under it, including creditors of all kinds, (i) any right and privilege
which it or any of them may have under any present or future Law to redeem any
of the Leased Premises or to have a continuance of this Lease after termination
of this Lease or of Tenant's right of occupancy or possession pursuant to any
court order or any provision hereof, and (ii) the benefits of any present or
future Law which exempts property from liability for debt or for distress for
rent.
(k) Except as otherwise provided herein, all remedies are cumulative
and concurrent and no remedy is exclusive of any other remedy. Each remedy may
be exercised at any time an Event of Default has occurred and is continuing and
may be exercised from time to time. No remedy shall be exhausted by any
exercise thereof.
24. NOTICES. All notices, demands, requests, consents, approvals,
offers, statements and other instruments or communications required or permitted
to be given pursuant to the provisions of this Lease shall be in writing and
shall be deemed to have been given for all purposes when delivered in person or
by telecopy (with a hard copy to follow by Federal Express or other reliable
24-hour delivery service) or by Federal Express or other reliable 24-hour
delivery service or five (5) business days after being deposited in the United
States mail, by registered or certified mail, return receipt requested, postage
prepaid, addressed to the other party at its address stated in the first
paragraph of this Lease. A copy of any notice given by Tenant to Landlord shall
simultaneously be given by Tenant to Reed Smith Shaw & McClay, 2500 One Liberty
Place, Philadelphia, PA 19103, Attention: Chairman, Real Estate Department.
For the purposes of this Paragraph, any party may substitute another address
stated above (or substituted by a previous notice) for its address by giving
fifteen (15) days' notice of the new address to the other party, in the manner
provided above.
25. ESTOPPEL CERTIFICATE. Landlord or Tenant, as the case may be,
shall, at any time upon not less than ten (10) days' prior written request by
the other party, deliver to the other party a statement ("TENANT ESTOPPEL
CERTIFICATE") in writing, executed by the president or a vice president of
Landlord or Tenant, as the case may be, certifying that:
(a) Except as otherwise specified, this Lease is unmodified and in
full force and effect;
(b) The Basic Rent, Additional Rent and all other Monetary
Obligations have been paid to the dates stated in such certificate;
(c) The certifying party has not filed a voluntary or involuntary
bankruptcy petition;
(d) To the knowledge of the signer, based on reasonable inquiry and
except as may otherwise be specified, no default by either Landlord or Tenant
exists under this Lease;
(e) Landlord or Tenant, as the case may be, has performed all of its
obligations under the Lease with respect to the construction of the
Improvements;
(f) The other matters specified in the form of Tenant Estoppel
Certificate attached hereto as EXHIBIT "E" are true and correct, such
certification to be made by Tenant only.
26. SURRENDER. Upon the expiration or earlier termination of this
Lease, Tenant shall peaceably leave and surrender the Leased Premises to
Landlord in the same condition in which the Leased Premises was at the
commencement of this Lease, except as repaired, rebuilt, restored, altered,
replaced or added to as permitted or required by any provision of this
Lease, and except for ordinary wear and tear. Upon such surrender, Tenant shall
(a) remove from the Leased Premises all property which is owned by Tenant or
third parties other than Landlord and (b) repair any damage caused by such
removal. Property not so removed shall become the property of Landlord, and
Landlord may thereafter cause such property to be removed from the Leased
Premises. The cost of removing and disposing of such property and repairing any
damage to any of the Leased Premises caused by such removal shall be paid by
Tenant to Landlord upon demand. Landlord shall not in any manner or to any
extent be obligated to reimburse Tenant for any such property which becomes the
property of Landlord pursuant to this Paragraph 26.
27. NO MERGER OF TITLE. There shall be no merger of the leasehold
estate created by this Lease with the leasehold estate or the fee estate in any
of the Leased Premises by reason of the fact that the same Person may acquire or
hold or own, directly or indirectly, (a) the leasehold estate created hereby or
any part thereof or interest therein, and (b) fee estate in any of the Leased
Premises or any part thereof or interest therein, unless and until all Persons
having any interest in the interests described in (a) and (b) above which are
sought to be merged shall join in a written instrument effecting such merger and
shall duly record the same.
28. BOOKS AND RECORDS. Tenant shall furnish Landlord with the
following:
(a) As soon as available and in any event within sixty (60) days
after the end of each quarterly accounting period in each fiscal year of Tenant
(with the exception of the last quarter), Tenant shall furnish copies of a
consolidated balance sheet of Holdings and its consolidated Affiliates as of the
last day of such quarterly accounting period, and copies of the related
consolidated statements of income and of changes in shareholders' equity and in
financial position of Holdings and its consolidated Affiliates for such
quarterly accounting period and for the elapsed portion of the current fiscal
year ended with the last day of such quarterly accounting period. All such
statements shall be prepared in accordance with GAAP (except that interim
quarterly financials are not required to include notes) certified as complete
and correct in all material respects by the chief financial officer of Holdings
(subject to year-end audit adjustments).
(b) As soon as available and in any event within one hundred twenty
(120) days after the end of each fiscal year of Holdings, Tenant shall furnish
copies of a consolidated balance sheet of Holdings and its consolidated
Affiliates as of the end of such fiscal year, and copies of the related
consolidated statements of income and of changes in shareholders' equity and in
financial position of Holdings and its consolidated Affiliates for such fiscal
year. All such statements shall be in reasonable detail and with appropriate
notes, if any, and shall be prepared in accordance with GAAP and state in
comparative form the corresponding figures as of the end of and for the previous
fiscal year, and shall be accompanied by an opinion or report
thereon, in scope and substance satisfactory to Landlord, by Holdings'
nationally recognized independent certified public accountants.
(c) Upon the request of Landlord, Tenant shall furnish copies of all
regular and periodic reports or filings which Holdings or Tenant of either of
them shall make or be required to file with the Securities and Exchange
Commission or any other federal or state regulatory agency or with any municipal
or other local body, and such other public, non-proprietary information relating
to the business, affairs and financial condition of Tenant as Landlord may from
time to time reasonably request.
(d) Upon reasonable advance notice to Tenant, Landlord and Lender
shall have the right to periodically visit the Leased Premises to meet with
officers of Tenant for the purpose of discussing the operating history of the
Leased Premises and the general condition of Tenant's business. At no time
shall Tenant be obligated to disclose to Landlord, Lender or any third party any
confidential or proprietary information about Tenant or Tenant's business. The
scope and nature of the information to be so provided by Tenant to Landlord
and/or Lender shall be limited to that which would be customarily provided to
investment analysts employed by investment banking firms.
29. DETERMINATION OF VALUE.
(a) Whenever a determination of Fair Market Value is required
pursuant to any provision of this Lease, such Fair Market Value shall be
determined in accordance with the following procedure:
(i) Landlord and Tenant shall endeavor to agree upon such Fair
Market Value within thirty (30) days after the date (the "APPLICABLE INITIAL
DATE") (A) on which (1) Tenant provides Landlord with notice of its intention to
terminate this Lease and purchase the Leased Premises pursuant to Paragraph 18,
or (2) Landlord provides Tenant with notice of its intention to redetermine Fair
Market Value pursuant to Paragraph 20(c), (B) Tenant exercises its option to
purchase the Leased Premises pursuant to Paragraph 35 hereof, or (C) which is
six (6) months prior to the expiration date of the Term. Upon reaching such
agreement, the parties shall execute an agreement setting forth the amount of
such Fair Market Value.
(ii) If the parties shall not have signed such agreement within
thirty (30) days after the Applicable Initial Date, Tenant shall within fifty
(50) days after the Applicable Initial Date select an appraiser and notify
Landlord in writing of the name, address and qualifications of such appraiser.
Within twenty (20) days thereafter, Landlord shall select an appraiser and
notify Tenant of the name, address and qualifications of such appraiser. Such
two appraisers shall endeavor to agree upon Fair Market Value based on an
appraisal made by each of them as of the Relevant Date. If such two appraisers
shall agree upon a Fair Market Value, the amount of such Fair Market Value as so
agreed shall be binding and conclusive.
(iii) If such two appraisers shall be unable to agree upon a Fair
Market Value within twenty (20) days after the selection of an appraiser by
Landlord, then such appraisers shall
advise Landlord and Tenant of their respective determination of Fair Market
Value and shall select a third appraiser to make the determination of Fair
Market Value, which determination as to the selection of the third appraiser
shall be binding and conclusive upon Landlord and Tenant.
(iv) If such two appraisers shall be unable to agree upon the
designation of a third appraiser within ten (10) days after the expiration of
the twenty (20) day period referred to in clause (iii) above, or if such third
appraiser does not make a determination of Fair Market Value within twenty (20)
days after his selection, then such third appraiser or a substituted third
appraiser, as applicable, shall, at the request of either party hereto, be
appointed by the President or Chairman of the American Arbitration Association
in Louisville, Kentucky. The determination of Fair Market Value made by the
third appraiser appointed pursuant hereto shall be made within twenty (20) days
after such appointment. Fair Market Value shall be the average of the
determination of Fair Market Value made by the third appraiser and the
determination of Fair Market Value made by the appraiser (pursuant to Paragraph
29(a)(iii) hereof) whose determination of Fair Market Value is nearest to that
of the third appraiser. Such average shall be binding and conclusive upon
Landlord and Tenant.
(v) All appraisers selected or appointed pursuant to this
Paragraph 29(a) shall (A) be independent qualified MAI appraisers (B) have no
right, power or authority to alter or modify the provisions of this Lease,
(C) utilize the definition of Fair Market Value hereinabove set forth above, and
(D) be registered in the State if the State provides for or requires such
registration. The Cost of the procedure described in this Paragraph 29(a) above
shall be borne entirely by Tenant.
(b) If, by virtue of any delay, Fair Market Value of the Leased
Premises is not determined by the expiration or termination of the then current
Term, then the date on which the Term would otherwise expire or terminate shall
be extended to the date specified for termination in the particular provision of
this Lease pursuant to which the determination of Fair Market Value is being
made.
(c) In determining Fair Market Value of the Leased Premises as
defined in clause (b) of the definition of Fair Market Value of the Leased
Premises, the appraisers shall add (a) the present value of the Rent for the
then-remaining Term (with assumed increases in the CPI (as defined in Exhibit D)
to be determined by the appraisers) and (b) the present value of the Leased
Premises as of the end of such Term. The appraisers shall further assume that
no default then exists under the Lease, that Tenant has complied (and will
comply) with all provisions of the Lease, and that Tenant has not violated (and
will not violate) any Covenants. In no event shall the formula for, or amount
of, the Early Termination Amount be considered in determining Fair Market Value.
30. NON-RECOURSE AS TO LANDLORD.
(a) Anything contained herein to the contrary notwithstanding, any
claim based on or in respect of any liability of Landlord under this Lease shall
be enforced only against the Leased Premises and not against any other assets,
properties or funds of (i) Landlord, (ii) any director, officer, general
partner, shareholder, limited partner, employee or agent of Landlord, or any
general partner of Landlord, or any of its general partners (or any legal
representative, heir, estate, successor or assign of any thereof), (iii) any
predecessor or successor partnership or corporation (or other entity) of
Landlord, or any of its general partners, shareholders, officers, directors,
employees or agents, either directly or through Landlord, or its general
partners, shareholders, officers, directors, employees or agents or any
predecessor or successor partnership or corporation (or other entity), or (iv)
any other Person (including Carey Property Advisors, Carey Fiduciary Advisors,
Inc., W. P. Carey & Co. Inc., and any Person affiliated with any of the
foregoing), or any director, officer, employee, agent or successor of any
thereof.
(b) Nothing in this Paragraph 30 shall be construed as waiving or
limiting any equitable remedies which Tenant may have against Landlord and/or
any of the foregoing Persons by reason of any breach of this Lease by Landlord
and/or such Persons.
31. FINANCING. If Landlord desires to obtain or refinance any Loan,
Tenant shall negotiate in good faith with Landlord concerning any request made
by any Lender or proposed Lender for changes to or modifications of this Lease;
provided no such changes or modifications shall increase Tenant's obligations
under this Lease. In particular, Tenant shall agree, upon request of Landlord,
to supply any such Lender with such notices and information as Tenant is
required to give to Landlord hereunder and to acknowledge that the rights of
Landlord hereunder have been assigned by Landlord to such Lender and to consent
to such financing if such consent is requested by such Lender. Tenant shall
provide any other consent or statement and shall execute any and all other
documents that such Lender reasonably requires in connection with such
financing, including any environmental indemnity agreement and subordination,
non-disturbance and attornment agreement, so long as the same do not adversely
affect any right, benefit or privilege of Tenant under this Lease or materially
increase Tenant's obligations under this Lease; provided, however, that in no
event shall Tenant be obligated to provide any Lender with any confidential or
proprietary information about Tenant or its business. Such subordination,
non-disturbance and attornment agreement shall be in form and substance
reasonably satisfactory to Tenant and may require Tenant to confirm that (a)
Lender and its assigns will not be liable for any misrepresentation, act or
omission of Landlord and (b) Lender and its assigns will not be subject to any
counterclaim, demand or offset which Tenant may have against Landlord.
32. SUBORDINATION. Subject to the provisions of Paragraph 31, this
Lease and Tenant's interest hereunder shall be subordinate to the Tenant
Mortgage and to any Mortgage or other security instrument hereafter placed upon
the Leased Premises by Landlord, and to any and all advances made or to be made
thereunder, to the interest thereon, and all renewals, replacements and
extensions thereof, provided that the holder of any such Mortgage or other
security instrument (other than the
Tenant Mortgage) enters into a subordination, non-disturbance and attornment
agreement with and reasonably satisfactory to Tenant which recognizes this Lease
and all Tenant's rights hereunder unless and until (i) an Event of Default
exists or (ii) Landlord shall have the right to terminate this Lease pursuant to
any applicable provision hereof.
33. TAX TREATMENT; REPORTING; INTENTION OF PARTIES. Landlord and
Tenant each acknowledge that it is the intention of each of them that this
transaction be a true lease transaction and not a financing transaction,
notwithstanding any formula for the amount to be paid to Landlord if a
rejectable offer is made by Tenant in accordance with the terms of this Lease
and each shall treat this transaction as a true lease for state law purposes and
shall report this transaction as a Lease for Federal income tax purposes. For
Federal income tax purposes each shall report this Lease as a true lease with
Landlord as the owner of the Leased Premises and Equipment and Tenant as the
lessee of such Leased Premises and Equipment including: (1) treating Landlord
as the owner of the property eligible to claim depreciation deductions under
Section 167 or 168 of the Internal Revenue Code of 1986 (the "CODE") with
respect to the Leased Premises and Equipment, (2) Tenant reporting its Rent
payments as rent expense under Section 162 of the Code, and (3) Landlord
reporting the Rent payments as rental income.
34. OPTION TO PURCHASE.
(a) Landlord does hereby give and grant to Tenant the option to
purchase the Leased Premises (i) for a purchase price (the "PURCHASE PRICE")
equal to the greater of (A) the Fair Market Value of the Leased Premises and (B)
the sum of the Landlord's Share of Project Costs and any applicable Prepayment
Premium and (ii) on any date (the "OPTION PURCHASE DATE") during the eleventh
(11th) Lease Year which is mutually agreeable to Landlord and Tenant, but in any
event not sooner than thirty (30) days after the Fair Market Value Date. If
Tenant intends to exercise such option, Tenant shall give written notice to
Landlord to such effect not later than six (6) months prior to the first day of
the eleventh (11th) Lease Year. Promptly upon receipt of such notice by
Landlord, the parties shall commence to determine Fair Market Value.
(b) If Tenant shall exercise the foregoing option to purchase the
Leased Premises, on the later to occur of (i) the Option Purchase Date or
(ii) the date when Tenant has paid the Purchase Price and has satisfied all
other Monetary Obligations, Landlord shall convey the Leased Premises to Tenant
in accordance with Paragraph 20 hereof; provided, that if an Event of Default
has occurred and is continuing on the Option Purchase Date, Landlord, at its
sole option, may terminate Tenant's option to purchase hereunder. If this Lease
shall terminate for any reason prior to the date originally fixed herein for the
expiration of the Term, or if Tenant shall fail to give the aforesaid notice of
intention to purchase, time being of the essence, the option provided in this
Paragraph 35 and any exercise thereof by Tenant shall cease and terminate and
shall be null and void.
35. OBLIGATION TO PURCHASE. On the expiration date of the Term (or
if such date is not a Business Day, then on the first Business Day immediately
preceding such expiration date) (the "PURCHASE DATE") Tenant shall have an
obligation to purchase the Leased Premises for an amount equal to the positive
difference, if any, between the Fair Market Value of the Leased Premises and the
sum of the original principal amount of the Initial Loan and the Tenant Loan,
and six (6) months prior to such expiration date Landlord and Tenant shall
determine the Fair Market Value of the Leased Premises in accordance with the
terms of Paragraph 29 hereof. On the Purchase Date Landlord shall convey the
Leased Premises to Tenant in accordance with Paragraph 20 hereof.
36. FINANCING MAJOR ALTERATIONS.
(a) Should Tenant, during the Term of this Lease, desire to make
Alterations to any of the Leased Premises which are not readily removable
without causing material damage to the Leased Premises, and which will cost in
excess of $500,000 ("MAJOR ALTERATIONS"), Tenant may, prior to the commencement
of construction of such Major Alterations, request Landlord to reimburse the
costs thereof to Landlord (the "ALTERATION COST") to Tenant, TO WIT: cost of
labor and materials, financing fees, legal fees, survey, title insurance and
other normal and customary loan or construction costs.
(b) Should Landlord agree to reimburse such Alteration Cost, Landlord
and Tenant shall enter into good faith negotiations regarding the execution and
delivery of a written agreement of modification of this Lease, which agreement
shall provide for the following:
(i) payment by Landlord to Tenant of the Alteration Cost within
one hundred twenty (120) days of the date of Landlord's agreement to pay the
Alteration Cost, or in installment payments as agreed, or on the date of
completion of the Major Alterations, whichever shall be later;
(ii) an increase in the annual Basic Rent payable during the
Amortization Period (as hereinafter defined) to an amount sufficient to amortize
the Alteration Cost and the unpaid principal balance of the Note ("TOTAL
FINANCING") over a period (the "AMORTIZATION PERIOD") which shall be the shorter
of (A) twenty-five (25) years or (B) the remainder of the then current Term and,
if Tenant so elects, any additional extension periods provided for herein (so
long as Tenant shall confirm any such extension periods included in the
Amortization Period by a written waiver of its right to give notice of its
intention not to renew this Lease prior to the expiration of such extension
periods), at such rate of interest and upon such other terms as shall be agreed
upon between Landlord and Tenant, but which shall be no less favorable than the
prevailing interest rate and terms for first unsecured loans in a principal
amount equal to the Total Financings for borrowers with credit ratings
equivalent to that Tenant's at that time;
(iii) provide a rate of return to Landlord on Landlord's equity
investment in the Leased Premises equal to that enjoyed by Landlord hereunder
immediately prior to such proposed increase in Basic Rent; and
(iv) such other changes and amendments to this Lease as may be
necessary and appropriate in view of such payment of the Alteration Cost by
Landlord to Tenant.
Tenant shall pay all Costs incurred by Landlord in connection with any such
modification to this Lease and such financing, including closing costs,
brokerage fees, taxes, recording charges and legal fees and expenses.
(c) If Landlord and Tenant do not reach agreement on Tenant's request
to have Landlord finance the Alteration Costs, Tenant shall, subject to the
provisions of Paragraph 13 of this Lease, have the right to construct the Major
Alterations at Tenant's sole cost and expense. In such event the Major
Alterations shall be Tenant's property unless such Major Alterations are
Alterations to the Leased Premises in which case the Major Alterations shall be
the property of Landlord. The construction of any Major Alterations shall be
performed in accordance with the provisions of Paragraph 13 hereof.
(d) Nothing contained in this Paragraph 36 shall be construed to
modify Paragraph 13 hereof, and the provisions of Paragraph 12 and Paragraph 13
shall apply to all Major Alterations made or constructed hereunder, including
the requirement for Landlord's consent to Alterations.
37. MISCELLANEOUS.
(a) The paragraph headings in this Lease are used only for
convenience in finding the subject matters and are not part of this Lease or to
be used in determining the intent of the parties or otherwise interpreting this
Lease.
(b) As used in this Lease, the singular shall include the plural and
any gender shall include all genders as the context requires and the following
words and phrases shall have the following meanings: (i) "including" shall mean
"including without limitation"; (ii) "provisions" shall mean "provisions, terms,
agreements, covenants and/or conditions"; (iii) "lien" shall mean "lien, charge,
encumbrance, title retention agreement, pledge, security interest, mortgage
and/or deed of trust"; (iv) "obligation" shall mean "obligation, duty,
agreement, liability, covenant and/or condition"; (v) "any of the Leased
Premises" shall mean "the Leased Premises or any part thereof or interest
therein"; (vi) "any of the Land" shall mean "the Land or any part thereof or
interest therein"; (vii) "any of the Improvements" shall mean "the Improvements
or any part thereof or interest therein"; (viii) "any of the Building Systems
Equipment" shall mean "the Building Systems Equipment or any part thereof or
interest therein"; and (ix) "any of the Adjoining Property" shall mean "the
Adjoining Property or any part thereof or interest therein".
(c) Any act which Landlord is permitted to perform under this Lease
may be performed at any time and from time to time by Landlord or any person or
entity designated by Landlord. Each appointment of Landlord as attorney-in-fact
for Tenant hereunder is irrevocable and coupled with an interest. Except as
otherwise specifically provided herein, Landlord shall have the right, at its
sole option, to withhold or delay its consent whenever such consent is required
under this Lease for any reason or no reason. Time is of the essence with
respect to the performance by Tenant of its obligations under this Lease.
(d) Landlord shall in no event be construed for any purpose to be a
partner, joint venturer or associate of Tenant or of any subtenant, operator,
concessionaire or licensee of Tenant with respect to any of the Leased Premises
or otherwise in the conduct of their respective businesses.
(e) This Lease and any documents which may be executed by Tenant on
or about the effective date hereof at Landlord's request constitute the entire
agreement between the parties and supersede all prior understandings and
agreements, whether written or oral, between the parties hereto relating to the
Leased Premises and the transactions provided for herein. Landlord and Tenant
are business entities having substantial experience with the subject matter of
this Lease and have each fully participated in the negotiation and drafting of
this Lease. Accordingly, this Lease shall be construed without regard to the
rule that ambiguities in a document are to be construed against the drafter.
(f) This Lease may be modified, amended, discharged or waived only by
an agreement in writing signed by the party against whom enforcement of any such
modification, amendment, discharge or waiver is sought.
(g) The covenants of this Lease shall run with the land and bind
Tenant, its successors and assigns and all present and subsequent encumbrancers
and subtenants of any of the Leased Premises, and shall inure to the benefit of
Landlord, its successors and assigns. If there is more than one Tenant, the
obligations of each shall be joint and several.
(h) If any one or more of the provisions contained in this Lease
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this Lease, but this Lease shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.
(i) This Lease shall be governed by and construed and enforced in
accordance with the Laws of the State.
(j) Landlord agrees that so long as no Event of Default has occurred
and remains continuing, Landlord shall execute and deliver such Landlord lien
waivers as may be reasonably satisfactory to Landlord, in connection with the
financing of any personal property to be owned by Tenant, located at the Leased
Premises and used in connection with the operation of the Tenant's business at
the Leased Premises.
IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be
duly executed under seal as of the day and year first above written.
LANDLORD:
CFP ASSOCIATES, a Kentucky
partnership
By: CFP (MD) QRS 11-30, Inc.,
a Maryland corporation,
general partner
By:
-------------------------
Senior Vice President
By: CFP (MD) QRS 11-33, Inc.,
a Maryland corporation,
general partner
By:
-------------------------
Senior Vice President
TENANT:
CUSTOM FOOD PRODUCTS, INC.,
a California corporation
By:
-------------------------
Chief Financial Officer
EXHIBIT A
PREMISES
EXHIBIT B
BUILDING SYSTEMS EQUIPMENT
All fixtures, machinery, apparatus, equipment, fittings and appliances of every
kind and nature whatsoever now or hereafter affixed or attached to or installed
in any of the Leased Premises (except as hereafter provided), including all
electrical, anti-pollution, heating, lighting (including hanging fluorescent
lighting), incinerating, power, air cooling, air conditioning, humidification,
sprinkling, plumbing, lifting, cleaning, fire prevention, fire extinguishing and
ventilating systems, devices and machinery and all engines, pipes, pumps, tanks
(including exchange tanks and fuel storage tanks), motors, conduits, ducts,
steam circulation coils, blowers, steam lines, compressors, oil burners,
boilers, doors, windows, loading platforms, lavatory facilities, stairwells,
fencing (including cyclone fencing), passenger and freight elevators, overhead
cranes and garage units, together with all additions thereto, substitutions
therefor and replacements thereof required or permitted by this Lease, but
excluding all personal property and all trade fixtures, machinery, office,
manufacturing and warehouse equipment which are not necessary to the operation,
as buildings, of the buildings which constitute part of the Leased Premises.
EXHIBIT C
PERMITTED ENCUMBRANCES
1. Special assessments and special taxes, if any, not yet due and payable.
2. Taxes and assessments for 1995 which are a lien, but are not yet due and
payable.
EXHIBIT D
BASIC RENT SCHEDULE
1. BASIC RENT PRIOR TO THE REFINANCING DATE.
A. Basic Rent shall begin accruing on the Primary Term
Commencement Date. Commencing on the Basic Rent Commencement Date and to and
including the first day of the first calendar month following the earlier to
occur (the "REFINANCING DATE") of (i) the refinancing of the Initial Loan or
(ii) the last day of the fifth (5th) Lease Year, Basic Rent shall be payable
monthly in arrears on each Basic Rent Payment Date in an amount equal to the sum
of (a) 0.0125 multiplied by the weighted average amount advanced by Landlord
from its own funds for Landlord's Share of Project Costs based on the number of
days each advance is outstanding prior to such Basic Rent Payment Date; (b) the
amount of interest and/or interest and principal payable by Landlord on the
Initial Loan for such month; and (c) the amount of interest and/or interest and
principal payable by Landlord on the Tenant Loan for such month ("TENANT
VARIABLE RENT"); provided that from and after the date (the "TENANT LOAN
REFINANCING DATE") on which all or any part of the Tenant Loan is refinanced,
the Tenant Variable Rent shall be an amount equal to one-twelfth (1/12th) of the
amount of principal and interest that Landlord would be required to pay in a
twelve-month period on a hypothetical loan in a principal amount equal to the
outstanding principal balance of the Tenant Loan as of the date immediately
prior to the Tenant Loan Refinancing Date, which hypothetical loan has payment
terms identical to those of the Loan pursuant to which the Tenant Loan is
refinanced. The amount set forth in the foregoing sentence shall, absent
manifest error, be conclusively determined from the books and records of
Landlord.
B. Commencing with the first day of the second (2nd) Lease
Year, the Basic Rent shall be subject to adjustment as provided in subparagraphs
A, C and D of Paragraph 5 below.
2. BASIC RENT FOLLOWING THE REFINANCING DATE. Commencing on the
first day of the first calendar month following the Refinancing Date and
continuing on each Basic Rent Payment Date thereafter until the expiration of
the Term, Basic Rent shall be payable monthly in advance in an amount equal to
the sum of (i) Forty-nine Thousand Five Hundred Twenty-two and 50/100 Dollars
($49,522.50) and (ii) an amount equal to the Tenant Variable Rent for such
month.
The amount set forth in the foregoing sentence shall (i) absent
manifest error, be conclusively determined from the books and records of
Landlord, and (ii) be subject to the adjustments provided for in subparagraphs
B, C and D of Paragraph 5 below.
3. CPI ADJUSTMENTS TO BASIC RENT. The Basic Rent shall be subject
to adjustment, in the manner hereinafter set forth, for increases in the index
known as United States Department of Labor, Bureau of Labor Statistics,
Consumer Price
Index, All Urban Consumers, United States City Average, All Items, (1982-84=100)
("CPI") or the successor index that most closely approximates the CPI. If the
CPI shall be discontinued with no successor or comparable successor index,
Landlord and Tenant shall attempt to agree upon a substitute index or formula,
but if they are unable to so agree, then the matter shall be determined by
arbitration in accordance with the rules of the American Arbitration Association
then prevailing in New York City. Any decision or award resulting from such
arbitration shall be final and binding upon Landlord and Tenant and judgment
thereon may be entered in any court of competent jurisdiction. In no event will
the Basic Rent as adjusted by the CPI adjustment be less than the Basic Rent in
effect for the one (1) year period immediately preceding such adjustment.
4. EFFECTIVE DATES OF CPI ADJUSTMENTS. As of the first day of the
second (2nd) Lease Year and on the first day of each Lease Year thereafter,
Basic Rent shall be adjusted to reflect increases in the CPI during the most
recent Lease Year immediately preceding each of the foregoing dates (each such
date being hereinafter referred to as the "BASIC RENT ADJUSTMENT DATE").
5. METHOD OF ADJUSTMENT FOR CPI ADJUSTMENT.
A. PRIOR TO REFINANCING DATE. As of each Basic Rent Adjustment
Date occurring prior to the Refinancing Date when the average CPI determined in
clause (i) below exceeds the Beginning CPI (as defined in this Paragraph 5(A)),
the amount of $594,270 shall be multiplied by a fraction, the numerator of which
shall be the difference between (i) the average CPI for the three (3) most
recent calendar months (the "PRIOR MONTHS") ending prior to such Basic Rent
Adjustment Date for which the CPI has been published on or before the
forty-fifth (45th) day preceding such Basic Rent Adjustment Date and (ii) the
Beginning CPI, and the denominator of which shall be the Beginning CPI. An
amount equal to the lesser of (x) eighty percent (80%) of the product of such
multiplication or (y) the product of such multiplication assuming the increase
of 4.5% in the CPI for each one year period shall be added to the Basic Rent in
effect immediately prior to such Basic Rent Adjustment Date. As used herein,
"BEGINNING CPI" shall mean the average CPI for the three (3) calendar months
corresponding to the Prior Months, but occurring one (1) year earlier. If the
average CPI determined in clause (i) is the same or less than the Beginning CPI,
the Basic Rent will remain the same for the ensuing Lease Year.
B. FROM AND AFTER REFINANCING DATE. As of each Basic Rent
Adjustment Date occurring on or after the Refinancing Date when the average CPI
determined in clause (i) below exceeds the Beginning CPI, the Basic Rent in
effect immediately prior to the applicable Basic Rent Adjustment Date shall be
multiplied by a fraction, the numerator of which shall be the difference between
(i) the average CPI for the Prior Months ending prior to such Basic Rent
Adjustment Date for which the CPI has been published on or before the
forty-fifth (45th) day preceding such Basic Rent Adjustment Date and (ii) the
Beginning CPI, and the denominator of which shall be the Beginning CPI. An
amount equal to the lesser of (x) eighty percent (80%) of the product of such
multiplication or (y) the product of such multiplication assuming the increase
of 4.5% in the CPI for each one year period shall be added to the Basic Rent in
effect immediately prior to such Basic
EXHIBIT D
Rent Adjustment Date. If the average CPI determined in clause (i) is the same
or less than the Beginning CPI, the Basic Rent will remain the same for the
ensuing Lease Year.
C. ADJUSTMENT. Effective as of a given Basic Rent Adjustment
Date, Basic Rent payable under this Lease until the next succeeding Basic Rent
Adjustment Date shall be the Basic Rent in effect after the adjustment provided
for as of such Basic Rent Adjustment Date.
D. NOTICE. Notice of the new annual Basic Rent shall be
delivered to Tenant on or before the tenth (10th) day preceding each Basic Rent
Adjustment Date.
EXHIBIT E
TENANT ESTOPPEL CERTIFICATE
(Lender)
The undersigned, CUSTOM FOOD PRODUCTS, INC., a California corporation
("TENANT"), hereby certifies to , a
("LENDER") and/or ("PURCHASER"), as follows:
1. Attached hereto is a true, correct and complete copy of that certain
lease dated as of September, 1994, between CFP ASSOCIATES, a Kentucky
partnership ("LANDLORD"), and Tenant (the "LEASE"), the demised premises of
which ("PREMISES") are located at 3278 Kendall Springs Road in the City of
Owingsville, County of Bath, State of Kentucky, which Premises are more
particularly described in the Lease. The Lease (as attached) represents the
entire agreement between the parties as to the Premises, is now in full force
and effect, and has not been amended, modified or supplemented, except as set
forth in Paragraph 5 below.
2. The term of the Lease commenced on , 19 . Rent commenced to
accrue on , 19 .
3. The undersigned is in occupancy of the Premises.
4. The initial term of the Lease shall expire on ,
19 , with renewal option(s) of a period of years each.
5. The Lease has not been amended, modified, supplemented, extended,
renewed or assigned, except:
.
6. All conditions of the Lease to be performed by Landlord thereunder and
necessary to the enforceability of the Lease have been satisfied, except:
.
7. The amount of the installment of Basic Rent being paid currently is
$ .
8. Tenant is paying the full Basic Rent under the Lease, which Rent has
been paid in full through . No Basic Rent under the Lease has been
paid for more than thirty (30) days in advance of its due date.
9. To the best of the knowledge of the undersigned,
based on reasonable injury, Tenant has no defense as to its obligations under
the Lease and claims no set-off or counterclaim against Landlord.
10. To the best knowledge of the undersigned, there are no defaults on the
part of Landlord or Tenant under the Lease, and there are no events currently
existing (or with the passage of time, giving of notice or both, which would
exist) which give Tenant the right to cancel or terminate the Lease.
11. Tenant has no right to any concession (rental or otherwise) or similar
compensation in connection with renting the space it occupies, except as
provided in the Lease.
12. There are no actions, whether voluntary or otherwise, pending against
the undersigned or any guarantor of the undersigned's obligations under the
Lease pursuant to the bankruptcy or insolvency laws of the United States or any
state thereof.
13. It is Tenant's understanding that the present Landlord of the Premises
is .
14. Tenant's address for notices under the terms of the Lease is: 1117 W.
Olympic Boulevard, P.O. Box 1027, Montebello, California 90640.
15. Tenant hereby acknowledges that Lender intends to make a loan to
Landlord for , that Landlord intends to assign
the Lease to Lender in connection with such financing, and that Lender is
relying upon the representations herein made in funding such loan. Upon such
assignment and upon written request from Lender, Tenant agrees to send all
rents, payments and other amounts due under the Lease and assigned to Lender
pursuant to said financing to such address as may be indicated in writing by
Lender to Tenant. Tenant agrees that no modification, adjustment, revision,
cancellation or renewal of the Lease or amendments thereto shall be effective
unless the written consent of Lender is obtained. Tenant has not received any
notice of any other sale, pledge, transfer or assignment of the Lease or of the
rentals thereunder by Landlord.
16. Tenant shall deliver to Lender a copy of all notices of default or
termination served on or received from Landlord.
17. Lender is hereby given the right to cure Landlord's defaults under the
Lease within thirty (30) days after receipt of written notice by the undersigned
of Landlord's failure so to do; provided, however, that said thirty (30) day
period shall be extended (a) so long as within said thirty (30 day period Lender
has commenced to cure and is proceeding with due diligence to cure said
defaults, or (b) so long as Lender is proceeding with a foreclosure action
against Landlord and will commence to cure and will proceed with due diligence
to cure said defaults upon the resolution of said foreclosure action.
18. Tenant acknowledges that Lender shall assume no liability or
obligations under the Lease, or any renewal thereof, either by virtue of the
assignment thereof or any receipt or collection of rents under the Lease, except
in the event that
EXHIBIT E
Lender acquires title to the Leased Premies.
19. All provisions of the Lease and the amendments thereto (if any)
referred to above are hereby ratified.
DATED: , 19 "Tenant":
------------ ---
CUSTOM FOOD PRODUCTS, INC.,
a California corporation
By:
---------------------------
Its:
--------------------------
By:
---------------------------
Its:
--------------------------
SECOND LEASE AMENDMENT
THIS SECOND LEASE AMENDMENT (this "AMENDMENT") is made as of this 31st
day of December, 1996 between CFP ASSOCIATES, a Kentucky partnership
("LANDLORD") with an address c/o W. P. Carey & Co., Inc., 50 Rockefeller Center,
Second Floor, New York, New York 10020, and CUSTOM FOOD PRODUCTS, INC., a
California corporation ("TENANT") with an address at 1117 West Olympic
Boulevard, Montebello, California 90640.
WHEREAS, Landlord and Tenant are parties to a certain Lease Agreement
dated as of September 30, 1994, as amended by a certain letter agreement dated
September 30, 1994, and by a certain First Lease Amendment dated as of June 14,
1996 (the "LEASE"), whereby Landlord demised and let to Tenant, and Tenant took
and leased from Landlord, for the term and upon the provisions therein
specified, all right, title and interest of Landlord in and to the Leased
Premises; and
WHEREAS, the parties wish to further amend the Lease; and
WHEREAS, capitalized terms used herein and not otherwise defined
herein shall have the respective meanings assigned thereto in the Lease.
NOW THEREFORE, in consideration of the rents and provisions herein
stipulated to be paid and performed, Landlord and Tenant hereby covenant and
agree as follows:
1. INCORPORATION OF RECITALS. The recitals set forth above are hereby
incorporated as if set forth in their entirety.
2. CERTAIN DEFINITIONS. From and after the date hereof, the following
terms referred to in the Lease shall have the following respective meanings:
"GUARANTY" shall mean that certain Guaranty and Suretyship
Agreement dated as of September 30, 1994 from Guarantor to Landlord, as amended
by that certain First Amendment to Guaranty and Suretyship Agreement dated July
11, 1996 from Guarantor to Landlord, and as amended by that certain Second
Amendment to Guaranty and Suretyship Agreement of even date herewith and that
certain Guaranty and Suretyship Agreement of even date herewith from CFP Group,
Inc. to Landlord.
"INITIAL LENDER" shall mean CFPLOAN (MD) QRS 11-41, Inc., as
assignee of NationsCredit Commercial Corporation (formerly known as Greyrock
Capital Group, Inc.), as Agent, and any successor or assign of CFPLOAN (MD) QRS
11-41, Inc., as the holder of the Initial Loan.
"LEASE" shall mean the Lease, as modified, amended
and supplemented by this Amendment.
3. EVENTS OF DEFAULT. Paragraph 22(a), clause (xv) of the Lease is
hereby amended by deleting from the second line the phrase "under the Guaranty"
in its entirety and inserting in lieu thereof the phrase "under either
Guaranty".
4. FINANCING. Paragraph 31 of the Lease is hereby amended by adding
the following sentences at the end of such paragraph:
Notwithstanding anything else contained in this Lease to the contrary,
Tenant shall pay for the actual, reasonable, customary and documented costs
incurred by Landlord in connection with the initial refinancing of the Initial
Loan provided, however, that such obligation to pay for such costs shall only
pertain to the initial refinancing of the Initial Loan and provided further that
Tenant shall not be obliged to pay for any such costs to the extent the same
exceed the sum of $100,000. The parties hereto agree that the purchase of the
Initial Loan by CFPLOAN (MD) QRS 11-40, Inc. from NationsCredit Commercial
Corporation (formerly known as Greyrock Capital Group, Inc.) shall not
constitute a refinancing of the Initial Loan for purposes of this Lease,
including without limitation EXHIBIT D hereto.
5. RATIFICATION. As amended, supplemented and modified by this
Amendment, the Lease, including without limitation the provisions of EXHIBIT D,
is hereby ratified and confirmed in all respects.
6. MISCELLANEOUS.
(a) The covenants of this Amendment shall run with the land and bind
Tenant, its successors and assigns and all present and subsequent encumbrancers
and subtenants of any of the Leased Premises, and shall inure to the benefit of
Landlord, its successors and assigns.
(b) This Amendment shall be governed by and construed and enforced in
accordance with the Laws of the State.
(c) This Amendment may be executed in any number of counterparts and
by the different parties hereto on separate counterparts, each of which when so
executed shall be deemed to be an original, but all such counterparts shall
constitute but one and the same instrument.
IN WITNESS WHEREOF, Landlord and Tenant have caused this Amendment to
be duly executed under seal as of the day and year first above written.
LANDLORD:
CFP ASSOCIATES, a Kentucky
partnership
By: CFP (MD) QRS 11-30, Inc.,
a Maryland corporation,
general partner
By:
---------------------
Title:
------------------
By: CFP (MD) QRS 11-33, Inc.,
a Maryland corporation,
general partner
By:
---------------------
Title:
------------------
TENANT:
CUSTOM FOOD PRODUCTS, INC.,
a California corporation
By:
--------------------------
Title:
-----------------------
CONSENT OF LENDER
The undersigned, "Lender", by assignment, under that certain Assignment of
Net Lease and Rentals and Construction Agency Agreement dated as of September
30, 1994 given by CFP Associates, hereby consents to the foregoing Second Lease
Amendment.
CFPLOAN (MD) QRS 11-40, INC.
By:
Title:
September 30, 1994
Custom Food Products, Inc.
1117 West Olympic Blvd.
Montebello, CA 90640
Re: Lease Agreement dated as of September 30, 1994 (the "LEASE") by and
between CFP Associates, a Kentucky partnership ("LANDLORD"), as
landlord, and Custom Food Products, Inc., a California corporation
("Tenant"), as Tenant
Ladies and Gentlemen:
This letter shall serve as Landlord's commitment to purchase the Leased
Premises (as such term is defined in the Lease; capitalized terms used herein
and not otherwise defined herein having the respective meanings assigned thereto
in the Lease) from Tenant after Tenant has purchased the Leased Premises from
Landlord pursuant to Paragraph 35 of the Lease. The purchase price by Landlord
for the Leased Premises (the "PURCHASE PRICE") shall be the same net amount paid
by Tenant pursuant to Paragraph 35 of the Lease. Tenant shall pay or reimburse
Landlord for all Costs incurred by Landlord in connection with such transfer.
Tenant shall convey such title to the Leased Premises as was conveyed to
Tenant, and Landlord (or Landlord's designee) shall accept such title, subject,
however, to the Permitted Encumbrances and only those liens, exceptions and
restrictions on, against or relating to the Leased Premises at the time Tenant
takes title to the Leased Premises pursuant to Paragraph 35 of the Lease.
Landlord's purchase of the Leased Premises shall be completed within five
(5) Business Days of Tenant's purchase thereof and, on the date set for
Landlord's purchase of the Leased Premises, Landlord shall pay to Tenant the
Purchase Price, and Tenant shall deliver to Landlord (or Landlord's designee) a
special warranty deed which describes the premises being conveyed and conveys
the title thereto as provided above and such other instruments as shall be
necessary to transfer the Leased Premises to Landlord or Landlord's designee.
This letter agreement shall be binding upon, and shall inure to the benefit
of, Landlord and Tenant and their respective successors and assigns.
Very truly yours
CFP ASSOCIATES, a Kentucky
partnership
By: CFP (MD) QRS 11-30, Inc.,
a Maryland corporation, general
partner
By:
----------------------
Senior Vice President
By: CFP (MD) QRS 11-33, Inc., a
Maryland corporation, general
partner
By:
----------------------
Senior Vice President
ACCEPTED AND AGREED
THIS 30th DAY OF SEPTEMBER, 1994
CUSTOM FOOD PRODUCTS, INC.
By:
-----------------------------
Chief Financial Officer
RSSM DRAFT 5/24/96
AGREEMENT TO PURCHASE AND LEASE REAL ESTATE
by and between
CFP ASSOCIATES,
a Kentucky partnership
and
CUSTOM FOOD PRODUCTS, INC.,
a California corporation,
Dated as of: ________ ___, 1996
TABLE OF CONTENTS
PAGE
1. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . 3
3. Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4. Conditions to CFP's Obligation to Close. . . . . . . . . . . . 3
5. Conditions to Custom's Obligation to Close . . . . . . . . . . 6
6. Custom's Covenants, Representations
and Warranties . . . . . . . . . . . . . . . . . . . . . . . . 6
7. Remedies Upon Default. . . . . . . . . . . . . . . . . . . . . 7
8. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
9. Brokerage Commissions. . . . . . . . . . . . . . . . . . . . . 8
10. Costs and Expenses . . . . . . . . . . . . . . . . . . . . . . 8
11. Miscellaneous Provisions . . . . . . . . . . . . . . . . . . . 8
Exhibit "A" - Legal Description of Additional Land
Exhibit "B" - Form of First Lease Amendment
Exhibit "C" - Survey Checklist
Exhibit "D" - Form of Surveyor's Certificate
Exhibit "E" - Form of Warranty Deed
Exhibit "F" - Form of Bill of Sale
Exhibit "G" - Form of Amended and Restated Memorandum
of Lease
Exhibit "H" - Form of Lessee's Certificate
Exhibit "I" - Form of Guarantor's Certificate
Exhibit "J" - Form of First Amendment to Guaranty and
Suretyship Agreement
Exhibit "K" - Form of Consent and Amendment No. 1 to
Loan Agreement
AGREEMENT TO PURCHASE AND LEASE REAL ESTATE
THIS AGREEMENT TO PURCHASE AND LEASE REAL ESTATE (this "AGREEMENT") made
and entered into as of the day of ________, 1996, by and between CUSTOM
FOOD PRODUCTS, INC., a California corporation having a mailing address at 1117
West Olympic Boulevard, Montebello, California 90640 ("CUSTOM"), and CFP
ASSOCIATES, a Kentucky partnership having a mailing address c/o W. P. Carey &
Co., Inc., 50 Rockefeller Plaza, Second Floor, New York, New York 10020 ("CFP").
W I T N E S S E T H:
WHEREAS, CFP is the owner of real property situate in Owingsville, Bath
County, Kentucky (the "EXISTING LAND"), having constructed thereon certain
improvements (the "EXISTING IMPROVEMENTS") (together with the Existing Land, the
"PROPERTY"), which is leased to Custom pursuant to a Lease Agreement dated as of
September 30, 1994 between CFP, as landlord, and Custom, as tenant (the
"LEASE"); and
WHEREAS, Custom desires to expand the Improvements by constructing on the
Property and on the Additional Land (as hereinafter defined) an addition
containing approximately 10,380 square feet (the "EXPANSION") and, subject to
the terms and conditions of this Agreement, CFP has agreed to purchase certain
real property ("ADDITIONAL LAND") more particularly described in EXHIBIT "A"
hereto adjacent to the Property and the Expansion from Custom and to lease the
Additional Land and the Expansion to Custom; and
WHEREAS, the Additional Land and the Existing Land shall, on or before the
Closing, be consolidated into one single parcel pursuant to all applicable
zoning, land use and subdivision laws, which shall constitute the Consolidated
Land.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties hereto agree as follows:
1. DEFINITIONS. In addition to other words and terms defined elsewhere
in this Agreement, as used herein the following words and terms shall have the
following meanings, respectively, unless the context hereof otherwise clearly
requires:
(a) "Acquisition Fee" shall mean $70,681, which shall be part of the
Purchase Price paid by CFP to Custom.
(b) "Additional Property" shall mean,
collectively, the Additional Land and the Expansion.
(c) "Architect" shall mean Suhar & Miller, Architects.
(d) "Closing" shall mean the consummation of the purchase and lease
of the Additional Property in accordance with the terms of this Agreement.
(e) "Consolidated Land" shall mean the combination of the land
contained within the legal descriptions of the Existing Land and the Additional
Land so that a consolidated perimeter legal description and survey is created as
a result.
(f) "First Lease Amendment" shall mean an amendment to the Lease to
be executed by CFP and Custom, pursuant to which the Additional Property shall
be subjected to the terms of the Lease, a draft of which is attached hereto as
EXHIBIT "B".
(g) "Force Majeure" shall mean any cause or causes which Custom is
not, despite all reasonable efforts, able to prevent or overcome, including but
not limited to acts of God, strikes, walkouts or other labor disputes, riots,
civil strife, war, acts of a public enemy, lightning, fires, explosions, storms
or floods; but the unavailability of money, unavailability of sources of
financing, a shortage of labor or materials, or changes in market conditions
shall not constitute Force Majeure.
(h) "Guarantor" shall mean CFP Holdings, Inc.
(i) "Lender" shall mean NationsCredit Commercial Corporation,
formerly known as Greyrock Capital Group Inc.
(j) "Permits" shall mean all of the governmental permits, including
licenses and authorizations, required for the ownership and operation of the
Additional Property, including without limitation certificates of occupancy,
building permits, signage permits, site use approvals, zoning certificates,
planning commission approvals, environmental and land use permits and any and
all necessary approvals from state or local authorities.
(k) "Permitted Exceptions" shall mean taxes and assessments which are
a lien but are not yet due and payable, customary utility easements that benefit
and do not interfere with the use of the Additional Property and such other
easements, rights of way, covenants and conditions as may be approved by CFP in
its sole discretion and other matters specified in Schedule B to the Title
Policy.
(l) "Plans" shall mean the plans and specifications prepared by a
licensed architect approved by CFP, and in form and substance satisfactory to
CFP, for the construction of the Expansion.
(m) "Project Cost" shall mean all Direct Costs and
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Indirect Costs (as those terms are defined in the Lease) incurred with respect
to the acquisition of the Additional Land and the construction of the Expansion.
(n) "Purchase Price" shall mean Purchase Price as defined in SECTION
2.
(o) "Title Company" shall mean First American Title Insurance
Company, acting through its authorized agent, Multi-State Title Agency, Ltd.,
which shall either issue an endorsement to the Title Policy or issue a new title
policy.
(p) "Title Policy" shall mean Policy of Title Insurance No. 0-89383
issued by the Title Company.
2. PURCHASE PRICE. Subject to the terms and conditions set forth in this
Agreement, CFP agrees to purchase the Additional Property for a purchase price
(the "PURCHASE PRICE") equal to the lesser of (a) the sum of $1,500,000 and the
Acquisition Fee and (b) the sum of actual Project Costs and the Acquisition Fee.
3. CLOSING. The Closing of the purchase by CFP of the Additional
Property and the lease thereof to Custom shall take place on a date (the
"CLOSING DATE") that shall be mutually acceptable to CFP and Custom, but in no
event sooner than ten (10) days nor later than twenty (20) days after receipt by
CFP of written notice (the "CLOSING NOTICE") from Custom that each of the
conditions set forth in SECTION 4 hereof has been satisfied or will be satisfied
on the Closing Date, and the Closing shall occur at such time and at such
location as is mutually acceptable to CFP and Custom. In no event, however,
shall the parties be obligated to consummate the transactions contemplated
hereby after July 1, 1996, which date shall be extended for Force Majeure delays
or delays caused by CFP; provided, however, that in no event shall such date be
extended beyond September 1, 1996.
4. CONDITIONS TO CFP'S OBLIGATION TO CLOSE. CFP's obligation to purchase
the Additional Property on the Closing Date is subject to the satisfaction of
the following contingencies and conditions in the manner and within the time
limits herein specified:
(a) There shall exist no uncured Event of Default (as defined in the
Lease) or any event which, with the giving of notice or the passage of time or
both, would constitute an Event of Default.
(b) Custom shall have acquired all Permits for the occupancy and use
of the Expansion, copies of all of which shall be delivered to CFP.
(c) Title to the Additional Property shall be indefeasible and in fee
simple, and shall be consolidated with the Existing Land by a registered
engineer or surveyor and the
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appropriate survey plats properly filed in the Bath County, Kentucky Clerk's
Office so that the Existing Land and the Additional Land shall be consolidated
into one parcel of land of record, thereby forming the Consolidated Land, and
the foregoing shall be subject only to the Permitted Exceptions.
(d) CFP shall have received an as-built survey for the Expansion and
the Consolidated Land with the seal and signature of a registered engineer or
surveyor, which survey shall include all items set forth on the Survey Checklist
attached hereto as EXHIBIT "C" and which shall, in addition, (a) be certified to
CFP, Lender and to the Title Company, (b) show the location of all easements,
none of which shall be encroached upon by the Expansion to be constructed
thereon or shall interfere with the use of, or access to, the Property or the
Expansion, and (c) shall be accompanied by a certificate from the Surveyor in
the form attached as EXHIBIT "D".
(e) CFP shall have received a duly executed special warranty deed in
recordable form with respect to the Additional Property, together with a
consolidated perimeter legal description for the Consolidated Land attached to
the deed, executed by Custom, subject only to Permitted Exceptions, said deed to
be in the form attached hereto as EXHIBIT "E", and a duly executed bill of sale
with respect to the Expansion in the form attached hereto as EXHIBIT "F".
(f) CFP shall have received an endorsement to the Title Policy or a
new title insurance policy insuring fee simple title in and to the Additional
Land in the amount of the Purchase Price and subject to no exceptions other than
the Permitted Exceptions.
(g) CFP and Custom shall have executed and delivered the First Lease
Amendment and an Amended and Restated Memorandum of Lease in the form attached
hereto as EXHIBIT "G" to be recorded in Bath County, Kentucky, together with a
consolidated perimeter legal description for the Consolidated Land attached
thereto.
(h) CFP shall have received an updated Lessee's Certificate executed
by Custom in the form attached as EXHIBIT "H".
(i) CFP shall have received an updated Guarantor's Certificate
executed by Guarantor, in the form attached as EXHIBIT "I".
(j) CFP shall have received evidence that the insurance coverage
required by the Lease is in full force and effect with respect to the Expansion
and CFP shall have received certificates of insurance insuring CFP as the owner
of the Expansion.
(k) CFP shall have received an environmental site
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assessment with respect to the Additional Property, which shall show the
Additional Property to be in a condition acceptable to CFP and its counsel, in
their sole and absolute discretion.
(l) CFP shall have received an appraisal of the Additional Property
indicating that the value of the Additional Property is equal to or greater than
the Purchase Price (including the Acquisition Fee).
(m) CFP shall have received an opinion from Custom's counsel, or such
other counsel acceptable to CFP, that the Lease, as supplemented by the First
Lease Amendment and all other documents executed by Custom in connection
therewith constitute the legal, valid and binding obligations of Custom and are
enforceable against Custom in accordance with their terms, and addressing such
other matters as may be reasonably required by CFP and its counsel.
(n) CFP shall have received a certificate from Architect stating that
the Expansion has been completed in accordance with the Plans.
(o) CFP shall have received a list of Project Costs certified to be
true, correct and complete.
(p) CFP shall have received a First Amendment to Guaranty and
Suretyship Agreement from Guarantor in the form attached hereto as EXHIBIT "J",
guaranteeing the obligations of Custom under the Lease as amended by the First
Lease Amendment.
(q) CFP shall have received good standing certificates of Custom
issued by the States of California and Kentucky and an updated certificate of an
officer of Custom certifying to CFP and attaching thereto the articles of
incorporation, bylaws, resolutions and incumbency certificate of Custom.
(r) The representations and warranties of Custom set forth in SECTION
6 hereof shall be true, correct and complete in all material respects on and as
of the Closing Date and CFP shall have received from Custom a certificate to
such effect; PROVIDED, however, that if such representations and warranties are
not true, correct and complete on the Closing Date, then Custom shall have a
period of fourteen (14) days in which to attempt to make such representations
and warranties true and correct and the Closing Date shall be extended by such
period.
(s) CFP shall have received duplicate copies of the closing
statement.
(t) CFP shall have received the approval of its Investment Committee
to the transactions contemplated herein.
(u) There shall be no adverse change in the financial conditions of
Custom from the financial condition
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reflected in the financial statements dated September 30, 1995.
(v) CFP shall have received the consent of Lender to the construction
by Custom of the Expansion and the purchase of the Additional Property by CFP,
which consent shall be evidenced by the execution and delivery of the Consent
and Amendment No. 1 to Loan Agreement in the form attached hereto as EXHIBIT
"K".
(w) No damage or condemnation shall exist with respect to the
Existing Improvements or the Expansion.
(x) CFP shall have received evidence regarding the proper zoning and
the properly recorded survey plat for the Consolidated Land, and evidence that
the Consolidated Land is separately assessed for AD VALOREM real property taxes
from all other Lands.
5. CONDITIONS TO CUSTOM'S OBLIGATION TO CLOSE. Custom's obligation to
enter into the First Lease Amendment with respect to the Additional Property is
subject to satisfaction of the following conditions:
(a) Custom shall have received the Purchase Price in immediately
available funds less the costs and expenses specified in SECTION 10 hereof.
(b) Custom shall have received duplicate copies of the closing
statement.
(c) CFP and Custom shall have executed and delivered the First Lease
Amendment and the Amended and Restated Memorandum of Lease.
(d) CFP shall have received the consent of Lender to the construction
by Custom of the Expansion and the purchase of the Additional Property by CFP.
6. CUSTOM'S COVENANTS, REPRESENTATIONS AND WARRANTIES. In order to
induce CFP to enter into this Agreement and purchase the Additional Property,
Custom makes the following covenants, agreements, representations and
warranties, all of which shall survive the Closing and the purchase and lease of
the Additional Property:
(a) Custom has or, on or prior to the Closing Date shall have,
obtained all necessary authorizations and consents to enable it to execute and
deliver this Agreement.
(b) Custom has no knowledge of any condition or state of facts which
would preclude, limit or restrict the business operations contemplated, pursuant
to the terms of the Lease, to be conducted by Custom at the Additional Property.
(c) The Additional Property will be constructed in substantial
accordance with (i) the Plans and (ii) applicable
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building codes, laws and regulations in a good, substantial and workmanlike
manner.
All of the representations, warranties and agreements of Custom set forth
herein and elsewhere in this Agreement shall be true upon the execution of this
Agreement, except as otherwise provided, and shall be deemed to be repeated at
and as of the Closing Date and shall survive the Closing Date.
7. REMEDIES UPON DEFAULT. In the event CFP breaches or defaults under
any of the terms of this Agreement on or prior to any Closing Date, the sole and
exclusive remedy of Custom shall be to compel specific performance of this
Agreement. In the event Custom defaults under any of the terms of this
Agreement on or prior to the Closing Date, CFP shall have no obligation to
purchase the Additional Property. In the event of any breach by either CFP or
Custom of any of their respective obligations hereunder subsequent to any
Closing Date, the nonbreaching party shall have the right to pursue any and all
remedies afforded at law or in equity.
8. NOTICES. All notices, elections, requests and other communication
hereunder shall be in writing and shall be deemed given when delivered in person
or by telecopy (with a hard copy to follow by Federal Express or other reliable
24-hour delivery service) or five (5) business days after being deposited in the
United States mail, postage prepaid, or the next business day after being
deposited with a nationally recognized overnight mail delivery service, and
addressed as follows (or to such other person or at such other address, of which
any party hereto shall have given written notice as provided herein):
If to Custom: CUSTOM FOOD PRODUCTS, INC.
1117 West Olympic Boulevard
Montebello, California 90640
Facsimile: 212-727-0412
with a copy to: James M. Rishwain, Jr., Esquire
Pillsbury, Madison & Sutro LLP
Suite 1200
725 South Figueroa Street
Los Angeles, California 90017
Facsimile: 213-629-1033
If to CFP: CFP ASSOCIATES
c/o W.P. Carey & Co., Inc.
50 Rockefeller Plaza,
Second Floor
New York, New York 10020
Attn: Mr. W. Sean Sovak
Facsimile: 212-977-3022
with a copy to: Ruth S. Perfido, Esquire
Reed Smith Shaw & McClay
435 Sixth Avenue
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Pittsburgh, PA 15219
Facsimile: 412-288-3022
9. BROKERAGE COMMISSIONS. Custom and CFP each warrant to the other that
no finders or brokers have been involved with the introduction of Custom and CFP
except for W. P. Carey & Co., Inc. and its affiliates, whose fees shall be paid
by Custom from proceeds paid to Custom by CFP. In the event of a breach of the
foregoing warranty by Custom, Custom agrees to save, defend, indemnify and hold
harmless CFP from and against any claims, losses, damages, liabilities and
expenses, including but not limited to attorneys' fees. In the event of a
breach of the foregoing warranty by CFP, CFP agrees to save, defend, indemnify
and hold harmless Custom from and against any claims, losses, damage,
liabilities and expenses, including but not limited to attorneys' fees.
10. COSTS AND EXPENSES. Custom shall pay all reasonable costs and
expenses in connection with the purchase by CFP of the Additional Property,
including without limitation all usual and customary costs and expenses set
forth in a settlement statement with respect to the conveyance of a commercial
property, including without limitation (i) all of the cost of real estate
conveyance tax and other transfer taxes, if any, imposed by state or local
authorities (including those transfer taxes customarily paid by a grantee) and
all recording charges; (ii) costs of removing any lien, assessment or
encumbrance required to be discharged hereunder in order to convey title to the
Additional Property as herein provided; (iii) the cost of the owner's policy of
title insurance and the survey required hereunder; (iv) reasonable legal fees
and expenses of Lender, CFP and Guarantor; and (v) the cost of the environmental
site assessment obtained by CFP; provided, however, that Custom shall not be
responsible to pay CFP's legal fees and expenses in the event that the Closing
does not occur through no fault of Custom.
11. MISCELLANEOUS PROVISIONS.
(a) CAPTIONS. The several headings and captions of the Sections and
subsections used herein are for convenience of reference only and shall in no
way be deemed to limit, define or restrict the substantive provisions of this
Agreement.
(b) ENTIRE AGREEMENT; RECORDING. This Agreement constitutes the
entire agreement of CFP and Custom with respect to the purchase and lease of the
Additional Property, and supersedes any prior or contemporaneous agreement with
respect thereto. No amendment or modification of this Agreement shall be
binding upon the parties unless made in writing and signed by both Custom and
CFP. This Agreement shall not be recorded by either party and, if recorded by
either party, the other party hereto may immediately terminate all of its
obligations under this Agreement, and Custom shall pay CFP's reasonable costs
and attorneys' fees in removing this Agreement of record.
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(c) TIME OF ESSENCE. Time is of the essence with respect to the
performance of all of the terms, conditions and covenants of this Agreement.
(d) COOPERATION. CFP and Custom shall cooperate fully with each
other to carry out effectively the purchase and lease of the Additional Property
in accordance herewith and the satisfaction and compliance with all of the
conditions and requirements set forth herein, and shall execute such instruments
and perform such acts as may be reasonably requested by either party hereto.
(e) GOVERNING LAW. This Agreement and the rights of the parties
hereunder shall be governed by and construed in accordance with the laws and
customs of the State of Kentucky.
(f) TERMINATION. If not earlier terminated in accordance with its
terms, this Agreement shall terminate on July 1, 1996, and after such date, CFP
shall have no obligation to purchase the Additional Property.
(g) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts each
of which, when so executed, shall be deemed an original, but all such
counterparts shall constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement to
Purchase and Lease Real Estate as of the date first written above.
CUSTOM FOOD PRODUCTS, INC., a
California corporation
By:
---------------------------
Title:
------------------------
CFP ASSOCIATES, a Kentucky
partnership
By CFP (MD) QRS 11-30, Inc., a
Maryland corporation,
general partner
By:
-------------------------
Title:
---------------------
By CFP (MD) QRS 11-33, Inc., a
Maryland corporation,
general partner
By:
------------------------
Title:
----------------------
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EXHIBIT A
THE ADDITIONAL LAND
PARCEL B:
ALL THAT CERTAIN parcel of land being known as Parcel "B" in the Division
of Bath County Fiscal Court, D.B. 169, Page 188, Bath County, Kentucky, being
more particularly described as follows:
BEGINNING at a point corner to Parcel "A" in the Division of Bath County
Fiscal Court, said point being in the west right of way line of Kendall Springs
Road;
thence with said right of way line, S 29DEG. 36' 01" W, 308.13 feet to an
iron pin, corner to Leslie Crouch;
thence leaving said right of way line with said Crouch line, the following
seven calls: S 68DEG. 34' 48" W, 53.37 feet to an iron pin;
thence S 84DEG. 26' 45" W, 33.30 feet to an iron pin;
thence N 72DEG. 03' 12" W, 33.41 feet to an iron pin;
thence N 55DEG. 31' 47" W, 40.18 feet to an iron pin;
thence N 26DEG. 54' 58" W, 87.57 feet to an iron pin;
thence N 35DEG. 35' 25" W, 203.24 feet to an iron pin;
thence N 48DEG. 55' 30" W, 425.80 feet to an iron pin;
thence N 47DEG. 27' 05" E, 164.24 feet to an iron pin corner to said
Parcel "A";
thence with said Parcel "A", S 55DEG. 34' 10" E, 306.02 feet;
thence N 34DEG. 25' 35" E, 61.34 feet;
thence S 55DEG. 34' 10" E, 449.52 feet to the point of beginning.
The above described parcel contains 4.790 acres.
PARCEL C:
BEGINNING at an iron pin on the north side of a County gravel road, said
point being at the top of a bluff overlooking Slate Creek; thence North 48
degrees 55 minutes 30 seconds West 71 feet to the low water mark of Slate
Creek; thence with said low
water mark in a northerly direction North 44 degrees 18 minutes 15 seconds East
438.13 feet to a point in Cintas Northwest property corner; thence leaving Slate
Creek South 55 degrees 34 minutes 10 seconds East 71 feet to an iron pin on top
of the bluff; thence leaving the Cintas property line with the top of bluff the
following calls:
South 36 degrees 07 minutes 49 seconds West 129.59 feet to an iron pin;
thence South 47 degrees 27 minutes 05 seconds West 318.51 feet to the point
of beginning.
Containing approximately 0.7 acre as surveyed by Roy A. Wright L.S. #2808,
April 8, 1996.
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EXHIBIT B
FIRST LEASE AMENDMENT
THIS FIRST LEASE AMENDMENT (this "AMENDMENT") is made as of this 14th
day of June, 1996, but effective as of July 11, 1996, between CFP ASSOCIATES, a
Kentucky partnership ("LANDLORD") with an address c/o W. P. Carey & Co., Inc.,
50 Rockefeller Center, Second Floor, New York, New York 10020, and CUSTOM FOOD
PRODUCTS, INC., a California corporation ("TENANT") with an address at 1117 West
Olympic Boulevard, Montebello, California 90640.
WHEREAS, Landlord and Tenant are parties to a certain Lease Agreement
dated as of September 30, 1994, as amended by a certain letter agreement dated
September 30, 1994 (the "LEASE"), whereby Landlord demised and let to Tenant,
and Tenant took and leased from Landlord, for the term and upon the provisions
therein specified, all right, title and interest of Landlord in and to the
Leased Premises; and
WHEREAS, Tenant has requested that Landlord (i) purchase the
Additional Premises (as hereinafter defined) from Tenant and (ii) lease the
Additional Premises to Tenant; and
WHEREAS, capitalized terms used herein and not otherwise defined
herein shall have the respective meanings assigned thereto in the Lease.
NOW THEREFORE, in consideration of the rents and provisions herein
stipulated to be paid and performed, Landlord and Tenant hereby covenant and
agree as follows:
1. INCORPORATION OF RECITALS. The recitals set forth above are
hereby incorporated as if set forth in their entirety.
2. DEMISE OF ADDITIONAL PREMISES; AMENDMENT. Landlord hereby demises
and lets to Tenant, and Tenant hereby takes and leases from Landlord, for the
term and upon the provisions hereinafter specified, all right, title and
interest of Landlord in and to the following described property: (a) that
certain real property as is more particularly described on EXHIBIT "A-1" hereto,
together with the Appurtenances thereto (the "ADDITIONAL LAND"), which
Additional Land is hereby consolidated with the Land; (b) the buildings,
structures and other improvements now or hereafter constructed on the Land
(collectively, the "ADDITIONAL STRUCTURES"); and (c) the building systems
equipment described on EXHIBIT "B" that are installed or located in or on the
Additional Structures on the date hereof and paid for by Landlord (collectively,
the "ADDITIONAL BUILDING SYSTEMS EQUIPMENT"). In furtherance thereof, the Lease
is hereby amended by the addition of the Additional Land to the Land, the
Additional Structures to the Structures, and the Additional Building Systems
Equipment to
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the Building Systems Equipment. EXHIBIT "A" to the Lease is hereby deleted and
the legal description attached hereto as EXHIBIT "A-2", which is a consolidated
legal description, is hereby attached to the Lease as EXHIBIT "A".
3. PERMITTED ENCUMBRANCES. The Lease is hereby amended by adding to
the matters set forth on EXHIBIT "C" to the Lease, those matters set forth on
EXHIBIT "C" attached hereto (the "ADDITIONAL PERMITTED ENCUMBRANCES").
4. CERTAIN DEFINITIONS. From and after the date hereof, the
following terms referred to in the Lease shall have the following respective
meanings:
"GUARANTY" shall mean that certain Guaranty and Suretyship
Agreement dated as of September 30, 1994 from Guarantor to Landlord, as amended
by that certain First Amendment to Guaranty and Suretyship Agreement dated July
11, 1996 from Guarantor to Landlord.
"LANDLORD'S MAXIMUM CONTRIBUTION" shall mean $5,700,000.
"LEASE" shall mean the Lease, as modified, amended and
supplemented by this Amendment.
"PROJECT COST" shall mean $5,821,000.00.
5. SECURITY DEPOSIT. Effective as of the date hereof, the following
paragraph is added to the Lease as Paragraph 38 thereto:
38. SECURITY DEPOSIT.
(a) Concurrently with the execution of this Lease,
Tenant shall deliver to Landlord an irrevocable Letter of Credit (the
"LETTER OF CREDIT") in the amount of Two Hundred Fifteen thousand and
No/100 Dollars ($215,000) (the "SECURITY DEPOSIT") issued by a bank
reasonably acceptable to Landlord and in form and substance reasonably
satisfactory to Landlord. The Letter of Credit shall remain in full
force and effect during the Term as security for the payment by Tenant
of the Rent and all other charges or payments to be paid hereunder and
the performance of the covenants and obligations contained herein, and
the Letter of Credit shall be renewed at least thirty (30) days prior
to any expiration thereof. If Tenant fails to renew the Letter of
Credit by such date, TIME BEING OF THE ESSENCE, Landlord shall have
the right at any time after the thirtieth (30th) day before such
expiration date either (i) to draw on the Letter of Credit and to
deposit the Security Deposit in an account for the benefit of Landlord
or (ii) to declare an Event of Default under Section 22(a)(ii). The
Security Deposit shall not be commingled with other funds of Landlord
or other Persons and
-2-
no interest thereon shall be due and payable to Tenant.
(b) If at any time an Event of Default shall have occurred
and be continuing beyond the applicable grace period, if any, Landlord
shall be entitled, at its sole discretion, to draw on the Letter of Credit
or to withdraw the cash Security Deposit from the above-described account
and to apply the proceeds in payment of (i) any Rent or other charges for
the payment of which Tenant shall be in default, (ii) any expense incurred
by Landlord in curing any Event of Default, and/or (iii) any other sums due
to Landlord in connection with any Event of Default or the curing thereof,
including, without limitation, any damages incurred by Landlord by reason
of such Event of Default. If any portion of the Security Deposit is used,
retained or applied by Landlord for any purpose set forth above, Tenant
shall, within ten (10) days after demand therefor is made by Landlord,
provide to Landlord cash or a Letter of Credit which complies with the
requirements of this Paragraph 38 and is in the original principal amount
thereof.
(c) At the expiration of the Term and so long as no Event
of Default exists the Letter of Credit or the cash Security Deposit, as the
case may be, shall be returned to Tenant.
(d) Should Tenant at any time achieve, whether by itself,
by acquisition or merger (in each case subject to and in accordance with
the provisions of this Lease and the Guaranty) a long term unsecured credit
rating of either "BBB" from Standard & Poor's or "Baa" from Moody's
Investors Services, then Tenant shall no longer be required to maintain the
Security Deposit. In such event and provided that no Event of Default
shall have occurred and remains continuing beyond any applicable grace
period, Landlord shall release the Security Deposit to Tenant.
(e) Landlord shall have the right to designate Lender or
any other holder of a Mortgage as the beneficiary of the Letter of Credit
during the term of the applicable Loan and such Lender shall have all of
the rights of Landlord under this Paragraph 38. Tenant covenants and
agrees to execute such agreements, consents and acknowledgments as may be
requested by Landlord from time to time to change the beneficiary of the
Letter of Credit as hereinabove provided.
6. ALTERATIONS. Effective as of the date hereof, Paragraph 13(a) of
the Lease is amended and restated in its entirety to read as follows:
(a) In addition to Alterations required by Paragraph 12 and
17, Tenant shall have the right without having obtained the prior written
consent of Landlord and Lender, to (i) make
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any Alterations or series of related Alterations to the Structures for
a cost of not more than Five Hundred Thousand Dollars ($500,000) in
any one instance, or (ii) install Building Systems Equipment, in the
Structures or accessions to the Building Systems Equipment, the cost
of which as to such Building Systems Equipment or series of related
Building Systems Equipment does not exceed Five Hundred Thousand
Dollars ($500,000), subject to adjustment.
The consent of Landlord and Lender shall be required (A) if a Monetary
Event of Default exists, or (B) if the Alterations (or a series of related
Alterations) exceeds Five Hundred Thousand Dollars ($500,000), or (C) if
Tenant desires to remove and not upgrade or replace during the Term any
Improvements, or (D) if Tenant desires to construct upon the Land any
additional Improvements; provided that, with respect to (D) and (E) above,
such consent shall not be unreasonably withheld and shall be deemed given
if no response is received by Tenant within thirty (30) days following
receipt by Landlord and Lender of such request.
7. DELETIONS. The defined terms "Expansion", "Expansion
Improvements" and "Expansion Parcel" are hereby deleted from Paragraph 2 of the
Lease.
8. BASIC RENT. Effective as of the date hereof, EXHIBIT "D" of the
Lease is deleted and the Basic Rent Schedule attached hereto as EXHIBIT "D" is
hereby attached to the Lease as EXHIBIT "D" thereto.
9. RATIFICATION. As amended, supplemented and modified by this
Amendment, the Lease is hereby ratified and confirmed in all respects.
10. MISCELLANEOUS.
(a) The covenants of this Amendment shall run with the land and bind
Tenant, its successors and assigns and all present and subsequent encumbrancers
and subtenants of any of the Leased Premises, and shall inure to the benefit of
Landlord, its successors and assigns.
(b) This Amendment shall be governed by and construed and enforced in
accordance with the Laws of the State.
(c) This Amendment may be executed in any number of counterparts and
by the different parties hereto on separate counterparts, each of which when so
executed shall be deemed to be an original, but all such counterparts shall
constitute but one and the same instrument.
-4-
IN WITNESS WHEREOF, Landlord and Tenant have caused this Amendment to
be duly executed under seal as of the day and year first above written.
LANDLORD:
CFP ASSOCIATES, a Kentucky
partnership
By: CFP (MD) QRS 11-30, Inc.,
a Maryland corporation,
general partner
By:
---------------------------
Title:
-----------------------
By: CFP (MD) QRS 11-33, Inc.,
a Maryland corporation,
general partner
By:
--------------------------
Title:
------------------------
TENANT:
CUSTOM FOOD PRODUCTS, INC.,
a California corporation
By:
-------------------------------
Title:
----------------------------
-5-
CONSENT OF LENDER
The undersigned, "Lender" under that certain Assignment of Net Lease and
Rentals and Construction Agency Agreement dated as of September 30, 1994 given
by CFP Associates, hereby consents to the foregoing First Lease Amendment.
NATIONSCREDIT COMMERCIAL CORPORATION
(f/k/a Greyrock Capital Group, Inc.)
By:
--------------------------------
Title:
----------------------------
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EXHIBIT "A-1"
ADDITIONAL PREMISES
PARCEL B:
ALL THAT CERTAIN parcel of land being known as Parcel "B" in the Division
of Bath County Fiscal Court, D.B. 169, Page 188, Bath County, Kentucky, being
more particularly described as follows:
BEGINNING at a point corner to Parcel "A" in the Division of Bath County
Fiscal Court, said point being in the west right of way line of Kendall Springs
Road;
thence with said right of way line, S 29DEG. 36' 01" W, 308.13 feet to an
iron pin, corner to Leslie Crouch;
thence leaving said right of way line with said Crouch line, the following
seven calls: S 68DEG. 34' 48" W, 53.37 feet to an iron pin;
thence S 84DEG. 26' 45" W, 33.30 feet to an iron pin;
thence N 72DEG. 03' 12" W, 33.41 feet to an iron pin;
thence N 55DEG. 31' 47" W, 40.18 feet to an iron pin;
thence N 26DEG. 54' 58" W, 87.57 feet to an iron pin;
thence N 35DEG. 35' 25" W, 203.24 feet to an iron pin;
thence N 48DEG. 55' 30" W, 425.80 feet to an iron pin;
thence N 47DEG. 27' 05" E, 164.24 feet to an iron pin corner to said
Parcel "A";
thence with said Parcel "A", S 55DEG. 34' 10" E, 306.02 feet;
thence N 34DEG. 25' 35" E, 61.34 feet;
thence S 55DEG. 34' 10" E, 449.52 feet to the point of beginning.
The above described parcel contains 4.790 acres.
PARCEL C:
BEGINNING at an iron pin on the north side of a County gravel road, said
point being at the top of a bluff overlooking Slate Creek; thence North 48
degrees 55 minutes 30 seconds West 71 feet to the low water mark of Slate Creek;
thence with said low water mark in a northerly direction North 44 degrees 18
minutes 15 seconds East 438.13 feet to a point in Cintas Northwest property
corner; thence leaving Slate Creek South 55 degrees 34 minutes 10 seconds East
71 feet to an iron pin on top of the bluff; thence
-1-
EXHIBIT "A-1"
leaving the Cintas property line with the top of bluff the following calls:
South 36 degrees 07 minutes 49 seconds West 129.59 feet to an iron pin;
thence South 47 degrees 27 minutes 05 seconds West 318.51 feet to the point
of beginning.
Containing approximately 0.7 acre as surveyed by Roy A. Wright L.S. #2808,
April 8, 1996.
-2-
EXHIBIT "A-2"
LEGAL DESCRIPTION
ALL THAT CERTAIN tract or parcel of land lying north of Kendall Springs
Road near the town of Owingsville in the Bath County Industrial Park, Bath
County, Kentucky and being more particularly described as follows:
BEGINNING at an iron pin in the West right of way line of Kendall Springs
Road, 25 feet from the centerline, also being the Southwest corner of Bath
County Fiscal Court (Misc. Book 2, Page 675) property;
thence with said West right of way line, South 29 degrees 36 minutes 01
seconds West, 527.41 feet to an iron pin corner to Leslie Crouch (Deed Book 126,
Page 387);
Thence leaving said Kendall Springs Road right of way with said Crouch
property line the following seven courses:
South 68 degrees 34 minutes 48 seconds West, 53.37 feet to an iron pin;
thence South 84 degrees 26 minutes 45 seconds West, 33.30 feet to an iron
pin;
thence North 72 degrees 03 minutes 12 seconds West, 33.41 feet to an iron
pin;
thence North 55 degrees 31 minutes 47 seconds West, 40.18 feet to an iron
pin;
thence North 26 degrees 54 minutes 58 seconds West, 87.57 feet to an iron
pin;
thence North 35 degrees 35 minutes 25 seconds West, 203.24 feet to an iron
pin;
thence North 48 degrees 55 minutes 30 seconds West, 425.80 feet to an iron
pin at the top of bluff overlooking Slate Creek,
thence North 48 degrees 55 minutes 30 seconds West, 60.00 feet to an iron
pin as a witness point;
thence North 48 degrees 55 minutes 30 seconds West, 11.00 feet to the low
water mark on the South side of Slate Creek;
thence with said low water mark North 44 degrees 18 minutes 15 seconds East
438.13 feet to a point;
thence leaving low water South 55 degrees 34 minutes 10 seconds East, 11.00
feet to an iron pin as a witness point;
thence South 55 degrees 34 minutes 10 seconds East, 60.00
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EXHIBIT "A-2"
feet;
thence with said Bath County Fiscal Court, South 55 degrees 34 minutes 10
seconds East, 698.47 feet to the point of beginning.
The above described parcel contains 9.603 acres as surveyed by Roy A.
Wright L.S. #2808, April 8, 1996.
-2-
EXHIBIT "B"
BUILDING SYSTEMS EQUIPMENT
All fixtures, machinery, apparatus, equipment, fittings and appliances of every
kind and nature whatsoever now or hereafter affixed or attached to or installed
in any of the Leased Premises (except as hereafter provided), including all
electrical, anti-pollution, heating, lighting (including hanging fluorescent
lighting), incinerating, power, air cooling, air conditioning, humidification,
sprinkling, plumbing, lifting, cleaning, fire prevention, fire extinguishing and
ventilating systems, devices and machinery and all engines, pipes, pumps, tanks
(including exchange tanks and fuel storage tanks), motors, conduits, ducts,
steam circulation coils, blowers, steam lines, compressors, oil burners,
boilers, doors, windows, loading platforms, lavatory facilities, stairwells,
fencing (including cyclone fencing), passenger and freight elevators, overhead
cranes and garage units, together with all additions thereto, substitutions
therefor and replacements thereof required or permitted by this Lease, but
excluding all personal property and all trade fixtures, machinery, office,
manufacturing and warehouse equipment which are not necessary to the operation,
as buildings, of the buildings which constitute part of the Additional Premises.
-1-
EXHIBIT "D"
BASIC RENT SCHEDULE
1. BASIC RENT PRIOR TO THE REFINANCING DATE.
A. Basic Rent shall begin accruing on the Primary Term
Commencement Date. Commencing on the Basic Rent Commencement Date and to and
including the first day of the first calendar month following the earlier to
occur (the "REFINANCING DATE") of (i) the refinancing of the Initial Loan or
(ii) the last day of the fifth (5th) Lease Year, Basic Rent shall be payable
monthly in arrears on each Basic Rent Payment Date in an amount equal to the sum
of (a) 0.0125 multiplied by $2,000,000; (b) 0.010417 multiplied by $1,500,000
("EXPANSION RENT"); (c) the amount of interest and/or interest and principal
payable by Landlord on the Initial Loan for such month; and (d) the amount of
interest and/or interest and principal payable by Landlord on the Tenant Loan
for such month ("TENANT VARIABLE RENT"); provided that from and after the date
(the "TENANT LOAN REFINANCING DATE") on which all or any part of the Tenant Loan
is refinanced, the Tenant Variable Rent shall be an amount equal to one-twelfth
(1/12th) of the amount of principal and interest that Landlord would be required
to pay in a twelve-month period on a hypothetical loan in a principal amount
equal to the outstanding principal balance of the Tenant Loan as of the date
immediately prior to the Tenant Loan Refinancing Date, which hypothetical loan
has payment terms identical to those of the Loan pursuant to which the Tenant
Loan is refinanced. The amount set forth in the foregoing sentence shall,
absent manifest error, be conclusively determined from the books and records of
Landlord.
B. Commencing with the first day of the second (2nd) Lease
Year, the Basic Rent shall be subject to adjustment as provided in subparagraphs
A, C and D of Paragraph 5 below.
2. BASIC RENT FOLLOWING THE REFINANCING DATE. Commencing on the
first day of the first calendar month following the Refinancing Date and
continuing on each Basic Rent Payment Date thereafter until the expiration of
the Term, Basic Rent shall be payable monthly in advance in an amount equal to
the sum of (i) Forty-nine Thousand Five Hundred Twenty-two and 50/100 Dollars
($49,522.50), (ii) an amount equal to the Tenant Variable Rent for such month
and (iii) the Expansion Rent in effect on the last day of the calendar month
immediately preceding the Refinancing Date (including any adjustments
attributable thereto pursuant to Paragraph 5 below).
The amount set forth in the foregoing sentence shall (i) absent
manifest error, be conclusively determined from the books and records of
Landlord, and (ii) be subject to the adjustments provided for in subparagraphs
B, C and D of Paragraph 5 below.
EXHIBIT "D"
3. CPI ADJUSTMENTS TO BASIC RENT. The Basic Rent shall be subject
to adjustment, in the manner hereinafter set forth, for increases in the index
known as United States Department of Labor, Bureau of Labor Statistics, Consumer
Price Index, All Urban Consumers, United States City Average, All Items,
(1982-84=100) ("CPI") or the successor index that most closely approximates the
CPI. If the CPI shall be discontinued with no successor or comparable successor
index, Landlord and Tenant shall attempt to agree upon a substitute index or
formula, but if they are unable to so agree, then the matter shall be determined
by arbitration in accordance with the rules of the American Arbitration
Association then prevailing in New York City. Any decision or award resulting
from such arbitration shall be final and binding upon Landlord and Tenant and
judgment thereon may be entered in any court of competent jurisdiction. In no
event will the Basic Rent as adjusted by the CPI adjustment be less than the
Basic Rent in effect for the one (1) year period immediately preceding such
adjustment.
4. EFFECTIVE DATES OF CPI ADJUSTMENTS. As of the first day of the
second (2nd) Lease Year and on the first day of each Lease Year thereafter,
Basic Rent shall be adjusted to reflect increases in the CPI during the most
recent Lease Year immediately preceding each of the foregoing dates (each such
date being hereinafter referred to as the "BASIC RENT ADJUSTMENT DATE").
5. METHOD OF ADJUSTMENT FOR CPI ADJUSTMENT.
A. PRIOR TO REFINANCING DATE. As of each Basic Rent Adjustment
Date occurring prior to the Refinancing Date when the average CPI determined in
clause (i) below exceeds the Beginning CPI (as defined in this Paragraph 5(A)),
an amount equal to the sum of: (a) $594,270; and (b) $187,500 (i.e. the
Expansion Rent) plus an amount equal to the cumulative CPI increases to Basic
Rent attributable to such $187,500; shall be multiplied by a fraction, the
numerator of which shall be the difference between (i) the average CPI for the
three (3) most recent calendar months (the "PRIOR MONTHS") ending prior to such
Basic Rent Adjustment Date for which the CPI has been published on or before the
forty-fifth (45th) day preceding such Basic Rent Adjustment Date and (ii) the
Beginning CPI, and the denominator of which shall be the Beginning CPI. An
amount equal to the lesser of (x) eighty percent (80%) of the product of such
multiplication or (y) the product of such multiplication assuming the increase
of 4.5% in the CPI for each one year period shall be added to the Basic Rent in
effect immediately prior to such Basic Rent Adjustment Date. As used herein,
"BEGINNING CPI" shall mean the average CPI for the three (3) calendar months
corresponding to the Prior Months, but occurring one (1) year earlier. If the
average CPI determined in clause (i) is the same or less than the Beginning CPI,
the Basic Rent will remain the same for the ensuing Lease Year.
-2-
EXHIBIT "D"
B. FROM AND AFTER REFINANCING DATE. As of each Basic Rent
Adjustment Date occurring on or after the Refinancing Date when the average CPI
determined in clause (i) below exceeds the Beginning CPI, the Basic Rent in
effect immediately prior to the applicable Basic Rent Adjustment Date shall be
multiplied by a fraction, the numerator of which shall be the difference between
(i) the average CPI for the Prior Months ending prior to such Basic Rent
Adjustment Date for which the CPI has been published on or before the
forty-fifth (45th) day preceding such Basic Rent Adjustment Date and (ii) the
Beginning CPI, and the denominator of which shall be the Beginning CPI. An
amount equal to the lesser of (x) eighty percent (80%) of the product of such
multiplication or (y) the product of such multiplication assuming the increase
of 4.5% in the CPI for each one year period shall be added to the Basic Rent in
effect immediately prior to such Basic Rent Adjustment Date. If the average CPI
determined in clause (i) is the same or less than the Beginning CPI, the Basic
Rent will remain the same for the ensuing Lease Year.
C. ADJUSTMENT. Effective as of a given Basic Rent Adjustment
Date, Basic Rent payable under this Lease until the next succeeding Basic Rent
Adjustment Date shall be the Basic Rent in effect after the adjustment provided
for as of such Basic Rent Adjustment Date.
D. NOTICE. Notice of the new annual Basic Rent shall be
delivered to Tenant on or before the tenth (10th) day preceding each Basic Rent
Adjustment Date.
-3-
EXHIBIT C
SURVEY CHECKLIST
The following information should be included on the Survey:
1. Scale
2. Date
3. North arrow
4. Legend
5. Encroachments
6. Adjoining street, road highway, alleys, right-of-way lines, names,
right-of-way width, and distance to property.
7. All points of reference should be tied to an identifiable monument or
intersection of streets.
8. Delineate all improvements in place and show their measurements:
(a) Boundaries (all property line deflection points must have an iron
pin set in place). All boundary distances should be expressed in
feet and hundredths of feet, all courses in degrees, minutes and
seconds.
(b) Utilities (including connecting lines to this project from public
utility lines).
(c) Pavement and paved parking area, including size and number of
spaces (please shade edges and show parking space lines), if any.
(d) Walkways, if any (please "dot" concrete).
(e) Ingress and egress (curb cuts and driveways).
(f) Buildings, signs, structures, if any.
9. Building set-back lines shown on property (as defined by local zoning
entity, plat map and/or restrictive covenants) and any other building
restrictions including the volume and page number if recorded.
10. Lot, block or square designation if applicable, and written legal
description by metes and bounds on the survey plat.
11. Location and dimensions (with same information as boundaries) of all
easements or encroachments identified in
-1-
the title commitment together with complete recording information.
12. Identification of all abutting owners, lot numbers and names of
subdivisions.
13. Section, township and range if applicable.
14. Street address (of each building).
15. Area of land and area of buildings, if any; and distance of buildings,
if any, to boundary of property and to building lines.
16. Vicinity sketch showing closest thoroughfare intersection.
17. The point of beginning of description (labeled on survey).
18. True point of beginning of description (labeled on survey).
19. Certification of "True and Correct" survey by surveyor in form
separately provided.
20. Surveyor's seal or stamp clearly showing registration number.
21. Original surveyor's signature on all copies of survey.
22. Chart of curve data/information to support length of curves used on survey.
23. Curve tangent points indicated on survey lines.
24. Reference baseline for azimuth used.
25. Note whether survey has been balanced and adjusted.
26. Note whether a title report was used in defining easements and other
recordings.
27. Field notes on survey if applicable.
28. Indicate on survey, at all survey line deflections, whether the survey
monument was found or set; such as, "Found Iron Pin" or "Iron Pin
set".
29. State whether or not the property appears in any Flood Insurance
Boundary Map, and if so, further state map number and whether or not
the property appears to be in the "Flood Hazard Area" shown on that
map.
30. Parking spaces, if any, should be shown on survey (they may be shown
by sketch only). Total parking spaces should be shown in survey
notes.
-2-
Title and/or improvements may necessitate other requirements. The lender may
have additional requirements.
A second sheet to the survey may be added, should it become too crowded or
complex to show everything on one sheet. Both sheets should show buildings,
roads and paved areas.
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EXHIBIT E
FORM OF WARRANTY DEED
-1-
EXHIBIT F
BILL OF SALE
to
CFP ASSOCIATES
KNOW ALL MEN BY THESE PRESENTS, that CUSTOM FOOD PRODUCTS, INC., a
California corporation ("SELLER"), for and in consideration of Ten Dollars
($10.00) and other good and valuable consideration, to it in hand paid by CFP
ASSOCIATES, a Kentucky partnership ("PURCHASER"), at or before the sealing and
delivery of these presents, the receipt and sufficiency of which is hereby
acknowledged, has granted, bargained, sold, transferred and delivered, and by
these presents does grant, bargain, sell, transfer and deliver unto Purchaser
all and singular the following described machinery and equipment owned by Seller
and located on certain real property (the "LEASED PREMISES") situate in
Owingsville, Kentucky and more particularly described on EXHIBIT "A" attached
hereto and made a part hereof, to wit:
The equipment listed and described on EXHIBIT "B" attached hereto and made
a part hereof (the "EQUIPMENT").
TO HAVE AND TO HOLD the Equipment unto Purchaser, its successors and
assigns, to and for its own proper use and benefit forever.
AND Seller for itself and for its successors and assigns, does hereby
covenant with Purchaser, its successors and assigns, that it is the true and
lawful owner of the Equipment hereby sold, and has full power to sell and convey
the same; that the title so conveyed is clear, free and unencumbered; and
further that it does warrant and will forever defend the same against the claim
or claims of all persons whomsoever claiming or to claim the same or any part
thereof.
IN WITNESS WHEREOF, Seller has caused its corporate name to be hereunto
subscribed and its corporate seal to be hereunto affixed, as of this _____ day
of ____________, 1996.
CUSTOM FOOD PRODUCTS, INC.
By:
-----------------------
Title:
--------------------
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EXHIBIT A
PROPERTY DESCRIPTION
PARCEL B:
ALL THAT CERTAIN parcel of land being known as Parcel "B" in the Division
of Bath County Fiscal Court, D.B. 169, Page 188, Bath County, Kentucky, being
more particularly described as follows:
BEGINNING at a point corner to Parcel "A" in the Division of Bath County
Fiscal Court, said point being in the west right of way line of Kendall Springs
Road;
thence with said right of way line, S 29DEG. 36' 01" W, 308.13 feet to an
iron pin, corner to Leslie Crouch;
thence leaving said right of way line with said Crouch line, the following
seven calls: S 68DEG. 34' 48" W, 53.37 feet to an iron pin;
thence S 84DEG. 26' 45" W, 33.30 feet to an iron pin;
thence N 72DEG. 03' 12" W, 33.41 feet to an iron pin;
thence N 55DEG. 31' 47" W, 40.18 feet to an iron pin;
thence N 26DEG. 54' 58" W, 87.57 feet to an iron pin;
thence N 35DEG. 35' 25" W, 203.24 feet to an iron pin;
thence N 48DEG. 55' 30" W, 425.80 feet to an iron pin;
thence N 47DEG. 27' 05" E, 164.24 feet to an iron pin corner to said
Parcel "A";
thence with said Parcel "A", S 55DEG. 34' 10" E, 306.02 feet;
thence N 34DEG. 25' 35" E, 61.34 feet;
thence S 55DEG. 34' 10" E, 449.52 feet to the point of beginning.
The above described parcel contains 4.790 acres.
PARCEL C:
BEGINNING at an iron pin on the north side of a County gravel road, said
point being at the top of a bluff overlooking Slate Creek; thence North 48
degrees 55 minutes 30 seconds West 71 feet to the low water mark of Slate Creek;
thence with said low water mark in a northerly direction North 44 degrees 18
minutes 15 seconds East
-1-
438.13 feet to a point in Cintas Northwest property corner; thence leaving Slate
Creek South 55 degrees 34 minutes 10 seconds East 71 feet to an iron pin on top
of the bluff; thence leaving the Cintas property line with the top of bluff the
following calls:
South 36 degrees 07 minutes 49 seconds West 129.59 feet to an iron pin;
thence South 47 degrees 27 minutes 05 seconds West 318.51 feet to the point
of beginning.
Containing approximately 0.7 acre as surveyed by Roy A. Wright L.S. #2808,
April 8, 1996.
-2-
EXHIBIT B
EQUIPMENT
All fixtures, machinery, apparatus, equipment, fittings and appliances now
affixed or attached to or installed in any of the Leased Premises (except as
hereafter provided), including all electrical, anti-pollution, heating, lighting
(including hanging fluorescent lighting), incinerating, power, air cooling, air
conditioning, humidification, sprinkling, plumbing, lifting, cleaning, fire
prevention, fire extinguishing and ventilating systems, devices and machinery
and all engines, pipes, pumps, tanks (including exchange tanks and fuel storage
tanks), motors, conduits, ducts, steam circulation coils, blowers, steam lines,
compressors, oil burners, boilers, doors, windows, loading platforms, lavatory
facilities, stairwells, fencing (including cyclone fencing), passenger and
freight elevators, overhead cranes and garage units, together with all additions
thereto, substitutions therefor and replacements thereof required or permitted
by the Lease regarding the Leased Premises between Purchaser, as landlord, and
Seller, as tenant, but excluding all personal property and all trade fixtures,
machinery, office, manufacturing and warehouse equipment which are not necessary
to the operation, as buildings, of the buildings which constitute part of the
Leased Premises.
-1-
EXHIBIT G
Owingsville, Bath
County, Kentucky
This instrument was prepared by
Patrick E. Sweeney, Esquire
Reed Smith Shaw & McClay
435 Sixth Avenue
Pittsburgh, PA 15219
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AMENDED AND RESTATED MEMORANDUM OF LEASE
THIS AMENDED AND RESTATED MEMORANDUM OF LEASE, made as of the ____ day of
________, 1996, between CFP ASSOCIATES, a Kentucky partnership with an address
c/o W.P. Carey & Co., Inc., 620 Fifth Avenue, New York, New York 10020
("LANDLORD"), and CUSTOM FOOD PRODUCTS, INC., a California corporation with an
address at 1117 West Olympic Boulevard, P.O. Box 1027, Montebello, CA 90640
("TENANT").
(1) Pursuant to a Lease Agreement dated as of September 30, 1994, as
amended by a letter agreement dated September 30, 1994 and by a First Lease
Amendment of even date herewith (collectively, the "LEASE"), the terms and
conditions of which are incorporated herein as though set forth in full,
Landlord has demised and let to Tenant its leasehold interest in and to the
following described property (collectively, the "LEASED PREMISES"): (a) the
premises described in EXHIBIT "A" hereto, together with Appurtenances (as
defined in the Lease); (b) the buildings, structures and other improvements to
be constructed on the Land; and (c) the Building Systems Equipment (as defined
in the Lease).
(2) Pursuant to the terms of the Lease, Tenant shall have and hold the
Leased Premises, at the rental and upon the terms and conditions therein stated,
for a primary term (the "PRIMARY TERM") commencing on September 30, 1994 and
ending on the last day of the calendar month in which the Funding Deadline (as
defined in the Lease) occurs (the "PRIMARY TERM EXPIRATION DATE"), and for an
initial term (the "INITIAL TERM", and together with the Primary Term,
collectively, the "TERM") commencing on the first day following the Primary Term
Expiration Date and ending on the last day of the three hundredth (300th)
calendar month next following the date on which the Initial Term commences (the
"INITIAL TERM EXPIRATION DATE"). Provided that if, on or prior to the Initial
Term Expiration Date and the fifth (5th) and tenth (10th) anniversaries of the
Expiration Date (each such date being a "RENEWAL DATE"), the Lease shall have
not been terminated pursuant to any provision thereof, the Term shall be deemed
to
-1-
have been automatically extended for an additional five (5) years (each a
"RENEWAL TERM"), unless Tenant shall notify Landlord in writing at least four
hundred twenty-five (425) days prior to the next Renewal Date that Tenant is
terminating the Lease as of the next Renewal Date. The Renewal Term shall be
subject to all of the terms and conditions of the Lease. Upon the request of
either party, the other party hereto shall execute a document in recordable form
reflecting any such extension of the Term.
(3) NOTICE IS HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE FOR ANY
LABOR, SERVICES OR MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT, OR TO
ANYONE HOLDING ANY OF THE LEASED PREMISES THROUGH OR UNDER TENANT, AND THAT NO
MECHANICS' OR OTHER LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL ATTACH
TO OR AFFECT THE INTEREST OF LANDLORD IN AND TO ANY OF THE LEASED PREMISES.
(4) Tenant has the option to purchase the Leased Premises during the
eleventh Lease Year (as defined in the Lease), subject to the terms and
conditions more particularly set forth in the Lease.
(5) Tenant has the right to make or may be required to make certain
rejectable offers to Landlord to purchase the Leased Premises, subject to the
terms and conditions more particularly set forth in the Lease.
(6) On the expiration date of the Term, Tenant has the obligation to
purchase the Leased Premises, subject to the terms and conditions more
particularly set forth in the Lease, and Landlord has the obligation to
repurchase the Leased Premises, subject to the terms and conditions more
particularly set forth in the Lease.
(7) This Amended and Restated Memorandum of Lease is executed for the
purpose of (a) amending and restating in its entirety that certain Memorandum of
Lease dated as of September 30, 1994 and recorded in Lease Book 4, Page 638 in
the Office of the Clerk of Bath County, Kentucky, and (b) recordation in the
Office of the Clerk of Bath County, Kentucky, in order to give notice of all of
the terms, provisions and conditions of the Lease and is not intended, and shall
not be construed, to define, limit or modify the Lease.
(8) This Amended and Restated Memorandum of Lease may be executed in any
number of counterparts and by the different parties hereto on seperate
counterparts, each of which when so executed shall be deemed to be an original,
but all such counterparts shall constitute but one and the same instrument.
-2-
IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Memorandum of Lease as of the day and year first above written.
Signed, sealed and acknowledged CFP ASSOCIATES, a
in the presence of: Kentucky partnership
By: CFP (MD) QRS:11-30, INC.,
a Maryland corporation,
general partner
By:
----------------------------
Senior Vice President
By: CFP (MD) QRS:11-33, INC.,
a Maryland corporation,
general partner
By:
----------------------------
Senior Vice President
Signed, sealed and acknowledged CUSTOM FOOD PRODUCTS, INC.,
in the presence of: a California corporation
By:
-----------------------------
Title:
-3-
EXHIBIT A
PROPERTY DESCRIPTION
ALL THAT CERTAIN tract or parcel of land lying north of Kendall Springs
Road near the town of Owingsville in the Bath County Industrial Park, Bath
County, Kentucky and being more particularly described as follows:
BEGINNING at an iron pin in the West right of way line of Kendall Springs
Road, 25 feet from the centerline, also being the Southwest corner of Bath
County Fiscal Court (Misc. Book 2, Page 675) property;
thence with said West right of way line, South 29 degrees 36 minutes 01
seconds West, 527.41 feet to an iron pin corner to Leslie Crouch (Deed Book 126,
Page 387);
Thence leaving said Kendall Springs Road right of way with said Crouch
property line the following seven courses:
South 68 degrees 34 minutes 48 seconds West, 53.37 feet to an iron pin;
thence South 84 degrees 26 minutes 45 seconds West, 33.30 feet to an iron
pin;
thence North 72 degrees 03 minutes 12 seconds West, 33.41 feet to an iron
pin;
thence North 55 degrees 31 minutes 47 seconds West, 40.18 feet to an iron
pin;
thence North 26 degrees 54 minutes 58 seconds West, 87.57 feet to an iron
pin;
thence North 35 degrees 35 minutes 25 seconds West, 203.24 feet to an iron
pin;
thence North 48 degrees 55 minutes 30 seconds West, 425.80 feet to an iron
pin at the top of bluff overlooking Slate Creek,
thence North 48 degrees 55 minutes 30 seconds West, 60.00 feet to an iron
pin as a witness point;
thence North 48 degrees 55 minutes 30 seconds West, 11.00 feet to the low
water mark on the South side of Slate Creek;
thence with said low water mark North 44 degrees 18 minutes 15 seconds East
438.13 feet to a point;
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thence leaving low water South 55 degrees 34 minutes 10 seconds East, 11.00
feet to an iron pin as a witness point;
thence South 55 degrees 34 minutes 10 seconds East, 60.00 feet;
thence with said Bath County Fiscal Court, South 55 degrees 34 minutes 10
seconds East, 698.47 feet to the point of beginning.
The above described parcel contains 9.603 acres as surveyed by Roy A.
Wright L.S. #2808, April 8, 1996.
-2-
STATE OF NEW YORK )
) SS:
COUNTY OF NEW YORK )
On the ____ day of ________, 1996, before me personally came ___________,
to me known, who being by me duly sworn, did depose and say that he is the
____________ of CFP (MD) QRS:11-30, Inc., the corporation described in and
which executed the above instrument, as general partner of CFP Associates; and
that he signed his name thereto by order of the board of directors of said
corporation.
----------------------------
Notary Public
-1-
STATE OF NEW YORK )
) SS:
COUNTY OF NEW YORK )
On the ____ day of ________, 1996, before me personally came __________, to
me known, who being by me duly sworn, did depose and say that he is the
_____________ of CFP (MD) QRS:11-33, Inc., the corporation described in and
which executed the above instrument, as general partner of CFP Associates; and
that he signed his name thereto by order of the board of directors of said
corporation.
-----------------------------
Notary Public
-2-
STATE OF )
) SS:
COUNTY OF )
On the _____ day of ________, 1996, before me personally came __________
____________________, to me known, who being by me duly sworn, did depose and
say that he is the _________________ of Custom Food Products, Inc., the
corporation described in and which executed the above instrument; and that he
signed his name thereto by order of the board of directors of said corporation.
------------------------------
Notary Public
-3-
EXHIBIT H
LESSEE'S CERTIFICATE
This Lessee's Certificate of CUSTOM FOOD PRODUCTS, INC., a California
corporation ("LESSEE"), is being delivered to CFP ASSOCIATES, a Kentucky
partnership ("LANDLORD"), in connection with a certain First Lease Amendment
dated of even date herewith (the "AMENDMENT"), by and between Landlord and
Lessee, and this Lessee's Certificate updates and supplements that certain
Seller's/Lessee's Certificate dated as of September 30, 1994 (the "ORIGINAL
LESSEE'S CERTIFICATE"), given by Lessee to Landlord in connection with the
execution of the Lease.
A. LESSEE'S REPRESENTATIONS.
Lessee hereby represents and warrants to Landlord, its successors and
assigns, that the representations and warranties of Lessee contained in
Paragraph A of the Original Lessee's Certificate are true and correct as of the
date hereof with respect to the Additional Property (as defined in the
Amendment) the Amendment and the Lessee, as applicable.
B. INDEMNITY.
Lessee shall pay, protect, defend, indemnify and hold harmless
Landlord, its successors and assigns, from and against any and all liabilities,
losses, damages, costs, expenses (including without limitation reasonable
attorneys' fees and expenses), causes of action, suits, claims, demands or
judgments of any nature whatsoever howsoever caused should any representation or
warranty set forth herein prove to have been untrue or inaccurate when made or
arising from any breach by Lessee of any representation or warranty set forth
herein.
C. SUCCESSORS AND ASSIGNS; SURVIVAL OF REPRESENTATIONS.
This Lessee's Certificate shall be binding upon Lessee and each of its
successors and assigns. The representations, warranties, covenants and
indemnifications made by Lessee in this Lessee's Certificate shall survive the
closing of the transaction contemplated by the Amendment.
D. EFFECT OF KNOWLEDGE LIMITATION.
The fact that the representations of Lessee set forth in this Lessee's
Certificate may be limited to the best of Lessee's knowledge shall not be deemed
to modify or alter any provision of the Lease requiring Lessee to indemnify
Landlord.
-1-
WITNESS the due execution hereof this _____ day of ________, 1996.
ATTEST: CUSTOM FOOD PRODUCTS, INC., a
California corporation
By: By:
---------------------------- -----------------------------
Title: Title:
-------------------------- ---------------------------
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EXHIBIT I
GUARANTOR'S CERTIFICATE
This Guarantor's Certificate of CFP HOLDINGS, INC., a California
corporation ("GUARANTOR"), is being delivered to CFP ASSOCIATES, a Kentucky
partnership ("LANDLORD"), in connection with a certain First Lease Amendment,
dated of even date herewith (the "AMENDMENT"), by and between Landlord and
Lessee, and this Guarantor's Certificate updates and supplements that certain
Guarantor's Certificate dated as of September 30, 1994 (the "ORIGINAL
GUARANTOR'S CERTIFICATE"), given by Guarantor to Landlord in connection with the
execution of the Lease.
A. GUARANTOR'S REPRESENTATIONS.
Guarantor hereby represents and warrants to Landlord, its successors
and assigns that the representations and warranties of Guarantor contained in
Paragraph A the Original Guarantor's Certificate are true and correct as of the
date hereof with respect to the Guarantor.
B. INDEMNITY.
Guarantor shall pay, protect, defend, indemnify and hold harmless
Landlord, its successors and assigns, from and against any and all liabilities,
losses, damages, costs, expenses (including without limitation reasonable
attorneys' fees and expenses), causes of action, suits, claims, demands or
judgments of any nature whatsoever howsoever caused should any representation or
warranty set forth herein prove to have been untrue or inaccurate when made or
arising from any breach by Guarantor of any representation or warranty set forth
herein.
C. SUCCESSORS AND ASSIGNS; SURVIVAL OF REPRESENTATIONS.
This Guarantor's Certificate shall be binding upon Guarantor and each
of its successors and assigns. The representations, warranties, covenants and
indemnifications made by Lessee in this Guarantor's Certificate shall survive
the closing of the transaction contemplated by the Amendment.
D. EFFECT OF KNOWLEDGE LIMITATION.
The fact that the representations of Guarantor set forth in this
Guarantor's Certificate may be limited to the best of Guarantor's knowledge
shall not be deemed to modify or alter any provision of the Lease requiring
Guarantor to indemnify Landlord.
-1-
WITNESS the due execution hereof this ____ day of _________, 1996.
ATTEST: CFP HOLDINGS, INC., a
California corporation
By: By:
------------------------ -------------------------
Title: Title:
--------------------- ----------------------
-2-
EXHIBIT J
FIRST AMENDMENT TO GUARANTY AND SURETYSHIP AGREEMENT
THIS FIRST AMENDMENT TO GUARANTY AND SURETYSHIP AGREEMENT (this
"AMENDMENT") is made as of ________ , 1996, by CFP HOLDINGS, INC., a Delaware
corporation ("GUARANTOR") having its principal offices at 1117 West Olympic
Boulevard, Montebello, California 90640, to CFP ASSOCIATES, a Kentucky
partnership (herein, together with its successors and assigns, called
"LANDLORD") having an address c/o W. P. Carey & Co., Inc., 50 Rockefeller
Center, Second Floor, New York, New York 10020.
W I T N E S S E T H:
WHEREAS, Landlord owns certain real property (the "LAND") together with
certain improvements to be constructed thereon (the "IMPROVEMENTS") and certain
equipment (the "EQUIPMENT") to be installed therein located in Owingsville,
Kentucky and has leased the Land and the Improvements and the Equipment
(collectively, the "LEASED PREMISES") to Custom Food Products, Inc., a
California corporation ("TENANT"), by a certain Lease Agreement dated as of
September 30, 1994, as amended by a certain letter agreement also dated as of
September 30, 1994 (collectively, the "ORIGINAL LEASE"); and
WHEREAS, Tenant is a wholly-owned subsidiary of Guarantor; and
WHEREAS, as a material inducement to Landlord to enter into the Original
Lease, Guarantor executed and delivered a certain Guaranty and Suretyship
Agreement dated as of September 30, 1994 (the "GUARANTY"); and
WHEREAS, Tenant has expanded the Improvements by constructing on the Land
and on the Additional Land (as hereinafter defined) an addition containing
approximately 10,380 square feet (the "EXPANSION") and, subject to the terms and
conditions of a certain Agreement to Purchase and Lease Real Estate dated as of
________ , 1996 (the "PURCHASE AGREEMENT") by and between Landlord and Tenant,
Landlord has agreed to purchase certain real property ("ADDITIONAL LAND") more
particularly described on EXHIBIT "A" to the Purchase Agreement adjacent to the
Property and the Expansion from Custom and to lease the Additional Land and the
Expansion to Custom pursuant to a certain First Lease Amendment of even date
herewith (the "LEASE AMENDMENT") by and between Landlord and Tenant; and
WHEREAS, the execution and delivery of this Amendment by Guarantor is a
material inducement to Landlord to consummate the transactions contemplated by
the Purchase Agreement.
-1-
NOW, THEREFORE, in consideration of the execution and delivery of the Lease
Amendment and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor, intending to be legally
bound, covenants and agrees with Landlord as follows:
(1) CONSENT; ACKNOWLEDGMENT. Guarantor hereby consents to the
transactions contemplated by the Purchase Agreement and the Lease Amendment, and
acknowledges receipt of fully executed counterparts of the Purchase Agreement
and the Lease Amendment, together with all exhibits and schedules thereto.
(2) AMENDMENT. From and after the date hereof, all references in the
Guaranty to the "Lease" shall collectively mean the Original Lease, as modified,
supplemented and amended by the Lease Amendment. From and after the date
hereof, all references in the Guaranty to the "Certificate" shall collectively
mean the Lessee's Certificate dated as of September 30, 1994, together with the
Lessee's Certificate of even date herewith, in each case given by Tenant to
Landlord.
(3) RATIFICATION. As Amended hereby, the Guaranty is hereby ratified and
confirmed in all respects.
(4) GOVERNING LAW. This Amendment shall be governed by and construed in
accordance with the laws of the State of Kentucky.
-2-
IN WITNESS WHEREOF, Guarantor has caused this Amendment to be executed and
their corporate seal to be hereunto affixed and attested by its officers
thereunto duly authorized.
ATTEST: CFP HOLDINGS, INC.
By: By:
---------------------------- ---------------------------
Title: Title:
------------------------- ------------------------
(Corporate Seal)
-3-
EXHIBIT K
CONSENT AND AMENDMENT NO. 1 TO LOAN AGREEMENT
CONSENT AND AMENDMENT dated as of July 11, 1996 between CFP Associates (the
"Borrower") and NationsCredit Commercial Corporation (formerly known as Greyrock
Capital Group Inc.) (the "Lender").
W I T N E S S E T H:
WHEREAS, the parties hereto have heretofore entered into a Loan Agreement
dated as of September 30, 1994 (the "Agreement"); and
WHEREAS, the parties hereto desire to amend the Agreement to provide for
amendments to certain Lease Documents in connection with an expansion of
Tenant's food processing facilities located in Owingsville, Kentucky and to make
certain other mutually acceptable changes.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. DEFINITIONS; REFERENCES. Unless otherwise specifically defined
herein, each term used herein which is defined in the Agreement shall have the
meaning assigned to such term in the Agreement (including the amendments to the
defined terms and additional defined terms set forth in Section 2 hereof). Each
reference to "hereof", "hereunder", "herein" and "hereby" and each other similar
reference and each reference to "this Agreement" and each other similar
reference contained in the Agreement shall from and after the date hereof refer
to the Agreement as amended hereby.
SECTION 2. AMENDMENT OF SECTION 1.1 OF THE AGREEMENT. Section 1.1 of the
Agreement is amended as follows:
(a) The definition of "Custom Lease" appearing in Section 1.1 of the
Agreement is hereby amended to read as follows:
"Custom Lease" shall mean the Lease Agreement dated as of the date
hereof between Tenant and Borrower as amended by the letter agreement of
even date herewith and the First Lease Amendment dated June 14, 1996, but
effective as of July 11, 1996 and as further amended from time to time with
the consent of the Lender.
(b) The definition of "Existing Custom Credit Agreement" appearing in
Section 1.1 of the Agreement is hereby amended to read as follows:
-1-
"Existing Custom Credit Agreement" shall mean the Credit Agreement
dated as of March 31, 1993 among Tenant, Parent, the Lenders listed therein
and NationsCredit Commercial Corporation (as successor to US West Financial
Services, Inc.), as Agent, as amended and in effect from time to time.
(c) The definition of "Lease Documents" appearing in Section 1.1 of
the Agreement is amended by adding the words "and the Expansion Lease
Documents" at the end thereof.
(d) Section 1.1 of the Agreement is amended by adding the following
new definitions to appear therein in alphabetical order:
"Parent Guaranty" shall mean the Guaranty and Suretyship Agreement
dated as of September 30, 1994, given by Parent for the benefit of the
Borrower, as amended by a certain First Amendment to Guaranty and
Suretyship Agreement dated as of July 11, 1996 (the "GUARANTY AMENDMENT").
"Expansion Lease Documents" means (i) the Agreement to Purchase and
Lease Real Estate dated as of July 11, 1996 between the Borrower and the
Tenant (the "Expansion Agreement"), (ii) the First Lease Amendment dated as
of June 14, 1996, but effective as of July 11, 1996, between Borrower and
Tenant and (iii) the Lessee's Certificate, the Amended and Restated
Memorandum of Lease and the Guarantor's Certificate, each as executed and
delivered pursuant to the Expansion Agreement.
SECTION 3. SECURITY INTEREST IN LETTER OF CREDIT. The Borrower's
interest in all letters of credit issued to secure the Tenant's obligations
pursuant to Section 38 of the Lease and all amounts paid thereunder and all
proceeds thereof constitute collateral subject to the Lien of the Mortgage and,
in furtherance thereof, the Borrower hereby grants a security interest therein
to the Lender and agrees that all such letters of credit (including all letters
of credit issued in substitution for or exchange of letters of credit previously
delivered) shall be delivered to the Lender in pledge to be held as collateral.
If any letter of credit in the Lender's possession would by its terms expire
undrawn, the Lender shall, prior to the last date on which a drawing is
permitted thereunder, either draw on such letter of credit or return such letter
of credit to the Borrower for drawing, whereupon the amount paid under the
letter of credit in respect of such drawing shall be deposited with the Lender
to be held as collateral for the obligations of the Borrower under the Loan
Documents pursuant to arrangements satisfactory to the Lender.
SECTION 4. CONSENT. The Lender hereby consents to the execution,
delivery and performance by the parties thereto in accordance with the terms
thereof of the Expansion Lease Documents for purposes of the Loan Documents, the
Lease Documents and the
-2-
Existing Custom Credit Agreement.
SECTION 5. CONDITIONS TO EFFECTIVENESS. The effectiveness of this
Consent and Amendment No. 1 is subject to the satisfaction of the following
conditions:
(a) The following documents, in form and substance satisfactory to
Lender in its sole good faith discretion, shall have been duly executed and
delivered:
(i) This Consent and Amendment No. 1;
(ii) An amendment to the Existing Custom Credit Agreement
providing for waivers required to permit the
transactions contemplated by the Expansion Lease
Documents and the issuance of the letter of credit
required by Expansion Lease Documents;
(iii) the Expansion Lease Documents;
(iv) an amendment to the Mortgage in form and substance
satisfactory to the Lender extending the Lien of the
Mortgage to cover the property to be sold by the Tenant
to the Borrower as contemplated by the Expansion Lease
Documents;
(v) each of the title policies (or endorsements thereof),
surveys, deeds, certificates and other documents,
instruments and agreements to be delivered in
satisfaction of the conditions to closing set forth in
Sections 4 and 5 of the Expansion Agreement; and
(vi) the original letter of credit issued pursuant to
Section 38 of the Lease (as amended by Amendment No. 1
to the Lease) together with an undated instrument of
transfer duly executed in blank by the Borrower.
(b) Lender shall have received true, correct and complete executed copies
of resolutions in form and substance satisfactory to Lender from the board of
directors of each of the Tenant, Parent and each general partner of the Borrower
evidencing approval of and authorization to execute the appropriate this Consent
and Amendment No. 1 and the Expansion Lease Documents (collectively, the
"Amendment Documents") and the consummation of the transactions contemplated
hereby and thereby, and indicating the officers of each such corporation who are
authorized to sign the Amendment Documents.
(c) The receipt by the Lender of a certificate signed
-3-
by duly authorized officers of the Borrower dated the date hereof, to the effect
that: (i) the representations and warranties contained in the Loan Agreement
are true and correct on and as of such date as though made on and as of such
date; (ii) no Default has occurred and is continuing or would result from the
execution, delivery and performance by the parties thereto of the Amendment
Documents; and (iii) all of the conditions to closing set forth in the Amendment
Documents have been satisfied without waiver (except with the prior consent of
the Lender).
(d) The receipt by the Lender of such other documents as it may reasonably
request relating to the existence of the Borrower, the Tenant, the Parent or the
partners of the Borrower, the corporate or other authority for and validity of
the Amendment Documents, and any other matters relevant hereto, all in form and
substance satisfactory to the Lender in its sole good faith discretion.
(e) The fact that this Consent and Amendment No. 1 shall have become
effective on or prior to July 31, 1996.
SECTION 6. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants that:
(a) It has the legal power and authority to execute and deliver the
Amendment Documents, to amend the Loan Agreement as provided therein and to
perform its obligations under the Loan Agreement and under each of the other
Loan Documents to which it is a party.
(b) The execution and delivery of the Amendment Documents and the
amendment of the Loan Agreement as provided therein (i) have been duly
authorized by all requisite partnership and, if required, partner action and
(ii) will not (A) violate (1) any provision of law, statute, rule or regulation,
or of its partnership agreement or the constitutive documents or by-laws of any
partner, (2) any material provisions of any indenture, agreement or other
instrument to which the Borrower is a party or by which it or any of its
property is or may be bound, (B) be in conflict with, result in a breach of or
constitute (alone or with notice of lapse of time or both) a default under any
such indenture, agreement or other instrument or (C) result in the creation or
imposition of any Liens (other than the Liens under the Mortgage) upon any
property or assets of the Borrower.
(c) Each Amendment Document, the Loan Agreement and each other Loan
Document to which the Borrower is a party has been duly executed and delivered
by and constitutes a legal, valid and binding obligation of the Borrower,
enforceable in accordance with its terms, except as such enforceability may be
(i) limited by bankruptcy, insolvency, reorganization, moratorium or similar
laws of general application from time to time affecting the rights of creditors
and secured parties and (ii) subject to general principles of equity.
-4-
(d) No action, consent or approval of, registration or filing with, or any
other action by any governmental authority is or will be required in connection
with the execution, delivery and performance of the Amendment Documents.
(e) No Default or Event of Default has occurred and is continuing under
the Loan Agreement or any other Loan Document, as in effect immediately prior to
and after the effectiveness of the Amendment Documents.
SECTION 7. NO OTHER WAIVERS. Other than as specifically provided therein,
the Amendment Documents shall not operate as a waiver of any right, remedy,
power or privilege of the Lenders under the Loan Agreement or of any other term
or condition of the Loan Documents and no failure or delay by the Lenders in
exercising any right, remedy, power or privilege under any Loan Document shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege.
SECTION 8. GOVERNING LAW. THIS CONSENT AND AMENDMENT NO. 1 SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
-5-
SECTION 9. COUNTERPARTS; EFFECTIVENESS. This Consent and Amendment No. 1
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Consent and Amendment No. 1 shall become effective as of the
date hereof when all of the conditions set forth in Section 5 shall have been
satisfied or waived with the consent of all Lenders.
NATIONSCREDIT COMMERCIAL CFP ASSOCIATES, a Kentucky
CORPORATION partnership
By CFP (MD) QRS 11-30, Inc., a
Maryland corporation, general
By: partner
----------------------
Title: By:
------------------- ---------------------------
Title:
----------------------
By CFP (MD) QRS 11-33, Inc., a
Maryland corporation, general
partner
By:
-------------------------
Title:
----------------------
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Dates Referenced Herein
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