EXHIBIT
10.19
LEASE
AGREEMENT
dated
as of April 3, 2006
between
CT
CHATTANOOGA TN, LLC,
as Landlord
and
COVENANT
TRANSPORT, INC.,
a
Tennessee corporation,
as
Tenant
Table
of
Contents
|
1.
|
Certain
Definitions
|
1
|
| |
|
|
|
2.
|
Demise
of Premises
|
1
|
| |
|
|
|
3.
|
Title
and Condition
|
1
|
| |
|
|
|
4.
|
Use
of Leased Premises; Quiet Enjoyment
|
3
|
| |
|
|
|
5.
|
Term
|
4
|
| |
|
|
|
6.
|
Rent
|
4
|
| |
|
|
|
7.
|
Net
Lease; Non-Terminability
|
5
|
| |
|
|
|
8.
|
Payment
of Impositions; Compliance with Legal Requirements and Insurance
Requirements
|
6
|
| |
|
|
|
9.
|
Liens;
Recording and Title
|
8
|
| |
|
|
|
10.
|
Indemnification
|
9
|
| |
|
|
|
11.
|
Maintenance
and Repair
|
11
|
| |
|
|
|
12.
|
Alterations
|
12
|
| |
|
|
|
13.
|
Condemnation
|
13
|
| |
|
|
|
14.
|
Insurance
|
14
|
| |
|
|
|
15.
|
Restoration
|
18
|
| |
|
|
|
16.
|
Subordination
to Financing
|
19
|
| |
|
|
|
17.
|
Assignment,
Subleasing
|
20
|
| |
|
|
|
18.
|
Permitted
Contests
|
21
|
| |
|
|
|
19.
|
Conditional
Limitations; Default Provisions
|
21
|
| |
|
|
|
20.
|
Additional
Rights of Landlord and Tenant
|
24
|
| |
|
|
|
21.
|
Notices
|
25
|
| |
|
|
|
22.
|
Estoppel
Certificates
|
26
|
| |
|
|
|
23.
|
Surrender
and Holding Over
|
26
|
| |
|
|
|
24.
|
No
Merger of Title
|
27
|
| |
|
|
|
25.
|
Definition
of Landlord
|
27
|
| |
|
|
|
26.
|
Hazardous
Substances
|
27
|
| |
|
|
|
27.
|
Entry
by Landlord
|
28
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| |
|
|
|
28.
|
No
Usury
|
28
|
| |
|
|
|
29.
|
Financial
Statements
|
28
|
| |
|
|
|
30.
|
Special
Tax Indemnity
|
28
|
| |
|
|
|
31.
|
Withholdings
|
30
|
| |
|
|
|
32.
|
Representations
|
31
|
| |
|
|
|
33.
|
Duty
of First Offer
|
33
|
| |
|
|
|
34.
|
Separability
|
34
|
| |
|
|
|
35.
|
Miscellaneous
|
34
|
EXHIBITS
|
EXHIBIT
A
|
Legal
Description
|
|
EXHIBIT
B
|
Basic
Rent
|
|
EXHIBIT
C
|
Form
of Tenant Estoppel
|
|
EXHIBIT
D
|
Form
of Landlord Waiver
|
|
EXHIBIT
E
|
Form
of Subordination, Non-Disturbance and Attornment Agreement
|
| |
|
|
APPENDIX
A
|
Definitions
|
LEASE
AGREEMENT
THIS
LEASE AGREEMENT (as amended, supplemented and otherwise modified from time
to
time, this “Lease”) made as of April 3, 2006 by and between CT CHATTANOOGA TN,
LLC, a Delaware limited liability company, as landlord, having an office at
c/o
SunTrust Equity Funding, LLC, 303 Peachtree Street, 24th Floor, MC 3951,
Atlanta, Georgia 30308, and COVENANT TRANSPORT, INC., a Tennessee corporation,
as tenant, having an office at 400 Birmingham Highway, Chattanooga, TN
37419.
In
consideration of the rents and provisions herein stipulated to be paid and
performed, Landlord and Tenant, intending to be legally bound, hereby covenant
and agree as follows:
1. Certain
Definitions.
All
capitalized terms, unless otherwise defined herein, shall have the respective
meanings ascribed to such terms in Appendix A annexed hereto and by this
reference incorporated herein.
2. 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,
the
Leased Premises.
3. Title
and Condition.
(a) The
Leased Premises are demised and let subject to (i) Permitted Encumbrances,
(ii)
all Legal Requirements and Insurance Requirements, including any existing
violation of any thereof, and (iii) the condition of the Leased Premises as
of
the commencement of the Term; without representation or warranty by Landlord;
it
being understood and agreed, however, that the recital of the Permitted
Encumbrances herein shall not be construed as a revival of any thereof which
for
any reason may have expired.
(b) LANDLORD
HAS NOT MADE AND WILL NOT MAKE ANY INSPECTION OF ANY OF THE LEASED PREMISES,
AND
LANDLORD LEASES AND WILL LEASE AND TENANT TAKES AND WILL TAKE THE LEASED
PREMISES “AS IS”, AND 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 ITS FITNESS FOR USE OR PURPOSE, DESIGN OR CONDITION
FOR
ANY PARTICULAR USE OR PURPOSE, AS TO THE QUALITY OF THE MATERIAL OR WORKMANSHIP
THEREIN, LATENT OR PATENT, AS TO LANDLORD’S TITLE THERETO, OR AS TO VALUE,
COMPLIANCE WITH SPECIFICATIONS, LOCATION, USE, CONDITION, MERCHANTABILITY,
QUALITY, DESCRIPTION, DURABILITY OR OPERATION, IT BEING AGREED THAT ALL RISKS
INCIDENT THERETO ARE TO BE BORNE BY TENANT. Tenant acknowledges that the Leased
Premises are of its selection and to its specifications, and that the Leased
Premises have been inspected by Tenant and are satisfactory to it. In the event
of any defect or deficiency in any of the Leased Premises of any nature, whether
patent or latent, 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 the foregoing provisions 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
otherwise.
(c) Tenant
acknowledges and agrees that Tenant has examined the title to the Leased
Premises prior to the execution and delivery of this Lease and has found such
title to be satisfactory for the purposes contemplated by this
Lease.
(d) Landlord
hereby assigns, without recourse or warranty whatsoever, to Tenant, all
Guaranties. Such assignment shall remain in effect until the termination of
this
Lease. Landlord shall also retain the right to enforce any Guaranties assigned
to Tenant hereunder in the name of Tenant during the continuance of any Event
of
Default. Landlord hereby agrees to execute and deliver, at Tenant’s expense,
such further documents, including powers of attorney, as Tenant may reasonably
request in order that Tenant may have the full benefit of the assignment
effected or intended to be effected by this Paragraph
3(d).
Upon
the termination of this Lease, the Guaranties shall automatically revert to
Landlord, provided
that, to
the extent that Tenant has incurred out-of-pocket costs and expenses to replace
or repair any part of the Leased Premises for which there is a claim under
a
Guaranty, Tenant shall be subrogated to Landlord’s rights under such Guaranty to
the extent of such costs and expenses, and, at Tenant’s reasonable request,
Landlord shall cooperate with Tenant, at Tenant’s expense, to recover such
claim. The foregoing provision of reversion shall be self-operative and no
further instrument of reassignment shall be required. In confirmation of such
reassignment Tenant shall execute and deliver promptly any certificate or other
instrument which Landlord may reasonably request. Any monies collected by Tenant
under any of the Guaranties after the occurrence of and during the continuation
of an Event of Default shall be held in trust by Tenant and promptly paid over
to Landlord.
(e) Landlord
agrees to enter into, at Tenant’s expense, such Easements as are reasonably
requested by Tenant, subject to Lender’s and Landlord’s approval of the form
thereof, not to be unreasonably withheld or delayed; provided, however, that
no
such Easement shall result in any diminution in the value or utility of the
Leased Premises for use as an office building, truck terminal and truck
maintenance facility and related purposes and further provided that no such
Easement shall render the use of the Leased Premises dependent upon any other
property, or condition the use of the Leased Premises upon the use of any other
property, each of which Tenant shall certify to Landlord and Lender in writing
delivered with Tenant’s request with respect to such Easement. Tenant’s request
shall also include Tenant’s written undertaking acknowledging that Tenant shall
remain liable hereunder as principal and not merely as a surety or guarantor
notwithstanding the establishment of any Easement. Except
as
expressly permitted by this Lease, Landlord shall not enter into any Easements,
REA’s, restrictive covenants or other matters affecting title to the Leased
Premises without the prior consent of Tenant, which shall not be unreasonably
withheld or delayed.
(f) Tenant
agrees that Tenant is obligated to and shall perform all obligations of the
owner of the Leased Premises under, and pay all expenses which the owner of
the
Leased Premises may be required to pay in accordance with, any REA, and that
Tenant shall comply with all of the terms and conditions of each REA during
the
term of this Lease. Tenant further covenants and agrees to indemnify, defend
and
hold harmless Landlord and Lender against any claim, loss or damage suffered
by
Landlord or Lender by reason of Tenant’s failure to perform any obligations or
pay any expenses as required under any REA or comply with the terms and
conditions of any REA as hereinabove provided during the term of this
Lease.
4. Use
of
Leased Premises; Quiet Enjoyment.
(a) Tenant
may use the Leased Premises as an office building, truck terminal and truck
maintenance facility or any other lawful purpose, so long as such other purpose
would not (i) have a material adverse effect on the value or utility of the
Leased Premises, (ii) materially increase the likelihood that Tenant, Landlord
or Lender would incur liability under any provisions of any Environmental Laws,
(iii) result in or give rise to any material environmental deterioration or
degradation of the Leased Premises or (iv) result in the Leased Premises
constituting “limited use property” within the meaning of Revenue Procedure
2001-28, 2001-19 I.R.B. 1156. In no event shall the Leased Premises be used
for
any purpose which shall violate any of the provisions of any Permitted
Encumbrance or any covenants, restrictions or agreements hereafter created
by or
consented to by Tenant applicable to the Leased Premises. Tenant agrees that
with respect to the Permitted Encumbrances and any covenants, restrictions
or
agreements hereafter created by or consented to by Tenant, Tenant, at its
expense, shall observe, perform and comply with and carry out the provisions
thereof required therein to be observed and performed by Landlord or
Tenant.
Landlord
acknowledges and agrees that for so long as this Lease is in full force and
effect, Tenant shall have the right to enforce all of Landlord’s rights and to
enjoy all benefits and privileges under the Permitted Encumbrances. Landlord
shall reasonably cooperate with Tenant, at Tenant’s expense, in promptly
providing any consents or approvals that may be required by any third party
in
connection with Tenant’s enforcement of Tenant’s or Landlord’s rights under the
Permitted Encumbrances. Landlord further agrees to execute and deliver, at
Tenant’s expense, such further documents, including powers of attorney, as
Tenant may reasonably request in order that Tenant may enjoy all rights,
benefits and privileges under the Permitted Encumbrances.
(b) Subject
to Tenant’s rights under Paragraph
18
hereof,
Tenant shall not knowingly permit any unlawful occupation, business or trade
to
be conducted on the Leased Premises or any use to be made thereof contrary
to
applicable Legal Requirements or Insurance Requirements. Subject to Tenant’s
rights under Paragraph
18,
Tenant
shall not use, occupy or knowingly permit any of the Leased Premises to be
used
or occupied, nor do or knowingly permit anything to be done in or on any of
the
Leased Premises, in a manner which would (i) make void or voidable any insurance
which Tenant is then maintaining in force with respect to any of the Leased
Premises as required hereunder, (ii) affect the ability of Tenant to obtain
any insurance which Tenant is required to furnish hereunder, (iii) cause any
injury or damage to any of the Improvements unless as a result of Alterations
permitted under Paragraph
12
hereof
or (iv) result in Landlord being subject to any burdensome regulation. Tenant
shall operate the Leased Premises in accordance, in all material respects,
with
all applicable laws, rules and regulations, including, without limitation,
taking all such actions as may be necessary to permit the Leased Premises to
be
operated as an office building, truck terminal and truck maintenance
facility.
(c) Subject
to all of the provisions of this Lease, so long as no Event of Default exists
hereunder, Landlord covenants to do no act to disturb the peaceful and quiet
occupation and enjoyment of the Leased Premises by Tenant.
(d) Tenant
covenants and agrees to remain in actual physical possession of the Leased
Premises and to continuously operate its business in the Leased
Premises,
subject
to Tenant’s rights under Paragraph
17
hereof.
5. Term.
(a) Subject
to the provisions hereof, Tenant shall have and hold the Leased Premises for
an
initial term commencing on the Commencement Date and ending on the Expiration
Date.
(b) Provided
(i) this Lease shall not have been terminated pursuant to the provisions of
Paragraph
13(b)
or
19,
and
(ii) an Event of Default has not occurred and remains uncured, in each case
on
the applicable date of its Renewal Option Notice and on the Expiration Date
(or
the expiration date of the then expiring Renewal Term, as applicable), Tenant
shall have eight (8) consecutive options to extend the term of this Lease for
a
Renewal Term, commencing upon the day after the Expiration Date (or the
expiration date of the then expiring Renewal Term, as applicable). If Tenant
elects to exercise any one or more of said renewal options, it shall do so
by
giving a Renewal Option Notice to Landlord at any time during the Term (or
the
then Renewal Term, as applicable) but, in any event, on or before that date
which is twelve (12) months prior to the commencement of the Renewal Term for
which such election is exercised. Tenant shall forever waive its right to
exercise a renewal option if it shall, for any reason whatsoever, fail to give
such Renewal Option Notice to Landlord within the time and in the manner
provided for the giving of such notice, whether such failure is inadvertent
or
intentional, TIME BEING OF THE ESSENCE as to the exercise of such renewal option
and the giving of such notice. If Tenant shall elect to exercise any such
renewal option, the term of this Lease shall be automatically extended for
five
(5) years without the execution of an extension or renewal lease. Any Renewal
Term shall be subject to all of the provisions of this Lease, and all such
provisions shall continue in full force and effect. Within ten (10) days after
request by Landlord, Tenant shall execute, acknowledge and deliver to Landlord
an instrument confirming that such option has been effectively exercised,
confirming the extended expiration date of this Lease and confirming the Basic
Rent for the Renewal Term.
6. Rent.
(a) Tenant
shall pay to Landlord (or to such Person as is directed by Landlord), as rent
for the Leased Premises, beginning on the Commencement Date and continuing
for
the Term, the Basic Rent in advance, on the Basic Rent Payment Dates, and shall
pay the same by wire transfer in immediately available federal funds to such
account in such bank as Landlord shall designate from time to time. If the
Commencement Date shall occur on a date other than the first day of a calendar
month, Basic Rent for the period from and including the Commencement Date
through and excluding the first day of the following month shall be paid on
the
Commencement Date in the amount equal to one thirtieth (1/30) of the monthly
Basic Rent for the first year set forth on Exhibit
B
attached
hereto for each day from and including the Commencement Date through and
excluding the first day of the following month.
(b) Subject
to Tenant’s right to contest in accordance with Paragraph
18,
Tenant
shall pay and discharge before the imposition of any fine, Lien, interest or
penalty which may be added thereto for late payment thereof, as Additional
Rent,
all other amounts and obligations which Tenant assumes or agrees to pay or
discharge pursuant to this Lease, together with every fine, penalty, interest
and cost which may be added by the party to whom such payment is due for
nonpayment or late payment thereof. In the event of any failure by Tenant to
pay
or discharge any of the foregoing, Landlord shall have all rights, powers and
remedies provided herein, by law or otherwise, in the event of nonpayment of
Basic Rent. All payments of Additional Rent that are payable to Landlord shall
be paid by Tenant by wire transfer in immediately available federal funds to
such account in such bank as Landlord
shall
designate, from time to time.
(c) If
any
installment of Basic Rent is not paid after the same is due, Tenant shall pay
to
Landlord or Lender, as the case may be, on demand, as Additional Rent, an amount
equal to the late charge or late fee, if any, charged by, and due and owing
to,
Lender
under
the
Mortgage pursuant to the terms of
the
Mortgage.
(d) Landlord
and Tenant agree that this Lease is a true lease and does not represent a
financing arrangement. Each party shall reflect the transactions represented
by
this Lease in all applicable books, records and reports (including, without
limitation, income tax filings) in a manner consistent with “true lease”
treatment rather than “financing” treatment.
7. Net
Lease; Non-Terminability.
(a) This
is a
net lease
and
Basic Rent, Additional Rent and all other sums payable hereunder by Tenant
shall
be paid, except as otherwise expressly set forth in this Lease, without notice,
demand, setoff, counterclaim, recoupment, abatement, suspension, deferment,
diminution, deduction, reduction or defense.
(b) Except
as
otherwise expressly provided in this Lease, this Lease shall not terminate,
and
Tenant shall not have any right to terminate this Lease, during the Term. Except
as otherwise expressly provided in this Lease, Tenant shall not be entitled
to
any setoff, counterclaim, recoupment, abatement, suspension, deferment,
diminution, deduction, reduction or defense of or to Basic Rent, Additional
Rent
or any other sums payable under this Lease; and except as otherwise expressly
provided in this Lease, the obligations of Tenant under this Lease shall not
be
affected by any interference with Tenant’s use of any of the Leased Premises for
any reason, including but not limited to the following: (i) any damage to or
destruction of any of the Leased Premises by any cause whatsoever, (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 under this Lease or under any other agreement, (vii) any
latent or other defect in, or any theft or loss of any of, the Leased Premises,
(viii) the breach of any warranty of any seller or manufacturer of any of the
Fixtures, (ix) any violation of Paragraph
4(c)
by
Landlord, or (x) any other cause, whether similar or dissimilar to the
foregoing, any present or future Law to the contrary notwithstanding. It is
the
intention of the parties hereto that the obligations of Tenant under this Lease
shall be separate and independent covenants and agreements, and that Basic
Rent,
Additional Rent and all other sums payable by Tenant hereunder shall continue
to
be payable in all events (or, in lieu thereof, Tenant shall pay amounts equal
thereto), and that the obligations of Tenant under this Lease shall continue
unaffected, unless this Lease shall have been terminated pursuant to an express
provision of this Lease, including, without limitation, the provisions of
Paragraph
13(b)
and
Paragraph
14(g)
hereof.
Nothing set forth herein shall abrogate Tenant’s rights to pursue a claim for
damages against Landlord if Landlord breaches its obligations under this Lease,
provided
that in
no event shall Tenant have any right to offset any such damages against Basic
Rent or Additional Rent or to terminate this Lease.
(c) Tenant
agrees that it shall remain obligated under this Lease in accordance with its
provisions and that, except as otherwise expressly provided herein, it shall
not
take any action to terminate, rescind or avoid this Lease, notwithstanding
(i)
the bankruptcy, insolvency, reorganization, composition, readjustment,
liquidation, dissolution, winding-up or other proceeding affecting Landlord,
(ii) the exercise of any remedy, including foreclosure, under the Mortgage,
or
(iii) any action with respect to this Lease (including the disaffirmance hereof)
which may be taken by Landlord under the Federal Bankruptcy Code or by any
trustee, receiver or liquidator of Landlord or by any court under the Federal
Bankruptcy Code or otherwise.
(d) This
Lease is the absolute and unconditional obligation of Tenant. Tenant waives
all
rights which are not expressly stated in this Lease but which may now or
hereafter otherwise be conferred by law (i) to quit, terminate or surrender
this
Lease or any of the Leased Premises, (ii) to any setoff, counterclaim,
recoupment, abatement, suspension, deferment, diminution, deduction, reduction
or defense of or to Basic Rent, Additional Rent or any other sums payable under
this Lease, except as otherwise expressly provided in this Lease, and (iii)
for
any statutory Lien or offset right against Landlord or its
property.
8. Payment
of Impositions; Compliance with Legal Requirements and Insurance
Requirements.
(a) (i) Subject
to the provisions of Paragraph
18
hereof,
Tenant shall, before interest or penalties are due thereon, pay and discharge
all Impositions, which payment shall be on an After Tax Basis as to Landlord.
If
received by Landlord, Landlord shall promptly deliver to Tenant any bill or
invoice with respect to any Imposition.
(ii) Nothing
herein shall obligate Tenant to pay, and the term “Impositions”
shall
exclude, federal, state or local (A) transfer taxes as the result of a
conveyance by (or suffered by) Landlord (unless attributable to an Event of
Default or such conveyance is to Tenant or a person designated by Tenant),
(B)
franchise, capital stock or similar taxes if any, of Landlord, except to the
extent that such franchise, capital stock or similar taxes would not be payable
by Landlord but for Landlord’s interest in the Leased Premises or this Lease,
(C) income, excess profits or other taxes, if any, of Landlord, determined
on
the basis of or measured by its net income, (D)
any
estate, inheritance, succession, gift, capital levy or similar taxes, unless
the
taxes referred to in clauses
(B)
and
(C)
above
are in lieu of,
or a
substitute for,
any
other tax or assessment upon or with respect to any of the Leased Premises
which, if such other tax or assessment were in effect at the commencement of
the
Term, would be payable by Tenant,
or (E)
any Tax that would not have been imposed but for the failure of Indemnitee
to
comply with certification, information, documentation or other reporting
requirements applicable to Indemnitee, if compliance with such requirements
is
required by statute or regulation of the relevant taxing authority as a
precondition to relief or exemption from such Tax, provided
that
Tenant has complied with its obligations set forth in paragraph
(e)
below.
In the
event that any assessment against any of the Leased Premises may be paid in
installments, Tenant shall have the option to pay such assessment in
installments; and in such event, Tenant shall be liable only for those
installments which become due and payable during the Term. Tenant shall prepare
and file all tax reports required by governmental authorities which relate
to
the Impositions. Within twenty (20) days after Landlord’s written request
therefor, Tenant shall deliver to Landlord copies of all settlements and notices
pertaining to the Impositions which may be issued by any Governmental Authority
and receipts for payments of all Impositions made during each calendar year
of
the Term (provided
that,
(i) with respect to receipts for payments, Tenant shall provide them to Landlord
promptly upon request, but in any event Tenant shall have no less than thirty
(30) days after payment to make such delivery and (ii) Tenant shall provide
Landlord with evidence of payment of the property taxes due on May 1, 2006
on or
before May 1, 2006).
(b) Subject
to the provisions of Paragraph
18
hereof,
Tenant shall promptly comply with and conform to all of the Legal Requirements
and Insurance Requirements.
(c) Any
amount payable to Landlord pursuant to this Paragraph
8
shall be
paid within ten (10) days after receipt of a written demand therefor from
Landlord accompanied by a written statement describing in reasonable detail
the
amount so payable. Any payments required to be made by Tenant pursuant to this
Paragraph
8
that are
not allowed to be paid directly to the appropriate Governmental Authority
or
such
other Person to whom such payment is due shall
be
made directly to Landlord at the location and in the manner specified by
Landlord pursuant to Paragraph
6
for the
payment of Rent. Any amount payable by Tenant under this Paragraph
8
that is
not paid to
Landlord when
due
shall bear interest at the Default Rate.
In
addition, Tenant shall be solely responsible for the payment of any late fees,
penalties or default interest with respect to any amount payable by Tenant
under
this Paragraph
8
to
anyone other than Landlord that is not paid when due.
(d) If
any
report, return or statement (a “Filing”)
is
required to be filed with respect to any Imposition that is subject to this
Paragraph
8,
Tenant
shall, if permitted by Applicable Laws to do so, timely file or cause to be
filed such Filing with respect to such Tax and shall promptly provide notice
of
such filing to Landlord (except for any such Filing that Landlord has notified
Tenant in writing that Landlord intends to file) and will (if ownership of
the
Leased Premises or any part thereof or interest therein is required to be shown
on such Filing) show the ownership of the Leased Premises in the name of
Landlord and send a copy of such Filing to Landlord. If Tenant is not permitted
by Applicable Laws to file any such Filing, Tenant will promptly notify Landlord
of such requirement in writing and prepare and deliver to Landlord a proposed
form of such Filing and such information as is within Tenant’s reasonable
control or access with respect to such Filing within a reasonable time under
the
circumstances, and in all events at least five (5) Business Days, prior to
the
time such Filing is required to be filed. Tenant shall hold Landlord harmless
from and against any liabilities, including, but not limited to penalties,
additions to tax, fines and interest, arising out of any insufficiency or
inaccuracy in any such Filing, if such insufficiency or inaccuracy is
attributable to Tenant.
(e) Notwithstanding
anything herein to the contrary, any
obligations of Tenant under the
provisions of this Paragraph
8 that
accrue prior to the expiration or earlier termination of this Lease shall
survive such
expiration or
earlier
termination of this Lease.
(f) Until
the
earlier of (i) the receipt by Landlord of a separate tax parcel number for
the
Leased Premises and (ii) May 1, 2007, Tenant (A) shall pay when due all Taxes
with respect to the approximate 181.2 acre tax parcel of which the Leased
Premises is a part (the “Existing
Tax Parcel”)
and
shall provide evidence of such payment to Landlord within three (3) Business
Days of such payment, (B) shall not construct any improvements on that portion
of the Existing Tax Parcel not included in the Leased Premises except for a
body
shop and such other improvements as shall be instrumental to the construction
and/or operation of such body shop, the aggregate construction cost of which
shall not exceed $10,000,000, and (C) shall not encumber that portion of the
Existing Tax Parcel that is not included in the Leased Premises with any Lien
for borrowed money. Tenant shall (i) promptly after Landlord’s request, execute
and deliver an agreement, in recordable form, evidencing the agreements set
forth in this Paragraph
8(f),
which
agreement may be recorded against the Existing Tax Parcel in the appropriate
real estate records, and (ii) cooperate with Landlord in seeking to obtain
a
separate tax parcel number for the Leased Premises as promptly as practicable
after the Commencement Date. In the event that Landlord has not received a
separate tax parcel number for the Leased Premises on or prior to May 1, 2007,
then, until the date on which Landlord so receives such separate tax parcel
number, Tenant shall provide Landlord with not less than ninety (90) days’ prior
written notice of Tenant’s intent to undertake the construction of any
improvements on the Existing Tax Parcel or to encumber all or any portion of
the
Existing Tax Parcel with any Lien for borrowed money.
9. Liens;
Recording and Title.
(a) Subject
to the provisions of Paragraph
18
hereof,
Tenant shall not, directly or indirectly, create or permit to be created or
to
remain, and shall promptly discharge, any Lien on the Leased Premises, or on
the
Basic Rent, Additional Rent or any other sums payable by Tenant under this
Lease, other than the Mortgage, the Permitted Encumbrances and any mortgage,
Lien, encumbrance or other charge created by, or resulting from any act or
omission by, Landlord or those claiming by, through or under Landlord (except
Tenant, or any assignee of, or sublessee from, Tenant). 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 mechanic’s 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.
(b) Each
of
Landlord and Tenant shall execute, acknowledge and deliver to the other a
written memorandum of this Lease to be recorded in the appropriate land records
of the jurisdiction in which the Leased Premises is located, in order to give
public notice and protect the validity of this Lease. In the event of any
discrepancy between the provisions of such recorded memorandum of this Lease
and
the provisions of this Lease, the provisions of this Lease shall
prevail.
(c) Nothing
in this Lease and no action or inaction by Landlord shall be deemed or construed
to mean that Landlord has granted to Tenant any right, power or permission
to do
any act or to make any agreement which may create, give rise to, or be the
foundation for, any right, title, interest or Lien in or upon the estate of
Landlord in any of the Leased Premises. Landlord shall not have any Lien upon
Tenant’s Trade Fixtures or any other personal property of Tenant that is located
at or on the Leased Premises, so long as such Trade Fixtures or other personal
property is not part of the Leased Premises and has not been funded by
Landlord.
10. Indemnification.
(a) Tenant
agrees to assume liability for, and to indemnify, protect, defend, save and
keep
harmless each Indemnitee, on an After-Tax Basis, from and against any and all
Claims that may be suffered, imposed on or asserted against any Indemnitee,
arising out of (i) the ownership or leasing of the Leased Premises by Landlord,
the subleasing of the Leased Premises by Tenant, assignment by Tenant of its
interest in this Lease, or sale of the Leased Premises by Landlord to Tenant,
transfer of title of Tenant’s interest in this Lease, renewal of this Lease, or
operation, possession, use, non-use, maintenance, modification, alteration,
construction, reconstruction, restoration, or replacement of the Leased Premises
(or any portion thereof), or from the granting by Landlord at Tenant’s request
of easements, licenses or any rights with respect to all or any part of the
Leased Premises, or from the design, construction or condition of the Leased
Premises (including any Claims arising, directly or indirectly, out of the
actual or alleged presence, use, storage, generation or Release of any Hazardous
Materials, and any Claims for patent infringement and latent or other defects,
whether or not discoverable), including any liability under Applicable Laws
(including, without limitation, any Claims arising directly or indirectly out
of
any actual or alleged violation, now or hereafter existing, of any Environmental
Laws), (ii) this Lease or any modification, amendment or supplement thereto,
(iii) the non-compliance of the Leased Premises with Applicable Laws (including
because of the existence of the Permitted Encumbrances), (iv) any matter
relating to all or any part of the Leased Premises or any operations thereon,
including matters relating to Environmental Laws or Hazardous Materials, (v)
the
breach by Tenant of its representations, warranties, covenants and obligations
in this Lease whether or not such Claim arises or accrues prior to the date
of
this Lease, (vi) the business and activities of Tenant, (vii) the business
and
activities of any other Person on or about the Leased Premises (whether as
an
invitee, subtenant, licensee or otherwise), (viii) the cost of assessment,
containment and/or removal of any and all Hazardous Materials from all or any
portion of the Leased Premises or any surrounding areas for which Tenant or
Landlord has any legal obligation, the cost of any actions taken in response
to
a Release of any Hazardous Materials on, in, under or affecting any portion
of
the Leased Premises or any surrounding areas for which Tenant or Landlord has
any legal obligation to prevent or minimize such Release so that it does not
migrate or otherwise cause or threaten danger to present or future public
health, safety, welfare or the environment, and costs incurred to comply with
Environmental Laws in connection with all or any portion of the Leased Premises
or any surrounding areas for which Tenant or Landlord has any legal obligation,
and (ix) an Event of Default.
(b) In
case
any Claim shall be made or brought against any Indemnitee, such Indemnitee
shall
give prompt notice thereof to Tenant; provided
that
failure to so notify Tenant shall not reduce Tenant’s obligations to indemnify
any Indemnitee hereunder unless and only to the extent such failure results
in
additional liability on Tenant’s part. Tenant shall be entitled, at its expense,
acting through counsel selected by Tenant (and reasonably satisfactory to such
Indemnitee), to participate in, or, except as otherwise provided herein, to
assume and control (if it promptly so elects upon notice of the Claim), and,
to
the extent that Tenant desires to assume and control, in consultation with
Indemnitee, the negotiation, litigation and/or settlement of any such Claim
(subject to the provisions of the last sentence of subparagraph
(c)
of this
Paragraph
10).
Such
Indemnitee may (but shall not be obligated to) participate at its own expense
(unless Tenant is not defending such Claim in accordance herewith and then
at
the expense of Tenant) and with its own counsel in any proceeding conducted
by
Tenant in accordance with the foregoing, in which case Tenant shall keep such
Indemnitee and its counsel fully informed of all proceedings and filings and
afford such Indemnitee and counsel reasonable opportunity for comment.
Notwithstanding the foregoing, Tenant shall not be entitled to assume and
control the defense of any Claim if (i) an Event of Default has occurred and
is
continuing, (ii) the proceeding involves possible imposition of any criminal
liability or penalty or a civil penalty on such Indemnitee in excess of
$1,000,000, (iii) the proceeding involves the granting of injunctive relief
against the Indemnitee not related to this Lease, (iv) a significant
counterclaim is available to the Indemnitee that would not be available to
and
cannot be asserted by Tenant, (v) a conflict of interest exists between the
Indemnitee and Tenant with respect to the Claim, or (vi) the defense of such
Claim would require the delivery of material confidential and proprietary
information of such Indemnitee that would otherwise not be available to Tenant
or its counsel.
(c) Upon
payment in full of any Claim by Tenant pursuant to this Paragraph
10
to or on
behalf of an Indemnitee, Tenant, without any further action, shall be subrogated
to any and all Claims that such Indemnitee may have relating thereto (other
than
claims in respect of insurance policies maintained by such Indemnitee at its
own
expense or claims against another Indemnitee for which Tenant would have
indemnity obligations hereunder), and such Indemnitee shall execute such
instruments of assignment and conveyance, evidence of Claims and payment and
such other documents, instruments and agreements as may be reasonably necessary
to preserve any such Claims and otherwise reasonably cooperate with Tenant
to
enable Tenant to pursue such Claims, all at Tenant’s expense.
(d) Notwithstanding
anything to the contrary contained herein, Tenant shall not be required to
indemnify any Indemnitee under this Paragraph
10
for any
Claim to the extent resulting from the gross negligence or willful misconduct
of
such Indemnitee (except to the extent imputed to such Indemnitee as a result
of
Tenant’s acts or failure to act).
(e) Each
Indemnitee shall be an express third party beneficiary of Tenant’s obligations
under this Paragraph
10
and may
directly enforce its rights against Tenant hereunder.
(f) The
obligations of Tenant under this Paragraph
10
shall
survive any termination of this Lease.
11. Maintenance
and Repair.
(a) Tenant
shall at all times put, keep and maintain the Leased Premises (including,
without limitation, the roof, walls, footings, foundations, structural
components, paving, parking lots and landscaping (including the mowing of grass
and care of shrubs)) in good, clean, safe, first-class condition and repair,
but
in any event, except for any Alterations that Tenant is permitted to make
pursuant to this Lease, in at least the same condition and order of repair
as
exists as of the Commencement Date, except for ordinary wear and tear, and
at
least the same or better condition and order as other similar properties owned
or leased by Tenant and its Affiliates. Tenant shall promptly make all repairs
and replacements of every kind and nature, whether foreseen or unforeseen,
which
may be required to be made upon or in connection with the Leased Premises in
order to keep and maintain the Leased Premises in the order and condition
required by this Paragraph
11(a).
Tenant
shall do or cause others to do all shoring of the Leased Premises or of
foundations and walls of the Improvements and every other act necessary or
appropriate for preservation and safety thereof, by reason of or in connection
with any excavation or other building operation upon any of the Leased Premises,
whether or not Landlord shall, by reason of any Legal Requirements or Insurance
Requirements, be required to take such action or be liable for failure to do
so.
LANDLORD SHALL NOT BE REQUIRED TO MAKE ANY REPAIR, WHETHER FORESEEN OR
UNFORESEEN, OR TO MAINTAIN ANY OF THE LEASED PREMISES OR ADJOINING PROPERTY
IN
ANY WAY, AND TENANT HEREBY EXPRESSLY WAIVES THE RIGHT TO MAKE REPAIRS OR
MAINTENANCE AT THE EXPENSE OF THE LANDLORD, WHICH RIGHT MAY BE PROVIDED FOR
IN
ANY LAW NOW OR HEREAFTER IN EFFECT. Nothing in the preceding sentence shall
be
deemed to preclude Tenant from being entitled to insurance proceeds or
condemnation awards for Restoration pursuant to, and to the extent set forth
in,
Paragraphs
13(c)
and
14(g)
of this
Lease. Tenant shall, in all events, make all repairs for which it is responsible
hereunder promptly, and all repairs shall be made in a good, proper and
workmanlike manner.
(b) Subject
to Paragraph
18
hereof,
in
the
event that any Improvement shall violate any Legal Requirements or Insurance
Requirements and as a result of such violation enforcement action is threatened
or commenced against Tenant or Landlord or with respect to the Leased Premises,
then Tenant, at the request of Landlord, shall either (i) obtain valid and
effective waivers or settlements of all claims, liabilities and damages
resulting from each such violation, whether the same shall affect Landlord,
Tenant or both, or (ii) take such action as shall be necessary to remove such
violation, including, if necessary, making any Alteration. Any such Alteration
shall be made in conformity with the provisions of Paragraph
12.
(c) If
Tenant
shall be in default under any of the provisions of this Paragraph
11,
Landlord may, after thirty (30) days’ written notice given to Tenant and failure
of Tenant to cure during said period, but without notice in the event of an
emergency, do whatever is necessary to cure such default as may be appropriate
under the circumstances, for the account of and at the expense of Tenant. In
the
event of an emergency, Landlord shall notify Tenant of the situation by phone
or
other available communication. All reasonable sums so paid by Landlord and
all
reasonable costs and expenses (including, without limitation, attorneys’ fees
and expenses) so incurred, together with interest thereon at the Default Rate
from the date of payment or incurring the expense, shall constitute Additional
Rent payable by Tenant under this Lease and shall be paid by Tenant to Landlord
on demand.
(d) Tenant
shall from time to time replace with Replacement Fixtures any of the Fixtures
which shall have become worn out or unusable for the purpose for which it is
intended, been taken by a Condemnation as provided in Paragraph
13,
or been
lost, stolen, damaged or destroyed as provided in Paragraph
14.
Tenant
shall repair at its sole cost and expense all damage to the Leased Premises
caused by the removal of Fixtures or Replaced Fixtures or other personal
property of Tenant or the installation of Replacement Fixtures. All Replacement
Fixtures shall become the property of Landlord, shall be free and clear of
all
Liens and rights of others, and shall become a part of the Fixtures as if
originally demised herein.
12. Alterations.
(a) Tenant
shall have the right to make any Alteration(s) to the Leased Premises without
the prior consent of Landlord the cost of which does not exceed
$300,000, in
the
aggregate, in any calendar year and which are not Structural Changes;
provided,
that,
in each case, Tenant complies with clauses
(c)
and
(d)
of this
Paragraph
12.
(b) Upon
thirty (30) days’ prior written notice to Landlord requesting Landlord’s
consent, Tenant shall have the right to make any Alteration(s) to the Leased
Premises, the cost of which exceeds $300,000, in the aggregate, in any calendar
year or which are Structural Changes; provided,
that,
(i)
no
Event of Default under this Lease has occurred and is then continuing,
(ii)
Tenant complies with clauses
(c)
and
(d)
of this
Paragraph
12,
(iii)
prior to making any such Alteration(s), Tenant shall provide Landlord with
the
plans and specifications, estimated budgets and proposed schedule of
construction with respect thereto, and (iv) Landlord consents in writing to
any
such Alteration(s), which consent (1) shall not be unreasonably withheld, and
(2) shall be deemed to have been given by Landlord if Landlord fails to respond
to Tenant’s notice within said thirty (30) day period, provided
that
Tenant’s notice shall state on the envelope thereto in bold, capitalized print
substantially the following: “FAILURE
OF THE RECIPIENT TO RESPOND WITHIN THIRTY (30) DAYS TO THE ENCLOSED REQUEST
FOR
APPROVAL SHALL BE DEEMED APPROVAL”.
(c) In
the
event that Landlord gives its prior written consent to any Alterations, or
if
such consent is not required, Tenant agrees that in connection with any
Alteration: (i) the fair market value of the Leased Premises shall not be
lessened after the completion of any such Alteration, or its structural
integrity impaired; (ii) the Alteration and any Alteration theretofore made
or
thereafter to be made shall not in the aggregate reduce the gross floor area
of
the Improvements by more than ten percent (10%); (iii) all such Alterations
shall be performed in a good and workmanlike manner, and shall be expeditiously
completed in compliance with all Legal Requirements; (iv) no such
Alteration shall change the permitted use of the Leased Premises (as described
in Paragraph
4
hereof),
(v) all work done in connection with any such Alteration shall comply with
all
Insurance Requirements; (vi) Tenant shall promptly pay all costs and expenses
of
any such Alteration, and shall (subject to and in compliance with the provisions
of Paragraph
18
hereof)
discharge all Liens filed
against any of the Leased Premises arising out of the same; (vii) Tenant shall
procure and pay for all permits and licenses required in connection with any
such Alteration; (viii) all such Alterations shall be the property of Landlord
and shall be subject to this Lease; (ix) no such Alteration shall create any
debt or other encumbrance(s) on the Leased Premises (provided that if Tenant
requests additional funding for such Alteration from Landlord in writing,
Landlord shall, at Tenant’s sole expense, use commercially reasonable efforts to
obtain such additional funding, subject to the receipt of any required consent
thereto from the Lender and an adjustment to the Basic Rent to reflect such
additional funding), and (x) all Alterations shall be made in the case of any
Alteration the estimated cost of which in any one instance exceeds Five Hundred
Thousand and 00/100 Dollars ($500,000.00) under the supervision of an architect
or engineer and in accordance with plans and specifications which shall be
submitted to Landlord (for informational purposes only) prior to the
commencement of the Alterations. If requested, Tenant shall update Landlord’s
and/or Lender’s policy of title insurance to reflect any increase to the value
of the improvements and insure against any Liens which may have been placed
against the Leased Premises in connection with such
Alterations.
(d) Notwithstanding
anything to the contrary contained herein, Tenant shall not, without Landlord’s
prior written consent, which consent may be withheld or denied in Landlord’s
sole discretion (i) demolish all or substantially all of the Improvements,
or
(ii)
make
any Alterations, at any time, which would (after the completion thereof) impair
the structural integrity of the Leased Premises.
13. Condemnation.
(a) Tenant,
promptly upon obtaining knowledge of the institution of any proceeding for
Condemnation, shall notify Landlord thereof and Landlord shall be entitled
to
participate in any Condemnation proceeding. Landlord, promptly after obtaining
knowledge of the institution of any proceeding for Condemnation, shall notify
Tenant thereof and Tenant shall have the right to participate in such
proceedings. Subject to the provisions of this Paragraph
13
and
Paragraph 15,
Tenant
hereby irrevocably assigns to Landlord any award or payment in respect of any
Condemnation of Landlord’s interest in the Leased Premises, except that (except
as hereinafter provided) nothing in this Lease shall be deemed to assign to
Landlord any award relating to the value of the leasehold interest created
by
this Lease or any award or payment on account of the Trade Fixtures, moving
expenses, loss of business income and out-of-pocket expenses incidental to
the
move, if available, to the extent Tenant shall have a right to make a separate
claim therefor against the condemnor, it being agreed, however, that Tenant
shall in no event be entitled to any payment that reduces the award to which
Landlord is or would be entitled for the condemnation of Landlord’s interest in
the Leased Premises.
(b) (i) If
(I)
the entire Leased Premises, (II) a material portion of the Land or the building
constructed on the Land or any means of ingress, egress or access to the Leased
Premises, the loss of which even after restoration, would, in Tenant’s
reasonable business judgment, be substantially and materially adverse to the
business operations of Tenant at the Leased Premises, or
(III) any means of ingress, egress or access to the Leased Premises which does
not result in at least one method of ingress and egress to and from the Leased
Premises remaining, provided the same is permitted under then existing Legal
Requirements, shall
be
the subject of a Taking by a duly constituted authority or agency having
jurisdiction, then Tenant may, not later than ninety (90) days after Tenant
has
received notification of such Taking from the applicable Governmental Authority,
serve a Tenant’s Termination Notice upon Landlord.
(ii) In
the
event that Tenant shall serve a Tenant’s Termination Notice upon Landlord, this
Lease and the Term hereof shall terminate on the Termination Date specified
in
the Tenant’s Termination Notice; and in such event the Net Award to be made in
the Condemnation proceeding shall be paid to Landlord. From and after the
Termination Date specified in the Tenant’s Termination Notice, Tenant shall have
no further obligation to pay Basic Rent, Additional Rent or any other sums
otherwise payable by Tenant hereunder except with respect to those provisions
of
this Lease that expressly survive termination.
(c) (i) In
the
event of a Condemnation of any part of the Leased Premises which does not result
in a termination of this Lease, subject to the requirements of Paragraph
15,
the Net
Award of such Condemnation shall be retained by Landlord, and promptly after
such Condemnation, Tenant shall commence and diligently continue to completion
the Restoration of the Leased Premises.
(ii) Upon
the
payment to Landlord of the Net Award of a Taking which falls within the
provisions of this Paragraph
13(c),
Landlord and Lender shall, to the extent received, make the Restoration Award
available to Tenant for Restoration, in accordance with the provisions of
Paragraph
15,
and
promptly after completion of the Restoration, the balance of the Net Award
shall
be paid to Landlord. Notwithstanding the occurrence of any Condemnation that
does not result in a termination of this Lease, all Basic Rent, Additional
Rent
and other sums payable hereunder shall continue unabated and
unreduced.
(iii) In
the
event of a Requisition of the Leased Premises, Landlord shall apply the Net
Award of such Requisition, to the extent available, to the installments of
Basic
Rent, Additional Rent or other sums payable by Tenant hereunder thereafter
payable and Tenant shall pay any balance remaining thereafter. Upon the
expiration of the Term, any portion of such Net Award which shall not have
been
previously credited to Tenant on account of the Basic Rent and Additional Rent
shall be retained by Landlord.
(d) Except
with respect to an award or payment to which Tenant is entitled pursuant to
the
provisions of Paragraph
13(a)
or
13(c),
no
agreement with any condemnor in settlement of or under threat of any
Condemnation shall be made by either Landlord or Tenant without the written
consent of the other (provided
that if
an Event of Default has occurred and is continuing, no consent of Tenant shall
be required to any settlement made by Landlord), and of Lender, if the Leased
Premises are then subject to a Mortgage, which consent shall not be unreasonably
withheld or delayed.
14. Insurance.
(a) Tenant
shall maintain at its sole cost and expense the following insurance on the
Leased Premises:
(i) Insurance
against loss or damage to the Improvements and Fixtures under an “all risk”
extended coverage insurance policy, which shall include coverage against
all
risks of direct physical loss, including loss by fire, lightning, [riot,
civil
commotion,] terrorism and other risks which at the time are included under
“extended coverage” endorsements (which shall include windstorm if the
Leased Premises is located in an area where windstorm insurance is customarily
maintained for similar commercial properties, flood insurance if the Leased
Premises is located within a flood hazard area and earthquake insurance if
the
Leased Premises is located in an area where earthquake insurance is customarily
maintained for similar commercial properties) and against other risks insured
against by persons operating like properties in the locality of the Leased
Premises. Such insurance shall be in amounts sufficient to prevent Landlord
or
Tenant from becoming a co-insurer under the applicable policies, and in any
event, after application of the related deductible, in amounts not less than
the
actual replacement cost of the Improvements and Fixtures (excluding footings
and
foundations and other parts of the Improvements which are not insurable)
as
reasonably determined from time to time at Landlord’s request but not more
frequently than once in any 12-month period, by agreement of Landlord and
Tenant, or if not so agreed, at Tenant’s expense, by the insurer or insurers or
by an appraiser approved by Landlord. Such insurance policies may contain
reasonable exclusions and deductible amounts, all in accordance with industry
standards.
(ii) Contractual
and comprehensive general liability insurance against claims for bodily injury,
death or property damage occurring on, in or about the Leased Premises, which
insurance shall be written on an“Occurrence
Basis”, and shall provide minimum protection with a combined single limit in an
amount not less than Five Million ($5,000,000) Dollars (or in such increased
limits from time to time to reflect declines in the purchasing power of the
dollar as Landlord may reasonably request) for bodily injury, death and property
damage in any one occurrence.
(iii) Statutory
worker’s compensation insurance covering all persons employed by Tenant on the
Leased Premises in connection with any work done on or about any of the Leased
Premises for which claims for death or bodily injury could be asserted against
Landlord, Tenant or the Leased Premises.
(iv) Insurance
against loss or damage from explosion of any steam or pressure boilers or
similar apparatus, if any, located in or about the Improvements in an amount
not
less than the actual replacement cost of the Improvements and Fixtures
(excluding footings and foundations and other parts of the Improvements which
are not insurable).
(v) Business
interruption insurance in an amount at least equal to six months of operations
of the Leased Premises.
(vi) Such
additional and/or other insurance with respect to the Improvements located
on
the Leased Premises and in such amounts as at the time is customarily carried
by
prudent owners or tenants with respect to improvements similar in character,
location and use and occupancy to the Improvements located on the Leased
Premises, provided
that
Landlord shall notify Tenant of such additional insurance.
(b) The
insurance required by Paragraph
14(a)
shall be
written by companies having an A.M. Best Insurance Reports rating of not less
than “A”, and a financial size category of “VIII”, and all such companies shall
be authorized to do an insurance business in the State, or otherwise agreed
to
by Landlord and Lender. 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
14 (a)(iii)
hereof)
name Landlord, Tenant and each Lender
(whose
name and address Landlord shall provide to Tenant)
as
additional insured parties, as their respective interests may appear. If said
insurance or any part thereof shall expire, be withdrawn, become void by breach
of any condition thereof by Tenant or become void or unsafe by reason of the
failure or impairment of the capital of any insurer, Tenant shall immediately
obtain new or additional insurance reasonably satisfactory to Landlord and
Lender.
(c) Each
insurance policy referred to in clauses
(i)
and
(iv)
(and
(vi)
if
requested by Lender) of Paragraph
14(a),
shall
contain standard non-contributory mortgagee clauses in favor of each Lender
which holds an interest in a Mortgage on the Leased Premises. Each policy shall
provide that it may not be canceled or amended in any material respect except
after thirty (30) days’ prior notice to Landlord and any Lender. Each policy of
insurance shall contain a waiver of subrogation or consent to a waiver of right
of recovery against the Landlord. Each policy shall also provide that any losses
otherwise payable thereunder shall be payable notwithstanding (i) any act or
omission of Landlord, Tenant or any other Person which might, absent such
provision, result in a forfeiture of all or a part of such insurance payment,
or
(ii) the occupation or use of any of the Leased Premises for purposes more
hazardous than permitted by the provisions of such policy.
(d) Tenant
shall pay as they become due all premiums for the insurance required by this
Paragraph
14,
shall
renew or replace each policy, and shall deliver to Landlord and each Lender
(whose name and address Landlord shall provide to Tenant) a certificate or
other
evidence (reasonably satisfactory to Lender and Landlord) of the existing policy
and such renewal or replacement policy at least thirty days prior to the
Insurance Expiration Date of each policy. Each such policy shall be renewable
not more frequently than every six months and shall provide that it shall not
expire until the Landlord and Lender shall receive a notice from the insurer
to
the effect that such policy will expire on the Insurance Expiration Date, as
set
forth in such notice, which shall be thirty (30) days following the date of
the
receipt by Landlord and Lender of such notice. In the event of Tenant’s failure
to comply with any of the foregoing requirements of this Paragraph
14
within
five (5) business days of the giving of written notice by Landlord to Tenant,
Landlord shall be entitled to procure such insurance. Any sums expended by
Landlord in procuring such insurance shall be Additional Rent and shall be
repaid by Tenant, together with interest thereon at the Default Rate, from
the
time of payment by Landlord until fully paid by Tenant immediately upon written
demand therefor by Landlord.
(e) Anything
in this Paragraph
14
to the
contrary notwithstanding, any insurance which Tenant is required to obtain
pursuant to Paragraph
14(a)
may be
carried under a “blanket” policy or policies covering other properties or
liabilities of Tenant, provided that such “blanket” policy or policies otherwise
comply with the provisions of this Paragraph
14.
In the
event any such insurance is carried under a blanket policy, Tenant shall deliver
to Landlord and Lender evidence of the issuance and effectiveness of the policy,
the amount and character of the coverage with respect to the Leased Premises
and
the presence in the policy of provisions of the character required in the above
sections of this Paragraph
14.
No
deductible under any insurance required pursuant to this Paragraph
14
shall
exceed $25,000.
(f) In
the
event of any casualty loss exceeding $100,000, Tenant shall give Landlord
immediate notice thereof. Tenant shall adjust, collect and compromise any and
all claims, with the consent of Lender and Landlord, not to be unreasonably
withheld or delayed, and Landlord and Lender shall have the right to join with
Tenant therein. If the estimated cost of Restoration or repair shall be One
Hundred Thousand ($100,000.00) Dollars or less, all proceeds of any insurance
required under clauses
(i)
and
(iv)
(and (v)
if requested by Lender) of Paragraph 14(a)
shall be
payable to Tenant, provided that no Event of Default then exists hereunder,
and
in all other events to a Trustee. If the Leased Premises shall be covered by
a
Mortgage, Lender, if it so desires, shall be the Trustee. Each insurer is hereby
authorized and directed to make payment under said policies directly to such
Trustee instead of to Landlord and Tenant jointly; and Tenant and Landlord
each
hereby appoints such Trustee as its attorney-in-fact to endorse any draft
therefor for the purposes set forth in this Lease. In the event of any casualty
(whether or not insured against) resulting in damage to the Leased Premises
or
any part thereof, the Term shall nevertheless continue and there shall be no
abatement or reduction of Basic Rent, Additional Rent or any other sums payable
by Tenant hereunder. The Net Proceeds of such insurance payment shall be
retained by the Trustee and, promptly after such casualty, Tenant, as required
in Paragraphs
11(a)
and
12,
shall
commence and diligently continue to perform the Restoration to the Leased
Premises. Upon payment to the Trustee of such Net Proceeds, the Trustee shall,
to the extent available, make the Net Proceeds available to Tenant for
restoration, in accordance with the provisions of Paragraph
15.
Subject
to Paragraph
14(g),
Tenant
shall, whether or not the Net Proceeds are sufficient for the purpose, promptly
repair or replace the Improvements and Fixtures in accordance with the
provisions of Paragraph
11(a)
and the
Net Proceeds of such loss shall thereupon be payable to Tenant, subject to
the
provisions of Paragraph
15.
In the
event that any damage or destruction shall occur at such time as Tenant shall
not have maintained third-party insurance in accordance with Paragraph
14(a),
Tenant
shall pay to the Trustee Tenant’s Insurance Payment, unless the estimated cost
of Restoration is $100,000 or less, in which event Tenant may retain and use
Tenant’s Insurance Payment to pay for restoration of the Leased Premises
.
(g) (i) If
a
casualty occurs during the last twelve (12) months of the Initial Term or any
Renewal Term which casualty results in the total loss of the Improvements,
then
Tenant may, not later than ninety (90) days after such casualty has occurred,
serve a Tenant’s Termination Notice upon Landlord.
(ii) In
the
event that Tenant shall serve a Tenant’s Termination Notice upon Landlord
pursuant to paragraph
(i),
this
Lease and the Term hereof shall terminate on the Termination Date specified
in
the Tenant’s Termination Notice; and in such event
Tenant
shall have no obligation to commence or complete the Restoration and
all of
the insurance proceeds (or Tenant’s Insurance Payment, as applicable) payable in
connection with the casualty shall be paid to Landlord. From and after the
Termination Date specified in the Tenant’s Termination Notice, Tenant shall have
no further obligation to pay Basic Rent, Additional Rent or any other sums
otherwise payable by Tenant hereunder except with respect to those provisions
of
this Lease that expressly survive termination.
15. Restoration.
The
Restoration Fund shall be disbursed by the Trustee in accordance with the
following conditions:
(a) If
the
cost of Restoration will exceed $100,000, prior to commencement of the
Restoration the architects, general contractor(s), and plans and specifications
for the Restoration shall be approved by Landlord, which approval shall not
be
unreasonably withheld or delayed; and which approval shall be granted to the
extent that the plans and specifications depict a Restoration which is
substantially similar to the Improvements and Fixtures which existed prior
to
the occurrence of the casualty or Taking, whichever is applicable.
(b) At
the
time of any disbursement, no Event of Default shall exist and no mechanics’ or
materialmen’s Liens shall have been filed and remain undischarged or
unbonded.
(c) Disbursements
shall be made from time to time in an amount not exceeding the hard and soft
cost of the work and costs incurred since the last disbursement upon receipt
of
(1) satisfactory evidence, including architects’ certificates of the stage of
completion, of the estimated cost of completion and of performance of the work
to date in a good and workmanlike manner in accordance with the contracts,
plans
and specifications, (2) partial releases of Liens, and (3) other reasonable
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
or delivered to the site and free and clear of mechanics’ Lien
claims.
(d) Each
request for disbursement shall be accompanied by a certificate of Tenant
describing the work, materials or other costs or expenses, for which payment
is
requested, stating the cost incurred in connection therewith and stating that
Tenant has not previously received payment for such work or expense and the
certificate to be delivered by Tenant upon completion of the work shall, in
addition, state that the work has been substantially completed and complies
with
the applicable requirements of this Lease.
(e) The
Trustee may retain up to ten percent (10%) of the Restoration Fund until the
Restoration is at least fifty percent (50%) complete, and thereafter up to
five
percent (5%) until the Restoration is substantially complete.
(f) The
Restoration Fund shall be kept in a separate interest-bearing federally insured
account by the Trustee or by Lender.
All
interest accrued on the Restoration Fund shall become a part of the Restoration
Fund.
(g) At
all
times the undisbursed balance of the Restoration Fund held by Trustee plus
any
funds contributed thereto by Tenant, at its option, shall be not less than
the
cost of completing the Restoration, free and clear of all
Liens.
(h) In
addition, prior to commencement of Restoration and at any time during
Restoration, if the estimated cost of Restoration, as reasonably determined
by
Landlord, exceeds the amount of the Net Proceeds, the Restoration Award and
Tenant Insurance Payment available for such Restoration, Tenant shall fund,
at
its own expense, the costs of such Restoration until the remaining Restoration
Fund is sufficient for the completion of the Restoration. Any sum in the
Restoration Fund which remains in the Restoration Fund upon the completion
of
Restoration shall be paid 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 Proceeds or the Restoration Award shall be deemed to be
disbursed prior to any amount added by Tenant.
16. Subordination
to Financing.
(a) (i) Subject
to the provisions of Paragraph
16(a)(ii),
Tenant
agrees that this Lease shall at all times be subject and subordinate to the
Lien
of any Mortgage, and Tenant agrees, upon demand, without cost, to execute
instruments as may be reasonably required to further effectuate or confirm
such
subordination.
(ii) Except
as
expressly provided in this Lease by reason of the occurrence of an Event of
Default, and
as a
condition to the subordination described in Paragraph
16(a)(i)
above,
Tenant’s
tenancy and Tenant’s rights under this Lease shall not be disturbed, terminated
or otherwise adversely affected, nor shall this Lease be affected, by
the
existence of, or any
default under,
any
Mortgage, and in the event of a foreclosure or other enforcement of any
Mortgage, or sale in lieu thereof, the purchaser at such foreclosure sale shall
be bound to Tenant for the Term of this Lease and any Renewal Term, the rights
of Tenant under this Lease shall expressly survive, and this Lease shall in
all
respects continue in full force and effect so long as no Event of Default has
occurred and is continuing. Tenant shall not be named as a party defendant
in
any such foreclosure suit, except as may be required by law. Any Mortgage to
which this Lease is now or hereafter subordinate shall provide, in effect,
that
during the time this Lease is in force insurance proceeds and any Restoration
Award shall be permitted to be used for restoration in accordance with the
provisions of this Lease.
(b) Notwithstanding
the provisions of Paragraph
16(a),
the
holder of any Mortgage to which this Lease is subject and subordinate shall
have
the right, at its sole option, at any time, to subordinate and subject the
Mortgage, in whole or in part, to this Lease by recording a unilateral
declaration to such effect, provided
that
such holder shall have agreed that during the time this Lease is in force any
insurance proceeds and any Restoration Award shall be permitted to be used
for
Restoration in accordance with the provisions of this Lease.
(c) At
any
time prior to the expiration of the Term, Tenant agrees, at the election and
upon demand of any owner of the Leased Premises, or of a Lender who has granted
non-disturbance to Tenant pursuant to Paragraph
16(a)
above,
to attorn, from time to time, to any such owner or Lender, upon the terms and
conditions of this Lease, for the remainder of the Term. The provisions of
this
Paragraph
16(c)
shall
inure to the benefit of any such owner or Lender, shall apply notwithstanding
that, as a matter of law, this Lease may terminate upon the foreclosure of
the
Mortgage, shall be self-operative upon any such demand, and no further
instrument shall be required to give effect to said provisions.
(d) Each
of
Tenant, Landlord and Lender agrees that, if requested by any of the others,
each
shall, without charge, enter into a Subordination, Non-Disturbance and
Attornment Agreement in substantially the form attached hereto as Exhibit
E
and
Tenant hereby agrees for the benefit of any
Lender
whose
name and address have been provided to Tenant
that
Tenant will not, (i) without in each case securing the prior written consent
of
such
Lender,
amend or modify this Lease or enter into any agreement with Landlord so to
do,
(ii) without the prior written consent of such
Lender
which may be withheld in its
sole
discretion, cancel or surrender or seek to cancel or surrender the Term hereof,
or enter into any agreement with Landlord to do so (the parties agreeing that
the foregoing shall not be construed to affect the rights or obligations of
Tenant, Landlord or Lender with respect to any termination permitted under
the
express terms hereof in connection with certain events of condemnation
or
casualty as
provided in Paragraph
13
or
Paragraph
14),
or (c)
pay any installment of Basic Rent more than one (1) month in advance of the
due
date thereof or otherwise than in the manner provided for in this
Lease.
(e) If
any
Person providing financing of Tenant’s personal property requires that Tenant
obtain a landlord’s waiver from Landlord, Landlord shall execute and deliver a
waiver substantially in the form attached hereto as Exhibit
D,
promptly after Tenant’s request therefor, provided that Tenant pay, or reimburse
Landlord for, all reasonable costs and expenses, including reasonable attorneys’
fees, incurred by Landlord in connection with such waiver.
17. Assignment,
Subleasing.
(a) Tenant
may assign its interest in this Lease to any Subsidiary of Lease Guarantor
and
may sublet the Leased Premises in whole or in part, from time to time, without
the consent of Landlord. Except for any right to place a Lien on its personal
property, Tenant shall have no rights to mortgage or otherwise hypothecate
its
leasehold interest under this Lease.
(b) Each
sublease of the Leased Premises or any part thereof shall (i) be subject and
subordinate to the provisions of this Lease, (ii) terminate on or prior to
the
Expiration Date, (iii) provide for rent payable monthly in advance and (iv)
not
permit payment of rent more than one month in advance. No assignment or sublease
shall (i) 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 or sublease
had been made or (ii) be to a tenant that would render the Leased Premises
or
any portion thereof a “tax-exempt use property” within the meaning of Section
168(h) of the Code or otherwise result in any adverse tax effect on Landlord.
Notwithstanding any assignment or subletting, Tenant shall continue to remain
primarily liable and responsible for the payment of the Basic Rent and
Additional Rent and the performance of all its other obligations under this
Lease. No assignment or sublease shall impose any obligations on Landlord under
this Lease except as otherwise provided in this Lease. Tenant agrees that in
the
case of an assignment of this Lease, Tenant shall, within fifteen (15) days
after the execution and delivery of any such assignment, deliver to Landlord
(i)
a duplicate original of such assignment in recordable form and (ii) an agreement
executed and acknowledged by the assignee in recordable form wherein the
assignee shall agree to assume and agree to observe and perform all of the
terms
and provisions of this Lease on the part of the Tenant to be observed and
performed from and after the date of such assignment. In the case of a sublease,
Tenant shall, within fifteen (15) days after the execution and delivery of
such
sublease, deliver to Landlord a duplicate original of such
sublease.
(c) In
the
event this Lease is terminated following the occurrence of an Event of Default,
Landlord shall have the right to collect and enjoy all rents and other sums
of
money payable under any sublease of any of the Leased Premises, and, upon such
event, Tenant shall be deemed to have irrevocably and unconditionally assigned
such rents and money to Landlord.
18. Permitted
Contests.
(a) So
long
as no Event of Default has occurred and is continuing, after prior written
notice to Landlord, Tenant shall not be required to (i) pay any Imposition,
(ii)
comply with any Legal Requirement, (iii) discharge or remove any Lien referred
to in Paragraph
9
or
12,
or (iv)
take any action with respect to any violation referred to in Paragraph
11(b)
so long
as Tenant shall contest, in good faith and at its expense, the existence, the
amount or the 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 (A) the collection of,
or
other realization upon, the Imposition or Lien so contested, (B) the sale,
forfeiture or loss of any of the Leased Premises, any Basic Rent or any
Additional Rent to satisfy the same or to pay any damages caused by the
violation of any such Legal Requirement or by any such violation, (C) any
interference with the use or occupancy of any of the Leased Premises, (D) any
interference with the payment of any Basic Rent or any Additional
Rent,
and
(E) the
cancellation of any fire or other insurance policy.
(b) In
no
event shall Tenant pursue any contest with respect to any Imposition, Legal
Requirement, Lien, or violation, referred to above in such manner that exposes
Landlord or Lender to (i) criminal liability, penalty or sanction, (ii) any
civil liability, penalty or sanction for which Tenant has not made provisions
reasonably acceptable to Landlord and Lender or (iii) defeasance of its interest
(including the subordination of the Lien of any Mortgage to a Lien to which
such
Mortgage is not otherwise subordinate prior to such contest) in the Leased
Premises.
(c) Tenant
agrees that each such contest shall be promptly and diligently prosecuted to
a
final conclusion, except that Tenant shall have the right to attempt to settle
or compromise such contest through negotiations. Tenant shall pay and save
Landlord harmless against any and all losses, judgments, decrees and costs
(including all attorneys’ fees and expenses) 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, costs and expenses thereof or in connection
therewith, and perform all acts the performance of which shall be ordered or
decreed as a result thereof.
19. Conditional
Limitations; Default Provisions.
(a) If
any
Event of Default shall have occurred, Landlord shall have the right at its
option, then or at any time thereafter, to do any one or more of the following
without demand upon or notice to Tenant:
(i) Landlord
may give Tenant notice of Landlord’s intention to terminate this Lease on a date
specified in such notice (which date shall be no sooner than ten (10) days
after
the date of the notice). Upon the date therein specified the Term and the estate
hereby granted and all rights of Tenant hereunder shall expire and terminate
as
if such date were the date hereinabove fixed for the expiration of the Term,
but
Tenant shall remain liable for all its obligations hereunder through the date
hereinabove fixed for the expiration of the Term, including its liability for
Basic Rent and Additional Rent as hereinafter provided.
(ii) Landlord
may, whether or not the Term of this Lease shall have been terminated pursuant
to clause
(i)
above
give Tenant notice to surrender the Leased Premises to Landlord on a date
specified in such notice (which date shall be no sooner than ten (10) days
after
the date of the notice), at which time Tenant shall surrender and deliver
possession of the Leased Premises to Landlord. Upon or at any time after taking
possession of the Leased Premises, Landlord may remove any persons or property
therefrom. Landlord shall be under no liability for or by reason of any such
entry, repossession or removal. No such entry or repossession shall be construed
as an election by Landlord to terminate this Lease unless Landlord gives a
written notice of such intention to Tenant pursuant to clause
(i)
above.
(iii) After
repossession of any of the Leased Premises pursuant to clause
(ii)
above,
whether or not this Lease shall have been terminated pursuant to clause
(i)
above,
Landlord may relet the Leased Premises or any part thereof to such tenant or
tenants for such term or terms (which may be greater or less than the period
which would otherwise have constituted the balance of the Term) for such rent,
on such conditions (which may include concessions or free rent) and for such
uses as Landlord, in its sole discretion, may determine; and Landlord shall
collect and receive any rents payable by reason of such reletting. The rents
received on such reletting shall be applied (A) first to the reasonable and
actual expenses of such reletting and collection, including without limitation
necessary renovation and alterations of the Leased Premises, reasonable and
actual attorneys’ fees and any reasonable and actual advertising costs and real
estate commissions paid, and (B) thereafter toward payment of all sums due
or to
become due to Landlord hereunder. If a sufficient amount to pay such expenses
and sums shall not be realized or secured, then Tenant shall pay Landlord any
such deficiency monthly, and Landlord may bring an action therefor as such
monthly deficiency shall arise. Landlord shall not, in any event, be required
to
pay Tenant any sums received by Landlord on a reletting of the Leased Premises
in excess of the rent provided in this Lease, but such excess shall reduce
any
accrued present or future obligations of Tenant hereunder. Landlord’s re-entry
and reletting of the Leased Premises without termination of this Lease shall
not
preclude Landlord from subsequently terminating this Lease as set forth above.
Landlord may make such Alterations as Landlord in its reasonable discretion
may
deem advisable. Tenant agrees to pay Landlord, as Additional Rent, immediately
upon demand, all reasonable expenses incurred by Landlord in obtaining
possession, in performing Alterations and in reletting any of the Leased
Premises, including fees and commissions of attorneys, architects, agents and
brokers, to the extent such expenses are not paid by the new
tenant.
(iv) If
Tenant
shall fail to make payment of any installment of Basic Rent or any Additional
Rent within five (5) days after the date when each such payment is due, Tenant
shall pay to Landlord, as Additional Rent, interest on the unpaid amount of
Basic Rent or Additional Rent, at the Default Rate, such interest to accrue
from
the date such item of unpaid Basic Rent or Additional Rent was due until the
date paid.
(v) Landlord
may exercise any other right or remedy now or hereafter existing by law or
in
equity.
(b) In
the
event of any expiration or termination of this Lease or repossession of any
of
the Leased Premises by reason of the occurrence of an Event of Default, Tenant
shall pay to Landlord all then accrued and unpaid Basic Rent and Additional
Rent
and, as liquidated damages, on the same schedule as if no such expiration,
termination or repossession had occurred, Basic Rent, Additional Rent and all
other sums required to be paid by Tenant through what would have been the Term
in the absence of such expiration, termination or repossession, less,
in
respect of each such payment, the net proceeds of any corresponding payments,
if
any, received by Landlord, as a result of its reletting the Leased Premises
pursuant to Paragraph
19(a)(iii),
after
deducting from such proceeds all of Landlord’s reasonable expenses in connection
with such reletting (including all reasonable repossession costs, brokerage
commissions, legal expenses, attorneys’ fees, employees’ expenses, costs of
Alteration and expenses of preparation for reletting). Tenant hereby agrees
to
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
limitation had there been no such Event of Default.
(c) At
any
time after such expiration or sooner termination of this Lease pursuant to
Paragraph
19
or
pursuant to law or if Landlord shall have reentered the Leased Premises, as
the
case may be, as an alternative to the remedy set forth in Section
19(b),
Landlord shall be entitled to recover from Tenant and Tenant shall pay to
Landlord, on demand, as and for liquidated and agreed final damages for Tenant’s
default, the amount by which the Basic Rent, and all Additional Rent reserved
hereunder for the unexpired portion of the Term, discounted to present worth
at
the annual rate of 8.22% exceeds the then fair and reasonable rental value
of
the Leased Premises for the same period, discounted to present worth at the
annual rate of 8.22%, minus any such monthly deficiencies previously recovered
from Tenant under Paragraph
19(a)(iii).
If any
statute or rule of law governing a proceeding in which such liquidated final
damages provided for in this Paragraph
19(c)
are to
be proved shall validly limit the amount thereof to an amount less than the
amount above agreed upon, Landlord shall be entitled to the maximum amount
allowable under such statute or rule of law.
20. Additional
Rights of Landlord and Tenant.
(a) No
right
or remedy conferred upon or reserved to Landlord in this Lease is intended
to be
exclusive of any other right or remedy; and each and every right and remedy
shall be cumulative and in addition to any other right or remedy contained
in
this Lease. No delay or failure by Landlord or Tenant to enforce its rights
under this Lease shall be construed as a waiver, modification or relinquishment
thereof. In addition to the other remedies provided in this Lease, Landlord
and
Tenant shall be entitled, to the extent permitted by applicable law, to
injunctive relief in case of the violation or attempted or threatened violation
of any of the provisions of this Lease, or to specific performance of any of
the
provisions of this Lease.
(b) Tenant
hereby waives and surrenders for itself and all those claiming under it,
including creditors of all kinds, 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.
(c) Landlord
hereby waives any right to distrain or levy upon Trade Fixtures or any property
of Tenant and any Landlord’s Lien or similar Lien upon Trade Fixtures and any
other property of Tenant regardless of whether such Lien is created or
otherwise.
(d) Landlord
acknowledges and agrees in the future to acknowledge (in a written form
reasonably satisfactory to Tenant and Landlord) to such persons and entities
at
such times and for such purposes as Tenant may reasonably request that the
Trade
Fixtures are Tenant’s property and not part of the Improvements (regardless of
whether or to what extent such Trade Fixtures are affixed to the Improvements)
or otherwise subject to the terms of this Lease.
(e) Tenant
agrees to pay to Landlord any and all reasonable costs and expenses incurred
by
Landlord in connection with any litigation or other action instituted by
Landlord to enforce the obligations of Tenant under this Lease, to the extent
that Landlord has prevailed in any such litigation or other action. Any amount
payable by Tenant to Landlord pursuant to this Paragraph
20(e)
shall be
due and payable by Tenant to Landlord as Additional Rent within thirty (30)
days
after a final, non-appealable judgment or decision is rendered in favor of
Landlord, or a settlement is entered into, in connection with such litigation
or
other action.
(f) Landlord
agrees to pay to Tenant any and all reasonable costs and expenses incurred
by
Tenant in connection with any litigation or other action instituted by Tenant
to
enforce the obligations of Landlord under this Lease, to the extent that Tenant
has prevailed in any such litigation or other action. Any amount payable by
Landlord to Tenant pursuant to this Paragraph
20(f)
shall be
due and payable within thirty (30) days after a final, non-appealable judgment
or decision is rendered in favor of Tenant in such litigation or other
action.
21. Notices.
All
Notices shall be in writing and shall be deemed to have been given for all
purposes (i) three (3) days after having been sent by United States mail, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to the other party at its address as stated below, or (ii) one (1)
day
after having been sent for overnight delivery by Federal Express, United Parcel
Service or other nationally recognized air courier service.
To
the
Addresses stated below:
| |
If
to Landlord:
|
| |
|
|
| |
|
c/o
SunTrust Equity Funding, LLC
|
| |
|
303
Peachtree Street, 24th
Floor
|
| |
|
MC
3951
|
| |
|
Atlanta,
Georgia 30308
|
| |
|
Attention:
Allison
McLeod
|
| |
|
Facsimile:
(404) 230-1344
|
| |
|
|
| |
With
a copy to:
|
| |
|
|
| |
|
Greenberg
Traurig, LLP
|
| |
|
77
West Wacker Drive, Suite 2500
|
| |
|
Chicago,
Illinois 60601
|
| |
|
Attention:
Julia R. Sarron
|
| |
|
Facsimile:
(312) 899-0396
|
| |
|
|
| |
If
to Tenant:
|
| |
|
|
| |
|
Covenant
Transport, Inc
|
| |
|
400
Birmingham Highway
|
| |
|
Chattanooga,
Tennessee 37419
|
| |
|
Attention:
Joey B. Hogan
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Facsimile:
(423) 821-5442
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With
a copy to:
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Scudder
Law Firm, P.C., L.L.O.
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411
S. 13th
Street
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Lincoln,
Nebraska 68508
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Attention:
Mark Scudder
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Facsimile:
(402) 435-4239
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If
any
Lender shall have advised Tenant by Notice in the manner aforesaid that it
is
the holder of a Mortgage and states in said Notice its address for the receipt
of Notices, then simultaneously with the giving of any Notice by Tenant to
Landlord, Tenant shall send a copy of such Notice to Lender in the manner
aforesaid. For the purposes of this Paragraph 21,
any
party may substitute its address by giving fifteen (15) days’ notice to the
other party in the manner provided above. Any Notice may be given on behalf
of
any party by its counsel.
22. Estoppel
Certificates.
Landlord
and Tenant shall at any time and from time to time, upon not less than five
(5)
days’ prior written request by the other, execute, acknowledge and deliver to
the other a statement in writing, in substantially the form of Exhibit C hereto
certifying (i) that this Lease is unmodified and in full effect (or, if there
have been modifications, that this Lease is in full effect as modified, setting
forth such modifications), (ii) the dates to which Basic Rent payable hereunder
has been paid, (iii) that to the knowledge of the signer of such certificate
no
default by either Landlord or Tenant exists hereunder or specifying each such
default of which the signer may have knowledge, (iv) the remaining Term hereof,
(v) with respect to a certificate signed on behalf of Tenant, that to the
knowledge of the signer of such certificate, there are no proceedings pending
or
threatened against Tenant before or by any court or administrative agency which
if adversely decided would materially and adversely affect the financial
condition and operations of Tenant or if any such proceedings are pending or
threatened to said signer’s knowledge, specifying and describing the same , and
(vi) such other matters as may reasonably be requested by the party requesting
the certificate. It is intended that any such statements may be relied upon
by
Lender, the recipient of such statements or their assignees or by any
prospective purchaser, assignee or subtenant of the Leased Premises or of the
membership interest in Landlord. Landlord and Tenant agree that the requesting
party shall be responsible to reimburse the other party for all reasonable
out-of-pocket expenses incurred by such party in connection with preparing
and
delivering the requested estoppel certificate.
23. Surrender
and Holding Over.
(a) Upon
the
expiration or earlier termination of this Lease, Tenant shall peaceably leave
and surrender the Leased Premises to Landlord. Tenant shall remove from the
Leased Premises on or prior to such expiration or earlier termination the Trade
Fixtures and personal property which is owned by Tenant or third parties other
than Landlord, and Tenant at its expense shall, on or prior to such expiration
or earlier Termination, repair any damage caused by such removal. Trade Fixtures
and personal property not so removed at the end of the Term or within thirty
(30) days after the earlier termination of the Term for any reason whatsoever
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 borne by Tenant. Landlord shall not
in
any manner or to any extent be obligated to reimburse Tenant for any property
which becomes the property of Landlord as a result of such expiration or earlier
termination.
(b) Any
holding over by Tenant of the Leased Premises after the expiration or earlier
termination of the Term of this Lease or any extensions thereof, with the
consent of Landlord, shall operate and be construed as tenancy from month to
month only, at one hundred twenty-five percent (125%) of the Basic Rent reserved
herein and upon the same terms and conditions as contained in this Lease.
Notwithstanding the foregoing, any holding over without Landlord’s consent shall
entitle Landlord, in addition to collecting Basic Rent at a rate of one hundred
twenty-five percent (125%) thereof, to exercise all rights and remedies provided
by law or in equity, including the remedies of Paragraph
19(b).
24. No
Merger of Title.
There
shall be no merger of this Lease nor of the leasehold estate created by this
Lease with the fee estate in or ownership of any of the Leased Premises by
reason of the fact that the same person, corporation, firm or other entity
may
acquire or hold or own, directly or indirectly, (a) this Lease or the leasehold
estate created by this Lease or any interest in this Lease or in such leasehold
estate and (b) the fee estate or ownership of any of the Leased Premises or
any
interest in such fee estate or ownership. No such merger shall occur unless
and
until all Persons, corporations, firms and other entities having any interest
in
(i) this Lease or the leasehold estate created by this Lease and (ii) the fee
estate in or ownership of the Leased Premises or any part thereof sought to
be
merged shall join in a written instrument effecting such merger and shall duly
record the same.
25. Definition
of 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 Landlord’s interest in the Leased Premises and shall not be enforced
against the Landlord, or any member, beneficiary or shareholder of Landlord,
individually or personally.
(b) The
term
“Landlord”
as
used
in this Lease so far as covenants or obligations on the part of Landlord are
concerned, shall be limited to mean and include only the owner or owners of
the
Leased Premises or holder of the Mortgage in possession at the time in question
of the Leased Premises and in the event of any transfer or transfers of the
title of the Leased Premises, the Landlord herein named (and in case of any
subsequent transfers or conveyances, the then grantor) shall be automatically
freed and relieved from and after the date of such transfer and conveyance
of
all personal liability as respects the performance of any covenants or
obligations on the part of Landlord contained in this Lease thereafter to be
performed.
26. Hazardous
Substances.
(a) Tenant
agrees that it will not on, about, or under the Leased Premises, make, store,
release, treat or dispose of any Hazardous Materials; but the foregoing shall
not prevent the use,
storage
or existence
of any
hazardous substances in the ordinary course of Tenant’s business in accordance
with applicable laws and regulations and at levels that do not impose any clean
up liability or obligation. Tenant agrees that it will at all times comply
with
all Environmental Laws.
(b) To
the
extent required by any Environmental Laws, Tenant shall remove any Hazardous
Materials whether now or hereafter existing on the Leased Premises and whether
or not arising out of or in any manner connected with Tenant’s occupancy of the
Leased Premises during the Term.
(c) The
Tenant agrees that it will not install any underground storage tank at the
Leased Premises without specific, prior written approval from the Landlord.
27. Entry
by Landlord.
Landlord, Lender and their respective authorized representatives shall have
the
right upon reasonable notice (which shall be not less than two (2) Business
Days
except in the case of emergency) to enter the Leased Premises at all reasonable
business hours (and at all other times in the event of an emergency): (a) for
the purpose of inspecting the same, for the purpose of conducting an
environmental audit of the Leased Premises or for the purpose of doing any
work
under Paragraph 11(c), and may take all such action thereon as may be necessary
or appropriate for any such purpose (but nothing contained in this Lease or
otherwise shall create or imply any duty upon the part of Landlord to make
any
such inspection or do any such work), and (b) for the purpose of showing the
Leased Premises to prospective purchasers of the Leased Premises or the
membership interests in Landlord and mortgagees and, at any time within twelve
(12) months prior to the expiration of the Term of this Lease, for the purpose
of showing the same to prospective tenants. No such entry shall constitute
an
eviction of Tenant but any such entry shall be done by Landlord in such
reasonable manner as to minimize any disruption of Tenant’s business
operation.
The
costs and expenses of any such inspection pursuant to clause (b) of this
Paragraph 27 shall be borne by Landlord or Lender, as the case may
be.
28. No
Usury.
The
intention of the parties being to conform strictly to the applicable usury
laws,
whenever any provision herein provides for payment by Tenant to Landlord of
interest at a rate in excess of the legal rate permitted to be charged, such
rate herein provided to be paid shall be deemed reduced to such legal
rate.
29. Financial
Statements.
Tenant
shall submit, or cause Lease Guarantor to submit, to Landlord and Lender, either
in print or in electronic form, the following financial statements, all of
which
must be prepared in accordance with generally accepted accounting principles
consistently applied: (i) quarterly financial statements for Lease
Guarantor, within sixty
(60)
days
after the end of each fiscal
quarter during
the Term, certified by the chief financial officer or chief accounting officer
of Lease Guarantor, and (ii) annual financial statements for Lease
Guarantor, audited by an independent certified public accountant reasonably
acceptable to Landlord, within one hundred twenty (120) days after the end
of
each fiscal year during the Term. In the event that
Lease
Guarantor is, or shall become, a publicly listed company and is required to
file
quarterly and annual statements with the SEC, then Tenant shall submit, or
cause
Lease Guarantor to submit, to Landlord and Lender, when filed with the SEC,
copies of Lease Guarantor’s forms
10Q
and 10K. Notwithstanding the foregoing, Tenant shall not be required to submit
any such forms or financial statements if on or before the applicable delivery
date, such financial statements are available on EDGAR or on the Lease
Guarantor’s website.
30. Special
Tax Indemnity.
(a) Tenant
hereby represents, warrants and covenants to Landlord as follows:
(i)
neither the Leased Premises as a whole nor the Fixtures constitutes “limited use
property”
within
the meaning of Revenue Procedure 2001-28, 2001-19 I.R.B. 1156; (ii) at no time
during the Term will the Leased Premises or any portion thereof constitute
“tax-exempt use property” within the meaning of Section 168(h) of the Code in
effect as of the date of this Lease; (iii) neither Tenant nor any Affiliate
will
claim any depreciation or cost recovery deductions after the date hereof with
respect to the Leased Premises or any portion thereof, or has taken or will
take
any other action in connection with filing its or their federal income tax
returns that would be a primary factor resulting in a Loss or Inclusion (in
each
case, as defined in Paragraph
30(b)
below);
(iv) as of the Commencement Date hereof with respect to the Improvements and
Fixtures, such Leased Premises will not require any improvement, modification
or
addition in order to be rendered complete for its intended use by Tenant; and
(v) all written information supplied, caused to be supplied or to be supplied
to
any appraiser by or on behalf of Tenant or any Affiliate of Tenant with respect
to the Leased Premises or any portion thereof was or will be, as the case may
be, true and accurate when supplied.
(b) If,
by
reason of any act or omission of Tenant or by any other Person in possession
of
the Leased Premises or any portion thereof or by reason of the inaccuracy or
breach by Tenant of any of the representations, warranties and covenants
contained in this Paragraph
30,
any
anticipated depreciation deductions are lost, disallowed, eliminated, reduced,
recaptured, compromised, delayed or otherwise made unavailable to Landlord
(a
“Loss”)
or
Landlord incurs a tax detriment because Landlord is required to include amounts
in income other than Anticipated Lease Income (an “Inclusion”),
Tenant shall, upon notice from Landlord promptly pay such Person designated
by
Landlord on demand in immediately available funds, as an indemnity an amount
which, on an After-Tax Basis, shall be equal to the sum of (x) the increase
in
federal, state, local and foreign income tax liability for the respective
taxable year attributable to such Loss or Inclusion plus (y) the amounts of
interest, penalties and additions to tax (including, without limitation, any
additions to tax because of underpayment of estimated tax), which are assessed
against Landlord for such taxable year by the Internal Revenue Service or any
relevant state, local or foreign taxing authority and which are attributable
to
such Loss or Inclusion.
(c) Landlord
shall notify Tenant in writing of any actual or proposed claim, adjustment
or
other action of any tax authority received by Landlord in writing with respect
to which Tenant may be required to provide indemnification under this
Paragraph
30
(“Proposed
Adjustment”)
(but
failure of Landlord to so notify Tenant shall not relieve Tenant of its
obligations hereunder except to the extent that Tenant is precluded from any
contest and actually and materially harmed thereby). If Tenant shall request
in
writing within thirty (30) days after Landlord’s notice described above that the
Proposed Adjustment be contested (or such shorter period in which the Landlord
may be required to take action), Landlord shall contest the Proposed Adjustment;
provided,
however,
that:
(i) prior to taking such action, Tenant shall have furnished Landlord with
an
opinion of independent tax advisor chosen by Tenant and reasonably acceptable
to
Landlord, to the effect that Landlord has a reasonable possibility of success
in
contesting the claim; (ii) prior to taking such action, Tenant shall have (A)
acknowledged its obligation to indemnify Landlord hereunder in the event
Landlord does not prevail in such contest and (B) agreed to reimburse Landlord
promptly on demand for (or, if so requested by Landlord, advance) all costs
and
expenses that Landlord may incur in connection with contesting such claim,
including without limitation reasonable attorneys’ and accountants’ fees and
expenses; (iii) no Event of Default shall exist and be continuing; (iv) Landlord
shall not be obligated to contest any proposed amount that is less than
$25,000.00; and (v) Landlord shall in all events control the contest, and Tenant
shall not have any right to inspect the books and records of Landlord, but
shall
have reasonable opportunity to review and comment on portions of documentation,
protests, memoranda or briefs relating exclusively to a Proposed Adjustment.
In
the event Landlord pays the tax claimed and then seeks a refund, Landlord may
require Tenant to advance funds sufficient to pay the tax that would be
indemnified by Tenant hereunder if the refund claim were resolved adversely
to
Landlord. To the extent the refund claim is successful, the refund received
from
the taxing authority and attributable to funds advanced by Tenant shall be
refunded to Tenant, unless the refund is needed to pay an indemnity.
Notwithstanding anything to the contrary in this Paragraph
30(c),
Landlord may at any time decline to take any further action with respect to
a
Proposed Adjustment or may settle any contest without the consent of Tenant;
provided,
however,
that if
Tenant has complied with all the terms of this Paragraph
30(c),
and
Tenant has reasonably withheld in writing its consent to all or part of such
assessment or settlement based upon its evaluation of the merits, Tenant will
not be obligated to indemnify Landlord for the portion of such assessment or
settlement to which Tenant has reasonably withheld its consent. In the case
of
any flow-through entity, “Landlord” shall include the member or other equity
owners of Landlord required to report the gross or net income of Landlord and/or
other items of income, expense, deduction and credit with respect thereto,
and
“Landlord” and the owners thereof shall include the consolidated group of which
any such Person is a part for income tax purposes.
(d) Tenant
(or its designated beneficiary) is authorized and will control the ad valorem
real property tax valuation process. This includes the right to examine records,
obtain all tax statements and discuss or appeal any tax assessments to the
proper authorities. All trim notices and notices of valuation will be either
sent directly to Tenant from the tax assessor or will be promptly forwarded
to
Tenant by Landlord.
(e) Notwithstanding
anything herein to the contrary, the provisions of this Paragraph 30
shall
survive the earlier termination of this Lease.
31. Withholdings.
(a) Notwithstanding
anything herein to the contrary, Tenant agrees that each payment of Basic Rent
and Additional Rent shall be free and clear of, and without deduction for any
withholdings of any nature whatsoever unless required by Applicable Law. If
any
deduction or withholding is required with respect to a payment of Basic Rent
and/or Additional Rent by Tenant, Tenant shall pay an additional amount such
that the net amount actually received by the Tax Indemnitee, after deduction
or
withholding, will be equal, on an After-Tax Basis, to all such amounts that
would be received by the Tax Indemnitee if no such deduction or withholding
had
been required; provided, that the Tenant shall not be obligated to pay any
additional amount pursuant to this Paragraph
31
if the
requirement to make such payment is solely due to the failure of a Tax
Indemnitee to comply with Paragraph
30(c)
to
obtain relief or exemption from such withholding.
(b) Notwithstanding
anything herein to the contrary, the provisions of this Paragraph 31
shall
survive the earlier termination of this Lease.
32. Representations.
Tenant
represents and warrants to Landlord and the Lenders as follows:
(a) Existence
and Standing.
Tenant
is a corporation duly and properly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation and in the
jurisdiction where the Leased Premises is located and has all requisite
authority to conduct its business in each jurisdiction in which its business
is
conducted.
(b) Authorization
and Validity.
Tenant
has the power and authority and legal right to execute and deliver this Lease
and to perform its obligations hereunder. The execution and delivery by Tenant
of this Lease and the performance of its obligations hereunder have been duly
authorized by proper corporate or other proceedings, and this Lease constitutes
legal, valid and binding obligations of Tenant enforceable against Tenant in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors’
rights generally.
(c) No
Conflict.
The
execution, delivery and performance by Tenant of this Lease and the transactions
contemplated hereby do not and will not (i) violate any Law or the
organizational documents of Tenant or any agreement, indenture or other contract
to which Tenant is a party or is subject, (ii) result in or require the creation
or imposition of any Lien whatsoever on the Leased Premises or upon any of
the
properties or assets of Tenant, or (iii) require any approval of stockholders
which has not been obtained and is in full force and effect.
(d) Governmental
Consents.
Except
as have been made, obtained or given, and are in full force and effect, no
filing or registration with, consent or approval of, or notice to, with or
by
any Governmental Authority, is required to authorize, or is required in
connection with, the execution, delivery and performance by Tenant of this
Lease
or the legality, validity, binding effect or enforceability of this
Lease.
(e) Governmental
Regulation.
Neither
Tenant nor any Subsidiary of Tenant is an “investment company” or a company
“controlled” by an “investment company”, within the meaning of the Investment
Company Act of 1940, as amended.
(f) Requirements
of Law.
Tenant
and each Subsidiary of Tenant and each Person acting on behalf of any of them
is
in compliance with all Legal Requirements applicable to them and their
respective businesses to the extent the failure to be in such compliance has
had, or could have, a material adverse effect on Tenant’s financial condition,
operations, assets or prospects, or Tenant’s ability to perform its obligations
under this Lease.
(g) Hazardous
Materials.
(i) To
the
best knowledge of Tenant, there are no Hazardous Materials present at, upon,
under or within the Leased Premises or released or transported to or from the
Leased Premises (except for Hazardous Materials that are present in the ordinary
course of Tenant’s business on the Leased Premises in full compliance with all
Legal Requirements), except as set forth in that certain Phase I Environmental
Assessment of the Leased Premises obtained by Landlord on or prior to the
Commencement Date.
(ii) No
governmental actions have been taken or are in process or, to the Tenant’s
actual knowledge, have been threatened, which could reasonably be expected
to
subject the Leased Premises or any Indemnitee to any Claims or Liens under
any
Environmental Law which would have a materially adverse effect on such
Indemnitee or the Leased Premises.
(iii) Tenant
has, or will obtain on or before the date required by Law, all environmental
permits necessary to operate the Leased Premises in accordance with
Environmental Laws and, to the best knowledge of Tenant, is complying with
and
has at all times complied with all such environmental permits.
(iv) To
the
best of Tenant’s knowledge, no material notice, notification, demand, request
for information, citations, summons, complaint or order has been issued or
filed
to or with respect to Tenant, no penalty has been assessed on Tenant and no
investigation or review is pending or threatened by any Governmental Authority
or other Person in each case relating to the Leased Premises with respect to
any
alleged material violation or liability of Tenant under any Environmental Law.
To the best of Tenant’s knowledge, no material notice, notification, demand,
request for information, citations, summons, complaint or order has been issued
or filed to or with respect to any other Person, no material penalty has been
assessed on any other Person and no investigation or review is pending or
threatened by any Governmental Authority or other Person relating to the Leased
Premises with respect to any alleged material violation or liability under
any
Environmental Law by any other Person.
(v) To
the
best of Tenant’s knowledge, the Leased Premises and each portion thereof are
presently in compliance in all material respects with all Environmental Laws,
and there are no present or past facts, circumstances, activities, events,
conditions or occurrences regarding the Leased Premises (including without
limitation the release or presence of Hazardous Materials) that could reasonably
be anticipated to (A) form the basis of a material Claim against the Leased
Premises, any Indemnitee or Tenant, (B) cause the Leased Premises to be subject
to any restrictions on ownership, occupancy, use or transferability under any
Environmental Law, (C) require the filing or recording of any notice or
restriction relating to the presence of Hazardous Materials in the real estate
records in the county or other appropriate municipality in which the Leased
Premises is located, or (D) prevent or interfere with the continued operation
and maintenance of the Leased Premises as contemplated by this
Lease.
(h) Leased
Premises.
To the
best of Tenant’s knowledge, the present condition and use of the Leased Premises
conforms in all material respects with all conditions or requirements of all
existing permits and approvals issued with respect to the Leased Premises,
and,
to the best of Tenant’s knowledge, the present use of each Leased Premises does
not, in any material respect, violate any Law. To the best of Tenant’s
knowledge, no material notices, complaints of orders or violation or
non-compliance have been issued or threatened or contemplated by any
Governmental Authority with respect to the Leased Premises or any present or
intended future use thereof. To the best of Tenant’s knowledge, all agreements,
easements and other rights, public or private, which are necessary to permit
the
lawful use and operation of the Leased Premises
as Tenant intends to use the Leased Premises under this Lease and which are
necessary to permit the lawful intended use and operation of all presently
intended utilities, driveways, roads and other means of egress and ingress
to
and from the same have been, or will be, obtained and are in full force and
effect, and Tenant has no knowledge of any pending modification or cancellation
of any of the same.
33. Duty
of
First Offer.
(a) Except
in
transactions consummated prior to the second (2nd)
anniversary of the Commencement Date, Landlord shall not at any time during
the
Term sell or convey or agree to sell or convey the Leased Premises (except
to
SunTrust Banks, Inc. or any Affiliate thereof) without first having complied
with the requirements of this Paragraph
33.
Provided that no Event of Default exists or has occurred and is continuing,
if
Landlord shall desire to sell or convey the Leased Premises, then Landlord
shall
submit a written offer to sell the Leased Premises to Tenant setting forth
the
price and terms of such proposed sale (the “Offer”)
to
Tenant and shall give Tenant thirty (30) days within which to elect to purchase
the Leased Premises on the precise terms and conditions of the Offer (except
that if the Offer shall be in whole or in part for consideration other than
cash, Tenant shall have the right to pay in cash the fair market value of such
non-cash consideration). If Tenant elects to so purchase the Leased Premises
Tenant shall give to Landlord written notice thereof (“Acceptance
Notice”)
and
the closing shall be held within sixty (60) days after the date of the
Acceptance Notice, whereupon Landlord shall convey the Leased Premises to
Tenant. At the closing Landlord shall deliver to Tenant a special warranty
deed
(or local equivalent), sufficient to convey to Tenant fee simple title to the
Leased Premises free and clear of all Liens, restrictions and encumbrances,
except for the Permitted Encumbrances, Liens or encumbrances created, suffered
or consented to in writing by Tenant or arising by reason of the failure of
Tenant to have observed or performed any term, covenant or agreement herein
to
be observed or performed by Tenant, the Lien of any Impositions then affecting
the Leased Premises, this Lease and, if the Leased Premises are to be conveyed
subject to the outstanding balance of the Loan, the Mortgage and all other
Loan
documents. In the event Tenant shall elect not to so purchase the Leased
Premises, Landlord may thereafter sell the Leased Premises to any party without
offering it to Tenant, provided
that (i)
the purchase price shall not be less than 95% of that set forth in the Offer,
(ii) the material terms of such purchase shall not be substantially more
favorable to the buyer than those set forth in the Offer and (iii) the purchase
is consummated within eighteen (18) months after Landlord’s submission of the
Offer to Tenant.
(b) Notwithstanding
anything to the contrary herein, the provisions of this Paragraph 33
shall
not apply to (i) any sale or conveyance of the Leased Premises in foreclosure
sale (or similar proceeding) of a bona-fide mortgage or deed of trust or to
any
conveyance in lieu of foreclosure of such a mortgage or deed of trust, or to
any
transfer subsequent to a foreclosure sale or deed in lieu thereof in connection
with the requirements of Standard & Poor’s, Moody’s or any other Rating
Agencies if the Loan is securitized, (ii) any sale or conveyance of the Leased
Premises which occurs during the existence of an Event of Default hereunder,
or
(iii) any sale, transfer, assignment or pledge of the beneficial ownership
interest, membership interest, partnership interest or other equity interest
in
Landlord, or the change of the manager or other controlling person of the
Landlord, or any transfer, sale or other disposition of the Leased Premises
to
SunTrust Banks, Inc. or any Affiliate thereof.
(c) If
Landlord sells the Leased Premises (to Tenant or anyone else) Tenant hereby
acknowledges and consents as follows: (i) any such sale or conveyance during
any
period in which the Loan may not be prepaid or defeased, as the case may be,
shall be subject to the outstanding balance of the Loan (and the purchase price
payable to Landlord shall take into account such outstanding balance), and,
if
Tenant shall be entitled to, and shall, exercise its rights under this
Paragraph
33,
the
Loan, Note, Mortgage and other Loan documents will be assumed by Tenant, and
the
Lien of the Mortgage may not be released during such period; (ii) such sale
shall be in accordance with and subject to the terms and provisions of the
Note,
the Mortgage and the other Loan Documents, whether such purchase contemplates
the purchase of the Leased Premises subject to the Lien of the Mortgage or
for a
release of the Lien of the Mortgage; and (iii) if the Lien of the Mortgage
is
not released in connection with such sale of the Leased Premises, Tenant shall
acquire the Leased Premises through another entity, no merger of title shall
occur and this Lease and any guaranty of this Lease will remain in full force
and effect in accordance with their terms.
(d) If
Tenant
shall have agreed to purchase the Leased Premises at a time when the Loan may
be
prepaid or defeased, as the case may be, Tenant may purchase the Leased Premises
for cash free and clear of the Mortgage but only if (i) the cash portion of
the
Offer is increased by an amount equal to the principal and interest secured
by
the Mortgage, and (ii) Tenant pays (in addition to the purchase price) all
prepayment premiums or defeasance deposits, yield maintenance amounts,
satisfaction fees and any and all other sums which become owing as a result
of
such prepayment or defeasance, as the case may be; all to the end and effect
that Landlord will net the same amount as Landlord would have netted had the
Leased Premises been sold under and subject to the Lien of the
Mortgage.
34. Separability.
Each
and every covenant and agreement contained in this Lease is, and shall be
construed to be, a separate and independent covenant and agreement, and the
breach of any such covenant or agreement by Landlord shall not discharge or
relieve Tenant from its obligation to perform the same. If any term or provision
of this Lease or the application thereof to any provision of this Lease or
the
application thereof to any Person or circumstances shall to any extent be
invalid and unenforceable, the remainder of this Lease, or the application
of
such term or provision to such Person or circumstances other than those as
to
which it is invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Lease shall be valid and shall be enforced to the
extent permitted by law.
35. 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 as the context requires
and
the following words and phrases shall have the following meanings: (i)
“including” shall mean “including but not limited to”; (ii) “provisions” shall
mean “provisions, terms, agreements, covenants and/or conditions”; and (iii)
“obligation” shall mean “obligation, duty, agreement, liability, covenant or
condition”.
(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. Any act which Tenant is required to perform under this Lease shall
be
performed at Tenant’s sole cost and expense.
(d) This
Lease may be modified, amended, discharged or waived only by an agreement in
writing
signed by both
parties hereto.
(e) The
covenants of this Lease shall run with the Land and bind Tenant, the successors
and assigns of Tenant and all present and subsequent encumbrances and subtenants
of any of the Leased Premises, and shall inure to the benefit of and bind
Landlord, its successors and assigns.
(f) This
Lease will be simultaneously executed in several counterparts, each of which
when so executed and delivered shall constitute an original, fully enforceable
counterpart for all purposes.
(g) This
Lease shall be governed by and construed according to the laws of the State
in
which the Leased Premises is located.
IN
WITNESS WHEREOF, Landlord and Tenant have caused this instrument to be executed
as of the day and year first above written.
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CT
CHATTANOOGA TN, LLC, as Landlord
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By:
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SunTrust
Equity Funding, LLC, its Manager
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By:
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/s/
R. Todd Shutley |
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Name:
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R.
Todd Shutley
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Title:
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Senior
Vice President and
Manager
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COVENANT
TRANSPORT, INC., a Tennessee corporation,, as Tenant
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By:
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/s/
Joey B. Hogan |
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Name:
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Joey
B. Hogan |
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Title:
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EVP/CFO |
EXHIBIT
A
Legal
Description
Legal
Description of the Property Omitted
EXHIBIT
B
Basic
Rent for (i) the period from the Commencement Date to March 31, 2007 shall
be at
the annual amount equal to $2,466,000 and (ii) for each subsequent year
(including during any Renewal Term) shall be at an annual amount equal to the
sum of (A) the annual Basic Rent for the immediately preceding year plus (B)
the
Adjustment Amount for such year. The amount of Basic Rent shall be adjusted
pursuant to the foregoing sentence as of each April 1st. The “Adjustment
Amount”
any
year shall be an amount equal to the annual Basic Rent for the immediately
preceding year, times
1%.
The
Basic
Rent payable on any Basic Rent Payment Date shall be one-twelfth of the then
annual rent calculated pursuant to the foregoing paragraph.
EXHIBIT
C
Form
of Tenant Estoppel
Form
of Tenant Estoppel Omitted
EXHIBIT
D
Form
of Landlord
Waiver
Form
of Landlord Waiver
Omitted
EXHIBIT
E
Form
of Subordination, Non-Disturbance and Attornment Agreement
Form
of Subordination, Non-Disturbance and Attornment Agreement
Omitted
APPENDIX
A
“Additional
Rent”
shall
mean all amounts, costs, expenses, liabilities and obligations (including
Tenant’s obligation to pay any Net Award, Default Rate interest or late charges
or penalties hereunder) which Tenant is required to pay pursuant to the terms
of
this Lease other than Basic Rent.
“Adjoining
Property”
shall
mean all sidewalks, curbs, gores and vault spaces adjoining the Leased
Premises.
“Affiliate”
of
any
Person shall mean any other Person directly or indirectly controlling,
controlled by or under common control with, such Person and shall include,
if
such Person is an individual, members of the immediate family of such Person,
and trusts for the benefit of such individual. For the purposes of this
definition, the term “control”
(including the correlative meanings of the terms “controlling”, “controlled by”
and “under common control with”), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
“After
-Tax Basis”
shall
mean, with respect to any payment received or accrued by any Person, the amount
of such payment (the “base
payment”)
supplemented by a further payment (the “additional
payment”)
to
that Person so that the sum of the base payment plus the additional payment
shall, after taking into account the amount of all Taxes required to be paid
by
such Person in respect of the receipt or accrual of the base payment and the
additional payment (after any current credits or deductions arising therefrom
and the timing thereof), be equal to the amount required to be received. Such
calculations shall be made (a) in the case of entities subject to United States
Federal income tax, at the highest marginal United States federal, state and
local income tax rates applicable to individuals or corporations (as the case
may be) resident or domiciled in the jurisdiction where the recipient of such
payment is located (or where the recipient indicates such payment will be
required to be reported, if different); (b) in the case of an organization
exempt from United States Federal income tax, at the highest marginal United
States federal, state and local tax rates applicable to unrelated business
taxable income (or any tax that is a supplement or addition to or substitute
for
or in lieu thereof, whether or not expressly so designated), but only if the
payments with respect to the Leased Premises are subject to such tax or (c)
if
Landlord is not a US taxpayer, at Landlord’s actual effective overall tax rate,
if lower. In the case of any flow-through entity, “Landlord” shall include the
direct or indirect members or other equity owners of Landlord that are required
to report the gross or net income of Landlord and/or other items of income,
expense, deduction and credit with respect thereto, and in the case of any
entity, “Landlord” and the owners thereof shall include any consolidated,
combined or unitary group of which Landlord is a part for income tax
purposes.
“Alteration”
or
“Alterations”
shall
mean any or all changes, additions (whether or not adjacent to or abutting
any
then existing buildings), expansions (whether or not adjacent to or abutting
any
then existing buildings), improvements, reconstructions, removals or
replacements of any of the Improvements or Fixtures, both interior or exterior,
and ordinary and extraordinary.
“Anticipated
Lease Income”
shall
mean the amounts expected to be included in gross income with respect to this
Lease including only (i) Basic Rent and Additional Rent, (ii) payments as a
consequence of a sale or other disposition (other than in the case of the
exercise of remedies after an Event of Default) of the Leased Premises, and
(iii) an amount received pursuant to the indemnity set forth in Paragraph
30.
“Applicable
Laws”
shall
mean all existing and future applicable laws (including common laws), rules,
regulations, statutes, treaties, codes, ordinances, permits, certificates,
orders and licenses of any Governmental Authorities, and applicable judgments,
decrees, injunctions, writs, orders or like action of any court, arbitrator
or
other administrative, judicial or quasi-judicial tribunal or agency of competent
jurisdiction (including those pertaining to the environment and those pertaining
to the construction, use or occupancy of the Leased Premises). Applicable Laws
shall include Environmental Laws.
“Basic
Rent”
shall
mean the amounts set forth on Exhibit
B
annexed
to this Lease.
“Basic
Rent Payment Dates”
shall
mean the first day of each calendar month during the Term, or, if such day
is
not a Business Day, the next succeeding Business Day.
“Business
Day”
means
any day other than a Saturday or a Sunday, or any other day on which banks
are
required or authorized to be closed for business in Atlanta, Georgia or
Chattanooga, Tennessee.
“CERCLA”
shall
mean the Comprehensive Environmental Response, Compensation and Liability Act,
as amended by the Superfund Amendments and Reauthorization Act of 1986, 42
U.S.C. §§ 9601-9657.
“Claims”
shall
mean Liens (including, without limitation, Lien removal and bonding costs)
liabilities, obligations, damages, losses, demands, penalties, assessments,
payments, fines, claims, actions, suits, judgments, settlements, costs, expenses
and disbursements (including, without limitation, reasonable legal fees and
expenses and costs of investigation) of any kind and nature
whatsoever.
“Code”
shall
mean the Internal Revenue Code of 1986, as amended from time to
time.
“Commencement
Date”
shall
mean April 3, 2006.
“Condemnation”
shall
mean a Taking and/or a Requisition.
“Default
Rate”
shall
mean a rate of interest equal to four (4%) percent per annum above the then
current Prime Rate.
“Easements”
shall
mean easements, covenants, waivers, approvals or restrictions for utilities,
parking or other matters as desirable for operation of the Leased Premises
or
properties adjacent thereto.
“Environmental
Laws”
shall
mean and include the Resource Conservation and Recovery Act of 1976 (RCRA),
42
U.S.C. §§ 6901-6987, as amended by the Hazardous and Solid Waste Amendments of
1984, CERCLA, the Hazardous Materials Transportation Act of 1975, 49 U.S.C.
§§
1801-1812, the Toxic Substances Control Act, 15 U.S.C. §§ 2601-2671, the Clean
Air Act, 42 U.S.C. §§ 7401 et seq., the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. §§ 136 et seq and all other federal, state and local
laws, ordinances, rules, orders, statutes, codes and regulations applicable
to
the Leased Premises and (i) relating to the environment, human health or natural
resources, (ii) regulating, controlling or imposing liability or standards
of
conduct concerning Hazardous Materials, or (iii) regulating the clean-up or
other remediation of the Leased Premises or any portion thereof, as any of
the
foregoing may have been amended, supplemented or supplanted from time to
time.
“Event
of Default”
shall
mean the occurrence of any one or more of the following events under this Lease:
(i) a failure by Tenant to make: (x) any payment of Basic Rent when due and
such
failure continues for five (5) or more Business Days, or (y) any payment of
any
other sum herein required to be paid by Tenant which continues unremedied for
a
period of fifteen (15) Business Days
after
written notice thereof is given to Tenant by Landlord or Lender or Lender’s
designee;
(ii)
failure by Tenant to perform and observe, or a violation or breach of, any
other
provision in this Lease and such default shall continue for a period of thirty
(30) days after written notice thereof is given by Landlord or Lender or
Lender’s designee to Tenant, or if such default is of such a nature that it
cannot reasonably be cured within such period of thirty (30) days, such period
shall be extended for such longer time as is reasonably necessary (not to exceed
360 days in total) provided
that
Tenant has commenced to cure such default within said period of thirty (30)
days
and is actively, diligently and in good faith proceeding with continuity to
remedy such default; (iii) any representation or warranty made in this Lease,
or
in connection with this Lease, by Tenant is determined by Landlord to have
been
false or misleading in any material respect at the time made; (iv) Tenant or
Lease Guarantor shall (A) voluntarily be adjudicated a bankrupt or insolvent,
(B) voluntarily consent to the appointment of a receiver or trustee for itself
or for any of the Leased Premises, (C) voluntarily file a petition seeking
relief under the bankruptcy or other similar laws of the United States, any
state or any jurisdiction, or (D) voluntarily file a general assignment for
the
benefit of creditors; (v) a court shall enter an order, judgment or decree
appointing, with the voluntary consent of Tenant or Lease Guarantor, a receiver
or trustee for Tenant or Lease Guarantor or for the Leased Premises or approving
a petition filed against Tenant or Lease Guarantor which seeks relief under
the
bankruptcy or other similar laws of the United States or any State, and such
order, judgment or decree shall remain in force, undischarged or unstayed,
ninety (90) days after it is entered; (vi) Tenant or Lease Guarantor shall
in
any insolvency proceedings be liquidated or dissolved or shall voluntarily
commence proceedings towards its liquidation or dissolution; (vii) the estate
or
interest of Tenant in 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 sixty (60) days after
such levy or attachment; (viii) Tenant shall be in default under any other
lease
of real property with Landlord or with any Affiliate of Landlord or (ix) Lease
Guarantor defaults in, or repudiates, its obligations under the Lease Guaranty,
or the Lease Guaranty ceases to be in full force and effect for any
reason.
“Expiration
Date”
shall
mean March 31, 2026.
“Fixtures”
shall
mean all fixtures (except Trade Fixtures), including any components thereof,
on
and in respect to the Improvements, including, without limitation, all built-in
equipment intended to be permanently attached to the Improvements and used
in
the operation of the Leased Premises, together with all replacements,
modifications, alterations and additions thereto.
“Governmental
Authority”
shall
mean any federal, state, county, municipal, foreign or other governmental or
regulatory authority, agency, board, body, instrumentality, court or quasi
governmental authority (or private entity in lieu thereof).
“Guaranties”
shall
mean all warranties, guaranties and indemnities, express or implied, and similar
rights which Landlord may have against any manufacturer, seller, engineer,
contractor or builder in respect of any of the Leased Premises, including,
but
not limited to, any rights and remedies existing under contract or pursuant
to
the Uniform Commercial Code.
“Hazardous
Materials”
shall
mean all chemicals, petroleum, crude oil or any fraction thereof, hydrocarbons,
polychlorinated biphenyls (PCBs), asbestos, asbestos-containing materials and/or
products, urea formaldehyde, or any substances which are classified as
“hazardous” or “toxic” under CERCLA; hazardous waste as defined under the Solid
Waste Disposal Act, as amended 42 U.S.C. § 6901; air pollutants regulated under
the Clean Air Act, as amended, 42 U.S.C. § 7401, et seq.; pollutants as defined
under the Clean Water Act, as amended, 33 U.S.C. § 1251, et seq., any pesticide
as defined by Federal Insecticide, Fungicide, and Rodenticide Act, as amended,
7
U.S.C. § 136, et seq., any hazardous chemical substance or mixture or imminently
hazardous substance or mixture regulated by the Toxic Substances Control Act,
as
amended, 15 U.S.C. § 2601, et Seq., any substance listed in the United
States Department of Transportation Table at 45 CFR 172.101; any chemicals
included in regulations promulgated under the above listed statutes; any
explosives, radioactive material, and any chemical regulated by state statutes
similar to the federal statutes listed above and regulations promulgated under
such state statutes.
“Holder”
shall
mean, as of any particular date, any holder of a Note.
“Impositions”
shall
mean, collectively, all taxes of every kind and nature (including real, ad
valorem, single business, personal property, gross income, transaction
privilege, franchise, withholding, profits and gross receipts taxes) on or
with
respect to the Leased Premises, or the use, lease, ownership or operation
thereof; all charges and/or taxes for any easement or agreement maintained
for
the benefit of the Leased Premises; all general and special assessments, levies,
permits, inspection and license fees on or with respect to the Leased Premises;
all water and sewer rents and other utility charges on or with respect to the
Leased Premises; all ground rents on or with respect to the Leased Premises;
and
all other public charges and/or taxes whether of a like or different nature,
even if unforeseen or extraordinary, imposed or assessed upon or with respect
to
the Leased Premises, prior to or during the Term, against Landlord, Tenant
or
any of the Leased Premises as a result of or arising in respect of the
occupancy, leasing, use, maintenance, operation, management, repair or
possession thereof, or any activity conducted on the Leased Premises, or the
Basic Rent or Additional Rent, including without limitation, any gross income
tax, sales tax, occupancy tax or excise tax levied by any governmental body
on
or with respect to such Basic Rent or Additional Rent; all payments required
to
be made to a governmental or quasi-governmental authority (or private entity
in
lieu thereof) that are in lieu of any of the foregoing, whether or not expressly
so designated; and any penalties, fines, additions or interest thereon or
additions thereto.
“Improvements”
shall
mean, collectively, the buildings, structures and other improvements on the
Land.
“Indemnitee”
shall
mean Landlord, its assignees or other transferees, each Lender, each Holder
and
their respective Affiliates and their respective officers, directors, employees,
agents, representatives, shareholders, members or other equity
owners.
“Initial
Term”
shall
mean the period of time commencing on the Commencement Date and terminating
on
the Expiration Date.
“Insurance
Expiration Date”
shall
mean, with respect to an insurance policy, the date that such insurance policy
will expire.
“Insurance
Requirement”
or
“Insurance
Requirements”
shall
mean, as the case may be, any one or more of the terms of each insurance policy
required to be carried by Tenant under this Lease and the requirements of the
issuer of such policy, and whenever Tenant shall be engaged in making any
Alteration or Alterations, repairs or construction work of any kind
(collectively, “Work”),
the
term “Insurance Requirement” or “Insurance Requirements” shall be deemed to
include a requirement that Tenant obtain or cause its contractor to obtain
completed value builder’s risk insurance when the estimated cost of the Work in
any one instance exceeds the sum of One Hundred Thousand ($100,000.00) Dollars
and that Tenant or its contractor shall obtain worker’s compensation insurance
or other adequate insurance coverage covering all persons employed in connection
with the Work, whether by Tenant, its contractors or subcontractors and with
respect to whom death or bodily injury claims could be asserted against
Landlord.
“Land”
shall
mean the lot(s) or parcel(s) of land described in Exhibit
A
attached
to this Lease and made a part hereof, together with the easements, rights and
appurtenances thereunto belonging or appertaining.
“Landlord”
shall
mean CT
Chattanooga TN, LLC, a
Delaware limited liability company.
“Law”
shall
mean any constitution, statute or rule of law.
“Lease”
has
the
meaning set forth in the preamble.
“Lease
Guarantor”
means
Covenant Transport, Inc., a Nevada corporation.
“Lease
Guaranty”
means
the Lease Guaranty, dated as of the date of this Lease, issued by the Lease
Guarantor.
“Leased
Premises”
shall
mean, collectively, the Land, the Improvements and the Fixtures.
“Legal
Requirement”
or
“Legal
Requirements”
shall
mean, as the case may be, any one or more of all present and future laws, codes,
ordinances, orders, judgments, decrees, injunctions, rules, regulations and
requirements, even if unforeseen or extraordinary, of every duly constituted
governmental authority or agency (but excluding those which by their terms
are
not applicable to and do not impose any obligation on Tenant, Landlord or the
Leased Premises) and all covenants, restrictions and conditions now of record
which may be applicable to Tenant, Landlord (with respect to the Leased
Premises) or to all or any part of or interest in Leased Premises, or to the
use, manner of use, occupancy, possession, operation, maintenance, alteration,
repair or reconstruction of the Leased Premises, even if compliance therewith
(i) necessitates structural changes or improvements (including changes required
to comply with the “Americans with Disabilities Act”) or results in interference
with the use or enjoyment of the Leased Premises or (ii) requires Tenant to
carry insurance other than as required by the provisions of this
Lease.
“Lender”
shall
mean an entity identified as such in writing to Tenant which makes a Loan to
Landlord, secured by a Mortgage and evidenced by a Note or which is the holder
of the Mortgage and Note as a result of an assignment thereof.
“Lien”
shall
mean any Lien, mortgage, pledge, charge, security interest or encumbrance of
any
kind, or any type of preferential arrangement that has the practical effect
of
creating a security interest, including, without limitation, any thereof arising
under any conditional sale agreement, capital lease or other title retention
agreement.
“Loan”
shall
mean a loan made by a Lender to Landlord secured by a Mortgage and evidenced
by
a Note.
“Moody’s”
shall
mean Moody’s Investors Service, Inc.
“Mortgage”
shall
mean a first priority mortgage, deed of trust or similar security instrument
hereafter executed covering the Leased Premises from Landlord to Lender or
Trustee.
“Net
Award”
shall
mean the entire award payable to Landlord by reason of a Condemnation, less
any
reasonable expenses incurred by Landlord in collecting such award.
“Net
Proceeds”
shall
mean the entire proceeds of any insurance required under clauses (i),
(iv)
or
(v)
of
Paragraph
14 (a)
of this
Lease, less any actual and reasonable expenses incurred by Landlord in
collecting such proceeds.
“Note”
or
“Notes”
shall
mean a Promissory Note or Notes hereafter executed from Landlord to Lender,
which Note or Notes may be secured by a Mortgage and an assignment of leases
and
rents.
“Notice”
or
“Notices”
shall
mean 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.
“Permitted
Encumbrances”
shall
mean those covenants, restrictions, reservations, Liens, conditions,
encroachments, easements and other matters of title that affect the Leased
Premises as of the date of Landlord’s acquisition thereof, excepting, however,
any such matters arising from the acts of Landlord (such as Liens arising as
a
result of judgments against Landlord).
“Person”
shall
mean an individual, corporation, partnership, joint venture, association,
joint-stock company, trust, limited liability company, non-incorporated
organization or government or any agency or political subdivision
thereof.
“Prime
Rate”
shall
mean the prime rate of interest published in The Wall Street Journal or its
successor, from time to time.
“Rating
Agency”
or
“Rating
Agencies”
shall
mean, if any, one or more of Standard & Poor’s, Moody’s, Fitch or any other
rating agency that has rated the Loan, the Mortgage or the REMIC Trust or any
other trust or entity in which the Loan and the Mortgage have been
placed.
“REA”
shall
mean a reciprocal easement agreement or any other agreement or document of
record now affecting the Leased Premises.
“Release”
shall
mean the release under applicable Environmental Laws or the threatened release
of any Hazardous Materials into or upon any land or water or air, or otherwise
into the environment, including, without limitation, by means of burial,
disposal, discharge, emission, injection, spillage, leakage, seepage, leaching,
dumping, pumping, pouting, escaping, emptying, placement and the
like.
“REMIC”
shall
mean a “real estate mortgage investment conduit” within the meaning of the
Code.
“Renewal
Option Notice”
shall
mean a written notice from Tenant to Landlord of its election to extend the
Term
(or any then Renewal Term) of this Lease pursuant to Paragraph
5
of this
Lease.
“Renewal
Term”
shall
mean an additional Lease term of five (5) years.
“Replaced
Fixtures”
shall
mean Fixtures that have been replaced by Tenant with Replacement
Fixtures.
“Replacement
Fixtures”
shall
mean operational equipment or other parts used by Tenant to replace any of
the
Fixtures.
“Requisition”
shall
mean any temporary condemnation or confiscation of the use or occupancy 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.
“Restoration”
shall
mean, following a casualty or Condemnation, the restoration of the Leased
Premises to as nearly as possible its value, condition and character immediately
prior to such casualty or Condemnation, in accordance with the provisions of
this Lease, including but not limited to the provisions of Paragraphs
11(a),
12
and
15.
Notwithstanding the foregoing, such Restoration may depart from the exact
condition of the Leased Premises immediately prior to the casualty or
Condemnation, provided
that (i)
the fair market value of the Leased Premises shall not be lessened after the
completion of the Restoration, (ii) the use of the Leased Premises shall not
be
changed as a result of any such Restoration, (iii) all such Restoration shall
be
performed in a good and workmanlike manner, and shall be expeditiously completed
in compliance with all Legal Requirements, (iv) Tenant shall (subject to the
provisions of Paragraph
18
hereof)
discharge all Liens filed against any of the Leased Premises arising out of
the
same, and (v) no such Alteration shall create any debt or other encumbrance(s)
on the Leased Premises.
“Restoration
Award”
shall
mean that portion of the Net Award equal to the cost of
Restoration.
“Restoration
Fund”
shall
mean, collectively, the Net Proceeds, Restoration Award and Tenant Insurance
Payment.
“SEC”
shall
mean the Securities and Exchange Commission.
“Standard
& Poor’s”
shall
mean Standard & Poor’s Ratings Services.
“State”
shall
mean the State or Commonwealth in which the Leased Premises is
situated.
“Structural
Change”
means
any Alteration that (i) includes the movement of any load-bearing wall, (ii)
alters the foot-print of any Improvement, or (iii) includes the addition of
a
floor to any building.
“Subsidiary”
means
any corporation, association, trust or other business entity of which the
designated parent shall at any time own directly, or indirectly through a
Subsidiary or Subsidiaries, at least a majority (by number of votes) of the
outstanding Voting Stock.
“Taking”
shall
mean any taking of the Leased Premises in or by condemnation or other eminent
domain proceedings pursuant to any law, general or special, or by reason of
any
agreement with any condemnor in settlement of or under threat of any such
condemnation or other eminent domain proceedings or by any other means, or
any
de facto condemnation.
“Tax”
or
“Taxes”
shall
mean any and all present and future taxes, including income (gross or net),
gross or net receipts, sales, use, value added, franchise, doing business,
transfer, capital, property (tangible or intangible), municipal assessments,
excise and stamp taxes, levies, imposts, duties, charges, assessments or
withholding, together with any penalties, fines, additions or interest thereon
or additions thereto (any of the forgoing being referred to herein individually
as a “Tax”),
imposed by any Governmental Authority. Taxes shall include the costs of any
contest or appeal pursued which reduces the Taxes (or attempts to do so)
including reasonable attorneys’ fees and costs incident thereto. Without
limiting the foregoing, if at any time during the term of this Lease the methods
of taxation prevailing at the execution hereof shall be changed or altered
so
that in lieu of or as a supplement or addition to or a substitute for the whole
or any part of the real estate taxes or assessments now or from time to time
thereafter levied, assessed or imposed by applicable taxing authorities for
the
funding of governmental services, there shall be imposed (i) a tax, assessment,
levy, imposition or charge, wholly or partially as a capital levy or otherwise,
on the gross rents received or otherwise attributable to the Leased Premises,
or
(ii) a tax, assessment, levy (including but not limited to any municipal, state
or federal levy), imposition or charge measured by or based in whole or in
part
upon the Leased Premises or this Lease, and imposed on the Landlord under this
Lease or any portion thereof, or (iii) a license fee or other fee or tax
measured by the gross rent payable under this Lease, or (iv) any other tax,
assessment, levy, charge, fee or the like payable with respect to the Leased
Premises, the rents, issues and profits thereof, then all such taxes,
assessments, levies, impositions and/or charges, or the part thereof so measured
or based, shall be deemed to be Taxes.
“Tax
Indemnitee”
shall
mean Landlord, each Lender, any Holder, any servicer of a Loan, Trustee, any
trustee under a Mortgage which is a deed of trust, each of their assignees
or
other transferees and each of their Affiliates and their respective officers,
directors, employees, shareholders, members or other equity owners.
“Tenant”
shall
mean Covenant Transport, Inc., a Tennessee corporation.
“Tenant’s
Insurance Payment”
shall
mean, in the event of a damage or destruction, the amount of the proceeds that
would have been payable under the third-party insurance required to be
maintained pursuant to Paragraph
14(a)(i),
(iv)
or
(vi)
had such
insurance program been in effect, together with the amount of any deductible
under such insurance.
“Tenant’s
Termination Notice”
shall
mean a written notice from Tenant to Landlord after a Condemnation or casualty
of Tenant’s intention to terminate this Lease on the Termination
Date.
“Term”
shall
mean the Initial Term, together with any Renewal Term.
“Termination
Date”
shall
mean the date for the termination of this Lease pursuant to Tenant’s Termination
Notice, which date shall be on a Basic Rent Payment Date occurring no sooner
than thirty (30) days after the date of Tenant’s Termination Notice pursuant to
Paragraph
13
or
14
of this
Lease.
“Trade
Fixtures”
shall
mean all fixtures,
equipment and other items of personal property (whether or not attached to
the
Improvements)
which
are owned by Tenant and used in the operation of the business conducted on
the
Leased Premises.
“Trustee”
shall
mean an institution
serving
as a trustee, collateral agent or administrative agent for Lender.
“Voting
Stock”
shall
mean stock or similar interests, of any class or classes (however designated),
the holders of which are at the time entitled, as such holders, to vote for
the
election of a majority of the directors (or persons performing similar
functions) of the corporation, association, trust or other business entity
involved, whether or not the right so to vote exists by reason of the happening
of a contingency.