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EXHIBIT 10.6
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AGREEMENT FOR GROUND LEASE
between
BRAZOS AUTOMOTIVE PROPERTIES, L.P.
and
MONRO LEASING, LLC
Dated as of September 15, 1998
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THIS AGREEMENT FOR GROUND LEASE HAS BEEN ASSIGNED
AS SECURITY FOR INDEBTEDNESS
OF BRAZOS AUTOMOTIVE PROPERTIES, L.P.
SEE SECTION 11.12.
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This Agreement for Ground Lease has been manually executed in 10 counterparts,
numbered consecutively from 1 through 10, of which this is No. ____. To the
extent, if any, that this Agreement for Ground Lease constitutes chattel paper
(as such term is defined in the Uniform Commercial Code as in effect in any
jurisdiction), no security interest
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in this Agreement for Ground Lease may be created or perfected through the
transfer or possession of any counterpart other than the original counterpart
which shall be the counterpart identified as counterpart No. 1.
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TABLE OF CONTENTS
AGREEMENT FOR GROUND LEASE
Page
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ARTICLE I DEFINITIONS............................................................................................1
Section 1.1. Defined Terms..............................................................................1
Section 1.2. Forms......................................................................................5
Section 1.3. Recitals, Table of Contents, Titles, and Headings..........................................5
Section 1.4. Interpretation.............................................................................6
ARTICLE II APPOINTMENT OF LESSEE.................................................................................6
Section 2.1. Appointment and Duties.....................................................................6
Section 2.2. Termination of Appointment and Duties......................................................6
Section 2.3. Lease of Property..........................................................................6
Section 2.4. Powers of Lessee...........................................................................7
ARTICLE III ADVANCES.............................................................................................8
Section 3.1. Agreement to Make Advances.................................................................8
Section 3.2. Procedure for Advances.....................................................................8
Section 3.3. Determination of Amounts of Advances.......................................................8
Section 3.4. Partial Advances...........................................................................9
Section 3.5. Use of Proceeds............................................................................9
Section 3.6. No Obligation to Advance...................................................................9
Section 3.7. Brazos Equity..............................................................................9
Section 3.8. Brazos Covenants..........................................................................10
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF LESSEE.............................................................10
Section 4.1. Corporate Matters.........................................................................10
Section 4.2. Authorization; Binding Agreement..........................................................10
Section 4.3. Power and Authority.......................................................................10
Section 4.4. Consents, Approvals and Authorizations....................................................10
Section 4.5. Financial Statements......................................................................11
Section 4.6. Changes...................................................................................11
Section 4.7. Litigation................................................................................11
Section 4.8. No Default................................................................................11
Section 4.9. Property Liens............................................................................11
Section 4.10. Availability of Utilities................................................................11
Section 4.11. Brokerage................................................................................11
Section 4.12. Suitability of Property..................................................................11
Section 4.13. Acquired Ground Lease....................................................................11
Section 4.14. Accuracy of Value........................................................................12
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ARTICLE V AFFIRMATIVE COVENANTS.................................................................................12
Section 5.1. Performance under Other Agreements........................................................12
Section 5.2. Expenses..................................................................................12
Section 5.3. Certificates; Other Information...........................................................12
Section 5.4. Conduct of Business and Maintenance of Existence..........................................13
Section 5.5. Notices...................................................................................13
Section 5.6. Legal Requirements. ......................................................................13
Section 5.7. Leasing of Property.......................................................................14
Section 5.8. Filings...................................................................................14
ARTICLE VI CONDITIONS PRECEDENT TO THE INITIAL ADVANCE OR ADDITIONAL
ADVANCE WITH RESPECT TO A PROPERTY OR ADDITIONAL PROPERTY............................................14
Section 6.1. Acquisition Documents.....................................................................14
Section 6.2. No Event of Default.......................................................................16
Section 6.3. Continuing Representations................................................................16
Section 6.4. Additional Matters........................................................................16
Section 6.5. Properties Acquired in Brazos' Name.......................................................17
ARTICLE VII CONDITIONS PRECEDENT TO THE RECONCILIATION ADVANCE
WITH RESPECT TO A PROPERTY..........................................................................17
Section 7.1. Reconciliation Advance....................................................................17
ARTICLE VIII EVENTS OF DEFAULT..................................................................................17
Section 8.1. Events of Default.........................................................................17
Section 8.2. Rights Upon Default.......................................................................19
ARTICLE IX INDEMNITIES..........................................................................................20
Section 9.1. Indemnified Persons.......................................................................20
Section 9.2. Payments..................................................................................20
Section 9.3. Continuing Indemnification................................................................20
Section 9.4. Limitations...............................................................................20
Section 9.5. Litigation................................................................................21
ARTICLE X PERMITTED CONTESTS....................................................................................21
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ARTICLE XI MISCELLANEOUS........................................................................................22
Section 11.1. Survival.................................................................................22
Section 11.2. Entire Agreement.........................................................................22
Section 11.3. Modifications............................................................................22
Section 11.4. Governing Law............................................................................22
Section 11.5. No Offsets...............................................................................22
Section 11.6. Non-Recourse.............................................................................23
Section 11.7. Notices..................................................................................24
Section 11.8. Fundamental Changes......................................................................25
Section 11.9. Usury....................................................................................25
Section 11.10. No Waivers..............................................................................25
Section 11.11. Brazos and Assignee Sole Beneficiaries..................................................26
Section 11.12. Sale or Assignment by Brazos............................................................26
Section 11.13. Rights Cumulative.......................................................................26
Section 11.14. Reassignment............................................................................26
Section 11.15. Severability............................................................................27
Section 11.16. Execution in Counterparts...............................................................27
Section 11.17. Confidentiality.........................................................................27
Section 11.18. Execution by Lessee.....................................................................27
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LIST OF EXHIBITS
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Exhibit A Form of Ground Lease Agreement
Exhibit B Form of Initial Advance Certificate
Exhibit C Form of Reconciliation Certificate
Exhibit D Form of Additional Advance Certificate
Exhibit E Form of Opinion of Counsel
Exhibit F Form of Request for Initial Advance
Schedule 4.13 List of Acquired Ground Leases
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AGREEMENT FOR GROUND LEASE
THIS AGREEMENT FOR GROUND LEASE (this "AGREEMENT") is made and entered
into as September 15, 1998, by and between BRAZOS AUTOMOTIVE PROPERTIES, L.P., a
Delaware limited partnership ("BRAZOS") and MONRO LEASING, LLC, a Delaware
limited liability company ("LESSEE").
W I T N E S S E T H:
WHEREAS, on or after the date of this Agreement Brazos and Lessee
propose to enter into a Ground Lease Agreement, providing for the lease or
sublease by Lessee of such parcels of real property as may be acquired by Brazos
for lease to Lessee; and
WHEREAS, Brazos desires to appoint Lessee to act as agent for Brazos in
connection with the acquisition of fee or leasehold interests in parcels of real
property from time to time and Lessee wishes to accept such appointment.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Brazos and Lessee hereby agree as follows:
ARTICLE I
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DEFINITIONS
Section 1.1. DEFINED TERMS. For the purposes of this Agreement each of
the following terms shall have the meaning specified with respect thereto:
"ACQUIRED GROUND LEASE" means each ground lease entered into by Brazos
under which a leasehold interest in a Property is being leased to Brazos by the
owner of such Property, including without limitation, the leases set forth on
SCHEDULE 4.13 hereto.
"ACQUISITION COST" means for any Property, the sum of (a) the amount of
the Initial Advance, (b) the Reconciliation Advance, if any, and (c) the
Additional Advance, if any, made pursuant to this Agreement with respect to such
Property.
"ADDITIONAL ADVANCE" means, with respect to any Additional Property,
the advance made by Brazos upon satisfaction of the conditions of ARTICLE VI
hereof.
" ADDITIONAL ADVANCE CERTIFICATE" means the written certification of
Lessee to be delivered to Brazos and Agent which contains the information and
representations of Lessee as required by SECTION 6.1, and which is substantially
in the form of EXHIBIT "D" attached hereto.
"ADDITIONAL PROPERTY" means each parcel of land which is contiguous to
Property already under the Ground Lease in which either a fee interest has been
acquired by Brazos or a leasehold interest acquired by Brazos pursuant to an
Acquired Ground Lease, in each case for the purpose of making such parcel of
land part of the Property and which is approved by Agent.
"AFFILIATE" means any other Person controlling, controlled by or under
direct or indirect common control with any Person. For the purposes of this
definition, "control," when used with respect to any specified Person, means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract, or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
AGREEMENT FOR GROUND LEASE - Page 1
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"AGENT" means The Chase Manhattan Bank, a national banking association.
"AGREEMENT" means this Agreement for Ground Lease, as the same may be
amended, restated, supplemented or otherwise modified in accordance with the
terms hereof from time to time.
"AGREEMENT FOR FACILITIES LEASE" means the Agreement for Facilities
Lease, dated of even date herewith, between Brazos and Lessee, as the same may
be amended, restated, supplemented or otherwise modified in accordance with the
terms thereof.
"ASSIGNEE" means any lender or agent for a lender under the Credit
Agreement and each person, firm, corporation or other entity to which any part
of Brazos' interest under this Agreement or the Ground Lease shall at the time
have been assigned, conditionally or otherwise, by Brazos in accordance with
SECTION 11.12 of this Agreement.
"AVAILABLE COMMITMENT" means at any particular time, an amount equal to
the aggregate available commitment for the benefit of Brazos under the Credit
Agreement for the acquisition of Properties pursuant to this Agreement and for
the acquisition of equipment and for the construction, equipping and furnishing
of the buildings and other facilities on the Properties pursuant to the
Agreement for Facilities Lease.
"BANKS" means a "Bank", as defined in the Credit Agreement.
"BRAZOS" means Brazos Automotive Properties, L.P. or any successor or
successors to all of its rights and obligations hereunder.
"BUDGET" means the budget submitted by Lessee to Brazos and Agent in
connection with advances to be made under this Agreement, which must be approved
by the Agent.
"BUSINESS DAY" means a day other than a Saturday, Sunday, or other day
on which commercial banks in New York, New York are authorized or required by
law to close.
"CAPITALIZED LEASES" means, as applied to any Person, any lease of any
property by such Person as lessee which would, in accordance with GAAP, be
required to be classified and accounted for as a capital lease on the balance
sheet of such Person.
"CHASE CREDIT AGREEMENT" means that certain Credit Agreement dated as
of September 15, 1998 executed among Guarantor, Agent, and the other financial
institutions from time to time party thereto, as the same may have been amended
and in effect on the date hereof.
"CONTRACTUAL OBLIGATIONS" means as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of its property is bound.
"CORPORATE CREDIT AGREEMENT" means the Chase Credit Agreement as the
same may hereafter be amended, amended and restated, renewed, extended or
otherwise modified or supplemented from time to time, together with any credit
agreement or similar instrument, agreement or document executed from time to
time in respect of any financing arrangement entered into to replace, or which
is in substitution for, the financing arrangement evidenced by the Chase Credit
Agreement.
"CREDIT AGREEMENT" means the Credit Agreement dated of even date
herewith, by and among Brazos, the Agent and the Banks named therein for the
financing of the acquisition of Properties by Brazos in connection with this
Agreement, as it may be amended, restated, modified or supplemented, from time
to time.
AGREEMENT FOR GROUND LEASE - Page 2
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"CORPORATE CREDIT DOCUMENTS" means any and all notes, guarantees and
other loan documents executed pursuant to the Corporate Credit Agreement and any
document, instrument or other agreement entered in replacement or substitution
of such document or instrument.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations, rules, rulings, and
interpretations promulgated or adopted by the Internal Revenue Service or the
United States Department of Labor thereunder.
"EVENT OF DEFAULT" has the meaning set forth in SECTION 8.1 hereof.
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government having jurisdiction over Agent, Brazos, Guarantor or Lessee, or
any of their respective properties.
"GROUND LEASE" means the Ground Lease Agreement, dated of even date
herewith, by and between Brazos, as lessor, and Lessee, as lessee, as it may be
further amended, restated, modified or supplemented from time to time, in
accordance with the terms thereof, originally in the form of EXHIBIT "A"
attached hereto.
"GUARANTOR" means Monro Muffler Brake, Inc., a New York corporation.
"GUARANTY" means the Guaranty, dated of even date herewith, by and
between Guarantor and Brazos, as it may be further amended, restated, modified
or supplemented, from time to time, in accordance with the terms thereof.
"INDEBTEDNESS" means, with respect to any Person, (a) indebtedness of
such Person for borrowed money; (b) obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments; (c) obligations of such
Person to pay the deferred purchase price of property or services; (d)
obligations of such Person as lessee under Capitalized Leases; (e) reimbursement
obligations in respect of bonds or letters of credit; (f) obligations of such
Person under direct or indirect guaranties in respect of, and obligations
(contingent or otherwise) of such Person to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness of
others of the kinds referred to in clauses (a) through (e) above; and (g)
indebtedness of others of the kinds referred to in clauses (a) through (f)
secured by any Lien on or in respect of any property of such Person whether or
not assumed by such Person; provided, however, that all trade accounts payable
and accrued expenses incurred in the ordinary course of business of such Person
and not overdue shall be excluded from the foregoing.
"INDEMNIFIED PERSON" means any Person as defined in SECTION 9.1.
"INITIAL ADVANCE" means, with respect to any Property, the advance made
by Brazos upon satisfaction of the conditions set forth in ARTICLE VI hereof.
"INITIAL ADVANCE CERTIFICATE" means the written certification of Lessee
to be delivered to Brazos and Agent in connection with each purchase of a fee
interest, reimbursement of the advance of funds by Lessee for a fee interest or
each acquisition of a leasehold interest in a Property by Brazos through Lessee,
which contains the information and representations of Lessee as required by
SECTION 6.1, and which is substantially in the form of EXHIBIT "B" attached
hereto.
"LEGAL REQUIREMENTS" means all laws, judgments, decrees, ordinances and
regulations and any other governmental rules, orders and determinations and all
requirements having the force of law, now or hereafter enacted, made or issued,
whether or not presently contemplated, and all agreements, covenants, conditions
and restrictions, applicable to each Property and/or the ownership, operation,
or use thereof, including, without limitation, all requirements of the Americans
With Disabilities Act (P.L. 101-335) and environmental statutes, compliance with
which is required at any time from the date hereof until the date such Property
becomes subject to the terms and provisions of the Ground Lease, whether or not
such compliance shall require structural, unforeseen or extraordinary changes to
any Property, or the operation, occupancy or use thereof.
AGREEMENT FOR GROUND LEASE - Page 3
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"LESSEE" means Monro Leasing, LLC, a Delaware limited liability
company.
"LIEN" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), or preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement and any capital lease having substantially the same economic
effect as any of the foregoing).
"LIEN OF RECORD" means, with the exception of the Lien of a lender or a
lender's agent under a Credit Agreement and Permitted Exceptions, (i) any
mechanics' or materialmen's lien for which Lessee does not hold retainage or
trapped funds in amounts required by applicable law, (ii) any lien securing the
payment of taxes, assessments, or governmental charges and levies which are due,
payable and delinquent, (iii) any judgment lien, or (iv) any other filed,
recorded, or docketed matter (whether or not the same shall constitute a
Permitted Exception or be the subject of a Permitted Contest) which in the case
of any of the foregoing (a) is reasonably likely to result in a sale for
satisfaction of same, a loss, forfeiture, reversion of title, or right of
reentry with respect to any Property, or (b) whether or not valid, is reasonably
likely to interfere with the due and timely payment of any sum payable or the
exercise of any rights or the performance of any of the duties or
responsibilities of Lessee under this Agreement.
"MAXIMUM RATE" means the rate specified in SECTION 11.9 hereof.
"MORTGAGEABLE GROUND LEASE" means a ground lease presented by Lessee
for Brazos' execution which shall include the terms set forth herein or if
lacking any of the terms set forth below, shall have such terms and
characteristics as shall be required by Brazos and Agent, which terms and
characteristics shall include, without limitation, the following: (a) the
lessee's interest therein must be freely assignable, (b) have a remaining term
of at least twenty (20) years, (c) contain no provisions for percentage or
variable rent, (d) permit any lawful use, (e) have no provision for a security
deposit, (f) provide for the delivery to Brazos and Agent of copies of all
notices delivered under or pursuant to such ground lease, (g) provide Brazos and
Agent written notice and the right to cure any defaults (whether monetary or
non-monetary in nature) within thirty (30) days after receipt of such notice
under such ground lease, (h) prohibit any mortgages or other Liens on the
underlying fee, (i) permit Brazos or Agent the right to invalidate any
termination of such ground lease within thirty (30) days of the effective date
of such termination by notice given to the lessor thereunder of intention to
cure, or to foreclose and cure, all curable defects, and, in the event of any
termination of such ground lease, the right to receive a new lease on the same
provisions and with the same expiration date of the original ground lease, (j)
provide that insurance proceeds for damage to improvements and condemnation
proceeds for damage to leasehold interests or improvements shall be within the
control of the lessee under such ground lease, and (k) be delivered with such
estoppel certificates from the lessor, recognition and attornment agreements, or
confirmation of customary mortgagee protection as are acceptable to Brazos and
Agent.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in Section
4001(a) (3) of ERISA, to which the Guarantor, Lessee, or any ERISA Affiliate
makes, is making, or is obligated to make contributions or, during the preceding
three (3) calendar years, has made, or been obligated to make, contributions.
"PERMITTED CONTEST" means any good-faith contest permitted by and in
accordance with the terms of ARTICLE X.
"PERMITTED EXCEPTIONS" means the following Liens and other matters
affecting the title of any Property, (a) Liens securing the payment of taxes,
assessments and governmental charges or levies, either not delinquent or being
contested by Lessee as a Permitted Contest; (b) zoning and planning
restrictions, subdivision and platting restrictions, easements, rights-of-way,
licenses, reservations, covenants, conditions, waivers, restrictions on the use
of the Property, minor encroachments or minor irregularities of title none of
which materially impairs or may materially impair the intended use of the
Property by Lessee; (c) reservations of mineral interests; (d) the lien created
pursuant to a Credit Agreement contemporaneously with each Initial Advance; (e)
any mechanics' or materialmen's lien for which Lessee holds retainage or trapped
funds in amounts required by and in accordance with applicable law; (f) Liens
constituting Permitted
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Encumbrances under the Ground Lease; and (g) any other matters; provided that
such other or additional matters shall be approved in writing by Brazos and
Agent, whose approvals shall not be unreasonably withheld or delayed.
"PERSON" means an individual, partnership, corporation, business trust,
joint venture, joint stock company, trust, unincorporated association,
Governmental Authority or other entity of whatever nature.
"POTENTIAL DEFAULT" means any event which, but for the lapse of time,
or giving of notice, or both, would constitute an Event of Default.
"PROPERTY" means each individual parcel of land approved by Agent in
which either a fee interest has been or will be acquired by Brazos or a
leasehold interest has been or will be acquired by Brazos pursuant to an
Acquired Ground Lease, in each case for the purpose of entering into the Ground
Lease, and the respective easements, rights and appurtenances relating to such
parcel of land, but excluding all improvements thereon and all structures,
equipment and materials affixed thereon or located thereon, therein or
thereunder. Any reference to a particular Property shall refer collectively to
such Property and the Additional Property, if any.
"PROPERTY LEASING RECORD" means an instrument evidencing the ground
lease or sublease of a Property under the Ground Lease, as prepared and executed
by Brazos, as lessor or sublessor, accepted and executed by Lessee, as lessee or
sublessee.
"RECONCILIATION ADVANCE" means, with respect to any Property, the
advance made by Brazos pursuant to SECTION 7.1 hereof upon reconciliation of the
Initial Advance or the Additional Advance made with respect to such Property.
"RECONCILIATION CERTIFICATE" means the written certification of Lessee
to be delivered to Brazos and Agent which contains the information and
representations of Lessee as required by SECTION 7.1, and which is substantially
in the form of EXHIBIT "C" attached hereto.
"REQUEST FOR ADVANCE" means the document referred to in SECTIONS 6.1(b)
and 7.1(e) which shall be substantially in the form of attached EXHIBIT "F".
"RESPONSIBLE OFFICER" means any President, Treasurer, Executive Vice
President or Senior Vice President of Guarantor or of Lessee.
"REVISED PROPERTY LEASING RECORD" means a Property Leasing Record
delivered in connection with a Reconciliation Advance or Additional Advance.
"SPECIAL FLOOD HAZARD AREA" has the meaning given such term in the
Flood Disaster Protection Act of 1973, as amended by the National Flood
Insurance Reform Act of 1994.
"SUBSIDIARY" means with respect to any Person, any corporation of which
voting control or more than fifty percent (50%) of the outstanding capital stock
having ordinary voting power to elect a majority of the board of directors of
such corporation (irrespective of whether at such time capital stock of any
other class or classes of such corporation shall or might have voting power upon
the occurrence of any contingency) is at the time directly or indirectly owned
by such Person.
"TITLE COMPANY" means with respect to the acquisition or lease of any
particular Property, Old Republic National Title Insurance Company, Alamo Title
Insurance of Texas, ▇▇▇▇▇▇▇ Title Company, Ticor Title Insurance Company, Ticor
Title Insurance Company of California, Title Insurance Company of Minnesota,
Chicago Title Insurance Company, Commonwealth Land Title Insurance Company,
First American Title Insurance Company, Lawyers Title Insurance Corporation,
Transamerica Title Insurance Company and such other title insurance companies as
may be
AGREEMENT FOR GROUND LEASE - Page 5
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specifically approved by Brazos and Agent in writing, together with such
reinsurers or coinsurers of such title companies satisfactory to the Agent.
"VALUE" means, with respect to a Property, the value as determined by
Lessee as set forth in a certificate or as set forth in a statement of cost and
benefit prepared by Lessee.
Section 1.2. FORMS. All forms specified by the text hereof or by
reference to exhibits attached hereto shall be substantially as set forth
herein, subject to such changes by Brazos and Lessee by mutual consent that do
not alter the substantive rights of the parties hereto or of the Assignees or as
may be required by applicable laws hereafter enacted.
Section 1.3. RECITALS, TABLE OF CONTENTS, TITLES, AND HEADINGS. The
terms and phrases used in the recitals of this Agreement have been included for
convenience of reference only and the meaning, construction, and interpretation
of such words and phrases for purposes of this Agreement shall be determined
solely by reference to SECTION 1.1 hereof. The table of contents, titles, and
headings of the Articles and Sections of this Agreement have been inserted for
convenience of reference only and are not to be considered a part hereof and
shall not in any way modify or restrict any of the terms or provisions hereof
and shall not be considered or given any effect in construing this Agreement or
any provision hereof or in ascertaining intent, if any question of intent should
arise.
Section 1.4. INTERPRETATION. Unless the context requires otherwise,
words of the masculine gender shall be construed to include correlative words of
the feminine and neuter genders and vice versa, and words of the singular number
shall be construed to include correlative words of the plural number and vice
versa. This Agreement, and all the terms and provisions hereof, shall be
liberally construed to effect the purposes set forth herein and to sustain the
validity of this Agreement.
ARTICLE II
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APPOINTMENT OF LESSEE
Section 2.1. APPOINTMENT AND DUTIES. Brazos hereby appoints and
empowers Lessee as its agent (a) to select Properties, (b) to negotiate and
contract for the acquisition and purchase of fee interests in Properties on
behalf of Brazos, (c) to negotiate and contract for the acquisition of leasehold
estates for Brazos under Acquired Ground Leases, and (d) to purchase Properties
in the name of Brazos to the extent provided in SECTION 2.4(c) hereof, all of
which is subject to the approval of Agent as set forth herein. Lessee agrees to
exercise its best business judgment in connection with the performance of its
responsibilities under this Agreement on behalf of Brazos. Notwithstanding the
foregoing, Brazos and Agent reserve the right to accept or reject any Property
selected by Lessee in their sole discretion.
Section 2.2. TERMINATION OF APPOINTMENT AND DUTIES. Lessee may
terminate its appointment and duties under this Agreement at any time, upon
thirty (30) days advance written notice to Brazos. Any such termination by
Lessee shall be deemed a termination of this Agreement, however such termination
shall not affect any outstanding request for an advance under ARTICLE III
hereof.
Section 2.3. LEASE OF PROPERTY.
(a) Upon delivery to Brazos and Agent of the Initial Advance
Certificate with respect to a Property, Lessee shall request the Initial Advance
with respect to such Property which shall be within the Available Commitment and
within the Budget submitted by Lessee and approved by Agent, and which, subject
to SECTION 3.3(a) hereof, shall be sufficient to provide for payment of all
closing and acquisition costs of the Property. By delivery of the Initial
Advance Certificate and acceptance of the Initial Advance with respect to a
Property, Lessee (i) evidences its acceptance of such Property for lease under
the Ground Lease, (ii) acknowledges that such Property has been delivered to
Lessee in good condition and has been accepted for lease by Lessee as of the
date of the Initial Advance, (iii) acknowledges that such Property is subject to
all of the covenants, terms and conditions of the Ground Lease, and (iv)
certifies that the representations and warranties
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contained in Article II of the Ground Lease are true and correct in all material
respects on and as of the date of the Initial Advance as though made on and as
of such date and that there exists on such date no (1) Event of Default under
this Agreement or Event of Default (as defined in the Ground Lease) or (2)
Potential Default under this Agreement or Potential Default (as defined in the
Ground Lease). Upon making the Initial Advance with respect to such Property,
Brazos shall prepare and deliver to Lessee a Property Leasing Record for such
Property and Lessee shall promptly execute the Property Leasing Record and
return it to Brazos. Each Property Leasing Record shall give a full description
of the Property covered thereby, the Acquisition Cost of such Property, the
Lease Term (as such term is defined in the Ground Lease) for such Property, its
location, and such other details as Brazos, as lessor, and Lessee, as lessee,
may from time to time agree.
(b) Upon delivery to Brazos and Agent of the Reconciliation Certificate
with respect to a Property, Lessee shall request the Reconciliation Advance with
respect to such Property which shall be within the Available Commitment and
within the Budget submitted by Lessee and approved by Agent, and which, subject
to SECTION 3.3(b) hereof, shall be sufficient to pay in full the amount by which
the acquisition and closing costs of such Property exceeds the Acquisition Cost
of such Property as reflected in the Property Leasing Record. By delivery of the
Reconciliation Certificate and acceptance of the Reconciliation Advance, Lessee
(i) acknowledges that such Property is subject to all of the covenants, terms
and conditions of the Ground Lease, and (ii) certifies that the representations
and warranties contained in Article II of the Ground Lease are true and correct
in all material respects on and as of the date of the Reconciliation Advance as
though made on and as of such date and that there exists on such date no (1)
Event of Default under this Agreement or Event of Default (as defined in the
Ground Lease) or (2) Potential Default under this Agreement or Potential Default
(as defined in the Ground Lease). Upon making the Reconciliation Advance with
respect to such Property, Brazos shall prepare and deliver to Lessee a Revised
Property Leasing Record for such Property and Lessee shall promptly execute the
Revised Property Leasing Record and return it to Brazos.
(c) Upon delivery to Brazos and Agent of the Additional Advance
Certificate with respect to Additional Property, Lessee shall request the
Additional Advance with respect to such Additional Property which shall be
within the Available Commitment and within the Budget submitted by Lessee and
approved by Agent, and which, subject to SECTION 3.3(c) hereof, shall be
sufficient to provide for payment of all closing and acquisition costs of the
Additional Property. By delivery of the Additional Advance Certificate and
acceptance of the Additional Advance with respect to Additional Property, Lessee
(i) evidences its acceptance of such Additional Property for lease under the
Ground Lease, (ii) acknowledges that such Additional Property has been delivered
to Lessee in good condition and has been accepted for lease by Lessee as of the
date of the Additional Advance, (iii) acknowledges that such Additional Property
is subject to all of the covenants, terms and conditions of the Ground Lease,
and (iv) certifies that the representations and warranties contained in Article
II of the Ground Lease are true and correct in all material respects on and as
of the date of the Additional Advance as though made on and as of such date and
that there exists on such date no (1) Event of Default under this Agreement or
Event of Default (as defined in the Ground Lease) or (2) Potential Default under
this Agreement or Potential Default (as defined in the Ground Lease). Upon
making the Additional Advance with respect to such Additional Property, Brazos
shall prepare and deliver to Lessee a Revised Property Leasing Record for the
Property to which the Additional Property was added and Lessee shall promptly
execute the Revised Property Leasing Record and return it to Brazos. Each
Revised Property Leasing Record shall give a full description of the Additional
Property covered thereby, the Acquisition Cost of such Additional Property, the
Lease Term (as such term is defined in the Ground Lease) for such Additional
Property, its location, and such other details as Brazos, as lessor, and Lessee,
as lessee, may from time to time agree.
AGREEMENT FOR GROUND LEASE - Page 7
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15
Section 2.4. POWERS OF LESSEE.
(a) Subject to SECTION 8.2(b) and the right retained by Brazos and the
Agent to accept or reject any Property, Lessee in its capacity as agent for
Brazos shall have the right and obligation to act for Brazos and on Brazos'
behalf with full and complete authority to select potential future sites for
acquisition or for future lease pursuant to a Mortgageable Ground Lease,
negotiate and contract for purchase or lease of such sites as Property, appear
before each applicable Governmental Authority on behalf of Brazos for the
purpose of resolving issues related to the platting, zoning, installation of
utilities, and use of the Property, to grant and obtain minor easements for the
benefit of any Property or which are deemed reasonably necessary by Lessee for
the intended use of the Property, voluntarily to dedicate or convey portions of
any Property for road, highway and other public purposes as required in the good
faith judgment of Lessee in order to obtain the use of all or part of the
Property for the purposes intended (provided that no such action shall
materially adversely affect either the market value of such Property or the use
of such Property for its intended purpose) and to approve all related vouchers,
invoices and statements. Brazos agrees to cooperate with Lessee in connection
with any such activities and to sign any agreements, documents, plats or other
instruments necessary to carry out the intent of this Agreement, and Brazos will
use its best efforts to obtain any necessary approvals or consents under the
Credit Agreement. No payment shall be made relating to the acquisition of a
Property without the prior approval of Lessee, and each amount so approved and
paid shall be part of the Acquisition Cost of that Property and must be in
compliance with the Budget for such Property. If Lessee has unreasonably delayed
or withheld giving the approvals required to make such payments in violation of
any contract, Brazos may make payments which are properly due and payable in
accordance with the contracts with said parties and the Budget approved by the
Agent, and any such payment so made shall be and become a part of the
Acquisition Cost of that Property; provided, however, that Brazos shall not make
any such payment if it is subject to a Permitted Contest and, in any event,
Brazos shall give two (2) Business Days notice to Lessee prior to making any
such payment.
(b) Notwithstanding anything herein contained, Lessee shall have no
authority to, and shall not attempt to, enter into any Acquired Ground Lease on
behalf of and in the name of Brazos or to acquire any Property in the name of
Brazos without the advance written consent of Brazos.
(c) Lessee may, with the advance written consent of Brazos and Agent,
acquire Property in the name of Brazos by advancing Lessee's own funds at the
closing of such Property for the purchase price of the Property and any closing
costs. In the event Lessee advances its own funds for such purpose, Lessee shall
submit an Initial Advance Certificate to Brazos within thirty (30) days, or such
other period of time as may be agreed upon by Brazos and Lessee, of the closing
of such purchase pursuant to SECTION 2.3(a) above. The funding of such Initial
Advance to reimburse Lessee shall be subject to the terms and conditions hereof
to the same extent as an Initial Advance in connection with the acquisition of a
Property by Brazos with its own funds from an Initial Advance. Lessee
acknowledges that any Property so acquired is still subject to approval by
Brazos and Agent in their sole discretion. Any Property which is acquired by
Lessee in the name of Brazos and which is not the subject of an Initial Advance,
Reconciliation Advance or Additional Advance under this Agreement shall be
reassigned by Brazos to Lessee pursuant to SECTION 11.14 hereof.
AGREEMENT FOR GROUND LEASE - Page 8
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ARTICLE III
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ADVANCES
Section 3.1. AGREEMENT TO MAKE ADVANCES. Subject to the conditions and
upon the terms herein provided, including, without limitation, that the
Available Commitment not be exceeded and that all advances be within the Budget
for a Property, Brazos agrees to make available to Lessee advances for each
Property up to an aggregate principal amount determined with respect to that
Property in accordance with SECTION 3.3 hereof. Subject to the terms of this
Agreement, Brazos agrees to make (a) an Initial Advance in accordance with the
Initial Advance Certificate at the time (i) Brazos' fee interest in a Property
is acquired, Brazos approves and executes a Mortgageable Ground Lease for a
Property or an Acquired Ground Lease included in SCHEDULE 4.13 attached hereto
or as otherwise approved by Brazos for a Property, or within thirty (30) days,
or such other period of time as may be agreed upon by Brazos and Lessee, of the
advance of funds by Lessee for the purchase of Property in the name of Brazos to
the extent permitted by SECTION 2.4(c), and (ii) the conditions in ARTICLE VI
are satisfied, (b) a Reconciliation Advance in accordance with the
Reconciliation Certificate at the time the conditions in ARTICLE VII are
satisfied and (c) an Additional Advance in accordance with the Additional
Advance Certificate at the time (i) Brazos' fee interest in Additional Property
is acquired or Brazos approves and executes a Mortgageable Ground Lease for
Additional Property and (ii) the conditions in ARTICLE VI are satisfied.
Section 3.2. PROCEDURE FOR ADVANCES. Lessee shall give Brazos and Agent
at least five (5) Business Days' notice of its irrevocable request for an
advance pursuant to this Agreement, specifying a Business Day on which such
advance is to be made and the amount of the advance. Not later than 11:00 a.m.
Dallas, Texas time on the date for the advance specified in such notice;
provided the conditions set forth in SECTION 2.3 and ARTICLE VI, with respect to
the Initial Advance or Additional Advance, or ARTICLE VII, with respect to a
Reconciliation Advance, have been satisfied, and subject to SECTION 3.6 Brazos
shall provide to Lessee, in immediately available funds, the amount of the
advance then requested.
Section 3.3. DETERMINATION OF AMOUNTS OF ADVANCES.
(a) INITIAL ADVANCE. With respect to any Property, the amount of the
Initial Advance shall be made in accordance with the Initial Advance
Certificate, and shall be sufficient to pay in full all acquisition and closing
costs of the Property, including, without limitation, the vendor's contract
price therefor, amounts paid or payable with respect to such Property to parties
other than the vendor of such Property, any amounts paid by vendee on behalf of
vendor in addition to, and not as a credit against the contract price (including
without limitation, payments made in satisfaction of prior liens, and payment of
any transfer, transfer gains or similar taxes imposed in respect of the
conveyance of such Property), survey and survey inspection charges, recording
and filing fees, brokerage commissions, appraisal, architectural, rentals,
engineering, soil analysis and market analysis fees, environmental inspection
reports, Legal Requirements audits, transfer fees and taxes that are customarily
the responsibility of the purchaser, documentary fees, sales taxes on personal
property, title insurance premiums and costs of appropriate endorsements,
closing adjustments for taxes, utilities, and the like, escrow fees, legal fees
and expenses (including the legal fees and expenses of Brazos, Lessee and any
Assignee), and all reasonable printing, reproduction, closing and other normally
capitalized administrative fees and expenses paid by Lessee and any other
reasonable expenses relating to due diligence investigations. All such costs for
which the Initial Advance is requested shall be specifically set forth in the
Initial Advance Certificate and the request for the Initial Advance, and Brazos
shall have no obligation to advance any funds in the Initial Advance which are
not so specifically set forth in such documents. Lessee shall submit to Brazos
and Agent at least two weeks before the delivery of an Initial Advance
Certificate with respect to a Property, the Budget for the acquisition of the
Property which must be approved (such approval not to be unreasonably withheld)
by Agent and which will govern all advances made with respect to that Property.
(b) RECONCILIATION ADVANCE. With respect to any reconciliation of an
Initial Advance or Additional Advance, the amount of the Reconciliation Advance
shall be made in accordance with the Reconciliation Certificate, and shall be
sufficient to pay in full the amount by which the acquisition and closing costs
of the Property exceeds the Acquisition Cost of such Property as reflected in
the Property Leasing Record subject to the Budget. All such costs for which the
Reconciliation Advance is requested shall be specifically set forth in the
Reconciliation Certificate and the request for the
AGREEMENT FOR GROUND LEASE - Page 9
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17
Reconciliation Advance, and Brazos shall have no obligation to advance any funds
in the Reconciliation Advance which are not so specifically set forth in such
documents.
(c) ADDITIONAL ADVANCE. With respect to any Additional Property, the
amount of the Additional Advance shall be made in accordance with the Additional
Advance Certificate, and shall be sufficient to pay in full all acquisition and
closing costs of the Additional Property, including, without limitation, the
vendor's contract price therefor, amounts paid or payable with respect to such
Additional Property to parties other than the vendor of such Additional
Property, any amounts paid by vendee on behalf of vendor in addition to, and not
as a credit against the contract price (including without limitation, payments
made in satisfaction of prior liens, and payment of any transfer, transfer gains
or similar taxes imposed in respect of the conveyance of such Additional
Property), survey and survey inspection charges, recording and filing fees,
brokerage commissions, appraisal, architectural, rentals, engineering, soil
analysis and market analysis fees, environmental inspection reports, Legal
Requirements audits, transfer fees and taxes that are customarily the
responsibility of the purchaser, documentary fees, sales taxes on personal
property, title insurance premiums and costs of appropriate endorsements,
closing adjustments for taxes, utilities, and the like, escrow fees, legal fees
and expenses (including the legal fees and expenses of Brazos, Lessee and any
Assignee), and all reasonable printing, reproduction, closing and other normally
capitalized administrative fees and expenses paid by Lessee and any other
reasonable expenses relating to due diligence investigations subject to the
Budget. All such costs for which the Additional Advance is requested shall be
specifically set forth in the Additional Advance Certificate and the request for
the Additional Advance, and Brazos shall have no obligation to advance any funds
in the Additional Advance which are not so specifically set forth in such
documents or in conformance with the Budget.
Section 3.4. PARTIAL ADVANCES. If any or all conditions precedent to
either an Initial Advance, a Reconciliation Advance or an Additional Advance
have not been satisfied on the applicable date for a requested advance, Brazos,
in its sole discretion, may, but shall have no obligation to, disburse a part of
the requested advance.
Section 3.5. USE OF PROCEEDS. The proceeds of each advance with respect
to a Property shall be used by Lessee for payment or reimbursement of costs
specified in the applicable request for the advance.
Section 3.6. NO OBLIGATION TO ADVANCE. Notwithstanding anything
contained herein to the contrary, Brazos shall have no obligation (a) to make
any advance hereunder which would exceed the Available Commitment, or (b) to
make any advance hereunder if the funds therefor are not made available to
Brazos under the Credit Agreement for any reason; provided, however, this
SECTION 3.6 shall not be interpreted to relieve any Bank under the Credit
Agreement from the obligation to provide funds to Brazos in accordance with the
terms of the Credit Agreement.
Section 3.7. BRAZOS EQUITY. Brazos agrees that it will advance its
equity from its own funds in connection with each advance made hereunder upon
approval by Agent so that the maximum amount of debt advanced under the Credit
Agreement for any Property will not exceed ninety-seven percent (97%) of the
Acquisition Cost of such Property provided that the equity advanced by Brazos
shall not exceed 3% of such Acquisition Cost without the prior written approval
of Agent. Brazos agrees that it will not withdraw its equity advanced hereunder
for a Property except upon approval by Agent or the termination of the Ground
Lease for such Property.
Section 3.8. BRAZOS COVENANTS. In the absence of an Event of Default
which is continuing, Brazos agrees that it will not engage any broker in
connection with the purchase or sale of any Property without Lessee's prior
written consent. Within one hundred and twenty (120) days after the end of
Brazos' fiscal year, Brazos will provide to Lessee Brazos' unaudited balance
sheet dated as of the end of its fiscal year prepared in accordance with GAAP,
certified by an officer of the General Partner of Brazos.
AGREEMENT FOR GROUND LEASE - Page 10
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ARTICLE IV
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REPRESENTATIONS AND WARRANTIES OF LESSEE
In order to induce Brazos to enter into this Agreement and the Credit
Agreement and to agree to make advances, Lessee hereby represents and warrants
to Brazos on the date of each advance (it being understood that all
representations and warranties in this ARTICLE IV with respect to any Property
shall refer to the Property for which each such advance is requested) that:
Section 4.1. CORPORATE MATTERS. Lessee (a) has been duly incorporated
and is validly existing as a corporation in good standing under the laws of the
state of its organization, (b) has full corporate power and authority to own and
operate its properties and to conduct its business as presently conducted and
full corporate power, authority and legal right to execute, deliver and perform
its obligations under the Ground Lease and this Agreement and (c) is duly
qualified to do business as a foreign corporation in good standing in each
jurisdiction, including, without limitation, each state or other jurisdiction in
which a Property is located, in which its ownership or leasing of properties or
the conduct of its business requires such qualification and where
nonqualification, singly or in the aggregate, would materially adversely affect
the financial condition or creditworthiness of Lessee, or would impair the
ability of Lessee to perform its obligations under the Ground Lease or this
Agreement.
Section 4.2. AUTHORIZATION; BINDING AGREEMENT. This Agreement has been
duly authorized, executed and delivered by Lessee, and, assuming the due
authorization, execution and delivery of this Agreement by Brazos, this
Agreement is a legal, valid and binding obligation of Lessee, enforceable
according to its terms, subject, as to enforceability, to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally and to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
Section 4.3. POWER AND AUTHORITY. The consummation of the transactions
herein contemplated and the performance and observance of Lessee's obligations
under this Agreement have been duly authorized by all necessary corporate action
on the part of Lessee. The execution, delivery and performance by Lessee of this
Agreement will not result in any violation of any term of the certificate of
incorporation or the by-laws of Lessee, do not require approval of the board of
directors or shareholders of Lessee or the approval or consent of any trustee or
holders of Indebtedness of Lessee except such as have been obtained prior to the
date hereof and will not conflict with or result in a breach of any terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any Lien (other than a Lien on any Property, as may be
contemplated herein) upon any property or assets of Lessee under, any indenture,
mortgage or other agreement or instrument to which Lessee is a party or by which
it or any of its property is bound where breach or default, singly or in the
aggregate, could materially adversely affect the financial condition or
creditworthiness of Lessee, or any existing applicable law, rule, regulation,
license, judgment, order or decree of any Governmental Authority or court having
jurisdiction over Lessee or any of its activities or properties.
Section 4.4. CONSENTS, APPROVALS AND AUTHORIZATIONS. There are no
consents, licenses, orders, authorizations or approvals of, or notices to or
registrations with, any Governmental Authority which are required in connection
with the valid execution, delivery and performance of this Agreement that have
not been obtained or made, except (i) such permits and licenses as Lessee will
be required to obtain for the occupancy, use or operation of a Property, and
which, in the ordinary course of business, are not obtained until just prior to
the commencement of such occupancy, use or operation, and (ii) any such
consents, licenses, orders, authorizations, approvals, notices and
registrations, the failure of which to obtain would not reasonably be expected
to cause a Material Adverse Change. Any such consents, licenses, orders,
authorizations, approvals, notices and registrations that have been obtained or
made are in full force and effect.
Section 4.5. FINANCIAL STATEMENTS. Lessee has caused to be furnished to
Brazos and Agent copies of the most recent financial information and
certificates required to be furnished pursuant to the Corporate Credit
Documents, since March 31, 1998, which fairly present the financial position,
results of operations and cash flows with respect to Guarantor
AGREEMENT FOR GROUND LEASE - Page 11
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19
and its consolidated subsidiaries, as of the dates and for the periods indicated
therein and comply with all applicable requirements.
Section 4.6. CHANGES. Since the date of the most recent financial
statements delivered pursuant to SECTION 4.5, there has been no adverse change
in the financial condition or business of any Guarantor or Lessee which would
materially impair the ability of such Guarantor or Lessee to perform their
respective obligations under this Agreement or the Ground Lease or which would
materially impair the ability of Guarantor to perform its obligations under the
Guaranty.
Section 4.7. LITIGATION. Except as disclosed to Brazos, there is no
action, suit, proceeding or investigation at law or in equity by or before any
court, governmental body, agency, commission or other tribunal now pending or,
to the best knowledge of Lessee after due inquiry, threatened against in writing
or affecting Lessee or Guarantor or any property or rights of Lessee or
Guarantor, which affects any Property, as to which there is a significant
possibility of an adverse determination, and which if adversely determined,
could reasonably be expected to have a material adverse impact on the financial
condition or business of Lessee or Guarantor or which, if adversely determined,
could reasonably be expected to materially impair the ability of Lessee or
Guarantor to perform its obligations hereunder or of Guarantor to perform its
obligations under the Guaranty, or which, if adversely determined, could
reasonably be expected to have a material adverse impact on the Value or
intended use of a Property (it being agreed that a potential adverse impact
reasonably likely to be less than $500,000 in the aggregate with respect to all
Properties shall be deemed not to be material), and there is no action, suit,
proceeding or investigation at law or in equity by or before any court,
governmental body, agency, commission or other tribunal now pending or, to the
best knowledge of Lessee or Guarantor after due inquiry, threatened which
questions or would question the validity of this Agreement.
Section 4.8. NO DEFAULT. Neither Lessee nor Guarantor is in default,
after the expiration of all applicable grace periods, under or with respect to
any Contractual Obligation in any respect which could be materially adverse to
the business, operations, property or financial or other condition of Lessee or
Guarantor, or which could materially adversely affect the ability of Lessee or
Guarantor to perform its obligations under this Agreement or the Ground Lease.
Section 4.9. PROPERTY LIENS. Except as specifically disclosed by Lessee
in writing to Brazos, to Lessee's actual knowledge, no Property is subject to a
Lien of Record, and, to the best of Lessee's actual knowledge, no Property is
subject to any other Lien, except for Permitted Exceptions previously disclosed
in writing to Brazos and Agent.
Section 4.10. AVAILABILITY OF UTILITIES. To the best of Lessee's actual
knowledge, all utility services and facilities (including, without limitation,
gas, electrical, water and sewage services and facilities) that are necessary
for the intended use of the Property under the Ground Lease without impediment
or unreasonable delay are or will reasonably be available when needed at the
boundaries of the Property.
Section 4.11. BROKERAGE. Except as may be contemplated by the Ground
Lease, no brokerage or other fee, commission or compensation is to be paid by
Brazos in connection with this Agreement, and Lessee hereby indemnifies Brazos
against any claims for brokerage fees or commissions and agrees to pay all
reasonable expenses incurred by Brazos in connection with the defense of any
action or proceeding brought to collect any such brokerage fees or commissions;
provided such claim is made through or under Lessee.
Section 4.12. SUITABILITY OF PROPERTY. Each Property is suitable in
material respects (including, without limitation, ground conditions, utilities,
and condition of title) for the intended use of the Property under the Ground
Lease.
Section 4.13. ACQUIRED GROUND LEASE. Each Acquired Ground Lease is a
Mortgageable Ground Lease except to the extent agreed to in writing by Brazos
and Agent, and to the best of Lessee's actual knowledge is in full force and
effect and has not been amended, restated, modified or changed in any manner
that has not been disclosed in writing to Brazos and Agent, nor to the best of
Lessee's actual knowledge is there any material default under any Acquired
Ground Lease nor the occurrence of any event which, with the giving of notice or
the passage of time or both, would constitute a default under such Acquired
Ground Lease, nor to the best of Lessee's actual knowledge has any party under
any Acquired Ground
AGREEMENT FOR GROUND LEASE - Page 12
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20
Lease commenced any action or given or received any notice for the purpose of
terminating any Acquired Ground Lease, and to the best of Lessee's actual
knowledge all rents, additional rents and other sums due and payable under the
Acquired Ground Lease have been paid in full.
Section 4.14. ACCURACY OF VALUE. Lessee has no knowledge or reason to
believe that the Value contained in any certificate or statement furnished to
Brazos or Agent by Lessee with respect to any Property is not accurate and
complete in all material respects.
ARTICLE V
---------
AFFIRMATIVE COVENANTS
Lessee hereby agrees that, so long as this Agreement remains in effect,
Lessee shall keep and perform fully each and all of the following covenants:
Section 5.1. PERFORMANCE UNDER OTHER AGREEMENTS. Lessee shall duly
perform and observe all of the covenants, agreements and conditions on its part
to be performed and observed hereunder and shall duly perform and observe all of
the covenants, agreements and conditions on its part which it is obligated to
perform or observe under the Ground Lease and all other agreements related to
any Property.
Section 5.2. EXPENSES. Lessee shall pay upon demand all obligations,
reasonable costs and expenses incurred by Brazos (or its limited partners, if
payable to any such limited partner as Additional Rent under the Ground Lease or
if incurred in connection with the closing (as opposed to on-going
administrative expenses)) with respect to any and all transactions contemplated
herein and the preparation of any document reasonably required hereunder,
including (without limiting the generality of the foregoing) and without
duplication all amounts required to reimburse Brazos or its Affiliate for its
interest costs, obligations, costs, fees and expenses arising in connection with
any Credit Agreement or the termination thereof (whether as a result of a
default thereunder or otherwise), title and conveyancing charges, recording and
filing fees and taxes, title search fees, rent under each Acquired Ground Lease,
mortgage taxes, real property taxes and assessments, intangible personal
property taxes, escrow fees, revenue and tax stamp expenses, insurance premiums
(including title insurance premiums), brokerage commissions, finders' fees,
placement fees, court costs, surveyors', photographers', appraisers',
architects', engineers', rating agencies', accountants' and reasonable
attorneys' fees and disbursements (including, without limitation, the
preparation of any tax return or report relating to a Property), and will
reimburse to Brazos all expenses paid by Brazos or its partners of the nature
described in this SECTION 5.2 which have been or may be incurred by Brazos with
respect to any and all of the transactions contemplated herein. If Lessee or
Guarantor shall fail to reimburse Brazos within twenty (20) days after
presentation of a ▇▇▇▇ and demand for payment therefor, Brazos may pay or
deduct, from the advances to be made under the Credit Agreement, any of such
expenses; provided the same are within the Budget and any proceeds so applied
shall be deemed advances under this Agreement, and deducted from the total funds
available for the Property. Notwithstanding anything to the contrary contained
in the foregoing, neither Lessee nor the Guarantor shall be required to
reimburse Brazos for any of the foregoing obligations, costs and expenses which
constitute properly capitalized costs and which Brazos has agreed to capitalize
and to include as an element of the Acquisition Cost of a particular Property or
which are included in the calculation of Basic Rent (as defined in the Ground
Lease). Expenses incurred by Brazos in financing obligations, costs and expenses
pending allocation as a capitalized cost to a Property shall be payable by
Lessee or the Guarantor hereunder, if not capitalized by Brazos.
AGREEMENT FOR GROUND LEASE - Page 13
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21
Section 5.3. CERTIFICATES; OTHER INFORMATION. Lessee shall furnish to
Brazos and Agent:
(a) concurrently with the delivery of the annual financial
statements referred to in SECTION 5.3(b), the Compliance Certificate
(as defined in the Guaranty) required to be provided by Guarantor
pursuant to Section 7(b) of the Guaranty, and a certificate of a
Responsible Officer stating that, to the best of such Responsible
Officer's knowledge, Lessee during such period has observed or
performed all of its covenants and other agreements, and satisfied
every condition contained in this Agreement to be observed, performed
or satisfied by it, and that such Responsible Officer has obtained no
knowledge of any Event of Default or Potential Default, except as
specified in such certificate; and
(b) from time to time, (i) promptly upon request, copies of
the quarterly financial statements required to be delivered under
Section 8.1(b) of the Corporate Credit Documents, together with each
certificate required to be delivered under Section 8.1 of the Corporate
Credit Documents, and within one hundred (100) days after the end of
Guarantor's fiscal year, copies of the annual financial statements
required to be delivered under Section 8.1(a) of the Corporate Credit
Documents, together with each certificate required to be delivered
under Section 8.1 of the Corporate Credit Documents, (ii) promptly upon
request, such other information with respect to Guarantor or Lessee or
Guarantor's or Lessee's operations, business, property, assets or
financial condition as Brazos or Agent shall reasonably request, (iii)
promptly after a Responsible Officer obtains knowledge of any Event of
Default or Potential Default, a certificate of a Responsible Officer
specifying the nature and period of existence of such Event of Default
or Potential Default, and what action, if any, Lessee has taken, is
taking, or proposes to take with respect thereto, (iv) promptly after a
Responsible Officer obtains knowledge of any material adverse change in
the financial condition or business of Guarantor or Lessee or of any
litigation of the type described in SECTION 4.7, a certificate of a
Responsible Officer describing such change or litigation as the case
may be, and (v) promptly after Lessee obtains knowledge of any and all
Liens other than Permitted Exceptions on any Property or other matter
which may materially adversely affect the value or intended use of a
Property, a detailed statement describing each such Lien or other
matter.
Section 5.4. CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. Lessee
shall preserve, renew and keep in full force and effect its corporate existence
(except as otherwise permitted herein), and take all reasonable action to
maintain all rights, privileges and franchises material to the conduct of its
business; and comply with all its material Contractual Obligations; provided,
however, that nothing contained in this SECTION 5.4 shall prevent Lessee from
ceasing or omitting to exercise any rights, privileges or franchises which in
the reasonable judgment of Lessee can no longer be profitably exercised or
prevent Lessee from selling, abandoning or otherwise disposing of any property,
the retention of which in the reasonable judgment of Lessee is inadvisable to
the business of Lessee, or prevent any liquidation of any subsidiary of Lessee,
or any merger, consolidation or sale, permitted by the provisions of SECTION
11.8.
Section 5.5. NOTICES. Each party hereto shall give notice or copies, as
applicable, to the other party promptly upon the occurrence (or becoming aware
of or receiving notice) of:
(a) any litigation or proceedings affecting any Property in
which the amount involved (individually or collectively) is $100,000 or
more and not covered by insurance or in which injunctive or similar
relief is sought;
(b) any notices given to or received from the lessor under any
Acquired Ground Lease; and
(c) the imposition of any Lien, other than Permitted
Exceptions, or Lien of Record of which Lessee has knowledge.
AGREEMENT FOR GROUND LEASE - Page 14
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22
Each notice given by Lessee pursuant to this Section shall be accompanied by a
statement of a Responsible Officer setting forth details of the occurrence
referred to therein and stating what action Lessee proposes to take with respect
thereto.
Section 5.6. LEGAL REQUIREMENTS. Lessee shall comply in all material
respects with all Legal Requirements affecting the execution, delivery and
performance of this Agreement, and Lessee will not do or permit any act or thing
which is contrary in any material respect to any Legal Requirements, or which
might impair in any material respect, other than in the normal use thereof, the
value or usefulness of any Property; provided, in each case, that Lessee shall
not be required to comply with any Legal Requirements if (a) in the case of any
Legal Requirements with respect to laws affecting the environment, Lessee acts
diligently to cure such non-compliance upon becoming aware of it and (b) in
every case, such non-compliance, individually or in the aggregate, (i) shall not
involve any material danger that any Property would be subject to sale,
forfeiture, or loss as a result of failure to comply therewith; (ii) could not
reasonably be expected to cause either Brazos or any Assignee to incur (x) civil
liability which, in the sole judgment of Brazos or any Assignee, is not
adequately indemnified (Lessee's obligations under ARTICLE IX of this Agreement
shall be deemed to be adequate indemnification if no Event of Default or
Potential Default exists and if such civil liability is reasonably likely to be
less than $100,000 per Property and $500,000 in the aggregate) or (y) any
criminal liability as a result of failure to comply therewith; (iii) is
permitted under the provisions of the Acquired Ground Lease, if any, on such
Property, and (iv) is consistent with business practices normal within the
industry of Lessee or the practices of Lessee with respect to properties owned
by Lessee.
Section 5.7. LEASING OF PROPERTY. Lessee shall lease (or in the case of
Property under an Acquired Ground Lease, shall sublease) such Property from
Brazos pursuant to the Ground Lease in accordance with the procedures of SECTION
2.3 hereof. Upon the acquisition of a Property by purchase or lease, such
Property shall cease to be governed by the terms, provisions, and conditions of
this Agreement, and shall be governed by the terms, provisions, and conditions
of the Ground Lease; provided that nothing contained herein shall be deemed to
relieve Brazos from its obligation to make the Reconciliation Advance or
Additional Advance if the conditions hereof for such Reconciliation Advance or
Additional Advance shall be satisfied by Lessee or to relieve Lessee from the
obligation of satisfaction of all Liens with respect to any Property, it being
expressly agreed that such obligation shall survive the making of the Initial
Advance and the date of the Property Leasing Record.
Section 5.8. FILINGS. Lessee shall promptly and duly execute, deliver,
file, and record, at Lessee's expense, all such documents, statements, filings,
and registrations, and take such further action as Brazos or Assignee shall from
time to time reasonably request in order to establish, perfect and maintain
Brazos' title to and interest in the Property and any Assignee's interest in
this Agreement or any Property as against Lessee or any third party in any
applicable jurisdiction.
ARTICLE VI
----------
CONDITIONS PRECEDENT TO THE INITIAL ADVANCE OR ADDITIONAL
ADVANCE WITH RESPECT TO A PROPERTY OR ADDITIONAL PROPERTY
Brazos shall not be obligated to make the Initial Advance with respect
to a Property or an Additional Advance with respect to an Additional Property,
or if no advance is being made pursuant to Brazos acquiring a leasehold estate
in a Mortgageable Ground Lease Brazos shall not be required to acquire such
leasehold estate, until all of the conditions set forth in this ARTICLE VI shall
have been satisfied.
Section 6.1. ACQUISITION DOCUMENTS. In connection with the acquisition
of any Property with the proceeds of an Initial Advance, except as may otherwise
be agreed by Brazos and Agent, Brazos and Agent shall have received at least
five (5) Business Days prior to any advance, in each case in form and substance
satisfactory to Brazos and Agent, the following:
AGREEMENT FOR GROUND LEASE - Page 15
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(a) GROUND LEASE. A fully executed copy of the Ground Lease.
The delivery of the Ground Lease to satisfy this condition precedent
with respect to the first Property shall serve to satisfy this
condition precedent for each subsequent Property.
(b) REQUEST FOR ADVANCE. A Request for Advance, executed by
Lessee, which shall set out the total amount of the Initial Advance or
Additional Advance requested, the date on which the advance is to be
paid, the name and address of the escrow or closing agent to which the
Initial Advance or Additional Advance is to be tendered, and an
itemization of the various costs constituting the amount of the Initial
Advance or Additional Advance in such detail as will be necessary to
provide disbursement instructions to the escrow or closing agent.
(c) INITIAL ADVANCE CERTIFICATE OR ADDITIONAL ADVANCE
CERTIFICATE. The Initial Advance Certificate or the Additional Advance
Certificate, as applicable, containing, among other things, a
certification by Lessee that the proposed cost of such Property
contained in such certificate is within the Budget approved by Agent
and is true, complete, correct, and accurately represents all expected
costs of acquiring the Property, and that the Property is not
encumbered by any Liens of Record created by Lessee or, to the best
knowledge of Lessee, by any other Liens of Record.
(d) SPECIAL WARRANTY DEED AND ▇▇▇▇ OF SALE. Where fee title is
to be acquired by Brazos, a photocopy of the Special Warranty Deed and
▇▇▇▇ of Sale to be executed and delivered at the closing of the
acquisition of each Property, conveying indefeasible title to Brazos,
subject only to Permitted Exceptions, but not subject to any Liens of
Record. For purposes of the Initial Advance and Additional Advance,
Permitted Exceptions shall NOT include any Liens of Record (whether or
not the subject of a Permitted Contest).
(e) ACQUIRED GROUND LEASE. Where Brazos is acquiring an
Acquired Ground Lease listed on SCHEDULE 4.13 attached hereto or
otherwise approved by Brazos, an assignment of such Acquired Ground
Lease. Where Brazos is acquiring leasehold estate in a Property
pursuant to a Mortgageable Ground Lease, an original of the
Mortgageable Ground Lease to be executed and delivered at the closing
of the acquisition of Brazos' leasehold estate, certified by Lessee as
complying in all respects with this Agreement and with Article XVI of
the Ground Lease, and subject only to Permitted Exceptions but not
subject to any Liens of Record which are not Permitted Exceptions
(other than a lien of a lender to a landlord which is subordinate to
the Acquired Ground Lease or for which a nondisturbance agreement has
been obtained), along with any estoppel certificates deemed necessary
by Brazos or Agent (as, for example, when Lessee's interest in an
existing Acquired Ground Lease is being assigned to Brazos),
recognition and attornment agreements deemed necessary by Brazos or
Agent, and other confirmations required by legal counsel to Brazos and
Agent that such Acquired Ground Lease is a Mortgageable Ground Lease.
For purposes of the Initial Advance and Additional Advance, Permitted
Exceptions shall NOT include any Liens of Record (whether or not the
subject of a Permitted Contest).
(f) TAXES. Evidence that all past and current taxes and
assessments (excluding those which are due and payable but not yet
delinquent) applicable to the Property for which the Initial Advance or
Additional Advance, respectively, is requested have been paid in full.
(g) TITLE INSURANCE POLICY. A commitment for a fee (or
Leasehold or Mortgagee's, as the case may be) Policy of Title Insurance
on the most current ALTA form or, if not permitted by local regulations
such other form as is acceptable to Brazos and Agent. At closing,
Brazos and Agent shall receive fee (or Leasehold, or Mortgagee, as the
case may be) policies of title insurance (or binding commitments
therefor) issued by the Title Company with respect to the Property in
the amount of the vendor's contract price or the leasehold value for
such Property, insuring Brazos' title and the interest of any Assignee
to be good and indefeasible subject only to the Ground Lease, Permitted
Exceptions (but not subject to Liens of Record other than a lien of a
lender to a landlord for which a nondisturbance agreement has been
obtained), shortages in area, taxes for the current year not yet due
and payable and subsequent tax assessments for prior years due to a
change in land usage or ownership, and where applicable, the terms of
the Acquired Ground Lease, and containing such available endorsements
and
AGREEMENT FOR GROUND LEASE - Page 16
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24
affirmative coverages as Brazos and Agent may require. Brazos also
shall have received evidence satisfactory to it that all premiums in
respect of such policies will be paid at the closing of title.
(h) SURVEY. Brazos shall have received a survey of the
Property certified to Brazos and Agent, dated a date within ninety (90)
days prior to closing (or such shorter period as any title issuer may
require), by an independent, licensed registered public land surveyor,
which survey shall be made in accordance with the "Minimum Standard
Detail Requirements for Land Title Surveys" established by the American
Land Title Association and the American Congress on Surveying and
Mapping, and, without limiting the generality of the foregoing, there
shall be surveyed and shown on such survey the following: (A) the
location of the established building setback lines; (B) the lines of
streets abutting the Property and the width thereof; (C) all access and
other easements appurtenant to or necessary or desirable to use the
Property; (D) all roadways, paths, driveways, easements, encroachments
and overhanging projections and similar encumbrances affecting the
Property, whether recorded, apparent from a physical inspection of the
Property or otherwise known to the surveyor; (E) the location of any
existing improvements on the Property; (F) any encroachments on any
adjoining property by the building structures and improvements on the
Property; and (G) if the Property is described by reference to a filed
map, a legend relating the survey to said map.
(i) AVAILABILITY OF UTILITIES. With respect to each Property,
evidence satisfactory to Brazos and Agent that all utility services and
facilities (including, without limitation, gas, electrical, water and
sewage services and facilities) that are necessary for the intended use
of the Property under the Ground Lease without impediment or delay are
or will be available to the Property.
(j) FLOOD INSURANCE. Either (i) a policy of flood insurance in
an amount equal to the Acquisition Cost for such Property, or (ii) a
certification by the surveyor that the Property is not located in a
Special Flood Hazard Area.
(k) OPINION OF COUNSEL FOR GUARANTOR. Concurrently with the
execution of this Agreement, an opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP, in
form and substance reasonably satisfactory to Brazos and Agent.
(l) OPINION OF LOCAL COUNSEL. With respect to (i) any proposed
acquisition by Brazos of a fee interest in a Property in a state or
jurisdiction in which no Property has previously been acquired under
this Agreement and (ii) any proposed acquisition by Brazos of a
Property under an Acquired Ground Lease, an opinion of local counsel,
in each case in form and substance reasonably satisfactory to Brazos
and Agent and generally to the same effect as EXHIBIT "E" attached
hereto.
(m) CERTIFICATES OF INSURANCE. Certificates of insurance or
other evidence reasonably acceptable to Brazos and Agent certifying
that the insurance then carried or maintained on each Property complies
with the terms of the Ground Lease.
(n) ZONING. Satisfactory evidence that the Property is zoned
in the manner which permits the use intended by Lessee.
(o) MEMORANDUM OF LEASE. A memorandum of lease for the
Property in recordable form, executed by Lessee and Brazos, reciting
therein that the Property covered thereby is subject to the terms and
conditions of the Ground Lease.
(p) ENVIRONMENTAL ASSESSMENT. An environmental assessment
prepared by a third party environmental assessment firm of some of the
Property and a letter from ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP relating to the
environmental condition of all of the Property, both of which must be
delivered to Brazos and Agent in form and substance acceptable to
Brazos and Agent and their counsel on the Effective Date. No report
delivered pursuant to this SECTION 6.1(q) shall disclose, in the
reasonable judgment of Brazos or Agent, a violation of
AGREEMENT FOR GROUND LEASE - Page 17
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25
Environmental Law (as defined in the Ground Lease), the existence of an
Environmental Claim (as defined in the Ground Lease) or Lien against
such Property, or the existence of any material Environmental (as
defined in the Ground Lease) contamination of such Property.
(q) OTHER DOCUMENTS. All other documents or certificates
reasonably requested by Brazos or Agent, including, but not limited to,
a Value of the Property including the Facility and/or FF&E, opinions of
counsel and other corporate documents and certificates all in form and
substance acceptable to Brazos and Agent; provided however, Brazos and
Agent reserve the right to require Lessee to provide, at its sole cost
and expense, and appraisal of the Property if required by any
Governmental Authority or by the auditors of the Agent.
Section 6.2. NO EVENT OF DEFAULT. No Event of Default or Potential
Default shall have occurred and be continuing on the date of the Initial Advance
or Additional Advance or after giving effect to the advance to be made on such
date.
Section 6.3. CONTINUING REPRESENTATIONS. All representations and
warranties made in this Agreement, in the Ground Lease, and in connection with
the Initial Advance or Additional Advance or which are contained in any
certificate, document or financial or other statement furnished at any time
under or in connection herewith shall be true and correct as of the date they
are made or are deemed to be made.
Section 6.4. ADDITIONAL MATTERS. All other documents and legal matters
in connection with the transactions contemplated by this Agreement shall be
reasonably satisfactory in form and substance to Brazos and Agent, the Property
must be approved by the Agent and the amount of each advance to be made in
connection with such Property must be within the Budget approved by the Agent.
Section 6.5. PROPERTIES ACQUIRED IN BRAZOS' NAME. In connection with an
Initial Advance for a Property acquired by Lessee in Brazos' name with Lessee's
own funds, except as may otherwise be agreed by Brazos and Agent, Brazos and
Agent shall have received at least five (5) Business Days prior to any advance,
in each case in form and substance satisfactory to Brazos and Agent, such of the
documents and instruments referenced in Section 6.1 as may be required for
funding under the Credit Agreement.
ARTICLE VII
-----------
CONDITIONS PRECEDENT TO THE RECONCILIATION ADVANCE
WITH RESPECT TO A PROPERTY
Section 7.1. RECONCILIATION ADVANCE. Brazos' obligation to make the
Reconciliation Advance with respect to a Property shall be subject to the
satisfaction of the following conditions:
(a) RECONCILIATION CERTIFICATE. A fully executed copy of the
Reconciliation Certificate shall have been delivered to Brazos and
Agent.
(b) REPRESENTATIONS AND WARRANTIES. The representations and
warranties made herein or which are contained in any certificate,
document or financial or other statement furnished at any time under or
in connection herewith, shall be correct on and as of the date for such
advance as if made on and as of such date.
(c) NO EVENT OF DEFAULT. No Event of Default or Potential
Default shall have occurred and be continuing on such date or after
giving effect to the advance to be made on such date.
(d) EVIDENCE OF COMPLIANCE. Brazos and Agent shall have been
furnished with such documents, reports, certificates, affidavits and
other information, in form and substance satisfactory to Brazos or
Agent in
AGREEMENT FOR GROUND LEASE - Page 18
--------------------------
26
their reasonable judgment, as Brazos or Agent may require to evidence
compliance by Lessee with all of the provisions of this Agreement.
(e) REQUEST FOR ADVANCE. Brazos and Agent shall have received
a Request for Advance, executed by Lessee, and stating the total amount
of the Reconciliation Advance requested, the date on which such
Reconciliation Advance is to be made, and a specific breakdown of items
and costs for which the Reconciliation Advance is being made all of
which must be within the amounts specified for same in the Budget
approved by the Agent.
(f) SATISFACTORY TITLE. There shall have been no changes in
the state of title and no additional survey exceptions or Liens, except
for Permitted Exceptions. Brazos and Agent shall have received a list
of all Liens of Record and of all other Liens known to Lessee against
the Property and the amounts thereof and, in the case of an Acquired
Ground Lease, an estoppel certificate from the lessor confirming that
there are no defaults under the Acquired Ground Lease and such other
information satisfactory to Brazos and Agent.
ARTICLE VIII
------------
EVENTS OF DEFAULT
Section 8.1. EVENTS OF DEFAULT. The occurrence of any of the following
shall constitute an Event of Default:
(a) FAILURE TO MAKE PAYMENTS. Failure of Lessee to pay any
amount hereunder within five (5) Business Days from written demand for
such payment.
(b) OTHER DEFAULTS. Lessee shall default in the performance or
observance of any other term, covenant, condition or obligation
contained in this Agreement and such default shall (i) continue for
thirty (30) days after written notice shall have been given to Lessee
by Brazos or any Assignee specifying such default and requiring such
default to be remedied or (ii) if such default is of a nature that it
is not capable of being cured within such 30-day period, Lessee shall
not have diligently commenced curing such default, proceeded diligently
and in good faith thereafter to complete curing such default, or cured
such default within sixty (60) days from the date of written notice.
(c) BANKRUPTCY. (i) The entry of a decree or order for relief
in respect of Lessee or Guarantor by a court having jurisdiction in the
premises in an involuntary case under the Federal bankruptcy laws, as
now or hereafter constituted, or any other applicable Federal or state
bankruptcy, insolvency or other similar law, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of Lessee or Guarantor or of any substantial part of Lessee's
or Guarantor's property, or ordering the winding up or liquidation of
Lessee's or Guarantor's affairs, and the continuance of any such decree
or order unstayed and in effect for a period of sixty (60) consecutive
days; or (ii) the general suspension or discontinuance of Lessee's or
Guarantor's business operations, its insolvency (however evidenced) or
its admission of insolvency or bankruptcy, or the commencement by
Lessee or Guarantor of a voluntary case under the Federal bankruptcy
laws, as now or hereafter constituted, or any other applicable Federal
or state bankruptcy, insolvency or other similar law, or the consent by
it to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or other
similar official) of Lessee or of Guarantor of any substantial part of
its property, or the making by it of an assignment for the benefit of
creditors, or the failure of Lessee or Guarantor generally to pay its
debts as such debts become due, or the taking of corporate action by
Lessee or Guarantor in furtherance of any such action.
(d) PAYMENT OF OBLIGATIONS. A default or event of default
which results in the holder or holders of any Indebtedness of Lessee or
of Guarantor, or a trustee or agent on behalf of such holder or
holders, accelerating such Indebtedness prior to its stated maturity
under the provisions of any instrument evidencing
AGREEMENT FOR GROUND LEASE - Page 19
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27
Indebtedness in excess of $1,000,000 of Lessee or Guarantor (or under
the provisions of any agreement pursuant to which such instrument was
issued) or the occurrence of a default as specified in Section
7.1(d)(iii) of the Credit Agreement.
(e) MISREPRESENTATIONS. Any representation or warranty made by
Lessee herein or which is contained in any certificate, document or
financial or other statement furnished under or in connection with this
Agreement proves to be false or misleading in any material respect when
made or deemed made.
(f) DEFAULT UNDER LEASE DOCUMENTS. An Event of Default (as
defined in the Ground Lease, the Agreement for Facilities Lease or the
Facilities Lease) shall occur and be continuing under the Ground Lease,
the Agreement for Facilities Lease or the Facilities Lease,
respectively.
(g) GUARANTY. An Event of Default under the Guaranty shall
occur and be continuing or any representation or warranty made by
Guarantor in the Guaranty, any Consent (as defined in the Facilities
Lease) or any document contemplated hereby or thereby proves to be
false or misleading in any material respect when made or deemed made or
the Guarantor defaults in the performance of any term, covenant,
condition or obligation contained in the Guaranty or any Consent, and
such default shall not have been cured within any applicable grace or
cure period and such default shall be continuing or any provision of
the Guaranty shall for any reason be terminated or cease to be in full
force and effect and a valid and binding obligation of the Guarantor,
or the Guarantor shall challenge or repudiate in writing its liability
thereunder.
(h) OTHER AGREEMENTS. Any Lessee or the Guarantor shall
default in any material respect in the performance or observance of any
term, covenant, condition or obligation contained in any other written
agreement between Lessee and Brazos or any Consent to which any Lessee
or Guarantor is a party and such default shall not have been cured
within any applicable grace or cure period.
(i) UNAUTHORIZED ASSIGNMENTS. Any assignment by Lessee of any
interest in this Agreement or any advance to be made hereunder other
than in accordance with the terms of this Agreement.
(j) DEFAULT UNDER CORPORATE CREDIT DOCUMENTS. The occurrence
of any Default under any of the Corporate Credit Documents.
Section 8.2. RIGHTS UPON DEFAULT. Upon the occurrence and continuation
of any Event of Default, Brazos may in its discretion, in a writing delivered to
Lessee, declare this Agreement to be in default and do any one or more of the
following:
(a) Terminate this Agreement and/or Brazos' obligations to
make Initial Advances, Reconciliation Advances and Additional Advances
hereunder by giving written notice to that effect to Lessee;
(b) Terminate or suspend Lessee's right to act as agent of
Brazos under SECTION 2.4 by giving written notice to that effect to
Lessee;
(c) Recover from Lessee any sums due hereunder; and
(d) Exercise any other right or remedy which may be available
under applicable law and in general proceed by appropriate judicial
proceedings, either at law or in equity, to enforce the terms hereof or
to recover damages for the breach hereof.
Suit or suits for the recovery of any default in the payment of any sum
due hereunder or for damages may be brought by Brazos from time to time at
Brazos' election, and nothing herein contained shall be deemed to require Brazos
AGREEMENT FOR GROUND LEASE - Page 20
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28
to await the date whereon this Agreement or the term hereof would have expired
by limitation had there been no such default by Lessee or no such termination or
cancellation.
The receipt of any payments under this Agreement by Brazos with
knowledge of any breach of this Agreement by Lessee or of any default by Lessee
in the performance of any of the terms, covenants or conditions of this
Agreement, shall not be deemed to be a waiver of any provision of this
Agreement.
No receipt of moneys by Brazos from Lessee after the termination or
cancellation hereof in any lawful manner shall reinstate or continue this
Agreement or operate as a waiver of the right to receive any and all amounts
owing by Lessee to or on behalf of Brazos hereunder; it being agreed that, after
the service of notice to terminate or cancel this Agreement, and the expiration
of the time therein specified, if the default has not been cured in the
meantime, or after the commencement of suit, action or summary proceedings or of
any other remedy, or after a final order, warrant or judgment for the possession
of the Property, Brazos may demand, receive and collect any moneys payable
hereunder, without in any manner affecting such notice, proceedings, suit,
action, order, warrant or judgment; and any and all such moneys so collected
shall be deemed to be payments on account of Lessee's liability hereunder.
Lessee shall be liable to Brazos for Brazos' obligations, costs, and
expenses incurred reasonably in connection with its obligations hereunder,
including, without limitation, all losses, damages and expenses (including,
without limitation, attorneys' fees and expenses) sustained by Brazos by reason
of such Event of Default and the exercise of Brazos' remedies with respect
thereto.
No remedy referred to in this SECTION 8.2 is intended to be exclusive,
but each shall be cumulative and in addition to any other remedy referred to
above or otherwise available to Brazos at law or in equity, and the exercise in
whole or in part by Brazos of any one or more of such remedies shall not
preclude the simultaneous or later exercise by Brazos of any or all such other
remedies. No waiver by Brazos of any Event of Default hereunder shall in any way
be, or be construed to be, a waiver of any future or subsequent Event of
Default.
Lessee hereby waives any and all rights to reinstate this Agreement as
permitted or provided by or under any statute, law or decision now or hereafter
in force and effect.
ARTICLE IX
----------
INDEMNITIES
Section 9.1. INDEMNIFIED PERSONS. Lessee shall indemnify and hold
harmless Brazos, each general and limited partner of Brazos, any Assignee, any
successor or successors and any Affiliate of each of them, and their respective
officers, directors, incorporators, shareholders, partners (general and limited,
including, without limitation, the general and limited partners of Brazos),
employees, agents and servants (each of the foregoing an "Indemnified Person")
from and against all liabilities, taxes, losses, obligations, claims, damages,
penalties, causes of action, suits, costs and expenses (including, without
limitation, reasonable attorneys' and accountants' fees and expenses) or
judgments of any nature, except to the extent resulting from gross negligence or
willful misconduct of such Indemnified Person, relating to or in any way arising
out of:
(a) The ordering, delivery, acquisition, construction, title on
acquisition, rejection, installation, possession, titling, retitling,
registration, reregistration, custody by Lessee of title and registration
documents, ownership, use, non-use, misuse, lease, operation, transportation,
repair, control or disposition of any Property;
(b) The assertion of any claim or demand based upon any infringement or
alleged infringement of any patent or other right, by or in respect of any
Property; provided, however, that upon request of Lessee, Brazos will make
available to Lessee Brazos' rights under any similar indemnification arising
from any manufacturer's or vendor's warranties or undertakings with respect to
any Property; or
AGREEMENT FOR GROUND LEASE - Page 21
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29
(c) Any violation or alleged violation (other than an alleged violation
by Brazos) by Lessee of this Agreement or of any contracts or agreements to
which Lessee is a party or by which it is bound, or any laws, rules,
regulations, orders, writs, injunctions, decrees, consents, approvals,
exemptions, authorizations, licenses and withholdings of objection, of any
governmental or public body or authority and any other Legal Requirements,
including, without limitation, any Legal Requirements with respect to the
environment or the regulation of hazardous materials or substances, or any
breach of a representation or warranty by Lessee under this Agreement.
Section 9.2. PAYMENTS. Lessee shall forthwith upon demand reimburse any
Indemnified Person for any sum or sums expended with respect to any of the items
set forth in SECTION 9.1 or, upon request from any Indemnified Person, shall pay
such amounts directly. Any payment made to or on behalf of any Indemnified
Person pursuant to this ARTICLE IX shall be increased to such amount as will,
after taking into account all taxes imposed with respect to the accrual or
receipt of such payment (as the same may be increased pursuant to this
sentence), equal the amount of the payment, reduced by the amount of any savings
in such taxes actually realized by the Indemnified Person as a result of the
payment or accrual of the amounts in respect of which the payment to or on
behalf of the Indemnified Person hereunder is made. Any Indemnified Person
seeking indemnification under this ARTICLE IX shall give Lessee written evidence
supporting the amount demanded, and such written evidence shall be deemed to be
conclusive, absent manifest error. To the extent that Lessee in fact indemnifies
any Indemnified Person under the indemnity provisions of this Agreement, Lessee
shall be subrogated to such Indemnified Person's rights in the affected
transaction and shall have a right to determine the settlement of claims
therein.
Section 9.3. CONTINUING INDEMNIFICATION. The indemnities contained in
this ARTICLE IX shall not be affected by and shall survive any termination of
this Agreement as a whole or in respect of any Property, or any failure or
refusal of Lessee to accept any Property acquired pursuant to the terms hereof.
Section 9.4. LIMITATIONS.
(a) Brazos and Lessee agree that the activities of Lessee under the
Agreement for Ground Lease relating to the preparation or approval of any maps,
drawings, opinions, reports, surveys, change orders, designs, or specifications
relating to any Property is being done by Lessee in its capacity as the
prospective lessee of the Property and not as the agent or employee of Brazos.
Lessee and Brazos agree that to the greatest extent possible without causing any
indemnification provision of the Agreement for Ground Lease to be void and
unenforceable under the laws of any state, it is the intention of the parties to
the Agreement for Ground Lease for Lessee to bear all responsibility for and to
indemnify Brazos against, except to the extent resulting from the gross
negligence or willful misconduct of Brazos, any liability, claims, damages,
losses or expenses, including attorneys fees, arising out of the preparation or
approval of any maps, drawings, opinions, reports, surveys, change orders,
designs, or specifications relating to the Property.
(b) Brazos and Lessee agree that the terms of any state law or the laws
of other jurisdictions which may affect the rights of any Indemnified Person or
Lessee under this ARTICLE IX may be set forth in the Memorandum of Ground Lease
for the affected Property and shall apply as though set forth in this Agreement.
AGREEMENT FOR GROUND LEASE - Page 22
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30
Section 9.5. LITIGATION. If any claim, action, proceeding or suit is
brought against an Indemnified Person with respect to which Lessee would be
required to indemnify such Indemnified Person, Lessee shall have the right to
assume the defense thereof, including the employment at its expense of counsel;
provided that Lessee shall not have such right, to the extent that such
Indemnified Person shall deliver to Lessee a written notice waiving the benefits
of the indemnification of such Indemnified Person provided by this ARTICLE IX in
connection with such claim, action, proceeding or suit. Notwithstanding the
foregoing, if (i) any claim, action, proceeding or suit is brought against an
Indemnified Person who is an individual, (ii) the action threatens to restrain
or adversely affect the conduct of the business of the Indemnified Person, but
not the business of Brazos' ownership of the Property under this Agreement,
(iii) the claim, action, proceeding or suit seeks damages of more than
$1,000,000, or (iv) independent counsel to an Indemnified Person shall conclude
that there may be defenses available to the Indemnified Person which may
conflict with those available to Lessee, Lessee shall not have the right to
assume the defense of any such action on behalf of the Indemnified Person if
such Indemnified Person chooses to defend such action (with counsel reasonably
acceptable to Lessee), and all reasonable costs, expenses and attorneys' fees
incurred by the Indemnified Person in defending such action shall be borne by
Lessee. Notwithstanding the assumption of its defense by Lessee pursuant to this
paragraph, any Indemnified Person shall have the right to employ separate
counsel and to participate in its defense, but the fees and expenses of such
counsel shall be borne by the Indemnified Person. In addition, Lessee will not
be liable for any settlement of any claim, action, proceeding or suit unless
Lessee has consented thereto in writing. Any decision by an Indemnified Person
to employ its own counsel rather than counsel selected by Lessee (whether or not
at Lessee's expense) shall in no way affect any rights of such Indemnified
Person otherwise arising under this ARTICLE IX.
ARTICLE X
---------
PERMITTED CONTESTS
(a) Lessee shall not be required, nor shall Brazos have the right, to
pay, discharge or remove any tax, assessment, levy, fee, rent, charge, Lien or
encumbrance, or to comply or cause any Property to comply with any Legal
Requirements applicable to any Property or the occupancy, use or operation
thereof, so long as no Event of Default exists under this Agreement or the
Ground Lease, and, in the opinion of Lessee's counsel, Lessee shall have
reasonable grounds to contest, and shall be diligently contesting, the
existence, amount, applicability or validity thereof by appropriate proceedings,
which proceedings in the reasonable judgment of Brazos, (i) shall not involve
any material danger that any Property would be subject to sale, forfeiture or
loss, as a result of failure to comply therewith, (ii) could not result in any
criminal liability from a failure to comply therewith, and could not reasonably
be expected to cause either Brazos or any Assignee to incur civil liability
which, in the sole judgment of Brazos or any Assignee, is not adequately
indemnified (Lessee's obligations under ARTICLE IX of this Agreement shall be
deemed to be adequate indemnification if no Event of Default or Potential
Default exists and if such civil liability is reasonably likely to be less than
$100,000 per Property and $1,000,000 in the aggregate), (iii) shall be permitted
under the provisions of the Acquired Ground Lease, if any, on such Property,
(iv) if involving taxes, shall suspend the collection of such taxes and (v)
shall be permitted under and be conducted in accordance with the provisions of
any other instrument to which Lessee or the Property is subject and shall not
constitute a default thereunder. Lessee shall conduct all such contests in good
faith and with due diligence and shall promptly after the final determination
(including appeals) of such contest, pay and discharge all amounts which shall
be determined to be payable therein.
(b) At least ten (10) days prior to the commencement thereof, Lessee
shall notify Brazos in writing of any such proceeding in which the amount in
contest exceeds $100,000, and shall describe such proceeding in reasonable
detail. If a taxing authority or subdivision thereof proposes an additional
assessment or levy of any tax for which Lessee is obligated to reimburse Brazos
under this Agreement, or if Brazos is notified of the commencement of an audit
or similar proceeding which could result in such an additional assessment, then
Brazos shall in a timely manner notify Lessee in writing of such proposed levy
or proceeding.
ARTICLE XI
----------
MISCELLANEOUS
AGREEMENT FOR GROUND LEASE - Page 23
--------------------------
31
Section 11.1. SURVIVAL. All agreements, indemnities, representations,
and warranties shall survive the expiration or other termination hereof.
Section 11.2. ENTIRE AGREEMENT. This Agreement and the instruments,
documents or agreements referred to herein constitute the entire agreement
between the parties and no representations, warranties, promises, guarantees or
agreements, oral or written, express or implied, have been made by any party
hereto with respect to this Agreement or the Property, except as provided herein
or therein.
Section 11.3. MODIFICATIONS. This Agreement may not be amended,
modified or terminated, nor may any obligation hereunder be waived orally, and
no such amendment, modification, termination or waiver shall be effective for
any purpose unless it is in writing, signed by the party against whom
enforcement thereof is sought. A waiver on one occasion shall not be construed
to be a waiver with respect to any other occasion.
Section 11.4. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
ANY PROVISION OF THIS AGREEMENT WHICH IS PROHIBITED BY LAW OR UNENFORCEABLE IN
ANY JURISDICTION SHALL, AS TO SUCH JURISDICTION, BE INEFFECTIVE TO THE EXTENT OF
SUCH PROHIBITION OR UNENFORCEABILITY WITHOUT INVALIDATING THE REMAINING
PROVISIONS HEREOF, AND THE PARTIES HERETO SHALL NEGOTIATE IN GOOD FAITH
APPROPRIATE MODIFICATIONS TO REFLECT SUCH CHANGES AS MAY BE REQUIRED BY LAW,
AND, AS NEARLY AS POSSIBLE, TO PRODUCE THE SAME ECONOMIC EFFECTS AS THE
PROVISION WHICH IS PROHIBITED OR UNENFORCEABLE; AND ANY SUCH PROHIBITION OR
UNENFORCEABILITY IN ANY JURISDICTION SHALL NOT INVALIDATE OR RENDER
UNENFORCEABLE SUCH PROVISION IN ANY OTHER JURISDICTION. TO THE EXTENT PERMITTED
BY APPLICABLE LAW, BRAZOS AND LESSEE HEREBY WAIVE ANY PROVISION OF LAW WHICH
RENDERS ANY PROVISION HEREOF PROHIBITED OR UNENFORCEABLE IN ANY RESPECT.
Section 11.5. NO OFFSETS. The obligations of Lessee to pay all amounts
payable pursuant to this Agreement shall be absolute and unconditional under any
and all circumstances of any character, and such amounts shall be paid without
notice, demand, defense, setoff, deduction or counterclaim and without
abatement, suspension, deferment, diminution or reduction of any kind
whatsoever, except as herein expressly otherwise provided.
LESSEE HAS SELECTED AND SHALL SELECT EACH PROPERTY ACQUIRED ON THE
BASIS OF ITS OWN JUDGMENT. NEITHER BRAZOS NOR ANY ASSIGNEE NOR ANY AFFILIATE OF
EITHER, NOR ANYONE ACTING ON BEHALF OF ANY OF THEM, MAKES ANY REPRESENTATION OR
WARRANTY OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION, AS TO THE SAFETY, TITLE, CONDITION, QUALITY, QUANTITY, FITNESS FOR
USE, MERCHANTABILITY, CONFORMITY TO SPECIFICATION, ENVIRONMENTAL CONDITION
(INCLUDING THE PRESENCE OR ABSENCE OF HAZARDOUS MATERIALS), OR ANY OTHER
CHARACTERISTIC, OF ANY PROPERTY, OR AS TO WHETHER ANY PROPERTY OR THE OWNERSHIP,
USE, OCCUPANCY OR POSSESSION THEREOF COMPLIES WITH ANY LAWS, RULES, REGULATIONS
OR REQUIREMENTS OF ANY KIND.
AS BETWEEN BRAZOS AND LESSEE, ANY ASSIGNEE OR ANY INDEMNIFIED PERSON,
AND TO THE EXTENT ALLOWED BY LAW AND EXCEPT AS OTHERWISE PROVIDED HEREIN, LESSEE
ASSUMES ALL RISKS AND WAIVES ANY AND ALL DEFENSES, SET-OFFS, DEDUCTIONS,
COUNTERCLAIMS (OR OTHER RIGHTS), EXISTING OR FUTURE, TO ITS OBLIGATION TO PAY
ALL AMOUNTS PAYABLE HEREUNDER, INCLUDING, WITHOUT LIMITATION, ANY RELATING TO:
AGREEMENT FOR GROUND LEASE - Page 24
--------------------------
32
(a) THE SAFETY, TITLE, CONDITION, QUALITY, QUANTITY, FITNESS FOR USE,
MERCHANTABILITY, CONFORMITY TO SPECIFICATION, OR ANY OTHER QUALITY OR
CHARACTERISTIC OF ANY PROPERTY, LATENT OR NOT;
(b) ANY SET-OFF, COUNTERCLAIM, RECOUPMENT, ABATEMENT, DEFENSE OR OTHER
RIGHT WHICH LESSEE MAY HAVE AGAINST BRAZOS, ANY ASSIGNEE, OR ANY INDEMNIFIED
PERSON FOR ANY REASON WHATSOEVER ARISING OUT OF THIS OR ANY OTHER TRANSACTION OR
MATTER;
(c) ANY DEFECT IN TITLE OR OWNERSHIP OF ANY PROPERTY OR ANY TITLE
ENCUMBRANCE NOW OR HEREAFTER EXISTING WITH RESPECT TO THE PROPERTY;
(d) ANY FAILURE OR DELAY IN DELIVERY OR ANY LOSS, THEFT OR DESTRUCTION
OF, OR DAMAGE TO, ANY PROPERTY, IN WHOLE OR IN PART, OR CESSATION OF THE USE OR
POSSESSION OF ANY PROPERTY BY LESSEE FOR ANY REASON WHATSOEVER AND OF WHATEVER
DURATION, OR ANY CONDEMNATION, CONFISCATION, REQUISITION, SEIZURE, PURCHASE,
TAKING OR FORFEITURE OF ANY PROPERTY, IN WHOLE OR IN PART;
(e) ANY INABILITY OR ILLEGALITY WITH RESPECT TO THE USE, OWNERSHIP,
OCCUPANCY OR POSSESSION OF THE PROPERTY BY LESSEE;
(f) ANY INSOLVENCY, BANKRUPTCY, REORGANIZATION OR SIMILAR PROCEEDING BY
OR AGAINST LESSEE, GUARANTOR OR BRAZOS;
(g) ANY FAILURE TO OBTAIN, OR EXPIRATION, SUSPENSION OR OTHER
TERMINATION OF, OR INTERRUPTION TO, ANY REQUIRED LICENSES, PERMITS, CONSENTS,
AUTHORIZATIONS, APPROVALS OR OTHER LEGAL REQUIREMENTS;
(h) THE INVALIDITY OR UNENFORCEABILITY OF THIS AGREEMENT OR ANY OTHER
INFIRMITY HEREIN OR ANY LACK OF POWER OR AUTHORITY OF BRAZOS OR LESSEE TO ENTER
INTO THIS AGREEMENT; OR
(i) ANY OTHER CIRCUMSTANCES OR HAPPENING WHATSOEVER, WHETHER OR NOT
SIMILAR TO ANY OF THE FOREGOING.
LESSEE HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY
AND ALL RIGHTS WHICH IT MAY NOW HAVE OR WHICH AT ANY TIME HEREAFTER MAY BE
CONFERRED UPON IT, BY STATUTE OR OTHERWISE, TO TERMINATE, CANCEL, QUIT, RESCIND
OR SURRENDER THIS AGREEMENT EXCEPT IN ACCORDANCE WITH THE EXPRESS TERMS HEREOF.
NOTHING CONTAINED IN THIS SECTION 11.5 SHALL BE DEEMED TO BENEFIT ANY THIRD
PARTY OR TO CONSTITUTE A WAIVER OR LIMITATION OF ANY RIGHT THAT LESSEE MAY HAVE
AGAINST ANY OTHER PERSON, INCLUDING, WITHOUT LIMITATION, ANY LESSOR OF AN
ACQUIRED GROUND LEASE (OTHER THAN BRAZOS) OR ANY PRIOR OWNER OF ANY PROPERTY.
Section 11.6. NON-RECOURSE. Brazos' obligations hereunder are intended
to be the limited obligations of the limited partnership and of the corporation
which is the general partner thereof. Notwithstanding any other provision of
this Agreement, Lessee agrees that, except for a breach by Brazos of SECTION
11.12 or SECTION 11.14, the personal liability of Brazos and the limited
partners of Brazos shall be strictly and absolutely limited to the Property and
no recourse for the payment of any amount due under this Agreement, or for any
claim based thereon or otherwise in respect thereof, shall be had against any
other assets of the limited partnership or of the general or of any limited
partner of Brazos or of any incorporator, shareholder, officer, director or
Affiliate (past, present or future) of such general partner or limited partner
AGREEMENT FOR GROUND LEASE - Page 25
--------------------------
33
of Brazos or of any Affiliate of either, or of any successor corporation to any
corporate general partner or any corporate limited partner of Brazos, it being
understood that Brazos is a limited partnership entering into the transactions
involved in and relating to this Agreement and the Ground Lease on the express
understanding aforesaid.
Section 11.7. NOTICES.
(a) Any notice or request which by any provision of this Agreement is
required or permitted to be given by either party to the other shall be deemed
to have been given when delivered by hand (including, delivery by courier),
three (3) Business Days after being deposited in the mail, postage prepaid, by
certified or registered mail or, if promptly confirmed by mail or by
hand-delivery, as provided above, when sent by telex, or other written
telecommunication, addressed to the following specified addresses or to such
other addresses as Brazos or Lessee may specify by written notice to the other
party:
If to Brazos:
Brazos Automotive Properties, L.P.
c/o Brazos Automotive Properties Management, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ Financial, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Commercial Equipment Finance Division,
Portfolio Manager
If to Agent or Assignee:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Gardere ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to Lessee:
Monro Leasing, LLC
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
AGREEMENT FOR GROUND LEASE - Page 26
--------------------------
34
Attention: ▇▇▇▇▇▇▇▇▇ ▇'▇▇▇▇▇, Senior Vice-President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ ▇ ▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to any Assignee at such other address as such Assignee may specify
by written notice to Brazos and Lessee.
(b) Brazos shall within five (5) Business Days give to Lessee a copy of
all notices received by Brazos pursuant to any Credit Agreement or any Acquired
Ground Lease and any other notices received with respect to any Property.
Section 11.8. FUNDAMENTAL CHANGES. Lessee shall not consolidate with or
merge into any other corporation which is not a Subsidiary or sell all or
substantially all of its assets to any Person which is not a Subsidiary, except
that Lessee may consolidate with or merge into any other corporation, or sell
all or substantially all of its assets to any Person; provided that, (i) no
default or event of default occurs under the Corporate Credit Documents and (ii)
the surviving corporation or transferee Person shall assume, by execution and
delivery of instruments satisfactory to Brazos and Agent, the obligations of
Lessee hereunder and become successor to Lessee, but Lessee, if it is a
surviving corporation, shall not thereby be released, without the consent of
Brazos, such consent not to be unreasonably withheld or delayed, from its
obligations hereunder and, provided further, that such surviving corporation or
transferee Person will, on a pro forma basis, immediately after such
consolidation, merger or sale, possess a consolidated net worth greater than or
equal to that of Lessee immediately prior to such consolidation, merger or sale,
and provided further that each Guarantor shall reaffirm its obligations under
the Guaranty by execution and delivery of instruments satisfactory to Brazos and
Agent and no Event of Default shall have occurred or result therefrom. Lessee
may assign its rights and obligations under this Agreement with respect to any
Property to a Subsidiary of Lessee; provided that Lessee shall, in connection
with any such assignment, continue to be liable hereunder without regard to such
assignment and Lessee shall guaranty the performance of all obligations of such
assignee.
AGREEMENT FOR GROUND LEASE - Page 27
--------------------------
35
Section 11.9. USURY. No provision of this Agreement or any other
instrument relating to this Agreement, shall require the payment or permit the
collection of interest in excess of the maximum nonusurious interest rate under
applicable law (the "MAXIMUM RATE"). If any excess interest in such respect is
so provided for, or shall be adjudicated to be so provided for, the provisions
of this SECTION 11.9 shall govern, and neither Lessee nor its successors or
assigns shall be obligated to pay the amount of such interest to the extent it
is in excess of the Maximum Rate. In determining the Maximum Rate, any interest
shall be spread over the term of this Agreement to the extent permitted by
applicable U.S. Federal or state law, notwithstanding the actual time for the
payment of any rent or other amounts hereunder. It is expressly stipulated and
agreed to be the intent of Brazos and Lessee at all times to comply with
applicable state law governing the Maximum Rate or the amount of interest
payable pursuant to this Agreement (or applicable U.S. Federal law to the extent
that it permits Brazos to contract for, charge, take, reserve or receive a
greater amount of interest than under state law). If the applicable law is ever
judicially interpreted so as to render usurious any amount called for under this
Agreement, the Agreement or any of the other documents relating to this
Agreement or any amount contracted for, charged, taken, reserved or received
with respect to this Agreement, or if Brazos' exercise of any option herein or
in any other document contained to accelerate the payment of amounts required
hereunder results in Lessee having paid any interest in excess of that permitted
by applicable law, then it is Brazos' and Lessee's intent that all excess
amounts theretofore collected by Brazos be credited on the remaining balance of
payments due hereunder (or, if all amounts due hereunder have been or would
thereby be paid in full, refunded to Lessee) and the provisions of this
Agreement shall immediately be deemed reformed in the amounts thereafter
collectible hereunder reduced, without the necessity of the execution of any new
documents, so as to comply with the applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder and under any
other document relating hereto. If at any time the amount of any interest for a
year, would, but for this SECTION 11.9, exceed the amount of interest that would
have been accrued during such year if the Maximum Rate had from time to time
been in effect, the total interest payable for such year shall be limited to the
amount that would have been accrued if the Maximum Rate had from time to time
been in effect, and to the fullest extent permitted by applicable law, such
excess shall be (i) spread and allocated to the preceding periods in which the
interest paid was less than the interest that would have been accrued at the
Maximum Rate or (ii) spread and allocated to subsequent periods in which the
total payments on account of interest are less than the interest that would have
accrued at the Maximum Rate.
Section 11.10. NO WAIVERS. No advance hereunder shall constitute a
waiver of any of the conditions of Brazos' obligation to make further advances
nor, if Lessee is unable to satisfy any such condition, shall any waiver of such
condition have the effect of precluding Brazos from thereafter declaring such
inability to be an Event of Default as herein provided. Any advance made by
Brazos and any sums expended by Brazos pursuant to this Agreement shall be
deemed to have been made pursuant to this Agreement, notwithstanding the
existence of an uncured Event of Default. No advance at a time when an Event of
Default exists shall constitute a waiver of any right or remedy of Brazos
existing by reason of such Event of Default, including, without limitation, the
right to refuse to make further advances.
Section 11.11. BRAZOS AND ASSIGNEE SOLE BENEFICIARIES. All conditions
of the obligation of Brazos to make advances hereunder are imposed solely and
exclusively for the benefit of Brazos and Assignee and their assigns and no
other person shall have standing to require satisfaction of such conditions in
accordance with their terms or be entitled to assume that Brazos will refuse to
make advances in the absence of strict compliance with any or all thereof and no
other person shall, under any circumstances, be deemed to be a beneficiary of
such conditions, any or all of which may be freely waived in whole or in part by
Brazos, with the consent of Agent, at any time if in its sole discretion it
deems it advisable to do so. Brazos' sole obligation hereunder is to make the
advances if and to the extent required by this Agreement.
AGREEMENT FOR GROUND LEASE - Page 28
--------------------------
36
Section 11.12. SALE OR ASSIGNMENT BY BRAZOS.
(a) Brazos shall not sell, mortgage or encumber or assign its right,
title, interest or obligations in a Property or under this Agreement, except
that Brazos shall have the right to finance the acquisition and ownership of the
Property by selling, assigning or granting a security interest in its right,
title and interest in this Agreement as provided in the Credit Agreement and any
or all amounts due from Lessee or any third party under this Agreement as
provided in the Credit Agreement; provided that any such sale, assignment or
grant of a security interest shall be subject to the rights and interests of
Lessee under this Agreement and the Ground Lease.
(b) Upon the occurrence of an event of default under the Credit
Agreement, any Assignee shall, except as otherwise agreed by Brazos and
Assignee, have all the rights, powers, privileges and remedies of Brazos
hereunder, and Lessee's obligations as between itself and such Assignee
hereunder shall not be subject to any claims or defense that Lessee may have
against Brazos. Upon written notice to Lessee of any such assignment, Lessee
shall attorn to any Assignee, and Lessee shall thereafter make payments of any
and all sums due hereunder to Assignee, to the extent specified in such notice,
and such payments shall discharge the obligation of Lessee to Brazos hereunder
to the extent of such payments. Anything contained herein to the contrary
notwithstanding, no Assignee shall be obligated to perform any duty, covenant or
condition required to be performed by Brazos hereunder, and any such duty,
covenant or condition shall be and remain the sole obligation of Brazos except
as set forth in the Subordination, Non-Disturbance and Attornment Agreement (as
defined in the Credit Agreement) for each Property.
Section 11.13. RIGHTS CUMULATIVE. All rights, powers and remedies
herein given to Brazos are cumulative and not alternative, and are in addition
to all statutes or rules of law; any forbearance or delay by Brazos in
exercising the same shall not be deemed to be a waiver thereof, and the exercise
of any right or partial exercise thereof shall not preclude the further exercise
thereof, and the same shall continue in full force and effect until specifically
waived by an instrument in writing executed by Brazos. All representations and
covenants by Lessee shall survive the making of the advances, and the provisions
hereof shall be binding upon and inure to the benefit of the respective
successors and permitted assigns, if any, of the parties hereto. Lessee may not,
however, assign its rights or obligations as agent hereunder other than in
accordance with the terms of this Agreement.
Section 11.14. REASSIGNMENT. In the event that Lessee advances its own
funds for the acquisition of any Property in the name of Brazos and an Initial
Advance for such Property is not made under this Agreement for any reason,
including a default on the part of Lessee, Brazos hereby agrees to execute all
instruments of assignment and transfer with respect to such Property, without
warranty (except for special warranties against the actions of Brazos), or
recourse to Brazos except to the extent of any applicable title insurance, which
may be necessary to transfer all of Brazos' right, title and interest in and to
such Property to Lessee. Any Property which is assigned and transferred by
Brazos to Lessee pursuant to this Section shall not thereafter be acquired by
Brazos or by Lessee on behalf of Brazos under this Agreement. All agreements,
indemnities, warranties and representations of Lessee pertaining to such
Property shall survive any transfer by Brazos to Lessee pursuant to this SECTION
11.14. The obligations of Brazos under this SECTION 11.14 shall survive any
termination of this Agreement.
Section 11.15. SEVERABILITY. In case one or more provisions of this
Agreement shall be invalid, illegal or unenforceable in any respect under any
applicable law, the validity, legality and enforceability of the remaining
provisions contained herein shall not be affected or impaired thereby.
Section 11.16. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
Section 11.17. CONFIDENTIALITY. Brazos shall keep confidential all
information of a confidential nature received by it from Lessee pursuant to this
Agreement; provided, however, that such information may be disclosed where
necessary: (i) to directors, officers, employees, agents, representatives or
outside counsel of Brazos or of the Agent or any Bank or
AGREEMENT FOR GROUND LEASE - Page 29
--------------------------
37
any Affiliate of any Bank under any Credit Agreement; (ii) to any auditor,
government official or examiner; (iii) pursuant to any subpoena or other court
order or otherwise as may be required by applicable law; or (iv) to any assignee
of or participant in, or prospective assignee of or participant in, any Bank's
Advances or its Commitment or any part thereof under any Credit Agreement who,
in each case, agrees in writing to be bound by the terms of this Section; and
provided further, that no confidentiality obligation shall attach to any
information which (1) is or becomes publicly known, through no wrongful act on
the part of any Person who shall have received such information, (2) is
rightfully received by such Person from a third party, (3) is independently
developed by such Person, or (4) is explicitly approved for release by Lessee.
Section 11.18. EXECUTION BY LESSEE. By execution of the Memorandum of
Lease for a Property, Lessee agrees to all of the terms and conditions of this
Agreement and is deemed to have executed this Agreement as of the date of the
request for advance with respect to such Property.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
AGREEMENT FOR GROUND LEASE - Page 30
--------------------------
38
IN WITNESS WHEREOF, Brazos and Lessee have caused this Agreement to be
executed and delivered by their duly authorized officers as of the day and year
first above written.
BRAZOS AUTOMOTIVE PROPERTIES, L.P.,
a Delaware limited partnership
By: BRAZOS AUTOMOTIVE PROPERTIES MANAGEMENT,
INC., a Delaware corporation, its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Executive Vice President
MONRO LEASING, LLC,
a Delaware limited liability company
By: MONRO MUFFLER BRAKE, INC.,
its Sole Member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
------------------------------------------------------
▇▇▇▇▇▇▇▇▇ ▇'▇▇▇▇▇, Senior Vice President and
Chief Financial Officer
AGREEMENT FOR GROUND LEASE - Page 31
--------------------------
39
STATE OF NEW YORK }
}
COUNTY OF NEW YORK }
On the 15th day of September 1998, before me personally came ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ who, being by me duly sworn, did depose and say that he is the
Executive Vice President of BRAZOS AUTOMOTIVE PROPERTIES MANAGEMENT, INC., a
Delaware corporation, the General Partner of BRAZOS AUTOMOTIVE PROPERTIES, L.P.,
a Delaware limited partnership, and as said officer executed the foregoing
instrument.
--------------------------------------------
NOTARY PUBLIC IN AND FOR
THE STATE OF NEW YORK
[SEAL]
STATE OF NEW YORK }
}
COUNTY OF NEW YORK }
On the 15th day of September 1998, before me personally came ▇▇▇▇▇▇▇▇▇
▇'▇▇▇▇▇ who, being by me duly sworn, did depose and say that she is the Senior
Vice President and Chief Financial Officer of MONRO MUFFLER BRAKE, INC., a New
York corporation, the Sole Member of MONRO LEASING, LLC, a Delaware limited
liability company, and as said officer executed the foregoing instrument.
--------------------------------------------
NOTARY PUBLIC IN AND FOR
THE STATE OF NEW YORK
[SEAL]
AGREEMENT FOR GROUND LEASE - Page 32
--------------------------
40
EXHIBIT A
FORM OF GROUND LEASE AGREEMENT
AGREEMENT FOR GROUND LEASE - Page 33
--------------------------
41
EXHIBIT B
Property No._________
INITIAL ADVANCE CERTIFICATE
MONRO LEASING, LLC ("LESSEE"), the Lessee under a certain Agreement for
Ground Lease (the "AGREEMENT FOR GROUND LEASE") dated as of September 15, 1998,
between BRAZOS AUTOMOTIVE PROPERTIES, L.P. ("OWNER") and Lessee, delivers this
Initial Advance Certificate as a part of Lessee's Request for Initial Advance
made with respect to the above noted Property. All capitalized terms used in
this Certificate shall have the meanings given to such terms in the Agreement
for Ground Lease. Lessee hereby certifies, warrants and represents to Owner as
follows:
1. LEGAL DESCRIPTION. Accompanying this Certificate is a copy of
the form of deed by which the Property will be conveyed to
Owner, which sets forth a true and complete legal description
for the Property. The Property is being acquired pursuant to
the Purchase Option Agreement or Acquired Ground Lease
accompanying this Certificate (being a true, complete, and
correct copy thereof and of all amendments thereto).
2. ITEMIZATION OF COSTS. Accompanying this Certificate is a true,
complete, and correct itemization of all costs incurred to
date or to be incurred in connection with the closing of the
acquisition of Owner's interest in the Property. Each item of
cost is for the Property described herein and is within the
Budget approved by Agent.
3. TITLE. Accompanying this Certificate is a true, complete, and
correct copy of a Commitment for Title Insurance issued with
respect to the Property by _____________ Title Insurance
Company, bearing Commitment No. ____________ and an Effective
Date of _____________. To the best of Lessee's knowledge,
after due inquiry, no mechanics' or materialmen's liens have
been filed in connection with the Property, and with the
exception of the Deed of Trust, Security Agreement, Assignment
of Rents and Fixture Filing granted by Owner in connection
with the acquisition of the Property, there are no Liens of
Record affecting the title to the subject Property.
All matters affecting title to the Property as to which Lessee
has any knowledge, recorded or unrecorded, are disclosed to
Owner in writing as reflected in the documents constituting
this Request for Initial Advance with respect to such
Property, and all such matters are Permitted Exceptions.
4. SURVEY. Accompanying this Certificate is a true, complete, and
correct copy of the survey covering the Property contained in
the files of Lessee. To the best of Lessee's knowledge, there
has been no change in the location of the established building
setback lines or in the lines of streets abutting the Property
and the width thereof since the date of the survey.
5. TAXES. Taxes levied on the Property for years prior to
_______________ have been paid in full.
6. FLOOD INSURANCE. The subject Property does not lie within the
flood hazard area, and no flood insurance is required in
connection with the improvement of said Property or if the
subject Property does lie within the flood hazard area, a
policy of flood insurance has been obtained in accordance with
the Agreement for Ground Lease.
7. REPRESENTATIONS. Lessee represents to Owner that (a) all costs
and expenses which are the subject of the Initial Advance
requested hereby have been or will be paid in full out of the
proceeds of this Initial Advance; (b) all representations,
covenants, and warranties of Lessee contained in the Agreement
for Ground Lease and in the Ground Lease are true and correct
in all material respects as of the date hereof;
AGREEMENT FOR GROUND LEASE - Page 34
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(c) all additional matters required by Section 6.1 of the
Agreement for Ground Lease are enclosed herewith; and (d) no
Event of Default exists under the Agreement for Ground Lease,
and none will arise after giving effect to the Initial Advance
to be made hereunder.
8. INSURANCE. Lessee maintains the insurance coverage required by
the Ground Lease as indicated by the certificates of insurance
previously delivered to Owner or to be delivered on or after
closing to Owner. Such insurance will be effective as to the
subject Property upon acquisition thereof by Owner.
Dated as of _________ , _____.
MONRO LEASING, LLC
By: MONRO MUFFLER BRAKE, INC.,
its Sole Member
By:___________________________________
Name:_________________________________
Title:________________________________
AGREEMENT FOR GROUND LEASE - Page 35
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EXHIBIT "C"
Property No. _______________
RECONCILIATION CERTIFICATE
MONRO LEASING, LLC ("LESSEE"), the Lessee under a certain Agreement for
Ground Lease (the "AGREEMENT FOR GROUND LEASE") dated as of September 15, 1998,
between BRAZOS AUTOMOTIVE PROPERTIES, L.P. ("OWNER") and Lessee, delivers this
Reconciliation Certificate as part of Lessee's Request for Reconciliation
Advance made with respect to the above noted Property. All capitalized terms
used in this Certificate shall have the meanings given to such terms in the
Agreement for Ground Lease. Lessee hereby certifies, warrants and represents to
Owner as follows:
1. COMPLETION OF ACQUISITION. The completion of the acquisition
of the Property has occurred.
2. STATEMENT OF EXPENDITURES. Attached hereto is a true,
complete, and correct itemization of all costs actually
incurred in connection with the acquisition of the Property
and for which the Reconciliation Advance is being made. The
Initial Advance was $ ___________. With the Reconciliation
Advance, the total expenditures will be $ _____________. Each
item of cost is for the Property described herein and is
within the Budget approved by Agent.
3. TITLE. After matters affecting title to the Property as to
which Lessee has any knowledge, recorded or unrecorded, are
described in an Exhibit attached hereto or were disclosed to
Owner in writing as reflected in the documents constituting
the Request for Initial Advance with respect to such Property,
and all such matters are Permitted Exceptions. To the best of
Lessee's knowledge, since the Initial Advance there has been
no change in the state of title of the Property, and no
additional survey or title exceptions or Liens have been
discovered or created. Upon acquisition of the Property, Owner
granted a Deed of Trust, Security Agreement, Assignment of
Rents and Fixture Filing to ______________ Title Insurance
Company as Trustee for the benefit of ______________[Lender],
which Deed of Trust, Security Agreement, Assignment of Rents
and Fixture Filing is recorded in Book _________, Page ___, of
the Official Public Records of ________ County, ______.
4. REPRESENTATIONS. Lessee represents to owner that (a) all costs
and expenses which are the subject of the Reconciliation
Advance requested hereby are amounts which have been paid by
Lessee and all such amounts have been paid in connection with
the acquisition of the Property, (b) all representations,
covenants and warranties of Lessee contained in the Agreement
for Ground Lease and in the Ground Lease are true and correct
in all material respects as of the date hereof, (c) all
additional matters required by Section 7.1 of the Agreement
for Ground Lease are enclosed herewith, and (d) no Event of
Default exists under the Agreement for Ground Lease, and none
will arise after giving effect to the Reconciliation Advance
to be made hereunder.
5. INSURANCE. Lessee maintains the insurance coverage required by
the Ground Lease as indicated by the certificate of insurance
delivered to Owner or to be delivered on or after closing to
Owner. Such insurance is effective with respect to the
Property and complies with the terms of the Ground Lease.
MONRO LEASING, LLC
Dated as of _______________
By: MONRO MUFFLER BRAKE, INC.,
its Sole Member
By:________________________________
Name:______________________________
Title:_____________________________
AGREEMENT FOR GROUND LEASE - Page 36
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EXHIBIT "D"
Property No.
ADDITIONAL ADVANCE CERTIFICATE
MONRO LEASING, LLC ("LESSEE"), the Lessee under a certain Agreement for
Ground Lease (the "AGREEMENT FOR GROUND LEASE") dated as of September 15, 1998,
between BRAZOS AUTOMOTIVE PROPERTIES, L.P. ("OWNER") and Lessee, delivers this
Additional Advance Certificate as part of Lessee's Request for Additional
Advance made with respect to Additional Property contiguous to the above noted
Property. All capitalized terms used in this Certificate shall have the meanings
given to such terms in the Agreement for Ground Lease. Lessee hereby certifies,
warrants and represents to Owner as follows:
1. LEGAL DESCRIPTION. Accompanying this Certificate is a copy of
the form of Warranty Deed or Acquired Ground Lease by which
the Additional Property will be conveyed or leased to Owner,
which sets forth a true and complete legal description for the
Additional Property. The Additional Property is being acquired
pursuant to the Purchase Option Agreement or Acquired Ground
Lease accompanying this Certificate (being a true, complete,
and correct copy thereof and of all amendments thereto) and is
contiguous to Property No. ___________.
2. ITEMIZATION OF COSTS. Accompanying this Certificate is a true,
complete, and correct itemization of all costs incurred to
date or to be incurred in connection with the closing of the
acquisition of Owner's interest in the Property. Each item of
cost is for the Additional Property described herein and is
within the Budget approved by Agent.
3. TITLE. Accompanying this Certificate is a true, complete, and
correct copy of a Commitment for Title Insurance issued with
respect to the Additional Property by ___________ Title
Insurance Company, bearing Commitment No. ______________ and
an Effective Date of _____________. Owner is the owner in fee
of the Additional Property. To the best of Lessee's knowledge,
after due inquiry, no mechanics' or materialmen's liens have
been filed in connection with the Additional Property, and
with the exception of the Deed of Trust, Security Agreement,
Assignment of Rents and Fixture Filing granted by Owner in
connection with the acquisition of the Additional Property,
there are no recorded mechanics' or materialmen's liens or
other Liens of Record affecting the title to the Additional
Property.
All matters affecting title to the Additional Property as to
which Lessee has any knowledge, recorded or unrecorded, are
disclosed to Owner in writing as reflected in the documents
constituting this Request for Additional Advance with respect
to such Additional Property, and all such matters are
Permitted Exceptions.
4. TAXES. Taxes levied on the subject Additional Property for
years prior to ____________ have been paid in full.
5. FLOOD INSURANCE. The Additional Property does not lie within
the flood hazard area, and no flood insurance is required in
connection with the improvement of said property or if the
Additional Property does lie within the flood hazard area, a
policy of flood insurance has been obtained in accordance with
the Agreement for Ground Lease.
6. REPRESENTATIONS. Lessee represents to Owner that (a) all costs
and expenses which are the subject of the Additional Advance
requested hereby have been or will be paid in full out of the
proceeds of this Additional Advance, (b) all representations,
covenants, and warranties of Lessee contained in the Agreement
for Ground Lease and in the Ground Lease are true and correct
in all material respects as of the date hereof, (c) all
additional matters required by Section 6.1 of the Agreement
for Ground Lease are enclosed herewith, and (d) no Event of
Default exists under the Agreement for Ground Lease, or
AGREEMENT FOR GROUND LEASE - Page 37
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Ground Lease Agreement, and none will arise after giving
effect to the Additional Advance to be made hereunder.
7. INSURANCE. Lessee maintains the insurance coverage required by
the Ground Lease as indicated by the certificates of insurance
previously delivered to Owner or to be delivered on or after
closing to Owner. Such insurance will be effective as to the
Additional Property upon acquisition thereof by Owner.
Dated as of __________________.
MONRO LEASING, LLC
By: MONRO MUFFLER BRAKE, INC.,
its Sole Member
By:_____________________________________
Name:___________________________________
Title:__________________________________
AGREEMENT FOR GROUND LEASE - Page 38
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EXHIBIT "E"
FORM OF LOCAL COUNSEL OPINION
1. The form of the Deed of Trust and Assignment of Leases and Rents to
be filed in ______________ is in proper form under applicable law to (a) be
accepted for recording in the office of the [Recorder of Deeds] in and for any
county in __________________; (b) create and constitute a valid mortgage lien on
or security interest in the [Trust Estate (as defined in such Deed of Trust and
Assignment of Leases and Rents)]; and (c) be enforceable against the Borrower,
in accordance with its terms.
2. The recording of the Deed of Trust to be filed in ______________
with the office of the [Recorder of Deeds] in the county where the real property
to be encumbered is located is the only recording or filing necessary to publish
notice to perfect the liens and security interests created by the Deed of Trust
and Assignment of Leases and Rents to the extent such liens and security
interests may be perfected under the laws of __________.
3. Except for the payment of recording or filing fees with respect to
UCC-1 Financing Statements and any Deed of Trust to be filed in
__________________ no other taxes and governmental fees and charges are required
by any applicable Governmental Authority in connection with (a) the creation,
perfection, or the recording of the liens purported to be created by the
Security Documents, (b) the execution and delivery of the Credit Documents, or
(c) the obtaining of credit under the Credit Agreement.
4. Upon the filing of appropriate UCC-1 Financing Statements with the
____________________ Secretary of State, the security interests of the
Banks in the Collateral created by the Security Agreement will constitute
perfected security interests under the Uniform Commercial Code as in effect to
the extent that a security interest in the Collateral may be perfected by filing
with the ____________.
5. The Lease Documents are in acceptable legal form and constitute
legal, valid, and binding obligations of the respective parties thereto
enforceable against them under ____________ law in accordance with the terms of
such documents.
AGREEMENT FOR GROUND LEASE - Page 39
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EXHIBIT "F"
FORM OF REQUEST FOR INITIAL ADVANCE
September 15, 1998
Brazos Automotive Properties, L.P.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Re: Request for Initial Advance for Facility No. ___________,
located at ________________________________.
Dear ▇▇. ▇▇▇▇▇▇:
This Request for Initial Advance is delivered pursuant to the Lease
Documents dated as of September 15, 1998, between Brazos Automotive Properties,
L.P.("BRAZOS") and Monro Leasing, LLC ("MONRO"). The complete Request for
Initial Advance consists of this statement and the various documents provided
herewith, and the complete Request for Initial Advance is being provided to
legal counsel for Brazos and The Chase Manhattan Bank, respectively. All
documents provided herewith, including the Initial Advance Certificate, are true
and correct. All capitalized terms used herein shall have the meanings given to
such terms in either the Agreement for Ground Lease or the Agreement for
Facilities Lease, whichever is applicable.
It is contemplated that the Effective Date of the Facility, as will be
evidenced by a Facility Leasing Record, will be September 15, 1998 and you are
requested to pay on that date the sum of $____________ (comprised of a ground
advance of $________________ and a facility advance of $_____________) by wire
transfer of immediately available funds to CHICAGO TITLE INSURANCE COMPANY. The
representative of MONRO to contact with regard to the wire transfer is ▇▇▇▇▇▇▇▇▇
▇'▇▇▇▇▇ at (▇▇▇) ▇▇▇-▇▇▇▇.
MONRO LEASING, LLC,
a Delaware limited liability company
By: MONRO MUFFLER BRAKE, INC.,
a New York corporation, its Sole Member
By:______________________________________
Name:____________________________________
Title:___________________________________
Enclosures
cc: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
AGREEMENT FOR GROUND LEASE - Page 40
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▇▇▇▇▇ ▇. ▇▇▇▇▇
Gardere ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
AGREEMENT FOR GROUND LEASE - Page 41
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SCHEDULE 4.13
LIST OF ACQUIRED GROUND LEASES
APPRAISAL
NUMBER LOCATION VALUE ($)
5/0655 Hartford, CT 50,000
6/0656 Waterbury, CT 90,000
20/0752 Elsmere, DE 70,000
46/2020 Newton, MA 40,000
47/2021 Waltham, MA 90,000
49/2026 Auburn, MA 70,000
50/2030 Danvers, MA 200,000
53/2056 Framingham, MA 90,000
▇▇/▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ 10,000
83/2122 Ferndale, MI 110,000
97/3105 Tonawanda, NY 50,000
98/3106 Willamsville, NY 90,000
101/3110 Bellmore, NY 100,000
102/3111 Hempstead, NY 80,000
104/3124 Huntington, NY 90,000
▇▇▇/▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ 100,000
▇▇▇/▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ 70,000
▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ 140,000
109/3135 Smithtown, NY 210,000
142/3452 Brooklyn, OH 100,000
▇▇▇/▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ 110,000
169/3726 Pittsburgh, PA 100,000
171/3731 Harrisburg, PA 110,000
172/3734 Philadelphia, PA 130,000
174/3736 York, PA 380,000
194/4501 Fairfax, VA 190,000
AGREEMENT FOR GROUND LEASE - Page 42
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