Exhibit10.1

 

AMENDED AND RESTATED LEASE AGREEMENT

Between

Joint DevelopmentAuthority of Brooks, Colquitt, 

Grady, Mitchell,and Thomas Counties 

(a public body corporate andpolitic)

as Lessor and Landlord

and

NATIONAL BEEF PACKING COMPANY, LLC

(a limited liability company organized and existing 

under the laws of the State of Delaware)

 

as Lessee and Tenant

Dated as of  April 1, 2006

 

 

 

 

 

 

THEPARTIES INTEND FOR THE RIGHTS AND INTEREST OF THEJOINT DEVELOPMENT AUTHORITY OF BROOKS, COLQUITT, GRADY, MITCHELL, AND THOMASCOUNTIES (THE “ISSUER”) IN THE PROJECT LEASED HEREUNDER, THIS LEASE AGREEMENTAND CERTAIN REVENUES AND RECEIPTS DERIVED HEREUNDER, EXCEPT FOR CERTAINUNASSIGNED RIGHTS, AS DEFINED HEREIN, TO BE RESPECTIVELY CONVEYED, ASSIGNED ANDPLEDGED TO AMERICAN BANKING COMPANY D/B/A AMERIS (THE “PURCHASER”) AS SECURITYFOR $3,200,000 MAXIMUM PRINCIPAL AMOUNT OF THE ISSUER’S TAX-EXEMPT INDUSTRIALDEVELOPMENT REVENUE BOND (NATIONAL BEEF PROJECT), SERIES 2006 AND ITS TAXABLEINDUSTRIAL DEVELOPMENT REVENUE BOND (NATIONAL BEEF PROJECT), SERIES 2006 ASPROVIDED IN AN INSTRUMENT ENTITLED “DEED TO SECURE DEBT, ASSIGNMENT OF LEASES ANDRENTS AND SECURITY AGREEMENT” FROM THE ISSUER, AS GRANTOR, TO THE PURCHASER, ASGRANTEE.

 

 

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TABLE OF CONTENTS

 

(This Table of Contents isnot a part of the Lease

Agreement and is only forconvenience of reference.)

| ARTICLE I   DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION                                                                                                                                                                                                                                                          |   3 |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------|
| Section 1.1.  Definitions                                                                                                                                                                                                                                                                                                    |   3 |
| Section 1.2.   Construction Of Certain Terms                                                                                                                                                                                                                                                                                 |   8 |
| Section 1.3.  Table  of Contents; Titles and Headings                                                                                                                                                                                                                                                                        |   9 |
| ARTICLE II   REPRESENTATIONS AND UNDERTAKINGS                                                                                                                                                                                                                                                                                | 10            |
| Section 2.1.   Representations by the Issuer                                                                                                                                                                                                                                                                                 | 10            |
| Section 2.2.   Representations by the Company                                                                                                                                                                                                                                                                                | 11            |
| ARTICLE III  LEASING  CLAUSE; SECURITY; TITLE                                                                                                                                                                                                                                                                                | 12            |
| Section 3.1.  Lease  of the Project                                                                                                                                                                                                                                                                                          | 12            |
| Section 3.2.   Security for Payments Under the Bonds                                                                                                                                                                                                                                                                         | 12            |
| Section 3.3.   Warranties and Covenants of Authority as to Title                                                                                                                                                                                                                                                             | 13            |
| Section 3.4.   Warranties and Covenants of Company as to Title                                                                                                                                                                                                                                                               | 13            |
| ARTICLE IV   CONSTRUCTION OF THE LEASED IMPROVEMENTS; ISSUANCE OF THE                                        BONDS; FUNDS | 14            |
| Section 4.1.   Agreement to Construct the Project                                                                                                                                                                                                                                                                            | 14            |
| Section 4.2.   Funding of Project Costs                                                                                                                                                                                                                                                                                      | 14            |
| Section 4.3.  Use of  Bond Proceeds                                                                                                                                                                                                                                                                                          | 14            |
| Section 4.4.   Disbursements from the Bond Proceeds                                                                                                                                                                                                                                                                          | 14            |
| Section 4.5.   Obligation of the Parties to Cooperate in Furnishing Documents;                           Reliance of  the Custodian                                                             | 14            |
| Section 4.6.   Establishment of Completion Date                                                                                                                                                                                                                                                                              | 14            |

 

 

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| Section 4.7.   Company Required to Pay the Company’s Project Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 15 |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----|
| Section 4.8.   Authorized Company and Authority Representatives and Successors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 15 |
| Section 4.9.   Enforcement of Remedies Against Contractors, Subcontractors,                           Suppliers,  Fabricators and Their Sureties                                                                                                                                                                                                                                                                                                                                | 15 |
| ARTICLE V  EFFECTIVE  DATE OF THIS LEASE; DURATION OF LEASE TERM;                                         RENTAL PROVISIONS; NATURE OF  OBLIGATIONS OF                                         COMPANY | 16 |
| Section 5.1.   Effective Date of this Lease; Duration of Lease Term                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 16 |
| Section 5.2.   Delivery and Acceptance of Possession; Quiet Enjoyment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 16 |
| Section 5.3.  Rents  and Other Amounts Payable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 16 |
| Section 5.4.  Place  of Rental Payments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 17 |
| Section 5.5.  Nature  of Obligations of Company Hereunder                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 17 |
| ARTICLE VI   MAINTENANCE, TAXES, INSURANCE AND EMINENT DOMAIN                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 19 |
| Section 6.1.   Maintenance of Project                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 19 |
| Section 6.2.   Removal of Building Fixtures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 19 |
| Section 6.3.  Taxes,  Other Governmental Charges, and Utility Charges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 20 |
| Section 6.4.   Insurance Required.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 21 |
| Section 6.5.   Application of Net Proceeds of Insurance                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 22 |
| Section 6.6.   Advances by the Issuer or the Holder                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 22 |
| Section 6.7.   Eminent Domain                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 23 |
| ARTICLE VII  DAMAGE,  DESTRUCTION, AND CONDEMNATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 24 |
| Section 7.1.   Repair, Restoration or Replacement                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 24 |
| ARTICLE VIII   ADDITIONAL COVENANTS; ADDITIONAL BONDS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 25 |
| Section 8.1.  No  Warranty of Condition or Suitability by the Issuer                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 25 |
| Section 8.2.  Access  to Project and Records                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 25 |

 

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| Section 8.3.   Company to Maintain its Existence and Qualification; Conditions                           Under Which  Exceptions Permitted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 25 |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----|
| Section 8.4.   Operation of the Project and Tax Covenants                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 26 |
| ARTICLE IX   ASSIGNMENT, SUBLEASING, ENCUMBERING, AND SELLING;                                         REDEMPTION; RENT  PREPAYMENTS AND ABATEMENT;                                         INSTALLATION OF COMPANY’S OWN MACHINERY AND  			                                        EQUIPMENT | 29 |
| Section 9.1.   Assignment and Subleasing                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 29 |
| Section 9.2.   Restrictions on Sale, Encumbrance, or Conveyance of the Project                          by the Issuer                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 29 |
| Section 9.3.   Restrictions on Encumbrance by the Company                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 30 |
| Section 9.4.   Redemption of Bonds                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 30 |
| Section 9.5.   Prepayment of Basic Rent                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 30 |
| Section 9.6.   Reserved.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 31 |
| Section 9.7.   Installation of Company’s Own Machinery and Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 31 |
| Section 9.8.   Reference to the Bonds Ineffective After such Bonds are Paid                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 31 |
| ARTICLE X  EVENTS OF  DEFAULT AND REMEDIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 32 |
| Section 10.1.   Events of Default Defined                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 32 |
| Section 10.2.   Remedies on Default                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 32 |
| Section 10.3.   Remedies Not Exclusive                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 33 |
| Section 10.4.   Company to Pay Fees and Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 33 |
| Section 10.5.   Waiver of Events of Default                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 34 |
| ARTICLE XI  PURCHASE  OPTION IN FAVOR OF COMPANY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 35 |
| Section 11.1.   Option to Purchase Project                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 35 |
| Section 11.2.   Conveyance on Exercise of Option to Purchase                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 35 |
| Section 11.3.   Public Purpose of Option to Purchase                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 35 |

 

 

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| Section 11.4.   Priority Position of Option                                | 35 |
|---------------------------------------------------------------------------------|----|
| ARTICLE XII   MISCELLANEOUS                                                | 37 |
| Section 12.1.  Supplemental  Payments for Failure to Meet Employment Goals | 37 |
| Section 12.2.   Notices                                                    | 38 |
| Section 12.3.   Recording                                                  | 39 |
| Section 12.4.   Construction and Binding Effect                            | 39 |
| Section 12.5.   Severability                                               | 39 |
| Section 12.6.   Immunity of Members, Officers, and Employees of Authority  | 39 |
| Section 12.7.   Amendments, Changes, and Modifications                     | 39 |
| Section 12.8.   Execution of Counterparts                                  | 39 |
| Section 12.9.  Law  Governing Construction of this Lease                   | 39 |
| Section 12.10.   Covenants Run with Project                                | 40 |
| Section 12.11.   Subordination to Security Deed                            | 40 |
| Section 12.12.  Net  Lease                                                 | 40 |
| Section 12.13.   Surrender of Project                                      | 40 |
| Section 12.14.   Immunity of Directors, Officers, and Employees of Company | 40 |
| Section 12.15.   Payments Due on Other than Business Days                  | 40 |
| Section 12.16.   Holders are Third Party Beneficiaries                     | 41 |
| Section 12.17.   Restriction on Use                                        | 41 |
| EXHIBIT A                                                                       | 44 |

 

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AMENDED AND RESTATED LEASE AGREEMENT

STATE OF GEORGIA          )

COLQUITT COUNTY          )

This**AMENDED AND RESTATED LEASE AGREEMENT** (this“Lease”), dated as of April 1, 2006, by and between the **JOINT DEVELOPMENTAUTHORITY OF BROOKS, COLQUITT, GRADY, MITCHELL, AND THOMAS COUNTIES**(the “Issuer”),a public body corporate and politic and public corporation created and existingunder the laws of the State of Georgia, party of the first part, and**NATIONAL BEEF PACKING COMPANY, LLC**(the “Company”),****a limited liabilitycompany organized and existing under the laws of the State of Delaware, partyof the second part, amends and restates the Lease Agreement, dated as ofJanuary 16, 2001, as amended May 1, 2001 (the “2001 Lease”), by and between theIssuer****and the Company’s predecessor, Farmland National Beef Company, aDelaware limited partnership.

W I T N E S S E T H:

**WHEREAS**, the Issuer is a joint development authorityinitially created pursuant to O.C.G.A. § 36-62-5.1 by concurrent resolutions ofthe governing bodies of Brooks, Colquitt and Thomas Counties; the Issuer wasthereafter expanded to include Mitchell and Grady Counties by concurrentresolutions of the governing bodies of Brooks, Colquitt, Grady, Mitchell andThomas Counties  (Colquitt County being herein called the “County”); and

**WHEREAS**, the Moultrie-Colquitt County DevelopmentAuthority (the “County Authority”) and the Issuer, pursuant to Article IX,Section III, Paragraph I (a) of the Constitution of the State of Georgia of1983, entered into an intergovernmental contract under which (i) the Issuer usedcertain grant proceeds and other funds, including certain funds provided by theCompany, to renovate the industrial building that is located on the landdescribed in Exhibit A hereto (collectively called the “Colquitt CountyFacilities”), (ii) the County Authority assisted the Issuer in providing theColquitt County Facilities for use by the Company under the 2001 Lease, byissuing the Series 2001 Bonds (hereinafter defined) to pay a portion of the costsof such Colquitt County Facilities and renovations thereto and (iii) the Issuerwas required to make payments to the County Authority or to the holder of the Series2001 Bonds, as assignee of the County Authority, in the amount and at the timesrequired to pay debt service on the Series 2001 Bonds; and

**WHEREAS**, in consideration of such financialassistance, the Issuer pledged to the County Authority and the County Authorityre-pledged to American Banking Company (now called American Banking Companyd/b/a Ameris), as the holder of the Series 2001 Bonds, the Colquitt CountyFacilities and the revenues therefrom; and 

 

 

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**WHEREAS**, the Series 2001 Taxable Bond (hereinafterdefined) has been prepaid and retired and the Series 2001 Tax-Exempt Bond(hereinafter defined) has been prepaid and retired or shall be prepaid and retiredbefore the issuance of the Bonds; and 

**WHEREAS**, the Company desires for the Issuer to issueits Bonds (hereinafter defined) to pay issuance costs of the Bonds and tofinance costs of additional renovations to, and equipment for, the ColquittCounty Facilities, as previously renovated; and

**WHEREAS**, it is desirable to amend and restate the2001 Lease, as herein provided; and

**WHEREAS**, after careful study and investigation ofthe nature of the Colquitt County Facilities and the additional renovation andequipping thereof, the Issuer has determined that: (i) the Colquitt County Facilities,as so renovated and equipped, constitute a “project” that the Issuer mayfinance; (ii) the Colquitt County Facilities, as so renovated and equipped,will promote the objectives of developing and promoting industry and employmentopportunities for the public good and the general welfare of the County and ofthe State of Georgia; and (iii) the issuance of the Bonds to finance costsrelating to the further renovation and equipping of the Colquitt County Facilitieswill be in the interest of the residents of the County and will serve thepublic purposes for which the Issuer was created and is existing; and

**WHEREAS**, the Company has represented that thefurther renovation and equipping of the Project will preserve and create jobsin the County; and 

**WHEREAS**, it is desirable for the Issuer to sell andissue the Bonds and use the proceeds thereof for the purpose of reimbursing theCompany for Project Costs (as herein defined) and to lease the Project to theCompany under this Lease for use as a plant for the processing and packing ofmeat; under which the Company will pay Basic Rent payments which are to bepledged to pay debt service on the Bonds; and

**WHEREAS**, upon the issuance of the Bonds, the Series2001 Bonds and all documents securing the Series 2001 Bonds have been or are tobe terminated.

**NOW, THEREFORE**, in consideration of the respectiverepresentations and agreements hereinafter contained, the parties hereto agreeas follows.

[BALANCE OF PAGEINTENTIONALLY LEFT BLANK]

 

 

 

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# **ARTICLE I****DEFINITIONS AND OTHER PROVISIONS OF GENERALAPPLICATION**

## **Section 1.1.           Definitions**.  Certain capitalized words andterms used in this Lease are defined in the text hereof or in the BondResolution (defined below).  In addition to the words and terms definedelsewhere herein and in the Bond Resolution, the following words and terms aredefined terms under this Lease:

**“Act”** means O.C.G.A. Section 36-62-1, etseq.

**“Additional Rent”** means the amounts payable by theCompany, described in Section 5.3(b) of this Lease. 

**“Additions or Alterations”** means modifications, improvements,alterations, additions, enlargements, or expansions in, on or to the Project.

**“Advance”** means an amount paid by the Purchaserunder the Bond Purchase Loan Agreement to pay or reimburse Project Costspursuant to the submission by the Company, on behalf of the Issuer, of anAdvance Request..  

**“Advance Request”** means in the case of Advancesunder the Bond Purchase Loan Agreement, a written request by the Company to thePurchaser, on behalf of the Issuer on the form required by the Bond Purchase LoanAgreement.

**“Affiliate”** means a Person which is controlled bythe Company or its corporate successor, which controls the Company or itssuccessor or which is under common control with the Company or its successor(direct or indirect ownership of more than fifty percent (50%) of the votingpower constituting “control” of a Person for such purpose).

**“Architect”** means any architect or architecturalfirm selected by the Issuer and Company to prepare the Plans andSpecifications, if any.

**“Authorized Company Representative”** means any officerof the Company and any other person at the time designated to act on behalf ofthe Company by written certificate furnished to the Issuer and the Custodian andsigned on behalf of the Company by an officer of the Company; more than oneperson may be designated as an Authorized Company Representative.

**“Authorized Issuer Representative”** means Chairman orother officer of the Issuer and any person at the time designated to act onbehalf of the Issuer by written certificate furnished to the Company and theCustodian signed on behalf of the Issuer by the Chairman, or other officer of theIssuer; more than one person may be designated as an Authorized Issuer Representative.

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**“Basic Rent”** means the rent payable by the Companypursuant to Section 5.3(a) of this Lease.

**“Bond”** means, as applicable, theTax-Exempt Bond or the Taxable Bond.

**“Bonds”** means both the Tax-Exempt Bond and theTaxable Bond, to be issued in the combined aggregate Maximum Principal Amountof $3,200,000 to finance the Project Costs, and bonds issued in exchangetherefor or in replacement thereof.

**“Bond Purchase Loan Agreement”** means the BondPurchase Loan Agreement, between the Issuer and the Purchaser of the Bond, insubstantially the form to be attached to the Bond Resolution, as it maythereafter be amended in accordance with the Bond Resolution.

 **“Bond Resolution”** means the resolution, adopted bythe Issuer, as it may thereafter be amended in accordance with the provisionsof the Bond Resolution, providing the terms and provisions under which the Bondsare  issued. 

**“Business Day”** means a day which is not a Saturday,Sunday, a legal holiday, or any other day on which banking institutions areauthorized to be closed in the State.

“**Colquitt****County Facilities”** means the Leased Land and those of the Leased Improvements that existed at the time the Leased Land was acquired by the Issuer.

**“Company”** means National Beef Packing Company, LLC,a limited liability company organized under the laws of the State of Delaware, and any successor lessee under this Lease.

**“Completion Date”** means the first date on which therenovation of the Existing Improvements have been substantially completed, asthat date shall be certified as provided in Section 4.6 hereof.

**“County”** means Colquitt County, Georgia.

**“County Authority”** means Moultrie-Colquitt CountyDevelopment Authority.

**“Custodian”** means the Issuer or its designee, solong as an Event of Default under the Bond Resolution  or under the SecurityDeed has not occurred and is continuing, but if an Event of Default under theBond Resolution or the Security Deed has occurred and is continuing the Holdermay remove the Custodian by written notice to the Issuer and the Company andmay appoint itself or its designee as Custodian of the Project Fund and DebtService Fund until the Event of Default is cured or waived.

**“Debt Service”** and **“debt service”** means, asto any Bond, the principal of, interest on and redemption price of such Bond.

**“Debt Service Fund”** means the Debt Service Fundcreated by the Bond Resolution.

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**“Default Interest Rate”** means when used with respectto interest on delinquent payments of Additional Rent, 10% per annum and whenused with respect to the Basic Rent applicable to the Bonds, the Default InterestRate provided for in such Bonds.

**“Environmental Laws”** means all federal, state, andlocal laws, rules, regulations, ordinances, programs, permits, guidance,orders, and consent decrees relating to health, safety, and environmentalmatters, including, but not limited to, the Comprehensive EnvironmentalResponse, Compensation, and Liability Act of 1980, as amended, the ToxicSubstances Control Act, as amended, the Clean Water Act, as amended, the CleanAir Act, as amended, the Superfund Amendments and Reauthorization Act of 1986,as amended, state and federal superlien and environmental cleanup programs andlaws, and U.S. Department of Transportation regulations.

**“Event of Default”** means, when used with respect tothis Lease, the events specified in Section 10.1 of this Lease.

**“Governing Body”** means, as to the Issuer, themembers of the Issuer acting as its board of directors.

**“Government Obligations”** means direct generalobligations of the United States of America (including obligations issued orheld in book‐entry form on the books of the Department of Treasury of the United States of America) or obligations the payment of the principal of andinterest on which when due are fully and unconditionally guaranteed by the United States of America.

**“Holder”** means the Person in whose name a Bond isregistered on the registration books of the Issuer.

**“Issuer”** means the Joint Development Authority of Brooks,Colquitt, Grady, Mitchell, and Thomas Counties.

**“Issuer Documents”** means this Lease, the BondPurchase Loan Agreement, the Security Deed and the Satisfaction and Cancellationof Deed to Secure Debt, Assignment of Rents and Leases and Security Agreement andAssignment of Rights under Intergovernmental Contract and Assignment of Deed ToSecure Debt, Assignment of Leases and Rents and Security Agreement andTermination of Intergovernmental Contract to be executed by the Issuer, ascontemplated by the Bond Resolution.

**“Lease”** means this Amended and Restated LeaseAgreement, as the same may be amended from time to time.

**“Leased Equipment”** means such items of equipment asshall be financed by the Bonds, owned by the Issuer and located at the LeasedLand, and replacements thereof and substitutions therefor.

**“Leased Improvements”** means the buildings,structures, renovations and other improvements from time to time located on theLeased Land, and all Additions, Alterations, replacements and substitutions forany items of Leased Improvements.

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**“Leased Land”** means the land described in ExhibitA attached hereto.

**“Maturity Date”** means, as to each Bond,  April 1,2009.

**“Maximum Principal Amount”** means $3,200,000, beingthe combined maximum principal amount of both of the  Bonds and the maximumaggregate amount that may be drawn down by the Issuer under the Bond PurchaseLoan Agreement.  

**“Net Proceeds”**means, when used with respect to anyproceeds of casualty insurance received with respect to any damage ordestruction of the Project or any eminent domain award (or proceeds of sale inlieu of a taking by eminent domain) or with respect to any other recovery on acontractual claim or claim for damage to or for taking of the Project, or anypart thereof, the gross proceeds from such insurance, eminent domain award,sale or recovery with respect to which that term is used remaining afterpayment of all costs and expenses (including attorneys’ fees and reimbursableexpenses) incurred in the collection of such gross proceeds.

**“Permitted Encumbrances”** means: (i) all encumbranceson the Project on the date of delivery of the Bonds including any restrictivecovenants applicable to the Leased Land (including any restrictions in the deedor deeds conveying the Leased Land to the Issuer), (ii) this Lease, (iii) theSecurity Deed, and (iv) mechanics’ and materialmen’s liens arising after thecommencement of construction of additional renovations to the Project or therepair, replacement or renovations of the Leased Improvements, or any partthereof, provided that any such mechanics’ and materialmen’s liens shall bedischarged by the Company prior to any foreclosure thereof.

**“Permitted Entity”** means a legal entity organizedand existing under the laws of one or more states of the United States of America. 

**“Permitted Successor”** mean any corporation**,**partnership,or limited liability company into which the Company may merge, any corporation,****partnership, or limited liability company resulting from a consolidation towhich the Company is a party or any corporation,****partnership, or limitedliability company to which the Company transfers substantially all of itsassets and then, and also includes any Successor (as above defined, butsubstituting “Successor” for “Company”) of a Successor, provided that in eachcase such Permitted Successor shall be a Permitted Entity or the Issuer shallhave consented to the assignment hereof or subleasing of the Project to suchsuccessor entity.

**“Person”** means a natural person, a public body andany form of business organization or other legal entity.

**“Plans and Specifications”** means the detailed plansand specifications, if any, for the renovation of the Leased Improvements, asshall be approved in writing by the Issuer and the Company, and any amendmentsthereto approved from time to time by the Issuer and the Company, copies ofwhich are or will be on file with, or held by the Custodian and Company forinspection by the Holder. 

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**“Pledged Security”** means and includes: (a) theProject; (b) the rights of the Issuer in and under the Lease and any subsequentleases of the Project including the right to receive Basic Rent thereunder(except for the Unassigned Rights);  (c)  the Net Proceeds of casualtyinsurance received on account of damage to or destruction of the Project or anypart thereof; (d) the Net Proceeds received on account of a taking of theProject, or any portion thereof, under power of eminent domain; (e) the Net Proceedsof any sale of the Project, or any portion thereof; (f) all other revenues ofthe Issuer from the Project or any part thereof;  (g) any amounts in the ProjectFund and in the Debt Service Fund (subject to the rights of the Issuer and theCompany to apply amounts in such funds as provided in the Issuer Documents);(h) accounts receivable arising out of the foregoing; and (i) the proceeds ofthe foregoing, all as to be****more particularly described in the SecurityDeed. 

“**Principal Balance”** means, as to any Bond as of anyparticular time: (i) the total amount drawn down by the Issuer under the BondPurchase Loan Agreement with respect to such Bond, reduced by (ii) anyprincipal amounts thereof which have theretofore been paid on such Bond.

**“Principal Payment Date”** means, as to any Bond, thedate on which any principal thereof is due. 

**“Project”** means the Leased  Land, the LeasedImprovements and the Leased Equipment.

**“Project Costs”** means costs related to expansionsand renovations of the Leased Improvement made and to be made by the Companywhich are to be reimbursed by the Bonds, costs of Leased Equipment and issuancecosts of the Bonds.

**“Project Fund”** means the Project Fund created by theBond Resolution. 

**“Purchaser”** means American Banking Company d/b/aAmeris, located in Moultrie, Georgia.

**“Redemption Date”** or **“redemption date”** means,as to the Bond, any date on which such Bond is to be prepaid and redeemed, inwhole or in part, as established by the notice of redemption relating thereto.

**“Rent Commencement Date”** means April 1, 2006. 

**“Security Deed”** means a Deed to Secure Debt, Assignmentof Leases and Rents and Security Agreement, approved by the Bond Resolution, fromthe Issuer to the Purchaser, securing the Bonds.

**“Series 2001 Bonds”** means the Series 2001 Tax-ExemptBond and the Series 2001 Taxable Bond.

**“Series 2001 Taxable Bond”** means the County Authority’s Industrial Development Revenue Bond (National Beef Project), TaxableSeries 2001.

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**“Series 2001 Tax-Exempt Bond”** means the County Authority’s Industrial Development Revenue Bond (National Beef Project), Tax-ExemptSeries 2001.

**“State”** means the State of  Georgia.

**“Taxable Bond”** means the Issuer’s Taxable IndustrialDevelopment Revenue Bond (National Beef Project), Series 2006, and bonds issuedin exchange therefor or in replacement thereof.

**“Tax-Exempt Bond”** means the Issuer’s Tax-Exempt IndustrialDevelopment Revenue Bond (National Beef Project), Series 2006, and bonds issuedin exchange therefor or in replacement thereof.

**“Term”**means the Term of this Lease, as provided forin Section 5.1 hereof.

**“Unassigned Rights”** means all of the rights of the Issuer(i) to receive reimbursements and payments pursuant to Sections 5.3(b)(i), 6.6,10.4 and 12.1 hereof, (ii) to receive notices under or pursuant to anyprovision of this Lease or the Bond Resolution (iii) certain consensual andenforcement rights pursuant to Sections 6.3, 6.4, 8.7 and 10.2 (as providedtherein) hereof and (iv) to be indemnified as provided in Section 8.5 of thisLease.

## **Section 1.2.           Construction Of Certain Terms**.  For allpurposes of this Lease, except as otherwise expressly provided or unless thecontext otherwise requires, the following rules of construction shall apply:

##### (1)        the use of the masculine, feminine, or neuter gender is forconvenience only and shall be deemed and construed to include correlative wordsof the masculine, feminine, or neuter gender, as appropriate;

##### (2)       “this Lease” means this instrument as originally executed or asit may from time to time be supplemented or amended by one or more leasessupplemental to this Lease and entered into pursuant to the applicableprovisions hereof;

##### (3)       all references in this instrument to designated “Articles,”“Sections,” and other subdivisions are to the designated articles, sections,and other subdivisions of this instrument; 

##### (4)       the words “herein, “hereof,” and “hereunder” and other words ofsimilar import refer to this Lease as a whole and not to any particulararticle, section, or other subdivision;

##### (5)        the terms defined in this Article shall have the meaningsassigned to them in this Article and include the plural as well as thesingular; and

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##### (6)        all accounting terms not otherwise defined herein have themeanings assigned to them in accordance with generally accepted accountingprinciples as promulgated by the American Institute of Certified PublicAccountants, on and as of the date of this Lease.

## **Section 1.3.           Table of Contents; Titles and Headings**.  Thetable of contents, the titles of the articles, and the headings of the sectionsof this Lease are solely for convenience of reference, are not a part of thisLease, and shall not be deemed to affect the meaning, construction, or effectof any of its provisions.

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# **ARTICLEII****REPRESENTATIONS AND UNDERTAKINGS**

## **Section 2.1.           Representations by the Issuer.** The Issuermakes the following representations and warranties as the basis for theundertakings on its part herein contained:

### (a)               Creation and Authority.  The Issuer is a public bodycorporate and politic and a public corporation duly created and validly existingunder the Act.  The Issuer has all requisite power and authority under the Act:(i) to own the Project and to lease the same to the Company, (ii) to issue the Bonds,and (iii) to enter into, perform its obligations under, and exercise its rightsunder the Issuer Documents.  The Issuer has found that the Project is a“project” within the meaning of the Act which will promote the public purposesset forth in the Act.

### (b)              Pending Litigation.  There are no actions, suits,proceedings, inquiries, or investigations pending or, to the knowledge of the Issuer,after making due inquiry with respect thereto, threatened against or affectingthe Issuer in any court or by or before any governmental authority orarbitration board or tribunal, which involve the possibility of materially andadversely affecting the transactions contemplated by the Issuer Documents orwhich, in any way, would adversely affect the validity or enforceability of theIssuer Documents, nor is the Issuer aware of any facts or circumstancespresently existing which would form the basis for any such actions, suits,proceedings, inquiries, or investigations.

### (c)               Transactions Shall be Legal and Authorized.  The executionand delivery by the Issuer of the Issuer Documents and the compliance by the Issuerwith all of the provisions of each thereof (i) shall be within the purposes,powers, and authority of the Issuer, (ii) shall be done in full compliance withthe provisions of the Act and shall have been approved by the Governing Body ofthe Issuer, and (iii) shall be duly executed and shall be legal and valid. 

### (d)              Governmental Consents.  Neither the nature of the Issuernor any of its activities or properties, nor any relationship between the Issuerand any other Person, nor any circumstance in connection with the offer, issue,sale, or delivery of the Bonds is such as to require the consent, approval,permission, order, license, or authorization of, or the filing, registration,or qualification with, any governmental authority on the part of the Issuer inconnection with the execution, delivery, and performance of this Lease.

### (e)               No Defaults.  To the knowledge of the Issuer, after makingdue inquiry with respect thereto, no event has occurred and no condition existswhich would constitute a breach of this Lease by the Issuer Documents or which,with the lapse of time or with the giving of notice or both, would become abreach of this Lease.  To the knowledge of the Issuer, after making due inquirywith respect thereto, the Issuer is not in default or violation in any materialrespect under the Act or under any charter instrument, bylaw, or otheragreement or instrument to which it is a party or by which it may be bound. 

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### (f)                No Prior Pledge.  The Project shall not be mortgaged,pledged, or hypothecated by the Issuer in any manner or for any purpose orsubject to any security interest by other than as shall be****provided inthe Security Deed.

### (g)               Representations Relating to the Leased Land and Leased Improvements. The zoning of the Leased Land permits the Leased Land and Leased Improvementsto be used as meat processing facilities.  The Project is not subject to anyother leases.  No proceedings for the taking of any portion of the Project byeminent domain have been served on the Issuer, and, to the best of the Issuer’sknowledge, no such proceedings have been file or are threatened. 

## **Section 2.2.           Representations by the Company.**  The Companymakes the following representations and warranties as the basis for theundertakings on its part herein contained:

### (a)               Organization and Power.  The Company is a limited liabilitycompany duly organized, validly existing, and in good standing under and byvirtue of the laws of the State of Delaware and has all requisite power andauthority to lease the Project from the Issuer and to enter into, perform itsobligations under, and exercise its rights under this Lease. 

### (b)              Pending Litigation.  There are no actions, suits,proceedings, inquiries, or investigations pending or, to the knowledge of theCompany, after making due inquiry with respect thereto, threatened against oraffecting the Company in any court or by or before any governmental authorityor arbitration board or tribunal, which in the opinion of the Company involvethe possibility of materially and adversely affecting the ability of theCompany to perform its obligations under this Lease or the transactionscontemplated by this Lease or which, in any way, in the opinion of the Companywould adversely affect the validity or enforceability of this Lease or anyagreement or instrument to which the Company is a party and which is used orcontemplated for use in the consummation of the transactions contemplatedhereby or thereby, nor is the Company aware of any facts or circumstancespresently existing which would form the basis for any such actions, suits,proceedings, inquiries, or investigations. 

### (c)               Agreements Are Legal and Authorized.  This Lease, theconsummation of the transactions herein contemplated, and the fulfillment of orthe compliance with all of the provisions hereof (i) are within the power,legal right, and authority of the Company, (ii) have been duly authorized byall necessary and appropriate corporate action on the part of the Company,(iii) has been duly executed and delivered on the part of the Company, (iv) is legaland valid as to the Company, and (v) will not conflict with or constitute onthe part of the Company a violation of or a breach of or a default under anycharter instrument, bylaw, indenture, mortgage, deed to secure debt, pledge,note, lease, loan, or installment sale agreement, contract, or other agreementor instrument to which the Company is a party or by which the Company or itsproperties are otherwise subject or bound which would have a material adverseimpact on the Company’s ability to perform its obligations hereunder, or any license,law, statute, rule, regulation, judgment, order, writ, injunction, decree, ordemand of any court or governmental agency or body having jurisdiction over theCompany or any of its activities or properties.

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### (d)              Governmental Consents.  No circumstances in connectionwith the execution, delivery, and performance by the Company of its obligationsunder this Lease or the Company’s participation in the offer, issue, sale, ordelivery by the Issuer of the Bonds are such as to require the Company toobtain the consent, approval, permission, order, license, or authorization of,or the filing, registration, or qualification with, any governmental authorityon the part of the Company in connection with the Company’s execution,delivery, and performance of this Lease, the consummation of any transactionherein contemplated, or the offer, issue, sale, or delivery of the Bonds,except as shall have been obtained or made and as are in full force and effectand except as are not presently obtainable.  To the knowledge of the Company,after making due inquiry with respect thereto, the Company will be able toobtain all such additional consents, approvals, permissions, orders, licenses,or authorizations of governmental authorities as may be required on or prior tothe date the Company is legally required to obtain the same in connection withthe performance of its obligations under this Lease. 

### (e)               No Defaults.  No event has occurred and no conditionexists that would constitute an Event of Default (as such term is used in thisLease) or which, with the lapse of time or with the giving of notice or both,would become an Event of Default hereunder. 

### (f)                Disclosure.  The representations of the Company contained inthis Lease and any certificate, document, written statement, or other instrumentfurnished by or on behalf of the Company to the Issuer or Purchaser of the Bondsin connection with the transactions contemplated hereby, do not contain anyuntrue statement of a material fact. 

### (g)               Construction.  The Company shall be responsible forcompliance with all county and city laws and codes pertaining to allconstruction work at the Project.

# **ARTICLE III****LEASING CLAUSE; SECURITY; TITLE**

## **Section 3.1.           Lease of the Project**.  The Issuer, as landlord,hereby grants to the Company, as tenant, a usufruct in the Project and theCompany hereby leases from the Issuer, the Project at the rental set forth inSection 5.3 hereof and for the Term (as defined in Section 5.1 hereof), inaccordance with the provisions of this Lease. 

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## **Section3.2.           ****Security for Payments Under the Bonds**.  Assecurity for the payment of the Bonds, the Issuer shall execute and deliver tothe Purchaser the Security Deed, in which the Issuer shall grant unto thePurchaser, its successors and assigns, legal title (as security) to the Projectand shall assign unto the Purchaser, its successors and assigns, the otherPledged Security, as security for, among other things, the payment of the Bonds. From and after the Completion Date, and except with respect to a breach by the Issuerof its covenant of quiet enjoyment contained in Section 5.2, below, the Companyhereby agrees that its obligations to make all payments under this Lease shallbe absolute and shall not be subject to any defense, except payment, or to anyright of set off, counterclaim, or recoupment arising out of any breach by the Issuerof any obligation to the Company, whether hereunder or otherwise, or arisingout of any indebtedness or liability at any time owing to the Company by the Issuer. The Company further agrees that all payments of rent required to be made underthis Lease to the Issuer (except as otherwise provided herein in the case ofAdditional Rent) shall, if requested by the Holder of the Bonds be paiddirectly by the Company to the Holder. 

## **Section 3.3.           Warranties and Covenants of Authority as to Title**. The Issuer has title to the Leased Land and any existing LeasedImprovements, and shall acquire title to any additions or improvements to theLeased Improvements that may be thereafter constructed or installed on the Leased Land.  The Issuer disclaims any interest in any trade fixtures or equipmentinstalled at the Project that neither are paid for with proceeds of the Bonds norconstitute Additions, Alterations, replacements or substitutions therefor.  TheIssuer warrants and covenants that, except for the lease of the Project andoptions herein granted to the Company, except for any mechanics andmaterialmen’s liens relating to the construction or installation of renovationsof the Leased Improvements by the Company and except as provided in theSecurity Deed, the Issuer shall not otherwise encumber the Project or any partthereof.  The Issuer covenants to take all acts necessary to defend its titleto the Project and will do no act to impair such title.

## **Section 3.4.           Warranties and Covenants of Company as to Title.** The Company will, as principal and not as agent of the Issuer, provide theadditional renovation of the Leased Improvements and acquire and install theLeased Equipment and cause any mechanics’ and materialmen’s liens relating tothe Project to be discharged and will take such further actions as arenecessary to cause good and merchantable title to the Project to be vested in theIssuer (subject only to Permitted Encumbrances).  The Company further covenantsto do no act that will impair the title of the Issuer to the Project. Notwithstanding the foregoing, the Company may, contest in good faith any suchmechanics’ and materialmen’s liens relating to the Project, provided that itposts bond or takes such other action as may be required to prevent title tothe Project from being lost. In the case of liens relating to Project Coststhat constitute Project Costs attributable to the Company’s fault, negligence,or directed change orders, the cost on contesting such liens shall be paid bythe Company.  In the case of liens relating to Project Costs that constitute ProjectCosts, but which are not attributable to the Company’s fault, negligence ordirected change order, then, the same shall be paid by the Issuer.

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# **ARTICLE IV****CONSTRUCTION OF THE LEASED IMPROVEMENTS;ISSUANCE OF THE BONDS; FUNDS**

## **Section 4.1.           Agreement to Construct the Project**.  As soon asreasonably possible following the execution of the this Lease, the Company asprincipal and not as agent for the Issuer, will complete the construction ofthe additional renovations to the Leased Improvements and acquire and installthe Leased Equipment. 

## **Section 4.2.           Funding of Project Costs**.  On the date the Bondsare issued, an amount of the Bond proceeds shall be drawn down under the BondPurchase Loan Agreement with respect to each of the Bonds in amounts agreed toby the Issue and the Company and in compliance with the terms of the BondPurchase Loan Agreement.  Additional proceeds of the Bonds shall be drawn down fromtime to time thereafter, by  the Issuer, pursuant to Advance Requests under theBond Purchase Loan Agreement, and shall be either paid to the Company toreimburse it for Project Costs that it has paid or paid to third party payeesin payment of Project Costs.

## **Section 4.3.           Use of Bond Proceeds.** Bond Proceeds shall beused only to pay, or to reimburse, Project Costs.

## **Section 4.4.           Disbursements from the Bond Proceeds.  **The Issuerhereby authorizes and directs the Company to act as its agent for the purposeof requesting Advances from the Purchaser to pay or reimburse Project Costs. The Company shall submit to the Purchaser Advance Requests in the form attachedto the Bond Purchase Loan Agreement pertaining to the payment or reimbursementof Project Costs.  Each Advance Request shall be signed by an AuthorizedCompany Representative, as agent for the Issuer, and shall be accompanied byany supporting documentation required by the Purchaser. The Company, whenrequesting Advances on behalf of the Issuer, may request the Purchaser to makereimbursement payments for Project Costs to (i) suppliers, contractors,subcontractors, laborers, materialmen, or persons furnishing labor, services,or materials used or to be used in connection with the Project, (ii) to theCompany or any Affiliate of the Company to reimburse it for Project Costs, or(iii) to any combination of the foregoing. Each payment shall be made in lawfulmoney of the United States by check, wire transfer or by interbank orintrabank transfer of funds, as directed by the Authorized CompanyRepresentative in such particular Advance Request.  The Custodian may act inreliance upon any instrument or signature reasonably believed by it to begenuine and authorized.

## **Section 4.5.           Obligation of the Parties to Cooperate in FurnishingDocuments; Reliance of the Custodian**.  The Issuer agrees to cooperatewith the Company in furnishing to the Purchaser the documents referred to inthis Article that are required to effect disbursements from the Project Fund.

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## **Section4.6.           ****Establishment of Completion Date**.  When theProject has been substantially completed, such substantial completion shall beevidenced to the Issuer, to the Custodian and to the Holder by a certificate ofsigned by the Authorized Company Representative and stating (1) that the renovationof the Leased Improvements has been substantially completed (2) all of theLeased Equipment has been acquired and installed at the Leased Land and (3) allProject Costs have been paid except for amounts which either are (i) not yetdue and payable or (ii) are being contested (the estimated amount of such notyet due or contested amounts being set forth in the certificate). 

## **Section 4.7.           Company Required to Pay the Company’s Project Costs**. The Issuer does not make any warranty, either express or implied, that the Bondproceeds will be sufficient to pay all of the Project Costs. The Company agreesthat the Company shall pay, from its own funds, any Project Costs in excess ofthe Project Costs to be paid with Bond proceeds, and that it shall not beentitled to any reimbursement therefor from the Issuer or from the Holder, norshall it be entitled to any diminution of the amounts payable under Section 5.3hereof. 

## **Section 4.8.           Authorized Company and Authority Representatives andSuccessors**.  The Company and the Issuer, respectively, shall designate inthe manner prescribed in Section 1.1 hereof, the Authorized Company Representative(s)and the Authorized Issuer Representative(s).  In the event that any person sodesignated should become unavailable or unable to take any action or make anycertificate provided for or required in this Lease, a successor or additionalAuthorized Company Representative or Authorized Issuer Representative shall beappointed in the manner prescribed in Section 1.1 hereof.

## **Section 4.9.           Enforcement of Remedies Against Contractors,Subcontractors, Suppliers, Fabricators and Their Sureties.** The Issueragrees that the Company may, from time to time, in its own name, or in the nameof the Issuer, take such action as may be necessary or advisable, as determinedby the Company, against such contractors, subcontractors, suppliers,fabricators and their sureties, to insure the proper construction of the LeasedImprovements.  The Company agrees that any such action taken by it pursuant tothis Section shall be at its own expense, and without cost to the Issuer. 

[End of Article IV]

 

 

 

 

 

 

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# **ARTICLE V****EFFECTIVE DATE OF THIS LEASE; DURATION OF LEASETERM;RENTAL PROVISIONS; NATURE OF OBLIGATIONS OF COMPANY**

## **Section 5.1.           Effective Date of this Lease; Duration of Lease Term.** This Lease, as amended and restated, shall become effective upon its deliveryand shall expire at 12:01 a.m., City of Moultrie, Georgia, time, on October 1,2009, unless this Lease is earlier terminated as herein provided. 

## **Section5.2.           **** Delivery and Acceptance ofPossession; Quiet Enjoyment**.  The Company shall, commencing withthe date of delivery of this Lease, have possession, custody and control of theProject as it exists on such date and the Company hereby accepts suchpossession, custody and control.  The Issuer agrees that, subject to PermittedEncumbrances, so long as the Company shall fully and punctually pay all of therents and other amounts provided to be paid hereunder by the Company and shallfully and punctually perform all of its other covenants and agreementshereunder, the Company shall peaceably and quietly have, hold, and enjoy theProject during the Term, and the Issuer warrants and covenants, subject toPermitted Encumbrances, that it will defend the Company in such peaceable andquiet possession of the Project. The Issuer covenants and agrees that, subjectto Permitted Encumbrances, it shall not take any action, other than pursuant toArticle X of this Lease, or the other express provisions of this Lease, toprevent the Company from having quiet and peaceable possession and enjoyment ofthe Project during the Term. 

## **Section 5.3.           Rents and Other Amounts Payable.**

### (a)         Basic Rent: Basic Rent of $175,000 shall be paid on April1, 2006.  Basic Rent of $729,045 shall be paid on April 1, 2007, 2008 and 2009,and Basic Rent of  $729,045 shall be paid on October 1, 2006, 2007 and 2008.

### (b)         Additional Rent: 

#### (i)              Payable to Issuer.  The Company agrees that, during theTerm, it shall pay directly to the Issuer, as Additional Rent, (I) an amountsufficient to reimburse the Issuer for all expenses, advances or liabilitiesincurred by the Issuer as a result of the failure of the Company to comply withthe terms of this Lease, including, but not limited to, the reasonable fees andexpenses of counsel for the Issuer and (II) any amounts that are subject topayment or indemnification by the Company to the Issuer under Sections5.3(b)(i), 6.6, 8.5 or 10.4 hereof. All payments of Additional Rent describedin this paragraph shall be billed to the Company by the Issuer from time totime, together with reasonable supporting documentation thereof.  Amounts sobilled shall be paid by the Company within thirty (30) days after receiptof the bill by the Company; the right of the Issuer to payments under thisparagraph is one of the Unassigned Rights.  In the event the Company shall failto make any of the payments required in this Section 5.3(b)(i), the unpaidamount shall continue as an obligation of the Company until fully paid, andshall accrue interest from such thirtieth day at the lesser of: (i) theDefault Interest Rate calculated on the basis of a 365/366 day year and actualnumber of days elapsed or (ii) the maximum rate allowed by law.

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#### (ii)             Payable to Holder.  The Company agrees that, during theTerm, it shall pay directly to any Holder, as Additional Rent, an amountsufficient to reimburse such Holder for all expenses, advances or liabilitiesincurred by such Holder, including, but not limited to, the reasonable fees andexpenses of counsel for such Holder, as a result of the failure of the Companyto comply with the terms of this Lease and any amounts that are subject topayment or indemnification by the Company to such Holder under Sections5.3(b)(ii), 6.6, 8.5 or 10.4 hereof. All payments of Additional Rent describedin this paragraph shall be billed to the Company by such Holder from time totime, together with reasonable supporting documentation thereof.  Amounts sobilled shall be paid by the Company within thirty (30) days after receipt ofthe bill by the Company.  In the event the Company shall fail to make any ofthe payments required in this Section 5.3(b)(ii), the unpaid amount shallcontinue as an obligation of the Company until fully paid, and shall accrueinterest from such thirtieth day at the lesser of: (i) the Default InterestRate calculated on the basis of a 365/366 day year and actual number of dayselapsed or (ii) the maximum rate allowed by law. 

## **Section 5.4.           Place of Rental Payments**.  The Basic Rentprovided for in Section 5.3(a)  and Additional Rent provided for inSection 5.3(b)(i) and any interest on late payments thereof shall bepayable directly to the Issuer, provided that if so directed in writing by theIssuer, the Company shall pay part or all of the Basic Rent to the Holder forthe account of the Issuer.    All payments shall be paid in lawful money of theUnited States of America in funds that are immediately available on the duedate of such payment.

## **Section5.5.           Nature of Obligations of Company Hereunder**.  Theobligations of the Company to make the payments required in Section 5.3 hereofand other sections hereof and to perform and observe any and all of the othercovenants and agreements on its part contained herein shall be a generalobligation of the Company and shall, from and after the Completion Date, andexcept with respect to a breach by the Issuer of its covenant of quietenjoyment contained in Section 5.2, above, be absolute and unconditionalirrespective of any defense or any rights of set off, recoupment, orcounterclaim, except payment, it may otherwise have against the Issuer or anyHolder.  The Company agrees that it shall, from and after the Completion Date,and except with respect to a breach by the Issuer of its covenant of quietenjoyment contained in Section 5.2, above, not (i) suspend, abate, reduce,abrogate, diminish, postpone, modify, or discontinue any payments provided forin Section 5.3 hereof, (ii) fail to observe any of its other agreements containedin this Lease, or (iii) terminate its obligations under this Lease for anycontingency, act of God, event, or cause whatsoever, including, withoutlimiting the generality of the foregoing, failure of the Company to occupy orto use the Project as contemplated in this Lease or otherwise, any change ordelay in the time of availability of the Project, any acts or circumstanceswhich may impair or preclude the use or possession of the Project, any defectin the title, design, operation, merchantability, fitness, or condition of theProject or in the suitability of the Project for the Company’s purposes orneeds, failure of consideration, any declaration or finding that a Bond isunenforceable or invalid, the invalidity of any provision of this Lease, any actsor circumstances that may constitute an eviction or constructive eviction,destruction of or damage to the Project, the taking by eminent domain of titleto or the use of all or any part of the Project, failure of the Issuer’s titleto the Project or any part thereof, commercial frustration of purpose, anychange in the tax or other laws of the United States of America or of the Stateor any political subdivision of either thereof or in the rules or regulationsof any governmental authority, or any failure of the Issuer to perform andobserve any agreement, whether express or implied, or any duty, liability, orobligation arising out of or connected with this Lease.  The preceding sentenceis not intended to impair, and shall not impair, the Company’s rights underSections 6.5, 6.7 and 7.1, below, in the event of damage, destruction orcondemnation of the Project.

 

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Nothing contained in this Section shall be construed torelease the Issuer from the performance of any of the agreements on its partherein contained.  In the event the Issuer should fail to perform any suchagreement on its part, the Company may institute such action against the Issueras the Company may deem necessary to compel performance so long as such actiondoes not abrogate the Company’s obligations hereunder.  The Issuer herebyagrees that it shall not take or omit to take any action that would cause thisLease to be terminated, except pursuant to an express right contained herein.

The Company may, however, at its own cost and expense andin its own name or in the name of the Issuer, prosecute or defend any action orproceeding or take any other action involving third persons which the Companydeems reasonably necessary in order to secure or protect its right ofpossession, occupancy, and use hereunder, and in such event the Issuer herebyagrees to cooperate fully with the Company and to take all action necessary toeffect the substitution of the Company for the Issuer in any such action orproceeding if the Company shall so request.

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# **ARTICLEVI****MAINTENANCE, TAXES, INSURANCE AND EMINENT DOMAIN**

## **Section 6.1.           Maintenance of Project**.   The Company shall not commit or suffer any waste to the Project or do or suffer to be done anythingwhich would increase the risk of casualty to the Project or which would resultin the cancellation of any insurance policy carried with respect to theProject.  The Company, at the expense of the Company, during the Term shall (i)keep the Project in as reasonably safe condition as its operations shall permitand (ii) keep the Leased Improvements in reasonably good repair and operatingcondition, making from time to time, subject to the provisions of Section 6.2hereof, all necessary and proper repairs thereto and renewals and replacementsthereof, including external and structural repairs, renewals, andreplacements.  Subject to the provisions of Article VIII hereof, the Company,at its own expense, may from time to time make any Additions or Alterations andany modifications, upgrades, replacements and substitutions to the LeasedImprovements that it may deem desirable for its purposes, subject to obtainingthe Issuer’s prior consent, which consent shall not be unreasonably withheld,conditioned or delayed.  Subject to the provisions of Section 9.7 hereof,Additions or Alterations and any modifications, upgrades, replacements andsubstitutions to the Leased Improvements so made by the Company shall belocated on the Leased Land and shall become a part of the Project.  TheCompany shall not do or permit others under its control to do any work in orabout the Project or related to any repair, rebuilding, restoration,replacement, alteration of, or addition to the Leased Improvements, or any partthereof, unless all requisite municipal and other governmental permits andauthorizations shall have first been procured and paid for.  All such workshall be done in a good and workmanlike manner and in compliance with allapplicable laws, ordinances, governmental regulations, and requirements. Notwithstanding the foregoing, in the event the Project, or any part thereof,is damaged or destroyed by casualty, the Company’s obligations to repair orreplace the Project, or portion thereof so damaged or destroyed, shall begoverned exclusively by Section 7.1 hereof.

## **Section6.2.           Removal of Building Fixtures.**  The Issuer shallnot be under any obligation to replace any inadequate, obsolete, worn out,unsuitable, undesirable, or unnecessary building fixtures.  The Company shallnot be under any obligation to replace any inadequate, obsolete, worn out, unsuitable,undesirable, or unnecessary building fixtures, unless the replacement thereofis necessary, in the judgment of the Company for the proper operation of theProject or is necessary, in the judgment of the Issuer or the Holder topreserve the value of the Project.  Subject to the foregoing exceptions, if noEvent of Default under this Lease shall have happened and be continuing, in anyinstance where the Company in its discretion determines that any buildingfixture or part thereof has become inadequate, obsolete, worn out, unsuitable,undesirable, or unnecessary, the Company, following the giving of not less thanthirty (30) days notice to the Issuer and to the Holder of its intention to doso, may remove, at its own expense, such building fixture or part thereof fromthe Leased Improvements and sell, trade in, exchange, scrap or otherwisedispose of the same without any responsibility or accountability to the Issueror any Holder.  The removal from the Leased Improvements of any buildingfixture or part thereof pursuant to the provisions of this Section shall notentitle the Company to any abatement or diminution of the rental paymentspayable under Section 5.3 hereof.  If any building fixture or part thereof isto be sold or traded in, rather than abandoned and discarded, then, at thewritten request of the Company, the Issuer shall execute such instruments asshall be required to convey title thereto to the purchaser or to the personaccepting the same as a trade in and the Holder shall release the lien andsecurity interest of the Security Deed therein.  This Section 6.2 shall be inaddition to the Company’s rights under Section 9.7, below, to remove its owntrade fixtures, machinery, equipment, furnishings, and other personal propertyfrom the Project.

 

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## **Section 6.3.           Taxes, Other Governmental Charges, and Utility Charges.** The Company, at the expense of the Company, shall, throughout the Term, dulypay and discharge, as the same become due and payable, (i) all taxes andgovernmental charges of any kind whatsoever that may (on account of a change inlaw or otherwise) at any time be lawfully assessed or levied against or withrespect to the interests of the Issuer, of the Company and of the Holder in theProject, (ii) any sales or rent taxes levied upon or with respect to the leaserevenues and receipts of the Issuer from the Project which, if not paid, willbecome a lien on the Project or a charge on the revenues and receipts therefromprior to or on a parity with the charge, pledge, and assignment thereof createdand made in the Bond Resolution and in the Security Deed, (iii) all utility andother charges incurred in the operation, maintenance, use, occupancy, andupkeep of the Project, and (iv) other levies, permit fees, inspection andlicense fees and all other charges imposed upon or assessed against the Projector any part thereof or upon the revenues, rents, issues, and income of theProject or arising in respect of the occupancy, uses or possession thereof. Both the Issuer and the Holder shall be entitled to enforce the provisions ofthis Section, and the Issuer’s right to enforce the same is one of theUnassigned Rights. 

Under current law, the Issuer is exempt fromadvaloremproperty tax on its property.  In 2006, 2007 and 2008, the Company shall paypayments in lieu of taxes on its leasehold interest which is equal to the taxeswhich would be levied against the Project if the Company, rather than the Issuer,were the owner of the Project on January 1 of such year.  For purposes ofcalculating the payments in lieu of taxes (i) the fair market value of theProject shall be determined using the valuation procedures ordinarily employedin the County for purposes of advalorem property taxation, (ii)the fair market value shall be multiplied by the assessment percentage (40%),(iii) the resulting "assessed value" shall be multiplied by therespective millage rates of the state, county, city and local taxingauthorities to determine the "gross normal tax" applicable to eachsuch governmental entity and (iv) and the "gross normal tax"applicable to each such governmental entity shall be multiplied by theapplicable payment percentage for the year for which such calculation is madeto determine the payment in lieu of taxes payable in such year to each suchgovernmental entity. In any year in which a payment in lieu of taxes is duehereunder, the Company shall, on or before the date actual advaloremtaxes would normally be due, deliver to the Issuer, checks payable to therespective tax collectors for such state, county, city, and local taxingauthorities for the amount payable in such year to each such governmentalentity for which such tax collectors collect taxes.  Receipt of such checksshall be noted by the Issuer on its records and the Issuer shall then forwardthe respective checks to the respective tax collectors that are the payeesthereof.  The Issuer shall have no economic interest in such payments of taxes,but shall serve a collector thereof for the benefit of such governmentalentities. Should the Company fail to make payments of taxes required by thisSection at the times and in the manner provided for in this Section, theCompany shall be obligated to pay to the respective governmental entities, inaddition to such payment of taxes, any additional penalties and interest that maybe assessed against the Company. 

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## **Section 6.4.           Insurance Required**.  

### (a)         The Company, at the expense of the Company, throughout the Term,shall carry the following insurance: 

#### (i)              hazard and casualty insurance on the Leased Improvements, inamounts (taking into account a deductible of not more than $5,000,000 peroccurrence) not less than the lesser of (A) an amount not less than 100%of replacement cost of the Project or (B) full insurable value of the Project;all hazard, casualty, and flood insurance policies obtained by the Company asrequired by this Section 6.4(a)(i) shall be endorsed to name the Issuer, asowner, and the Holder as a secured party, with loss payable to jointly to the Issuerand the Holder, without contribution, under a standard mortgagee clause (thedeductible amount specified above may be increased with the written consent ofthe Issuer and the Holder); and 

#### (ii)             general liability insurance, in amounts of $1,000,000 peroccurrence and $2,000,000 in aggregate, and fire damage for any one fire of$500,000, subject to deductibles per occurrence not to exceed $500,000; suchpolicy or policies shall name the Issuer and the Holder as additional insureds(the deductible amount specified above may be increased with the writtenconsent of the Issuer and the Holder); and

#### (iii)           workers’ compensation insurance as required by law relating tothe Company’s employees working at the Project.

The Company further agrees that it will use its bestefforts to****cause any general contractor involved in the construction activitiesat the Leased Land to maintain general liability insurance in an amount notless than that required to be maintained under this Section, and shall cause theIssuer, the Company and the Holder to be named as additional insureds undersuch insurance.  The Company shall also use its best efforts to****causethe general contractor to maintain worker’s compensation insurance as requiredby law.  In addition, if the above-mentioned general liability insurance doesnot cover the Issuer, the Company and the Holder as to the subject matter ofsuch worker’s compensation insurance, then the Company shall either provide, oruse its best efforts to****cause the general contractor to provide, otherinsurance covering the Issuer, the Company and the Holder with respect to suchsubject matter. Each party hereto shall, if possible, obtain a waiver from anyinsurance carrier with which it carries insurance covering the demised premisesor the contents thereof, releasing subrogation rights against the other party.

### (b)              All such insurance policies and endorsements required by thisSection 6.4 shall be fully paid for (including periodic premium payments)****andcontain such provisions and expiration dates and be in such form and issued byinsurance companies licensed to do business in the State of Georgia.  In lieuof separate policies, the Company may maintain one or more blanket policies ofinsurance having the coverage required by Section 6.4(a) hereof.  Withoutlimiting the foregoing, each policy shall provide that no act or thing done bythe Company shall invalidate the policy as against the Issuer and the Holderand the Company shall provide the Issuer and the Holder with a certificate ofthe insurer that provides that such insurance may not be canceled or materiallychanged by the insurer without at least thirty (30) days’ prior written noticeto the Company, the Issuer, and the Holder.

 

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### (c)               A certificate or certificates of the insurers relating to theinsurance referred to in Section 6.4(a), above showing that such insurance isin force and effect shall be deposited with the Issuer , and prior to theexpiration of any such policy the Company shall furnish the Issuer with acertificate of insurance reasonably satisfactory to the Issuer showing that thepolicy has been renewed or replaced.  At the written request of the Issuer ,the Company shall deliver to the Issuer receipts evidencing the payment for allsuch insurance policies and renewals and replacements. 

### (d)              The Issuer, by the Security Deed, shall assign its interest inthe casualty insurance, described above, to the Holder, together with allunearned premiums as further security for the Bond. 

### (e)               The Issuer and the Holder shall each be entitled to enforce theprovisions of this Article, and the Issuer’s right to enforce this Articleshall be one of the Unassigned Rights.

## **Section 6.5.           Application of Net Proceeds of Insurance.**  TheNet Proceeds of the insurance carried pursuant to the provisions of Sections6.4(a)(ii) and (iii) and similar insurance carried by any contractor shall beapplied toward extinguishment or satisfaction of the liability with respect towhich such insurance proceeds have been paid.  The Net Proceeds of insurancecarried pursuant to Section 6.4(a)(i) shall be transferred to the Custodian anddeposited in the Project Fund to be applied as provided in Article VII hereof.

## **Section 6.6.           Advances by the Issuer or the Holder.** If theCompany shall fail to do any act or pay any taxes, assessments, charges orinsurance premiums required by this Article, the Issuer or any Holder may (butshall be under no obligation to), after notifying the Company of its intentionto do so, do any such act or pay any such taxes, assessments, charges orpremiums required by this Article, and all amounts so advanced therefor by the Issueror any Holder shall become an additional obligation of the Company to the onemaking the advancement, which amounts shall constitute Additional Rent whichshall be payable, with interest as provided in Section 5.3(b).  Any remedyherein vested in the Issuer for the collection of rent shall also be availableto each Holder for the collection of any Additional Rent payable to such Holderon account thereof.

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## **Section6.7.           **** Eminent Domain**. If the Issuer or the Company obtains knowledge of the institution or threat ofinstitution of any proceedings for the taking of the Project or any portionthereof by exercise of the power of eminent domain, it shall immediately notifythe other party hereto and the Holder of the pendency of such proceedings.  TheIssuer, the Company and the Holder may participate in any such proceedings and theIssuer from time to time shall deliver to the Company and the Holder allinstruments requested by it to permit such participation.  The Issuer shall notsettle any eminent domain proceeding relating to the Project or any partthereof or sell the Project or any part thereof under threat of eminent domainwithout the prior written consent of the Company and the Holder.  The NetProceeds of any eminent domain award or any sale in lieu of a taking by eminentdomain shall be transferred to the Custodian and deposited in the Project Fundto be applied as provided in Article VII hereof. 

[End of Article VI]

 

 

 

 

 

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# **ARTICLE VII****DAMAGE, DESTRUCTION, AND CONDEMNATION**

## **Section 7.1.           Repair, Restoration or Replacement**.  If anyportion of the Project is damaged, destroyed or taken by eminent domain (or issold under threat of eminent domain), the Net Proceeds shall, upon receipt, bedeposited in the Project Fund which shall be held by the Custodian and used forthe repair, restoration or replacement of the Project.  If such Net Proceedsare not sufficient to repair or replace the Project, so that the Project asrepaired, restored or replaced shall be at least equal in value and generalutility as it was prior to the damage or destruction or taking, then theCompany shall provide such additional funds as are needed to repair, restore orreplace the Project.

If it becomes necessary to repair, restore or replace theProject, the Company shall promptly proceed to do so and shall prosecute itsrepair, restoration and replacement activities with due diligence.  Amountsheld in the Project Fund shall be disbursed to pay costs for such repair,restoration or replacement substantially in the manner provided for herein forthe disbursement of Bond Proceeds.  Under no circumstance shall damage or destructionof the Project or restoration or repair thereof be deemed to extend theMaturity Date of the Bonds or the dates on which payments of interest and/orprincipal specified in the Bonds are due or relieve the Company of itsobligations to make scheduled periodic payments of Basic Rent.  Upon completionof the work and payment in full therefor, the Custodian shall apply any amountremaining in the Project Fund first to reimburse the Company, for deposits ithas made to the Project Fund for such purposes, and as provided in the SecurityDeed and any remaining amount shall be paid to the Issuer.

[End of Article VII]

 

 

 

 

 

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# **ARTICLE VIII****ADDITIONAL COVENANTS; ADDITIONAL BONDS**

## **Section 8.1.           No Warranty of Condition or Suitability by the Issuer.** THE ISSUER MAKES NO WARRANTY, EITHER EXPRESS OR IMPLIED, AS TO THEMERCHANTABILITY, CONDITION, OR WORKMANSHIP OF ANY PART OF THE PROJECT OR THATTHE SAME WILL BE SUITABLE FOR THE COMPANY’S PURPOSES OR NEEDS.

## **Section8.2.           **** Access to Project and Records**. The Issuer and the Holder and their respective duly authorized representativesand agents, shall have the right, upon reasonable prior notice, but subject toany reasonable restriction imposed by the Company for the protection of itspatents, trademarks, trade secrets, and other confidential proprietary information,to enter the industrial plant located on the Leased Land at all reasonabletimes during the Term for the purpose of (i) examining and inspecting theProject and (ii) performing such work in and about the Project made necessaryby reason of an Event of Default.  The Issuer and the Holder shall also havethe right at all reasonable times to examine, photocopy and make extracts fromthe books and records of the Company, insofar as such books and records relateto the repair and maintenance of the Project or insofar as necessary toascertain compliance with this Lease.

## **Section8.3.           **** Company to Maintain itsExistence and Qualification; Conditions Under Which Exceptions Permitted**. The Company agrees that while this Lease is in effect it shall maintain itslegal existence and good standing as a limited liability company in the stateof its domicile and shall before conducting business and thereafter maintainits qualification to do business and good standing in the State, shall notwithout the prior written consent of the Issuer and the Holder, which consentshall not be unreasonably withheld or delayed, consolidate with or merge intoanother Person or permit one or more other Persons to consolidate with or mergeinto it, and shall not dissolve or otherwise dispose of all or substantiallyall of its assets.  The Company may, without violating the agreement containedin this Section, consolidate with or merge into a Permitted Entity, or permitone or more such other legal entities to consolidate with or merge into it, orthe Company may sell or otherwise transfer to another Permitted Entity all orsubstantially all of its assets as an entirety and thereafter dissolve,provided the surviving, resulting, or transferee Permitted Entity (i) isauthorized to do business in the State, (ii) assumes in writing all of theobligations of the Company under this Lease, (iii) obtains all licenses andpermits required by law to operate the Project and (iv) has a net worth of notless than that of the Company immediately prior to such merger, consolidationof transfer of assets.  In calculating such net worth, indebtedness that issubordinated to the Company’s obligations under this Lease shall be deemed tobe “equity,” rather than indebtedness. 

## **Section8.4.           ** **Operation of the Project andTax Covenants.**  The Company shall operate the Project as a meatprocessing plant throughout the Term and, except in accordance with its normalbusiness practices (for a period not exceeding 30 consecutive days, or for morethan 60 days per year),****shall not suspend such operation except forreasons beyond the control of the Company.   The representations and covenantsof the parties contained in the Issuer’s Tax Compliance Certificate and in theCompany’s Tax Compliance Certificate  which are delivered at the closing of theissuance of the Bonds are incorporated herein by reference.

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**Section 8.5.     Indemnity.**

(a)        The Company shall and agrees to indemnify and save the Issuer,the Holder and their respective officials, directors, officers, members, andemployees harmless against and from all claims by or on behalf of any Personarising from or relating to (i) any condition of or operation of the Project,(ii) any act or negligence of the Company or of any of its agents, contractors,servants, employees, or licensees, (iii) any act or negligence of anyassignee or sublessee of the Company or of any agents, contractors, servants,employees, or licensees of any assignee or sublessee of the Company, or (iv)any violation of the federal or State securities laws by the Company.  However,with respect to matters referred to in the preceding clauses (i), (ii), (iii)or (iv), this indemnity shall not apply, as to the Issuer, to any acts of grossnegligence or willful misconduct or intentional misconduct of the Issuer and,as to the Holder, to any acts of gross negligence or willful misconduct orintentional misconduct of the of the Holder, or in the case of matters referredto in clause (iv) this indemnity shall not apply to the Holder if such Holderhas acquired a Bond other than in a bona fide private placement and has failedto perform a thorough due diligence investigation in connection therewith.  TheCompany shall indemnify and save the Issuer and the Holder (and the otherpersons and entities referred to above, as appropriate) harmless from andagainst all costs and expenses incurred in connection with any such claim or inconnection with any action or proceeding brought thereon, including reasonableattorneys’ fees actually incurred, and upon notice from the Issuer or from theHolder, as applicable, the Company shall defend it (and the other persons andentities referred to above, as appropriate) in any such action or proceeding. The indemnities set forth above specifically extend to, but are in no waylimited to, governmental or other claims relating to any actual or allegedviolation of any Environmental Laws, provided, that such indemnity shall notextend to any actual or alleged violation of any Environmental Laws, whichviolation exclusively relates to the Leased Land and exclusively relates to acause or condition occurring or existing prior to the delivery of this Lease.

(b)        With respect to the indemnity contained in thepreceding subparagraph (a), if any proceeding before any court, governmentalbody or arbitrator is brought against an indemnified party, the indemnifyingparty will be entitled to participate in such proceeding and, to the extentthat it wishes (unless the indemnifying party is also a party to suchproceeding and the indemnified party determines in good faith that jointrepresentation would be inappropriate) to assume the defense of such proceedingwith counsel satisfactory to the indemnified party, acting reasonably. If theindemnifying party assumes the defense of a proceeding, the indemnifying partywithout the indemnified party’s consent, which consent shall not beunreasonably withheld, may effect no compromise or settlement of such claims onbehalf of the indemnified party. Notwithstanding the foregoing, if anindemnified party determines in good faith that there is a reasonableprobability that a proceeding may adversely affect it or its affiliates otherthan as a result of monetary damages for which it would be entitled toindemnification under this Lease, the indemnified party may, by notice to theindemnifying party, assume****the exclusive right to****defend,compromise, or settle such proceeding, but the indemnifying party will not bebound by any determination of a proceeding so defended or any compromise orsettlement effected without its consent.

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(c)        Nothing contained in this Section 8.5 shall require theCompany to indemnify any indemnified Person for any claim or liability forwhich the Company was not given any opportunity to contest or for anysettlement of any such action effected without the Company’s consent (assumingsuch rights are available and have not been waived in writing by the Company). The indemnity of the indemnified Persons contained in this Section 8.5 shallsurvive the termination of this Lease.

(d)          Anything in the Lease to the contrary notwithstanding, it isagreed that each party (the “Releasing Party”) hereby releases the other party(the “Released Party”) from any liability or responsibility (to the ReleasingParty or anyone claiming through or under the Releasing Party by way of subrogationor otherwise) which the Released Party would, but for this Section 8.5 have hadto the Releasing Party during the Term of this Lease resulting from theoccurrence of any accident or occurrence or casualty (i) which is or would becovered by a fire and extended coverage policy (with a vandalism and maliciousmischief endorsement attached) or by sprinkler leakage, boiler and machinery orwater damage policy in the State of Georgia (irrespective of whether suchcoverage is being carried by the Releasing Party), or (ii) covered by any othercasualty or property damages insurance being carried by the Releasing Party atthe time of such occurrence, even if such casualty resulted in whole or in partfrom any act or neglect of the Released Party, its partners, officers, agentsor employees; provided, however, that the releases herein contained shall notapply to any loss or damage occasioned by the willful, wanton or premeditatedaction or omission of the Released Party.  Each party hereto shall, ifpossible, obtain a waiver from any insurance carrier with which it carriesinsurance covering the demised premises or the contents thereof, releasingsubrogation rights against the other party.  

(e)        The Issuer and the Holder shall each be entitled to enforceits right to indemnification under this Section, and the Issuer’s right toindemnification hereunder shall be one of the Unassigned Rights.

**Section 8.6.     Licenses and Permits**.  The Company shalldo all things necessary to obtain, maintain, and renew, from time to time, asnecessary, all permits, licenses, franchises, and other governmental approvalsnecessary for the operation of the Project and obtainable by the Company, thelack of which would have a material adverse affect upon the Company’s abilityto meet its obligations under this Lease.  The Company hereby agrees to giveprompt notice to the Issuer and the Holder of the loss of any permit, license,franchise, or other governmental approval, which notice shall set forth thereasons for such loss.

**Section 8.7.     Compliance with Laws**.  The Companywarrants that throughout the Term it shall, at its own expense, maintain theProject in compliance with all applicable life and safety codes and allapplicable building and zoning, health, environmental, and safety ordinancesand laws, including the Occupational Health and Safety Act, the Americans WithDisabilities Act of 1990, and all applicable Environmental Laws (provided, thatsuch warranty shall not extend to any actual or alleged violation of anyEnvironmental Laws, which violation exclusively relates to the Leased Land andexclusively relates to a cause or condition occurring or existing prior to thecommencement of work on the Leased Land for purposes of the Project), and allother applicable laws, ordinances, rules, and regulations of the United Statesof America, the State, and any political subdivision or agency thereof havingjurisdiction over the Project and which relate to the operations of theProject, any violation of which would have a material adverse affect on theCompany’s ability to fully perform its obligations under this Lease.  TheCompany shall not, in its use or operation of the Project, discriminate orpermit discrimination on the basis of race, sex, color or national origin inany manner prohibited by local state or federal laws, rules, orders orregulations. 

 

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If the Company shall first notify the Issuer and the Holder of itsintention to do so, the Company may, at its own expense and in its own name andbehalf or in the name and on behalf of the Issuer and in good faith, contestany allegation that it has not complied with the laws described in this Section8.7 and, in the event of any such contest, the provisions of this Section 8.7shall not apply to any such alleged violations of law during the period of suchcontest and any appeal therefrom.  The Issuer shall, at the expense of theCompany, cooperate fully with the Company in any such contest. 

The Issuer and the Holder shall each be entitled to enforce theprovisions of this Section, and the Issuer’s right to enforce this Sectionshall be one of the Unassigned Rights.

**Section 8.8.     Granting of Easements**.  The Issuer, at thewritten request of the Company, subject to the approval of the Holder, shall atany time or times grant easements, licenses, rights of way (including thededication of public highways), and other rights or privileges in the nature ofeasements with respect to the Leased Land, or the Issuer, at the writtenrequest of the Company, shall release existing easements, licenses, rights ofway, and other rights or privileges with or without consideration, and the Issueragrees that it shall execute and deliver any instrument necessary orappropriate to confirm and grant or release any such easement, license, rightof way, or other right or privilege upon receipt of (i) a copy of theinstrument of grant or release, (ii) a written application signed by theAuthorized Company Representative requesting such instrument, and (iii) acertificate executed by the Authorized Company Representative stating that suchgrant or release will not impair the effective use or interfere with theoperation of the Project.  Any money consideration received in connection withthe granting or release of an easement pursuant to this Section 8.8 shall beused, at the election of the Company, to acquire additional property for theProject or to retire principal of the Bonds.  No grant or release effectedunder the provisions of this Section shall entitle the Company to any abatementor diminution of the rents payable under Section 5.3 hereof.

[End of Article VIII]

 

 

 

 

 

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# **ARTICLE IX****ASSIGNMENT, SUBLEASING, ENCUMBERING, AND SELLING;REDEMPTION; RENT PREPAYMENTS AND ABATEMENT; INSTALLATION OFCOMPANY’S OWN MACHINERY AND EQUIPMENT**

## **Section 9.1.           Assignment and Subleasing.**  The Company may notassign this Lease or sublease the Project, as a whole or in part, withoutobtaining the prior written consent of the Issuer and the Holder, which consentshall not unreasonably be withheld, conditioned or delayed.  Notwithstandingthe foregoing, the Company may assign of its interest in this Lease to aPermitted Entity if the requirements set forth in Section 8.3 pertaining to a“surviving, resulting or transferee Person” have been fulfilled.  Any suchconsolidation, merger or transfer of substantially all of the assets of theCompany as provided in Section 8.3 hereof, and any assignment, delegation orsublease authorized in Section 8.3 hereof or above in this Section 9.1, orotherwise consented to by the Issuer, shall be subject to each of the followingconditions:

#### (i)              No assignment (other than pursuant to Section 8.3 hereof in atransaction in which the Company ceases to exist) or sublease shall relieve theCompany from primary liability for any of its obligations hereunder, and in theevent of any such assignment or sublease, the Company shall continue to remainprimarily liable for payment of the rents specified in Section 5.3 hereof andfor the payment, performance, and observance of the other obligations andagreements on its part herein provided to be performed and observed by it,unless the Issuer and the Holder of the Bonds consent in writing to suchrelease.

#### (ii)             The assignee or sublessee shall assume in writing the obligationsof the Company hereunder to the extent of the interest assigned or subleased.

#### (iii)           The Company shall furnish or cause to be furnished to the Issuerand the Holder assurances reasonably satisfactory to the Issuer and the Holderthat the Project will continue to be operated in compliance with the provisionshereof.

#### (iv)           No such assignment or sublease (other than pursuant to Section8.3 hereof in a transaction in which the Company ceases to exist) shall giverise to a novation, unless the Issuer and the Holder of the Bonds agree inwriting to such novation.

#### (v)            The Company or such “surviving, resulting or transferee Person”shall, within thirty (30) days prior to the execution thereof, furnish or causeto be furnished to the Issuer a true and complete copy of each such proposedassignment or sublease or documents of merger, consolidation or sale of assets,as the case may be. The Company or such “surviving, resulting or transfereePerson” shall, within thirty (30) days after the execution thereof, furnish orcause to be furnished to the Issuer a true and complete copy of each suchassignment or sublease or documents of merger, consolidation or sale of assets,as the case may be, as actually executed.  The Issuer and the Holder shall havethe right, at any time and from time to time, to notify any assignee orsublessee of their rights under this paragraph.

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## **Section9.2.           ****Restrictions on Sale, Encumbrance, or Conveyance of theProject by the Issuer**.  Except pursuant to the Security Deed and exceptfor any sale under threat of a taking by eminent domain or a sale pursuant toArticle VI hereof, the Issuer agrees that, during the Term, it shall not,except pursuant to or as permitted by the Security Deed: (1) directly,indirectly, or beneficially sell, convey, or otherwise dispose of any part ofits interest in the Project, (2) permit any part of the Project to becomesubject to any lien, claim of title, encumbrance, security interest,conditional sale contract, title retention arrangement, finance lease, or othercharge of any kind, without the written consent of the Company and the Holder,and (3) assign, transfer, or hypothecate (other than pursuant to the BondResolution and the Security Deed) any payment of rent (or analogous payment)then due or to accrue in the future under any lease of the Project, except thatif the laws of the State at the time shall permit, nothing contained in thisSection shall prevent the consolidation of the Issuer with, or merger of the Issuerinto, or transfer of the Project as an entirety to, any public body of theState whose property and income are not subject to taxation and which hasauthority to carry on the business of owning and leasing the Project, provided,that upon any such consolidation, merger, or transfer, the due and punctualpayment of the principal of, premium, if any, and interest on each Bondaccording to its tenor, and the due and punctual performance and observance ofall the agreements and conditions of this Lease, the Bond Resolution and theSecurity Deed to be kept and performed by the Issuer, shall (unless assumed asa matter of law) be expressly assumed in writing by the public body resultingfrom such consolidation or surviving such merger or to which the Project shallbe transferred as an entirety.

## **Section 9.3.           Restrictions on Encumbrance by the Company.** The interest of the Company hereunder shall not be pledged or encumbered,without the written consent of the Issuer and of the Holder, which shall not beunreasonably withheld, provided that the Company may pledge its interest inthis Lease to a commercial bank or other institutional lender in connectionwith the Company’s normal business practices without violating suchrestriction, but until foreclosure (and then only upon satisfaction of theconditions contained herein) no such pledgee as such shall have any rightshereunder, and provided further, that any proposed disposition of the Company’sinterest by such pledgee shall be subject to the preceding provisions of thisSection 9.3 and the other provisions of this Lease.

## **Section 9.4.           Redemption of Bonds**.  The Issuer, at thewritten request of the Company at any time and if the Bonds are then callableor available for purchase, and if there are funds available therefor in the  ProjectFund or funds provided by the Company, shall forthwith take all steps that maybe necessary to effect the redemption of all or part of any Bond, as may bespecified by the Company, on the earliest date on which such redemption ordefeasance may occur under such applicable provisions.

## **Section9.5.           Prepayment of Basic Rent.**  If the Company hasexercised its purchase option provided for in Section 11.1 hereof, the Companyshall have the right to prepay all of the Basic Rent payable under Section5.3(a) hereof prior to the closing of such purchase and the Issuer agrees thatit shall accept such prepayment of Basic Rent when the same is tendered by theCompany.  All Basic Rent so prepaid shall be applied first to the payment ofthe debt service on the Bonds, without preference or priority of any Bond overany other Bond, and when the Bonds have been paid in full, any excess BasicRent shall be retained by the Issuer.

 

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## **Section 9.6.           Reserved.**

## **Section 9.7.           Installation of Company’s Own Machinery and Equipment**. The Company may from time to time, in its sole discretion, install tradefixtures, machinery, equipment, furnishings, and other personal property at theProject.  All such trade fixtures, machinery, equipment, furnishings, and otherpersonal property shall not be a part of the Project and shall remain the soleproperty of the Company (or of any leasing company from whom the Company may berenting such items), and the Company may remove the same from the Project atany time, in its sole discretion and at its own expense, provided that theCompany repairs any damage to the Project caused by any such removal.  TheCompany may create any mortgage, encumbrance, lien, or charge on any such tradefixtures, machinery, equipment, furnishings, and other personal property thatis not a part of the Project that is owned by the Company or others and the Issuershall not have any interest in and waives any lessor’s lien that it may have onany such trade fixtures, machinery, equipment, furnishings, or personalproperty so installed pursuant to this Section.

## **Section 9.8.           Reference to the Bonds Ineffective After such Bonds arePaid**.  Upon payment in full of a Bond (or provision for payment thereofhaving been made in accordance with the defeasance provisions of the BondResolution), all references in this Lease to that Bond and the Holder thereofshall be ineffective, and the former Holder of such Bond shall not thereafterhave any rights hereunder, saving and excepting those that shall havetheretofore vested and any rights to indemnification under Section 8.5 hereof. For purposes of this Lease, a Bond shall be deemed fully paid if it is defeasedas provided in the Bond Resolution. 

[End of Article IX]

 

 

 

 

 

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# **ARTICLE X****EVENTS OF DEFAULT AND REMEDIES**

## **Section 10.1.       Events of Default Defined.**  The following shallbe “Events of Default” under this Lease, and the terms “Event of Default” or“Default” shall mean, whenever they are used in this Lease, any one or more ofthe following events:

### (a)               the failure of the Company to pay Basic Rent in the amounts andat the times required by Section 5.3(a) of this Lease provided, (1) that suchfailure to pay shall not constitute a “Default” or an “Event of Default” unlesscontinued for more than 5 days after receipt by the Company of written noticeof same given by the Issuer or the Holder; and (2) that the foregoing clause(1) shall be of no further force or effect once notices have been given withrespect to three (3) such failures to pay in any one 24 month period; or

### (b)              the failure of the Company to pay the amounts required to be paidunder Section 5.3(b) of this Lease, at the times specified therein, andcontinuing for a period of thirty (30) days after the Company’s receipt ofwritten notice given by the Issuer pursuant to Section 5.3(b), the Issuer orany Holder (whichever is entitled to receive such payment); or

### (c)               In the case of the Company’s failure to observe, perform, orcomply with any covenant, condition, or agreement in this Lease on the part ofthe Company to be observed or performed, for a period of thirty (30) days afterwritten notice from the Issuer or any Holder specifying such breach or failureand requesting that it be remedied, unless the Issuer and the Holder shallagree in writing to an extension of such time prior to its expiration.  In thecase of any such breach or default which can be cured, but cannot be curedwithin such thirty (30) day period, it shall not constitute an Event of Defaultif corrective action is instituted by the Company within the applicable thirty(30) day period and is diligently pursued until the breach or default iscorrected; or

### (d)               The filing of a voluntary petition in bankruptcy by the Companyor the adjudication of the Company as bankrupt pursuant to an involuntarypetition filed by a creditor of the Company.

## **Section 10.2.       Remedies on Default.**  Whenever any Event ofDefault referred to in Section 10.1 hereof shall have happened and besubsisting, the Issuer, or the Holder as assignee of the Issuer, to the extentpermitted by law, may take any one or more of the following remedial steps:

### (a)               take whatever action at law or in equity or under the terms ofthis Lease may appear necessary or desirable to collect the rents and otheramounts payable by the Company hereunder then due or thereafter to become due,or to enforce performance and observance of any obligation, agreement, orcovenant of the Company under this Lease; or

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### (b)              terminate, subject to the respective provisions concerning thepriority and subordination of the Company’s option to purchase the Project thatare set forth in Section 11.4, below, this Lease and recover, as and forliquidated and agreed final damages for the Company’s default, all amounts thathave theretofore become due plus an amount equal to all unpaid installments ofBasic Rent, and if any statute or rule of law shall validly limit the amount ofsuch liquidated final damages to less than the amount agreed upon, the Issuershall be entitled to the maximum amount allowable under such statute or rule oflaw; no termination of this Lease pursuant to this Section shall relieve theCompany from its indemnification obligations pursuant to Section 8.5 hereof.

Any amounts of Basic Rent collected, pursuant to actiontaken under this Section, shall be applied in payment of the Bonds withoutpreference or priority of one Bond over any other Bond. Any amounts collectedas Additional Rent shall be paid to the Person or Persons to whom suchAdditional Rent is due and owing hereunder.

Notwithstanding that this Lease (except for UnassignedRights) is to be assigned to the Holder, the Issuer shall be entitled toenforce this Lease if any Event of Default relates to such Unassigned Rights orexposes the Issuer, its assets (other than the Pledged Security) or itsmembers, officers, employees or agents to any liability.  The Holder shall beentitled to enforce the provisions hereof that affect its interests hereunder. Notwithstanding the foregoing and notwithstanding any statutory, decisional, orother law to the contrary, in no event shall the Issuer have any right toterminate this Lease, to enter upon and otherwise to obtain possession of theProject, by reason of the occurrence of any Event of Default by the Companyhereunder without the prior written consent of the Holder.

## **Section 10.3.       Remedies Not Exclusive.**  The remedies hereinexpressly conferred upon the Issuer and the Holder are intended to be inaddition to other remedies existing at law or in equity or by statute.  Nodelay or omission to exercise any right or power accruing upon any Event ofDefault shall impair any such right or power or shall be construed to be awaiver thereof, but any such right and power may be exercised from time to timeand as often as may be deemed expedient.  In order to entitle the Issuer or theHolder to exercise any remedy reserved to it in this Article, it shall not benecessary to give any notice, other than such notice as may be herein expresslyrequired hereby.

## **Section10.4.       Company to Pay Fees and Expenses.**  In the eventthe Company or the Issuer should default under any of the provisions of thisLease and the Issuer or either Holder, on the one hand, or the Company, on theother, as appropriate, should employ attorneys, accountants, or other expertsor incur other expenses for the collection of amounts due it hereunder or theenforcement of performance or observance of any obligation or agreement on thepart of the Company or Issuer, as appropriate, herein contained for itsbenefit, the Company on the one hand, and the Issuer, on the other hand, asappropriate, agree that it shall on demand therefor pay to such Person thereasonable and actual fees of such attorneys, accountants, or other experts andsuch other expenses so incurred by the Issuer or the Holder, on the one hand,or the Company, on the other, as appropriate.  Any attorneys’ fees required tobe paid by the Company or Issuer, as appropriate, under this Lease shallinclude attorneys’ and paralegals’ fees through all proceedings, including, butnot limited to, negotiations, administrative hearings, trials, and appeals,court costs and reimbursable expenses of such attorneys.  The Issuer, theCompany and the Holder shall each be entitled to enforce its respective rightsunder this Section, and the Issuer’s rights under this Section shall be one ofthe Unassigned Rights.

 

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## **Section 10.5.       Waiver of Events of Default.**  The Issuer may waiveany Event of Default hereunder and its consequences or rescind any declarationof acceleration of payments of the rents and other amounts due hereunderprovided that the Issuer shall not waive any Event of Default (other thanEvents of Default relating to the Unassigned Rights) without the prior writtenconsent of the Holder.  The Holder may waive any Event of Default hereunderother than Events of Default relating to the Unassigned Rights, which may bewaived only by the Issuer.  In case of any such waiver or rescission, or incase any proceeding taken by the Issuer or the Holder on account of any suchEvent of Default shall be discontinued or abandoned or determined adversely tothe Issuer or the Holder, then and in every such case the Issuer*,* the Holderand the Company shall be restored to their former positions and rightshereunder, but no such waiver or rescission shall extend to or affect anysubsequent or other Event of Default or impair or exhaust any right, power, orremedy consequent thereon.

[End of Article X]

 

 

 

 

 

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# **ARTICLE XI****PURCHASE OPTION IN FAVOR OF COMPANY**

## **Section 11.1.       Option to Purchase Project.**  The Company shallhave, and is hereby granted, the option to purchase the Project at the end ofthe Term for a purchase price which shall be the sum of: (i) $500,000; and (ii)all amounts, if any, then due on the date of such closing to the Issuer or tothe Holder as Additional Rent or for indemnification under this Lease (whichamounts shall be paid directly to the person to whom such amounts are owed);and (iii) those closing costs which are normally payable by the purchaser ofreal property in Georgia.  The option granted herein, if exercised, shall beexercised at least sixty (60) days prior to the expiration of the Term. Toexercise such option, the Company or its assignee shall give written notice ofexercise to the Issuer and to the Holder.  The purchase of the Project shall beclosed on a date specified by the Company, which shall be not sooner thanthirty (30) days from the date of such notice or later than to the expirationdate of the Term.  The Company shall be under no obligation to exercise theoption granted in this Section 11.1.  If no Event of Default is in existence atthe time the option is exercised, the Company may assign in writing****itsoption to an Affiliate; the Company or such Affiliate shall provide the Issuer witha copy of any such assignment at the time the option is exercised.

## **Section 11.2.       Conveyance on Exercise of Option to Purchase**. At the closing of any purchase pursuant to the exercise of the option to purchasegranted herein, the Issuer shall, upon payment of the purchase price by theCompany, deliver to the Company a limited warranty deed conveying to theCompany good title to the Project, as the Project then exists, subject to thefollowing: (i) Permitted Encumbrances, but excluding this Lease and theSecurity Deed; (ii) those liens and encumbrances (other than the IssuerDocuments) created by the Company or to the creation or suffering of which theCompany consented; and (iii) those liens and encumbrances resulting from thefailure of the Company to perform or observe any of the agreements on its partcontained in this Lease.

## **Section 11.3.       Public Purpose of Option to Purchase**.  The Issuerand the Company acknowledge that the option to purchase the Project granted inthis Article constitutes a material inducement to the Company renovate theProject and thereby preserve and create employment opportunities in the Countyand that in granting such option, the Issuer is considering the entiretransaction as a whole, including the promotion and expansion for the publicgood and welfare industry and trade within the County and the reduction ofunemployment, and the fact that, as a result of a sale of the Project as aresult of the exercise of the option, all indebtedness with respect to theProject shall be paid in full.

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## **Section11.4.       ****Priority Position of Option**.  Notwithstandingany other provision hereof or of the Bond Resolution, the purchase optiongranted to the Company in Section 11.1 may be exercised whether or not an Eventof Default hereunder has occurred and is continuing or whether or not an Eventof Default under the Bond Resolution has occurred and is continuing, and thisLease and the option granted in Section 11.1 shall have priority over theSecurity Deed and shall not be terminated by foreclosure or pursuant to thepower of sale in the Security Deed.  In the event the Company exercises theoption, the Company agrees that it, and any person or entity to whom it maythereafter sell or lease the Project shall meet the employment goals set forthin Section 12.1 hereof, and if the Company, or any successor in title or lesseeshall fail to meet such employment goals, the Company shall make thesupplemental payments required by Section 12.1 of this Lease, and suchobligation shall survive the termination of this Lease, if the purchase optionis exercised.

[End of Article XI]

 

 

 

 

 

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# **ARTICLE XII****MISCELLANEOUS**

## **Section 12.1.       Supplemental Payments for Failure to Meet EmploymentGoals.**  The Company has represented to the Issuer that throughout theTerm, the operation of the Project will provide at least 120 full-time jobs. The representations of the Company as to job creation are a material andsubstantial part of the consideration for the Issuer’s leasing of the Projectto the Company hereunder and in granting the Company the option to purchase theProject at a highly favorable price.  The failure of the Company (or if itexercises its option to purchase the Project, the failure of the Company, anysuccessor in title or any lessee of the Project, whichever shall be operatingthe Project) to realize such employment levels shall not constitute an Event ofDefault hereunder, but shall give rise to an obligation on the part of theCompany to make the supplemental payments provided for in this Section 12.1. For purposes hereof, a full-time employee is an employee of the Company (or ifthe Company exercises its option to purchase the Project, a full-time employeeshall include an employee of the Company, of any such successor in title or anylessee of the Company or lessee of a successor in title), exclusive ofemployees that are leased from an employee leasing agency, having at least1,800 paid hours per year, including paid hours actually worked, paid holidaysand paid vacation days constituting the equivalent of a full-time employee. Hours of temporary and part-time employees (exclusive of employees that areleased from an employee leasing agency) may be aggregated and divided by 1,800hours to calculate the number of equivalent full-time employees for suchpurpose.

If in any calendar year during the Term the averageemployment at the Project, whether by the Company (or if the Company exercisesits option to purchase the Project by the Company, by any such successor intitle or by any lessee of the Company or lessee of a successor in title) doesnot equal or exceed 120 full-time jobs, the Company, not later than 30 daysfollowing the end of such calendar year, shall pay to the Issuer an “employmentshort-fall payment” calculated as follows: the sum of $20,000 plus anadditional amount determined by subtracting the actual numbers of full-timejobs at the Project (if less than 100) from 100 jobs and multiplying theremainder by $1,000.  For example, if the actual number of full-time jobs insuch year was 90, the payment would be $30,000 ($20,000 plus $10,000). 

In the event this Lease expires and the option to purchasethe Project is not exercised, payments hereunder shall be made only withrespect to years (and parts of years) included in the Term of this Lease, andif the Lease terminates prior to the end of a calendar year, the calculationfor such partial year shall be based on the short period commencing on January1 of the year of expiration and ending on the date of termination, and the1,800 hours requirement for such year shall be shall be prorated based on thenumber of calendar days during the Term in such year to the total number ofdays in such calendar year.  In such case, the payment, if any, for suchpartial year shall be paid within 30 days of expiration of the Term hereof.

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If the Company exercises its option to purchase theProject: (i) the year in which the Company purchases the Project shall not besubject to proration, as aforesaid, and the full calendar year shall be usedfor purposes of such calculation; (ii) employment by the Company before suchexpiration and employment by the Company (and by any such successor in title orby any lessee of the Company or lessee of a successor in title after suchexpiration) shall be aggregated; (iii) in any year employment by the Companyand employment by any such successor in title or by any lessee of the Companyor lessee of a successor in title shall be aggregated; and (iv) the last yearfor which any payments shall be payable under this Section is the calendar year2013, which shall be payable not later than January 30, 2014.  

For purposes of this Section, the full-time employment atthe Project shall be deemed to be zero unless the Company provides to the Issuerpayroll records of the Company and/or payroll records of any such successor intitle or by any lessee of the Company or lessee of a successor in title thatestablish the number of full-time employees at the Project.

The provisions of this Section 12.1 shall survive thetermination of this Lease. 

## **Section12.2.       ****           Notices.** Any request, demand, authorization, direction, notice, consent, or otherdocument provided or permitted by this Lease to be made upon, given orfurnished to, or filed with, the Issuer, the Company or the initial Holder asset forth below shall be sufficient for every purpose hereunder if in writingand (except as otherwise provided in this Lease) either (i) deliveredpersonally, by hand delivery, courier or express company, to the party or, ifsuch party is not an individual, to an officer or other legal representative ofthe party to whom the same is directed, or (ii) mailed by registered orcertified mail, return receipt requested, postage prepaid, or (iii) sent byfax, as follows. 

To the Issuer:                            Joint DevelopmentAuthority of Brooks, Colquitt, 

Grady, Mitchell, and Thomas Counties

P.O. Box 487

Moultrie, GA 31776

Attn: Darrell Moore

Fax: (229)890-2638

To the Company:                      National Beef PackingCompany, LLC

12200 N. Ambassador Drive, Suite  500

Kansas City, MO  64163

Attn: Jay Nielsen, CFO

Fax: (816) 713-8856

With a copy to:                         Scott Smith

2690 Telemark Drive

Park City, UT 84061

Fax: (435)649-5675

To thePurchaser:                      American Banking Company d/b/a Ameris

225 S. Main Street

P.O. Box 2529

Moultrie, Georgia 31768

Attn:  Ronnie Marchant, President

Fax: (229) 985-2828

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Any person designated in this Section 12.2 may, by noticegiven to each of the others, designate any additional or different addresses towhich subsequent notices, certificates, or other communications shall be sent.

## **Section 12.3.       Recording**.  This Lease, or a “short form lease”or “memorandum of lease” giving appropriate notice hereof, may be recorded inall offices as may at the time be provided by law as the proper place forrecordation.

## **Section 12.4.       Construction and Binding Effect.**  This Leaseconstitutes the entire agreement of the parties concerning the subject matterhereof and supersedes any prior agreements with respect thereto.  This Leaseshall inure to the benefit of and shall be binding upon the Issuer, theCompany, and their respective successors and assigns subject, however, to thelimitations contained in Sections 8.3, 9.1, and 9.2 hereof.

## **Section 12.5.       Severability.**  In the event any provision ofthis Lease shall be held invalid or unenforceable by any court of competentjurisdiction, such holding shall not invalidate or render unenforceable anyother provision hereof.

## **Section 12.6.       Immunity of Members, Officers, and Employees ofAuthority.**  No recourse shall be had for the enforcement of anyobligation, covenant, promise, or agreement of the Issuer contained in thisLease or for any claim based hereon or otherwise in respect hereof or upon anyobligation, covenant, promise, or agreement of the Issuer contained in the BondResolution against any director, member, officer, or employee, as such, in hisindividual capacity, past, present, or future, of the Issuer, or any successorPerson, whether by virtue of any constitutional provision, statute, or rule oflaw, or by the enforcement of any assessment or penalty or otherwise, it beingexpressly agreed and understood that this Lease is solely a corporateobligation of the Issuer and that no personal liability whatsoever shall attachto, or be incurred by, any director, member, officer, or employee, as such,past, present, or future, of the Issuer, or of any successor Person, eitherdirectly or through the Issuer, or any successor Person, under or by reason ofany of the obligations, covenants, promises, or agreements entered into betweenthe Issuer and the Company whether contained in this Lease or in any instrumentsupplemental hereto, and that all personal liability of that character againstevery such director, member, officer, and employee of the Issuer or any suchsuccessor Person is, by the execution of this Lease and as a condition of andas part of the consideration for the execution of this Lease, expressly waivedand released by the Company.  The immunity of directors, members, officers, andemployees of the Issuer under the provisions contained in this Section shallsurvive the completion of the Project and the termination of this Lease.

## **Section 12.7.       Amendments, Changes, and Modifications.**  ThisLease may not be amended, modified, altered, or terminated, except as providedin the Bond Resolution.

## **Section12.8.       **** Execution of Counterparts**. This Lease may be executed in several counterparts, each of which shall be an originaland all of which shall constitute but one and the same instrument.

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## **Section12.9.       ****Law Governing Construction of this Lease.**  ThisLease is prepared and entered into with the intention that the laws of theState of Georgia, exclusive of such state’s rules governing choice of law,shall govern its construction. 

## **Section12.10.   **** Covenants Run with Project.**  The covenants,agreements, and conditions herein contained shall run with the Project herebyleased and shall be binding upon, inure to the benefit of, and be enforceableby the parties hereto and their respective successors and assigns.

## **Section 12.11.   Subordination to Security Deed.**  This Lease andthe rights and privileges hereunder of the Company (except for its purchaseoption) are specifically made subject and subordinate to the rights andprivileges of the Holder, as to be****set forth in the Security Deed. 

## **Section 12.12.   Net Lease.**  This Lease shall be deemed andconstrued to be a “triple net lease,” and the Company shall pay absolutely netduring the Term the Basic Rent, Additional Rent, taxes (or payments in lieu oftaxes), insurance premiums, costs of operation and maintenance and all otherpayments required hereunder, free of any deductions, without abatement,diminution, or set-off other than those herein expressly provided. 

## **Section12.13.   **** Surrender of Project. **Except as otherwiseprovided in this Lease, at the expiration or sooner termination of the Term,the Company agrees to surrender possession of the Project peaceably andpromptly to the Issuer in as good condition as at the commencement of the Term,excepting only ordinary wear, tear, and obsolescence, and damage by fire orother casualty or a taking by eminent domain which the Company is not obligatedby this Lease to repair. 

## **Section12.14.   **** Immunity of Directors, Officers, and Employees ofCompany**.  No recourse shall be had for the enforcement of anyobligation, covenant, promise, or agreement of the Company contained in thisLease or for any claim based hereon or otherwise in respect hereof, against anydirector, officer, or employee of the Company or any Permitted Successor, inhis individual capacity, past, present, or future, of the Issuer, whether byvirtue of any constitutional provision, statute, or rule of law, or by theenforcement of any assessment or penalty or otherwise, it being expresslyagreed and understood that this Lease is solely a corporate obligation of theCompany and that no personal liability whatsoever shall attach to, or beincurred by, any such director, officer, or employee, either directly orthrough the Company, or any Permitted Successor, under or by reason of any ofthe obligations, covenants, promises, or agreements contained in this Lease orto be implied herefrom, and that all personal liability of that characteragainst every such director, officer, and employee is, by the execution of thisLease and as a condition of and as part of the consideration for the executionof this Lease, expressly waived and released.  The immunity of directors,officers, and employees of the Company under the provisions contained in thisSection shall survive the termination of this Lease.

## **Section 12.15.   Payments Due on Other than Business Days.  **Whenevera date upon which a payment is to be made under this Lease falls on a datewhich is not a Business Day, such payment may be made on the next succeedingBusiness Day without interest for the intervening period.

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## **Section12.16.   ** **Holders are Third Party Beneficiaries.**  Eachperson who from time to time is the Holder shall be deemed to be and is a thirdparty beneficiary of the representations, covenants, and agreements of theCompany in favor of the Issuer herein contained (except for covenants andagreements pertaining to the Unassigned Rights).

## **Section 12.17.   Restriction on Use.** The Issuer is subject to arestrictive covenant in favor of the entity or entities (collectively, the“Sellers”) from which it purchased the Leased Land and the Leased Improvements(as they then existed).  Accordingly, the Company covenants with the Issuerthat during the period ending on the fifth anniversary (January 16, 2006) ofthe date of the original delivery of this Lease (being January 16, 2001), theCompany shall not (i) use the Project for the slaughter of hogs; or (ii)produce pork products at the Project in any of the following prohibitedcategories: sausages; hot dogs/franks; sliced luncheon meat; or bacon; or (iii)produce pork products at the Project in quantities that exceed 5.2 millionpounds in any calendar year (prorated for any portion of a calendar year) inany of the following permitted categories: boneless ham; or bone-in smokedhams.  For purposes of the restriction in the preceding clause (iii), totalproduction in all permitted categories may exceed 5.2 million pounds percalendar year, but production in any individual permitted category may notexceed 5.2 million pounds per calendar year.  The Company shall allow the Issuerand such other parties as the Issuer may designate (which may includerepresentatives of the Sellers) access to its books and records, no more thantwice per year on at least 10 days advance written notification, to the extentnecessary to verify compliance with the restriction set forth in the precedingsentence.

[End of Article XII]

 

 

 

 

 

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**IN WITNESS WHEREOF**, the Issuerhas executed this Lease by causing its name to be hereunto subscribed by itsChairman and by causing the official seal of the Issuer to be impressed hereonand attested by its Secretary; and the Company has executed this Lease bycausing its name to be hereunto subscribed by its partners, by their respectiveduly authorized officer, all being done as of the day and year first abovewritten.

| signed, sealed, anddelivered in the presence of:

/s/ William G. Fallin                              			Unofficial Witness                                                                                                                                                                                                                                                                                                                                                                                                                            | **Joint Development Authority 			of Brooks,  Colquitt, Grady, 			Mitchell, and Thomas Counties**BY:/s/ Darrell Moore                                  			                        Chairman |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| /s/ Stephanie Harrell                             			Notary Public   My Commission Expires:                                                           			            (NOTARY SEAL) | ATTEST:   			/s/ Marilyn Royal                                        			                        Secretary

(AUTHORITY’S  SEAL)         |

 

 

 

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| Signed and sealed in thepresence of

 

                                                                          | **NATIONAL BEEF PACKING COMPANY, LLC**, a Delaware  limited liability company, as successor to Farmland National Beef Company****By: /s/ Jay Nielsen                                			Name:    Jay Nielsen                             Title:  			Chief Financial Officer                 |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| /s/ Lynn Vineyard                                              			Unofficial Witness                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|  

/s/ Darcy Clements                                                                                                                                                                                                                                         |  

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| Notary Public                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| My Commission Expires:    2-28-2010                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (NOTARY  SEAL)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |

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## **EXHIBIT A**

DESCRIPTION OF THE LEASEDLAND

All that tract or parcel of land situate, lying and beingin Land Lots 244 and 245 in the Eighth (8th) Land District inColquitt County, Georgia, being 19.17 acres as shown by that plat dated January9, 2001, designated “Plat of Survey for Joint Development Authority of Brooks,Colquitt, Grady, Mitchell and Thomas Counties, A Statutory Authority”, andrecorded in Plat Book 35, page 21, Colquitt County Records; the property beingmore specifically described as follows:

To locate the point of beginning commence at the pointwhere the South margin of the right of way of the West By-Pass intersects theWest margin of the right of way of the Southern Railroad (this point being390.86 feet from the point where the South margin of the right of way of theWest By-Pass intersects the West margin of Georgia State Highway No. 35 and U.S. Highway 319), run thence South 04 degrees 01 minute 09 seconds East alongthe West margin of the right of way of the Southern Railroad a distance of764.89 feet to a point; continue thence along the West margin of the right of wayof the Southern Railroad a chord bearing of South 04 degrees 14 minutes 53seconds East a chord distance of 44.36 feet, an arc length distance of 44.36feet to a point; run thence South 77 degrees 06 minutes 35 seconds West adistance of 319.81 feet to a point; run thence South  86 degrees 17 minutes 12seconds West a distance of 571.42 feet to a point; run thence North 15 degrees53 minutes 04 seconds West a distance of 883.76 feet to a point on the Southmargin of the right of way of the West By-Pass; run thence North 86 degrees 28minutes 57 seconds East along the South margin of the right of way of the WestBy-Pass a distance of 1,068.97 feet to a point, this being the point ofbeginning.