Second Amendment to Ground Lease dated as of February 19, 1995
between the Registrant and Decatur.
SECOND AMENDMENT TO GROUND LEASE
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This Second Amendment to Ground Lease (this "Amendment") is made and
entered into as of the 19th day of February, 1995, by and between NEW ENGLAND
LIFE PENSION PROPERTIES; A REAL ESTATE LIMITED PARTNERSHIP (the "Landlord"),
whose address is c/o Copley Real Estate Advisors, Inc., βββ� ββββββββ ββββββ,
ββββββ, ββ βββββ�, and DECATUR TOWNCENTER ASSOCIATES, LTD., a Georgia limited
partnership (the "Tenant"), whose address is c/o Pope & Land Enterprises, ββββ
ββββββββ ββββ, βββββ� βββ�, βββββββ�, βββββββ� βββββ�, who, for and in consideration
of the sum of Ten Dollars ($10.00) each to the other paid, and the mutual
covenants flowing between the parties hereto, the receipt and sufficiency of
which are hereby acknowledged, do hereby covenant, warrant and agree as follows:
1. Recitals. This Amendment is made with reference to the following
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facts and objectives:
a. Landlord and Tenant entered into a certain written Ground Lease
dated February 20, 1985 (the "Lease") and a certain written Short-Form Ground
Lease dated February 20, 1985 recorded in Deed Book 5156, Page 52, Records of
DeKalb County, Georgia, pursuant to which Landlord leased to Tenant and Tenant
leased from Landlord, certain premises more particularly described therein (the
"Premises").
b. Landlord and Tenant entered into a certain written First Amendment
to Short-Form Ground Lease and Ground Lease dated February 1, 1988, recorded in
Deed Book 6092, Page 455, Records of DeKalb County, Georgia, amending the Lease
(as so amended, the Lease is hereinafter referred to as the "Amended Lease").
c. The parties hereto desire to amend the Amended Lease on the
effective date hereof on the terms and conditions set forth herein.
2. Representations. As an inducement to Landlord to enter into this
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Amendment, Tenant represents that (a) Tenant has not made any assignment,
sublease, transfer, conveyance or other disposition of said lease or any
interest thereof; and that there exists no claim, demand, obligation, liability,
action or cause of action arising from said Amended Lease; and (b) there are no
liens for past due taxes of any nature (except any lien for unpaid city, state
and county 1995 ad valorem taxes on said Premises), paving, sidewalk, curbing,
sewer, or any other street improvements of any kind against or affecting said
Premises.
3. Amendment of Section 3.1 of the Lease. The following is added as
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a new Section 3.1.D. of the Amended Lease, immediately following Section 3.1.C.
of the Amended Lease:
"D. Notwithstanding anything else to the contrary contained
herein, Tenant shall be required to pay Fixed Monthly Rental due to
Landlord only from and to the extent of Net Operating Cash Flow for
the month in which such payment is due. Each such Fixed Monthly Rental
(or portion thereof) which is not paid by Tenant when due in
accordance with the foregoing sentence shall accrue interest from the
date the same was due. The total of all such unpaid Fixed Monthly
Rental (or portions thereof) together with all interest accruals
thereon, shall be referred to herein as the "Accrued Amount." The
Accrued Amount or any portion thereof remaining unpaid at any time and
from time to time during the Term of this Lease (the "Accrual
Balance") shall bear interest at the rate of 8.5% per annum,
compounded monthly, until fully paid by Tenant to Landlord.
Notwithstanding the foregoing, Tenant hereby agrees to apply all Net
Operating Cash Flow for any month during the Term of this Lease (in
excess of the amount required to be paid pursuant to the first
sentence of this paragraph) to reduce the outstanding Accrual Balance
until paid in full. In all events, the entire Accrual Balance
remaining unpaid on the date of termination of this Lease shall be
paid to Landlord in full on such date of termination. For purposes of
this Lease, the term "Net Operating Cash Flow" shall mean, as to any
particular month or portion thereof, the difference between (i) Gross
Receipts, less (ii) Operating Expenses."
4. Amendment of Section 12.5 of the Lease. Section 12.5 is hereby
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deleted from the Amended Lease in its entirety, and the following is hereby
substituted in its place:
"12.5 Landlord's and Tenant's Share of Net Condemnation Proceeds.
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Net Condemnation Proceeds which are not applied to Restoration after Taking
and are to be distributed under the provisions of this Article shall be
distributed as follows:
A. First, to Landlord to the extent of the Accrual Balance;
B. Second, to Landlord to the extent of Landlord's Interest in
the Land;
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C. Third, to the First Mortgagee to the extent necessary to
satisfy all amounts secured by the First Mortgage;
D. Fourth, to the holders of any junior Mortgages, in the order
of priority of such Mortgages, to the extent necessary to satisfy all
amounts secured by such junior Mortgages;
E. Fifth, to Tenant an amount equal to the aggregate cost of (a)
capital improvements made after the Lease Commencement Date with
respect to the Property with the approval of Landlord, less the
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aggregate amount of costs of capital improvements included in
Operating Expenses under paragraph B(2) of Section 3.1 and costs
incurred in connection with a Restoration or Restoration after Taking
and (b) actual increases in Operating Expenses for the Property
incurred after the Lease Commencement Date which are not included in
Escalation Receipts, with interest thereon at a rate of 8.5% per annum
if paid from Tenant's own funds or, if paid from borrowed funds, the
rate of interest paid by Tenant on such borrowings, in either case
calculated on each such expense from the date such item of expense is
paid, provided that amounts payable under this clause (b) with respect
to increases in Operating Expenses and interest thereon shall only be
paid if and to the extent that the Property has appreciated in value
after each such element of increased expense is paid and each
increment of interest thereon has accrued;
F. The balance, if any, 60% to Landlord and 40% to Tenant.
5. Amendment of Section 16.8 of the Lease. Sections 16.8.A., 16.8.B.
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and 16.8.C. are hereby deleted from the Amended Lease in their entirety,
and the following is hereby substituted in their place:
"16.8. Sale of Property, Application of Net Sale Proceeds.
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A. The proceeds of any sale of the entire Property
(Landlord's Estate together with Tenant's Estate) pursuant to and in
accordance with the provisions of this Section 16.8, less the
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reasonable costs and expenses of such sale (including, without
limitation, transfer taxes, attorneys' fees, brokerage commissions,
title premiums, filing fees and any fees required to secure the
consent of any mortgagee)
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("Net Sale Proceeds") shall be paid, applied and distributed as follows:
(i) First, to Landlord to the extent of the Accrual Balance;
(ii) Second, to Landlord to the extent of Landlord's Interest in
the Land;
(iii) Third, to the First Mortgagee to the extent necessary to
satisfy all amounts secured by the First Mortgage;
(iv) Fourth, to the holders of any junior Mortgages, in the
order of priority of such Mortgages, to the extent necessary to satisfy all
amounts secured by such junior Mortgages;
(v) Fifth, to Tenant an amount equal to the aggregate cost of
(a) capital improvements made after the Lease Commencement Date with
respect to the Property with the approval of Landlord, less the aggregate
----
amount of costs of capital improvements included in Operating Expenses
under paragraph B2 of Section 3.1 and costs incurred in connection with a
Restoration or Restoration after Taking and (b) actual increases in
Operating Expenses for the Property incurred after the Lease Commencement
Date which are not included in Escalation Receipts, with interest thereon
at a rate of 8.5% per annum if paid from Tenant's own funds or, if paid
from borrowed funds, the rate of interest paid by Tenant on such
borrowings, in either case calculated on each such expense from the date
such item of expense is paid, provided that amounts payable under this
clause (b) with respect to increases in Operating Expenses and interest
thereon shall only be paid if and to the extent that the Property is
appreciated in value after each such element of increased expense is paid
and each increment of interest thereon has accrued;
(vi) The balance, if any, 60% to Landlord and 40% to Tenant.
"B. If Tenant has not delivered to Landlord on or before
October 2, 1995, a binding commitment to purchase Landlord's Estate
and that certain promissory note from Tenant to Landlord dated
February 20, 1985 in the original principal amount of $5,285,000 (the
"Note") in form and substance
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satisfactory to Landlord in its sole discretion, the Developer shall
cooperate with Landlord in (i) selecting a real estate broker to
market the entire Property (Landlord's Estate together with Tenant's
Estate) for sale, (ii) identifying prospective purchasers of the
entire Property and (iii) no later than November 4, 1995, mailing to
such prospective purchasers a sales brochure and related marketing
materials. If Tenant and Landlord have not executed a purchase and
sale agreement for the sale of Landlord's Estate and the Note on or
before January 1, 1996, the Landlord may at its sole discretion offer
the entire Property (Landlord's Estate together with Tenant's Estate)
for sale for such price and on such other terms and conditions as the
Landlord may determine in its sole discretion. In connection with any
such sale or proposed sale, the Landlord shall have the right to cause
the Property to be marketed to such prospective purchasers and upon
such terms as the Landlord shall determine in its sole discretion and
to take such other actions as it deems necessary or appropriate in
connection with such sale or proposed sale. The Tenant agrees, at the
direction of the Landlord, to execute and deliver such documents,
including without limitation purchase and sale agreements, deeds or
assignments of lease, as may be reasonably required in connection with
any such sale or proposed sale."
6. Accrual Balance. Tenant and Landlord agree that, as of December
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31, 1994, the Accrual Balance equals $988,250.
7. Effective Date. The effective date of this Amendment shall be the
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date first above written.
8. Successors. This Amendment shall be binding on and inure to the
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benefit of the parties hereto and their heirs, successors and assigns.
9. No Other Modification. Except as specifically amended by this
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Amendment, no other provision of the Amended Lease is hereby modified, and the
Amended Lease shall remain in full force and effect.
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IN WITNESS WHEREOF, the parties hereto have executed this Amended as a
sealed instrument on the date first above written.
LANDLORD:
NEW ENGLAND LIFE PENSION PROPERTIES;
A REAL ESTATE LIMITED PARTNERSHIP
By: ββββββ Properties Company,
Inc., General Partner
By:_______________________________
TENANT:
DECATUR TOWNCENTER ASSOCIATES, LTD.,
By:____________________________________
A.J. Land, Jr., General Partner
The undersigned leasehold mortgagee
hereby consents to this Amendment
and the terms set forth herein.
NEW ENGLAND LIFE PENSION PROPERTIES;
A REAL ESTATE LIMITED PARTNERSHIP
By: ββββββ Properties Company, Inc.
By:____________________________
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