HomeMy WebLinkAbout2017-08-29 Meeting Minutes Finance Committee Meeting Commission Chamber - 8/29/2017
ATTENDANCE:
Present: Hons. Frantom, Chairman; Sias, Vice Chairman; Hasan, member.
Absent: Hons. Hardie Davis, Jr., Mayor; Guilfoyle, member.
FINANCE
1. Approve funding request from the Greater Augusta Arts Council in the amount
of $35,000 to support the 2017 Arts in the Heart of Augusta Festival.
Item
Action:
Approved
Motions
Motion
Type Motion Text Made By Seconded By Motion
Result
Approve
Motion to
approve.
Motion Passes
3-0.
Commissioner
Sammie Sias
Commissioner Ben
Hasan Passes
2. Motion to accept the award of an additional $4,000 grant from the Georgia
Department of Natural Resources (DNR) for the Meadow Garden Rehabilitation
Project and amend the budget resolution for the project.
Item
Action:
Approved
Motions
Motion
Type Motion Text Made By Seconded By Motion
Result
Approve
Motion to
approve.
Motion Passes
3-0.
Commissioner Ben
Hasan
Commissioner
Sammie Sias Passes
3. Motion to approve a Memorandum of Understanding between Augusta and the
Downtown Development Authority of Augusta, Georgia (“DDA”) regarding the
use of SPLOST funds for the renovation and rehabilitation of the Miller Theater.
Item
Action:
None
Motions
Motion
Type Motion Text Made
By
Seconded
By
Motion
Result
It was the consensus of the committee
that this item be deleted from the
agenda.
4. Motion to approve the minutes of the Finance Committee held on August 8,
2017.
Item
Action:
Approved
Motions
Motion
Type Motion Text Made By Seconded By Motion
Result
Approve
Motion to
approve.
Motion Passes
3-0.
Commissioner Ben
Hasan
Commissioner
Sammie Sias Passes
5. Consider the following changes for no profit organizations that request funds
from the General Fund: 1. A cap of $25K for all General Fund requests. 2.
Consider an accounting review process that is not detrimental to the smaller
non profits. The following non profits would be considered exempt up to the
amount of $120K: The ARC Museum of History, The Lucy Craft Laney
Museum, and The Arts Council. We must find opportunities to reduce
discretionary spending. I consider this a first step with additional options to
follow. (Requested by Commissioner Sammie Sias)
Item
Action:
Rescheduled
Motions
Motion
Type Motion Text Made By Seconded By Motion
Result
Defer
Motion to refer this
item to the full
Commission with no
recommendation.
Motion Passes 3-0.
Commissioner
Sammie Sias
Commissioner
Ben Hasan Passes
6. Approve Water and Sewer Revenue Bonds, Series 2017 bond resolution and
authorize the Mayor and Clerk to sign all necessary documents to refund the
Augusta, Georgia Water and Sewer Revenue Bonds, Series 2007, currently
outstanding in the aggregate principal amount of $123,755,000.
Item
Action:
Approved
Motions
www.augustaga.gov
Motion
Type Motion Text Made By Seconded By Motion
Result
Approve
Motion to
approve.
Motion Passes
3-0.
Commissioner Ben
Hasan
Commissioner
Sammie Sias Passes
7. Discuss having a budget workshop in September to discuss the 2018 budget
needs. (Requested by Commissioner Frantom)
Item
Action:
Approved
Motions
Motion
Type Motion Text Made By Seconded By Motion
Result
Approve
Motion to approve
holding the
workshop.
Motion Passes 3-0.
Commissioner
Sammie Sias
Commissioner
Ben Hasan Passes
Finance Committee Meeting
8/29/2017 1:20 PM
Attendance 8/29/17
Department:
Presenter:
Caption:
Background:
Analysis:
Financial Impact:
Alternatives:
Recommendation:
Funds are Available
in the Following
Accounts:
REVIEWED AND APPROVED BY:
Finance Committee Meeting
8/29/2017 1:20 PM
Funding for Arts in the Heart of Augusta Festival
Department:Administrator/Finance
Presenter:Janice Allen Jackson
Caption:Approve funding request from the Greater Augusta Arts Council
in the amount of $35,000 to support the 2017 Arts in the Heart of
Augusta Festival.
Background:Augusta has historically provided financial support to the Arts in
the Heart of Augusta Festival. This festival has a proven record of
accomplishment and provides a positive economic impact to the
area.
Analysis:Arts in the Heart of Augusta attracts over 80,000 visitors annually.
Last year’s festival (2016) was the 36th year of this event.
Augusta has traditionally provided funding to support the cost of
public safety (staff from Law Enforcement agencies and Fire) and
power for the event. Direct visitor spending as calculated by the
CVB for 2016 was $1.7 million.
Financial Impact:Funds for this request are available in General Fund Contingency.
Alternatives:
Recommendation:approve request
Funds are Available
in the Following
Accounts:
General Fund Contingency
REVIEWED AND APPROVED BY:
Finance.
Law.
Administrator.
Clerk of Commission
Budget Resolution
STATE OF GEORGIA ) AUGUSTA RICHMOND COUNTY
AUGUSTA-RICHMOND COUNTY ) COMMISSION
BUDGET AMENDMENT NO. 1
IT IS HEREBY ORDERED that the General Fund Budget for the year 2017 be amended to
reflect increased revenue of $57,948.50 resulting from federal grant income of $57,948.50.
IT IS FURTHER ORDERED that the appropriations be increased by $$57,948.50 for payment
of the Meadow Garden Rehabilitation Project. The total budget for the project is $57,948.50.
REVENUES
Grant from Georgia DNR $ 24,000.00
Local Match (Cash from DAR) $ 31,448.50
Local Match (In-Kind Estimate) $ 2,500.00
Total $ 57,948.00
APPROPRIATIONS
Grant from Georgia DNR $ 24,000.00
Local Match (Cash from DAR) $ 31,448.50
Local Match (In-Kind Estimate) $ 2,500.00
Total $ 57,948.00
HARDIE DAVIS, JR., MAYOR
Approved this ……the day of………... 2017 AUGUSTA, GEORGIA
______________________________
As its mayor
Finance Committee Meeting
8/29/2017 1:20 PM
Historic Preservation Fund Grant
Department:Planning and Development
Presenter:Melanie Wilson
Caption:Motion to accept the award of an additional $4,000 grant from the
Georgia Department of Natural Resources (DNR) for the Meadow
Garden Rehabilitation Project and amend the budget resolution for
the project.
Background:In July 2016 the city accepted a $20,000 reimbursable grant from
Georgia Department of Natural Resources (DNR) to help finance
the rehabilitation of windows at the Meadow Garden House
Museum (a.k.a. George Walton Home), located at 1320
Independence Drive. The Daughters of the American Revolution
(DAR) owns the property, and is the source of the local match for
the project. The Planning and Development Department is
managing the project. Landmark Preservation LLC is the project
contractor. The rehabilitation of the windows is nearing
completion.
Analysis:Georgia DNR recently offered the city an additional $4,000 in
HPF grant funds for the project. Acceptance of the additional
grant funds will not cost the city anything. Acceptance will enable
the contractor to complete additional work on Meadow Garden.
Financial Impact:The additional grant funds make it possible for the contractor to
do additional rehabilitation work. The updated project budget is as
follows: BUDGET HPF/Federal Share $24,000.00 Local Match
(Cash From DAR) 31,448.50 Local In-Kind Match 2,500.00
TOTAL $57,948.50
Alternatives:None recommended
Recommendation:Accept the award of an additional $4,000 in grant funds and
amend the budget resolution for the project.
Funds are Available
in the Following
Accounts:
REVIEWED AND APPROVED BY:
Finance.
Law.
Administrator.
Clerk of Commission
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STATE OF GEORGIA)
RICHMOND COUNTY)
SPLOST VI OUTSIDE AGENCY AGREEMENT
This AGREEMENT made and entered into this ______ day of ___________, 2017, between
Augusta, Georgia, a political subdivision of the State of Georgia (hereinafter referred to as “Augusta”), and
the Downtown Development Authority of Augusta-Richmond County, a public body corporate and politic
of the State of Georgia (hereinafter referred to as the “Authority”).
WITNESSETH
WHEREAS, the voters of Augusta, Georgia on June 16th 2009, approved the imposition of the
Special Purpose County One Percent Sales and Use Tax (“SPLOST VI”) and designated the use of the
proceeds of said tax for certain capital outlay projects, as defined on O.C.G.A. 48-8-111(a) and further
approved a project priority payment order in an Intergovernmental Agreement entered into by and between
Augusta, Georgia, and the municipalities of Hephzibah and Blythe; and
WHEREAS, the Augusta Commission approved SPLOST funding for certain recreational,
historical and cultural improvement capital outlay projects to be implemented through various outside
agencies as provided in guidelines adopted on February 19th 2009; and
WHEREAS, Augusta has determined that the project described on Exhibit A hereof (the
“Project”) is beneficial to the citizens of Augusta as it provides and enhances recreational, historical and/or
cultural resources in Augusta; and
WHEREAS, Augusta has determined that it is more cost effective, avoids duplication of services
and is in the best interest of Augusta and the citizens of Augusta to contract with the Authority to undertake
the Project, rather than Augusta directly constructing and operating the Project; and
WHEREAS, Augusta desires to contract with the above named Authority to construct and operate
the Project, which was a part of the approved capital outlay projects; and
WHEREAS, the sum of $5,142,856.00 from the proceeds of said tax (the “SPLOST Funds”) has
been allocated for the Project and Augusta has agreed to advance the SPLOST Funds to the Authority to
allow for the Project to begin upon the satisfaction of the conditions provided below.
NOW, THEREFORE, for and in consideration of the mutual covenants and agreements between
the parties, it is agreed as follows:
SECTION 1 - APPROPRIATION AND USE OF FUNDS
1.1 Augusta agrees to appropriate the SPLOST Funds to be used by the Authority on behalf of
Augusta for the purpose of completing the Project as provided in Exhibit A hereto attached and
incorporated herein.
1.2 The Authority agrees to use such funds that it may receive, pursuant to this Agreement, solely and
exclusively for the completion of the above described Project; said Project, is more specifically described
in Exhibit A.
1.3 Said disbursement of the SPLOST Funds to the Authority is an authorized use of proceeds of
SPLOST VI, under O.C.G.A. Section 48-8-111(a)(1)(E), as said use benefits a “cultural facility, a
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recreational facility, or historical facility or a facility for some combination of such purposes” (referred to
as the “Public Purposes”), and this Agreement is entered into on behalf of and for the benefit of Augusta
and the Authority and also as an acknowledgement that upon distribution of the SPLOST Funds by
Augusta to the Authority, that Augusta will have fully met its SPLOST VI project obligation to the
Authority.
SECTION 2 - RESPONSIBILITIES AND OBLIGATIONS OF AUTHORITY
In consideration of the disbursement of the SPLOST Funds, the Authority shall observe all conditions that
the law and/or this Agreement imposes on the use of said SPLOST Funds, including:
2.1 The Authority shall use said SPLOST Funds only in connection with the capital outlay for the
Project as described in Exhibit A hereof.
2.2 The Authority covenants not to use any of said SPLOST Funds for any part of its maintenance and
operation budget, now or in the future.
2.3 The Authority will set up any and all banking accounts necessary or convenient to segregate the
account containing SPLOST Funds from its other accounts. The Authority shall keep any SPLOST Funds
that it receives from Augusta in a separate account fund and shall not commingle SPLOST Funds with
other funds of the Authority prior to their expenditure.
2.4 The Authority shall maintain a record of each and every expense, in compliance with the generally
accepted accounting principles, for which the SPLOST Funds are used. The Authority shall submit
quarterly or more frequent accounting reports to Augusta for all SPLOST Funds that the Authority receives
from Augusta. Said accounting reports shall set forth the amounts expended on the Project during the term
of this Agreement, which, shall include any amount expended on such Project in that current year, and the
estimated percentage of the completion of the Project. The initial report of expenditures regarding the
Project shall be made within 10 business days of the first installment of the SPLOST Funds being made
available to the Authority and at least quarterly thereafter (commencing at the end of the third month
following the initial installment of SPLOST Funds being paid to the Authority) until the end of the quarter
in which the Project is deemed completed as determined by the Augusta Finance Department. Quarterly
reports are due within ten (10) business days following the end of each said quarter and shall be delivered
to Augusta Finance Department, 535 Telfair St Street, Augusta Georgia 30901 to the attention of Mr. Tim
Schroer, Deputy Finance Director; provided, however, in the event any such report is not delivered as and
when due, the Augusta Finance Department shall not suspend disbursement of SPLOST Funds until it
notifies the Authority, SOA (as hereinafter defined) and the Registered Mortgagee (as hereinafter defined)
in writing that such report was not submitted, and the Authority, SOA and the Registered Mortgagee shall
have ten (10) days after receipt of such notice to cause such reports to be submitted (the failure to submit a
report shall not be a ground for terminating this Agreement, however, Augusta shall have no obligation to
disburse any installment of SPLOST Funds until such reports are received). The SPLOST Funds will be
disbursed by Augusta to the Authority within fourteen (14) days of the approval of each such report (which
approval will not be unreasonably withheld, conditioned or delayed) in the amount of the invoices
submitted for such report and the Authority shall disburse such funds to SOA (or its affiliate, MT Augusta
3
Property LLC or Miller Theater, LLC) or the Registered Mortgagee (as hereinafter defined) within five (5)
days of receipt of such SPLOST Funds by the Authority.
2.5 The Authority accepts the following conditions for disbursement of said funds:
A. Unless otherwise agreed by Augusta, no funds shall be made available to the Authority until such
time as the tax has been collected as provided in the disbursement schedule adopted in the
Intergovernmental Agreement.
B. Augusta Symphony, Inc., also known as “Symphony Orchestra Augusta” (herein referred to as
“SOA”), has raised an amount equal to a minimum of twenty five (25%) percent of the SPLOST Funds (the
“Matching Funds”) and has otherwise raised or otherwise obtained any remaining funds (which may be in
the form of a loan from a financial institution) necessary to complete the Project on or before April 1,
2018. Only cash or cash equivalents raised subsequent to June 16, 2009 shall qualify as Matching Funds.
Pledges (prior to being collected) and in-kind donations or other in-kind contributions (other than donations
and contributions of cash, cash equivalents, stocks or bonds) will not qualify as Matching Funds.
C. Upon Augusta executing an acknowledgement that the minimum amount of Matching Funds has
been raised by SOA, which acknowledgment will not be unreasonably withheld, conditioned or delayed,
the Authority shall be deemed to have authorized SOA to expend the Matching Funds on the Project,
provided that the same record keeping requirements as provided in 2.4 are kept for expenditures of
Matching Funds.
D. Prior to receipt of the SPLOST Funds or the above-authorization for the expenditure of Matching
Funds, the Authority shall cause SOA to furnish Augusta with a copy of SOA’s current audited financial
statements (and annually thereafter until the Project is completed), budget, scope of work and the projected
time for completion of the work on the Project, which must be approved by Augusta prior to disbursing
SPLOST Funds with respect to the Project. In addition, the Authority and SOA must provide Augusta
with a W-9, E-verify number, and SAVE Program verification prior to SPLOST Funds being distributed to
Authority.
E. With respect to the SPLOST Funds, the Authority and SOA have followed a competitive bid process
consistent with purchasing policies of Augusta. The Project has been effectively bonded through a
sub-guard policy covering sub-contractors on the Project or through a performance bond on one or more
subcontractors. Payments of SPLOST Funds to any contractor or sub-contractor employed on the Project
by the Authority or SOA or its subsidiary or affiliate shall be made subject to Augusta’s audit and approval,
which audit and approval will not be unreasonably conditioned, withheld or delayed. Payments by the
Authority or SOA or its subsidiary or affiliate to any contractor or sub-contractors shall be made only upon
presentation of invoices verified (or approved) by the architect, and if at such time as the Project is
completed, and provided such completion (meaning the Project is completed such that the same has been
approved by the applicable governmental authorities for occupancy and use) occurs prior to April 1, 2018,
any SPLOST Funds remaining to be disbursed shall be disbursed to the Authority to be disbursed to the
Registered Mortgagee (as hereinafter defined) for application to the debt of MT Augusta Property LLC to
such Registered Mortgagee (as hereinafter defined) in connection with the Project, and if such debt is paid
in full, to the Operating Tenant under the Lease (as hereinafter defined). For purposes hereof, the
4
“Registered Mortgagee” is the Registered Leasehold Mortgagee (as defined in the Lease (as hereinafter
defined)).
F. The Authority hereby acknowledges and agrees that as the Project is to benefit the citizens of
Augusta by providing and enhancing the recreational, historical and/or cultural resources in Augusta, the
use of the Project must be open and available for public use, such as symphonic performances by
Symphony Orchestra Augusta. The Authority (or an entity wholly-owned by the Authority) shall enter
into a lease with Miller Theater, LLC (a wholly owned subsidiary of SOA) with a minimum term of twenty
five (25) years (such 25 year period (regardless of whether such lease has a longer term) being referred to
as the “Servitude”) in substantially similar form as the lease attached hereto as Exhibit B hereof (the
“Lease”), but with such modifications thereof and amendments thereto as are approved by the Chairman or
Vice Chairman of the Authority, such approval to be evidenced by the execution of the Lease on behalf of
the Authority by its Chairman or Vice Chairman, provided that such modifications or amendments do not
materially change the Project or the “Public Use Requirement” as defined in the Lease.
G. Should SOA (or its affiliate, MT Augusta Property LLC) during the construction of the Project or
subsequently thereto obtain financing and all or a portion of the Project is pledged or is to be pledged as
collateral for such loan, any such lender shall be required to provide to the Authority a “non-disturbance”
agreement for at least the period of the Servitude (or if sooner, until the termination of the Authority’s
interest under the Lease) in form satisfactory to the Authority’s attorney, providing in part, that the interest
of the Authority in the Lease shall not be terminable by such lender except (i) with the written consent of
the Authority, or (ii) upon the termination or expiration of the DDA Lease (as defined in the Lease)
pursuant to the terms of the Lease, or (iii) upon the payment of the SPLOST Repayment Amount, or (iv)
taking of a material portion of the Project through condemnation or eminent domain, or (v) the bankruptcy
of the Authority or the Operating Tenant (as defined in the Lease), or (vi) in connection with a New Lease
(as defined in the Lease), or (vii) the failure of Augusta and/or the Authority to disburse SPLOST Funds as
and when required under this Agreement or (viii) the amendment or modification of this Agreement
without the prior written consent of the landlord under the Lease, the Operating Tenant under the Lease and
the Fee Mortgagee (as defined in the Lease).
H. In the event that SOA (or any of its affiliates or successors in interest) or the Authority desires to
change the use of the Project prior to the expiration of the Servitude such that the use of the Project would
not satisfy the Public Use Requirement in the Lease (following any applicable cure periods), or sells,
disposes of or transfers title or ownership of the Project prior to the expiration of the Servitude, and
following such sale, disposal or transfer, the use of the Project would not satisfy the Public Use
Requirement in the Lease (following any applicable cure periods), then in such event the Authority and/or
SOA shall reimburse Augusta, Georgia an amount equal to the fraction determined by the number of years
remaining on the Servitude as the numerator and the total number of years of the Servitude as the
denominator multiplied by $5,142,856.00 (or such lesser amount of SPLOST Funds actually disbursed
and used in connection with the Project) (such reimbursement amount is herein called the “SPLOST
Repayment Amount”).
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I. Notwithstanding anything herein to the contrary, if SOA (and/or its affiliates) complies with the
conditions hereof for the disbursements of the SPLOST Funds, and the Authority and/or Augusta fails to
disburse SPLOST Funds as and when contemplated herein, then SOA (and/or its affiliates) shall have no
obligation to pay the SPLOST Repayment Amount and shall have no obligation to use the Project for, inter
alia, Public Uses, and the leasehold estate of the Authority under the Lease and any non-disturbance and/or
other rights afforded Augusta and/or the Authority hereunder and/or under the Lease shall be null and void,
and SOA (and/or its affiliates and/or any Registered Mortgagee) may pursue any rights and/or remedies
available to it under applicable law.
2.6 The Authority and/or SOA and/or the Operating Tenant (as defined in the Lease) will maintain
the following insurance during the performance of this Agreement:
A. Comprehensive General Liability Insurance shall be maintained in force at all times and shall include
the following coverage: Commercial Liability Insurance in the combined single limits of $1,000,000. This
coverage shall be intended to apply as primary and shall not be affected by any insurance that Augusta may
carry in its own name. The Authority and/or SOA shall maintain Workers Compensation and Employer’s
Liability Insurance for the benefit of its workers related to the Project. The above requirements shall also
apply to the Authority’s contractors and subcontractors who are engaged in the Project.
B. Prior to, or simultaneously with the execution of, the Lease, the Authority will provide Augusta with
a certificate of insurance, which evidences the above coverage and names Augusta, Georgia as an
“additional insured” with respect to liability insurance.
SECTION 3 - RESPONSIBILITIES AND OBLIGATIONS OF AUGUSTA
3.1 Augusta enters this Agreement to improve the quality of life of its citizens and to provide its
citizens with additional facilities for delivery of recreational, historical and/or cultural services in a more
cost effective manner than it could if it were to construct and operate similar facilities without the
participation of the Authority.
3.2 Augusta and any auditors employed by Augusta shall have the right to verify and audit the
expenditures of the Authority and the Project, sufficient to determine that the SPLOST Funds are being
appropriately spent for the Project, in accordance with Georgia laws that govern the expenditures of Special
Purpose Local Option Sales Tax monies. Official representatives of Augusta may inspect the official
records of the Authority, which relate to this Project, at reasonable times and upon reasonable notice to the
Authority. Augusta shall also have the right to inspect the Project at any reasonable time for any purpose
related to the performance of any contract awarded, or to be bid upon or awarded, by the Authority for this
Project.
SECTION 4- OBLIGATIONS OF THE AUTHORITY AND COUNTY
4.1 Each of the parties hereto warrants and represents to the other that it will comply with all the
requirements of the laws of the State of Georgia.
4.2 After approval of this Agreement, all contracts between the Authority and any subcontractor shall
be submitted to Augusta Administrator for administrative review. If any irregularity or illegality appears,
the Administrator may submit any such questions to the Augusta Richmond County Commission.
6
4.3 This Agreement constitutes the entire agreement between the parties as to the matters described
herein and may not be amended except by a written instrument, signed by each party’s duly authorized
officers.
4.4 Breach of contract with respect to any of the terms of this Agreement, or with respect to the use of
funds, shall terminate Augusta’s obligations under this Agreement; shall terminate Augusta’s obligation for
the payment of any future funds; and shall entitle the Parties to all remedies provided by law. Provided,
however, prior to any such termination, the Authority and SOA and each Registered Mortgagee shall be
given written notice of such breach and at least sixty (60) days following receipt of such notice to cure any
such breach, or if such breach cannot be cured within such sixty (60) days period, as long as such cure is
being diligently pursued, such cure period shall be extended for a reasonable period to allow for such cure
(provided, however, nothing herein obligates SOA or any Registered Mortgagee to cure any such breach)
and Augusta will accept any cure by SOA and/or Registered Mortgagee as a cure by the Authority.
IN WITNESS WHEREOF, Augusta and Authority have caused these presents to be executed by
their respective, duly authorized officials, on the date entered above.
AUGUSTA, GEORGIA
By: ______________________________________
Mayor
ATTEST:
By: _______________________________________
Clerk of Commission
[signatures continue on the following page]
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Downtown Development Authority of
Augusta-Richmond County
By: ___________________________
_______________________________
Its: ___________________________
Attest:
_______________________________
_______________________________
Its: Secretary
8
EXHIBIT A
PROJECT
A facility designed for use as a performing arts center substantially in accordance with Rehabilitation Plan
as defined in the Lease.
9
Exhibit B
Lease
i
LEASE
between
MILLER THEATER, LLC, as Landlord
DOWNTOWN DEVELOPMENT AUTHORITY OF AUGUSTA, GEORGIA, as Tenant
and
MT AUGUSTA PROPERTY, LLC, as Subtenant
Dated as of __________, 2017
1
LEASE
THIS LEASE (together with Exhibits hereto, which are incorporated herein by this
reference, and the DDA Lease (as hereinafter defined) and Sublease (as hereinafter defined)
which are included herein, and all amendments and extensions hereof, collectively, “this Lease”)
is made on the ___ day of ___________, 2017, by and among MILLER THEATER, LLC, a
Georgia limited liability company, having an address at 1301 Greene St., Suite 200 in Augusta,
Georgia (“Landlord”), DOWNTOWN DEVELOPMENT AUTHORITY OF AUGUSTA,
GEORGIA, having an address at ___________________ in Augusta, Georgia (“DDA”) and
MT AUGUSTA PROPERTY LLC, a Georgia limited liability company, having an address at
1301 Greene St., Suite 200 in Augusta, Georgia (“Operating Tenant”). This Lease amends and
restates the Lease between Landlord and Operating Tenant dated as of February 28, 2016,
effective July 25, 2015, related to the Land (as hereinafter defined) (said Lease being herein
referred to as the “Original Lease”), to reflect the interest of the DDA in this Lease.
RECITALS
WHEREAS, Landlord is the owner in fee simple title of certain Land (as defined herein),
which it has agreed to lease under the terms and conditions hereof to Operating Tenant for
Operating Tenant’s development, rehabilitation and construction upon the Land of a historic
building (“Project”);
WHEREAS, Operating Tenant has been in possession of the Land under the Original
Lease and has been conducting rehabilitation and construction activities substantially consistent
with that certain Standard Form of Agreement Between Owner and Architect on AIA Document
B101-2017 by and among Miller Theater, LLC and Lord, Aeck & Sargent, Inc. (“Architect”),
dated June 5, 2012 (the “Architect Agreement”), which Architect Agreement has been assigned
by Miller Theater, LLC to MT Augusta Property LLC (the “Rehabilitation Plan”);
WHEREAS, DDA is entitled to receive the sum of $5,142,856.00 from the proceeds of a
the Special Purpose County One Percent Sales and Use Tax (the “SPLOST Funds”) under that
certain SPLOST VI Outside Agency Agreement (the “SPLOST Agreement”) dated the ______
day of __________, 2017, with Augusta, Georgia, a political subdivision of the State of Georgia
(hereinafter referred to as “Augusta”);
WHEREAS, DDA desires to invest the SPLOST Funds in the Project in order to acquire
a 49-year leasehold interest as tenant in the Project, and desires to sublease its leasehold interest
to Operating Tenant to allow Operating Tenant to complete the Rehabilitation Plan, to use the
SPLOST Funds and to use and occupy the Project under the terms of this Lease;
NOW THEREFORE, IN CONSIDERATION of the covenants and agreements of the
parties hereto, as are hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged by each party hereto, Landlord hereby
leases to DDA and DDA hereby subleases to Operating Tenant all of that tract of land (the
“Land”), in Augusta-Richmond County, Georgia, which is more particularly described in
Exhibit A attached hereto,
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TOGETHER WITH any and all rights, alleys, ways, waters, privileges, roads,
appurtenances, easements and advantages, to the same belonging or in any way appertaining,
including the existing and future Improvements on or under the Land (all of which, together with
the Land, are hereinafter referred to collectively as the “Premises”),
TO HAVE AND TO HOLD the Premises unto Operating Tenant, its successors and
permitted assigns, for and during the Term set forth herein,
ON THE TERMS AND SUBJECT TO THE CONDITIONS which are hereinafter set
forth:
Section 1. DEFINITIONS.
1.1. Specific. As used herein, the following terms have the following meanings:
“Annual Rent” has the meaning given it in subsection 3.1.
“Annual Subrent” has the meaning given it in subsection 3.1.
“Augusta” has the meaning given it in the Recitals.
“Bankruptcy” shall be deemed, for any person, to have occurred either
(a) if and when such person (i) applies for or consents to the appointment of a
receiver, trustee or liquidator of such person or of all or a substantial part of its assets, (ii) files a
voluntary petition in bankruptcy or admits in writing its inability to pay its debts as they come
due, (iii) makes an assignment for the benefit of its creditors, (iv) files a petition or an answer
seeking a reorganization or an arrangement with its creditors or seeks to take advantage of any
insolvency law, or (v) files an answer admitting the material allegations of a petition filed against
such person in any bankruptcy, reorganization or insolvency proceeding; or
(b) if (i) an order, judgment or decree is entered by any court of competent
jurisdiction adjudicating such person a bankrupt or an insolvent, approving a petition seeking
such a reorganization, or appointing a receiver, trustee or liquidator of such person or of all or a
substantial part of its assets, or (ii) there otherwise commences with respect to such person or
any of its assets any proceeding under any bankruptcy, reorganization, arrangement, insolvency,
readjustment, receivership or similar law, and if such order, judgment, decree or proceeding
continues unstayed for any period of one hundred twenty (120) consecutive days after the
expiration of any stay thereof.
“Business Day” means any day other than a Saturday, Sunday or a legal holiday on
which banks are authorized or required to be closed for the conduct of commercial banking
business in Augusta, Georgia.
“Commencement Date” has the meaning given it in paragraph 2.1.1.
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“Default Rate” shall mean a per annum rate of simple interest equal to the lesser of (i)
10% per annum and (ii) the maximum non-usurious interest rate that may be charged under
applicable law.
“DDA” means Downtown Development Authority of Augusta, Georgia, and any
successor governmental or quasi-governmental entity thereto.
“DDA Lease” means the lease from Landlord to DDA contained within this Lease for the
DDA Lease Term.
“DDA Lease Term” has the meaning given it in subsection 2.1.1.
“DDA Lease Termination Date” has the meaning given it in subsection 2.1.1.
“Effective Date” means _____________ ___, 2017.
“Environmental Laws” shall mean any and all Federal, State or local laws, pertaining to
health, safety, or the environment now or at any time hereafter in effect and any judicial or
administrative interpretation thereof (including, but not limited to, any judicial or administrative
order, consent decree or judgment relating to the environment or hazardous substances (as such
term is defined in any such law), or exposure to hazardous substances) including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, the Superfund Amendments and Reorganization Act of 1986, as amended, the
Resource, Conservation and Recovery Act of 1976, as amended, the Clean Air Act, as amended,
the Federal Water Pollution Control Act, as amended, the Oil Pollution Act of 1990, as amended,
the Safe Drinking Water Act, as amended, the Hazardous Materials Transportation Act, as
amended, the Toxic Substances Control Act, as amended, the federal Clean Water Act of 1977,
all regulations and laws adopted by the Occupational Safety and Health Administration, and any
other environmental or health conservation or protection laws.
“Event of Default” has the meaning given it in subsection 13.1.
“Fee Mortgage” means any Mortgage encumbering, inter alia, the Landlord’s fee interest
in the Land and any present and future interest of Landlord in the Property.
“Fee Mortgagee” means the Person secured by a Fee Mortgage.
“Force Majeure” means any (a) strike, lock-out or other labor troubles, (b) governmental
restrictions or limitations, (c) failure or shortage of materials, electrical power, gas, water, fuel
oil, or other utility or service, (d) riot, war, insurrection or other national or local emergency, (e)
accident, flood, fire or other casualty, (f) adverse weather condition, (g) other act of God, or (h)
other cause similar or dissimilar to any of the foregoing and beyond the reasonable control of the
person in question.
“Historic Tax Credits” means rehabilitation tax credits provided by Section 47 of the
Internal Revenue Code of 1986, as amended, and any successor provisions thereto, allocated in
connection with the Improvements.
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“Improvements” mean the historic building located on the Land, and all fixtures and
personal property, all off-street parking areas on the Property; an undivided interest in all
common areas at the Property, and all replacements, additions and alterations thereto.
“Land Records” means the records of the Clerk of Superior Court of Richmond County,
Georgia.
“Landlord” means Miller Theater, LLC, a Georgia limited liability company, and its
successors and assigns as owner of the fee simple title to the Land.
“Lease” means this Lease (as defined in the first paragraph hereof), including
amendments hereto and extensions hereof, if any.
“Lease Year” means (a) the period commencing on July 25, 2015 and terminating on the
first (1st) anniversary of the last day of the calendar month containing the Commencement Date,
and (b) each successive period of twelve (12) calendar months thereafter during the Term.
“Leasehold Estate” means the leasehold estate in the Premises held by Operating Tenant
under this Lease, any interest in future improvements made by Operating Tenant on the Premises
during this Lease and any fee or other interest in the Property acquired by Operating Tenant
hereafter.
“Leasehold Mortgage” means any Mortgage encumbering Operating Tenant’s Leasehold
Estate.
“Leasehold Mortgagee” means the Person secured by a Leasehold Mortgage.
“Legal Requirements” has the meaning given it in paragraph 4.3.8.
“Mortgage” means any mortgage, deed to secure debt or deed of trust, as amended and/or
modified from time to time, at any time encumbering any or all of the Property (or all or any
interest in the Property), and any other security interest therein existing at any time under any
other form of security instrument or arrangement used from time to time in the locality of the
Property (including but not limited to any such other form of security arrangement arising under
any deed of trust, sale-and-leaseback documents, lease-and-leaseback documents, security deed
or conditional deed, or any financing statement, security agreement or other documentation used
pursuant to the Uniform Commercial Code or any successor or similar statute), provided that
such mortgage, deed to secure debt, deed of trust or other form of security instrument, and an
instrument evidencing any such other form of security arrangement, has been recorded among
the records of the Clerk of Superior Court of Richmond County, Georgia or in such other place
as is, under applicable law, required for such instrument to give constructive notice of the
matters set forth therein.
“Mortgagee” means the Person secured by a Mortgage.
“Operating Tenant” means MT Augusta Property LLC, a Georgia limited liability
company, and its successors and permitted assigns as holder of the Leasehold Estate.
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“Original Lease” has the meaning assigned to said term in the first paragraph of this
Lease.
“Permitted Encumbrances” means any and all encumbrances of record existing as of the
date hereof with respect to all or any of the Property and any encumbrances hereafter consented
to in writing by Landlord, Operating Tenant, the Registered Leasehold Mortgagee and the Fee
Mortgagee. Each of the parties hereto hereby consent to and acknowledge as Permitted
Encumbrances, the Leasehold Deed to Secure Debt, Security Agreement and Assignment of
Leases and Rents from Operating Tenant in favor of AFB&T, a division of Synovus Bank
granting and conveying to AFB&T, a division of Synovus Bank, security title to and security
interest in the Operating Tenant’s interest under this Lease and the Operating Tenant’s rights,
title and interest in the Property, and any amendments and/or modifications thereof, and the Deed
to Secure Debt, Security Agreement and Assignment of Leases and Rents from Landlord in
favor of AFB&T, a division of Synovus Bank granting and conveying to AFB&T, a division of
Synovus Bank, security title to and security interest in the Land and Landlord’s rights, title and
interest in the Property, and any amendments and/or modifications thereof.
“Person” means a natural person(s), a trustee, a corporation, a partnership, a limited
liability company and any other form of legal entity.
“Premises” has the meaning assigned to such term in the recitals of this Lease.
“Project” or “Property” means collectively the Premises, including the Improvements.
“Public Uses” means uses that benefit a cultural, recreational or historical purpose or
some combination of such purposes, within the meaning of O.C.G.A. Section 48-8-111(a)(1)(E).
(For avoidance of doubt, “Public Uses” does not require the use to be free).
“Public Use Requirement” means, commencing when the Improvements are placed in
service, use of the Property (i) as a performing arts center, including other uses permitted by law
incident thereto which would not preclude use of the Property as a performance hall for
Symphony Orchestra Augusta, (ii) if, after exercising reasonable commercial efforts, it becomes
economically infeasible to continue to operate the Property as a performing arts center, then for
any other Public Uses approved by Augusta, which approval shall not be unreasonably withheld,
(iii) after the Registered Leasehold Mortgagee exercises its remedies under Article 18 or under
the Registered Leasehold Mortgage or other loan documents related thereto, then for any Public
Uses, or (iv) any other use approved by Augusta. The fact the Property is not being used (i.e., is
“dark”), if it is reasonably determined to be economically infeasible to operate as a performing
arts center, is not a violation of the Public Use Requirement and the fact the Property is used for
uses in addition to Public Uses is not a violation of the Public Use Requirement.
“Recapture Period” means the period commencing as of the date hereof and ending on
the next business day following the fifth (5th) anniversary of the date on which the last “qualified
rehabilitation expenditure” as defined in Section 47(c)(3) of the Code with respect to the
Property is first placed in service or ending sooner, upon the payment of the recapture amount as
provided in any subordination, non-disturbance and attornment agreement entered into in
connection with this Lease among Landlord, Operating Tenant, DDA, Fee Mortgagee and/or
6
Registered Leasehold Mortgagee, and the federal historic tax credit investor that becomes a
member of Borrower.
“Registered Leasehold Mortgage” has the meaning set forth in paragraph 18.2 hereof.
“Registered Leasehold Mortgagee” has the meaning set forth in paragraph 18.2 hereof.
”Rehabilitation Plan” has the meaning given it in the Recitals.
“Rent” means all Annual Rent.
“Restoration” means the repair, restoration or rebuilding of any or all of the Property
after any damage thereto or destruction thereof, with such alterations or additions thereto as are
made by Operating Tenant in accordance with this Lease, together with any temporary repairs or
improvements made to protect the Property pending the completion of such work.
“Servitude” means the twenty-five (25) year period commencing on ______ ____, 2017
and ending on ___________ ___, 2042.
“SNDA” means a Subordination, Non-Disturbance and Attornment Agreement entered
into by Landlord, DDA, Operating Tenant and Fee Mortgagee, substantially in the form of
Exhibit C hereof.
“SPLOST Agreement” has the meaning given it in the Recitals.
“SPLOST Funds” has the meaning given it in the Recitals.
“SPLOST Repayment” means an amount equal to the product of a fraction determined
by the number of years remaining on the Servitude at the time of the determination of the
SPLOST Repayment as the numerator and the total number of years of the Servitude (i.e., 25
years) as the denominator multiplied by the lesser of (i) $5,142,856.00 or (ii) the total amount of
SPLOST Funds that are paid to Landlord and/or Augusta Symphony, Inc. and/or Operating
Tenant and/or Registered Leasehold Mortgagee and applied to costs associated with the
Rehabilitation Plan.
“Sublease” means the sublease contained herein of the DDA’s interest under this Lease
to Operating Tenant; provided, however, if the DDA should cease to have an interest in this
Lease (either by voluntary cancellation or surrender, by termination or by expiration), then the
Sublease shall refer to this Lease as a direct lease between Landlord and Operating Tenant
expiring on the Termination Date, unless sooner terminated pursuant to the terms hereof.
“Sublease Commencement Date” means the date of this Agreement as stated in the first
paragraph.
“Term” has the meaning given it in subsection 2.1.1.
“Termination Date” has the meaning given it in subsection 2.1.1.
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1.2. General. Any other term to which meaning is expressly given in this Lease shall
have such meaning.
Section 2. TERM.
2.1. Length.
2.1.1. Original Term. With respect to the Operating Tenant, this Lease shall be for a
term (“Term”) commencing on July 25, 2015 (which was the commencement date of the
Original Lease) (“Commencement Date”), and terminating on July 25, 2070 (the “Termination
Date”, except that if the date of such termination is hereafter advanced to an earlier date or
postponed pursuant to any provision of this Lease, or by express, written agreement of the parties
hereto, or by operation of law, the date to which it is advanced or postponed shall thereafter be
the “Termination Date” for all purposes of this Lease).
With respect to the DDA Lease, this Lease shall be for a term (“DDA Lease Term”)
commencing on the Sublease Commencement Date, and terminating on the forty-ninth (49th)
anniversary of the Sublease Commencement Date (the “DDA Lease Termination Date”, except
that if the date of such termination is hereafter advanced to an earlier date or postponed pursuant
to any provision of this Lease, or by express, written agreement of the parties hereto, or by
operation of law, the date to which it is advanced or postponed shall thereafter be the “DDA
Termination Date” for all purposes of this Lease). Operating Tenant was in possession of the
Premises on the Sublease Commencement Date, and shall remain in possession thereof under the
terms of this Lease.
2.1.2. Surrender.
(a) DDA shall, at the expiration of the DDA Lease Term or any earlier
termination of this Lease or DDA Lease, promptly yield up to Landlord the Property, and
personal property which remains at the Property as of the DDA Lease Termination Date, in
reasonable order and repair, ordinary wear and tear and damage by casualty, or condemnation
excepted. Upon such expiration or termination (whether by reason of an Event of Default or
otherwise), (i) DDA shall not thereafter have any right at law or in equity in or to any or all of
the Property (including the Improvements) and shall be conclusively deemed to have abandoned
same, and Landlord, or if the Lease remains in effect with Operating Tenant, Operating Tenant,
shall automatically be deemed immediately thereupon to have succeeded to all of the same, free
and clear of the right, title or interest therein of DDA (but subject to any Fee Mortgage and to the
lien of all Permitted Encumbrances then outstanding), and (ii) DDA hereby waives any and all
rights of redemption which it may otherwise hold under any applicable law, and (iii) upon such
termination or expiration of the DDA Lease, unless the Lease has terminated or expired as
contemplated in the next paragraph, this Lease shall continue as between Landlord, as lessor, and
Operating Tenant, as lessee, on the same terms as this Lease and the Sublease contained herein
and upon the termination of the DDA Lease, the term of the Sublease shall refer to the Term of
the Lease; provided, however, the Landlord shall not be liable to Operating Tenant for any act,
omission, negligence or default of DDA under this Lease or the Sublease that occurred prior to
the termination, cancellation or surrender of the DDA Lease; shall not be bound by any pre-
payment of rents or other amounts paid by Operating Tenant to DDA under the Sublease more
8
than one month in advance of its due date (other than the pre-payment of Sublease Annual Rent
stated in section 3.1.1 hereof); and shall not be subject to any offsets, credits, claims or defenses
which Operating Tenant might have against DDA under this Lease or the Sublease contained
herein.
(b) Operating Tenant shall, at its expense, at the expiration of the Term or any earlier
termination of this Lease, promptly yield up to Landlord the Property, and personal property
which remains at the Property as of the Termination Date, in reasonable order and repair,
ordinary wear and tear and damage by casualty, or condemnation excepted. Upon such
expiration or termination (whether by reason of an Event of Default or otherwise), (i) neither
DDA nor Operating Tenant shall thereafter have any right at law or in equity in or to any or all of
the Property (including the Improvements) and shall be conclusively deemed to have abandoned
same, and Landlord shall automatically be deemed immediately thereupon to have succeeded to
all of the same, free and clear of the right, title or interest therein of DDA or Operating Tenant
(but subject to any existing Permitted Encumbrances then outstanding), and (ii) each of DDA
and Operating Tenant hereby waive any and all rights of redemption which it may otherwise
hold under any applicable law.
2.2. Holding Over.
2.2.1. Nothing in this Lease shall be deemed in any way to permit Operating Tenant or
DDA to use or occupy the Premises after the expiration of the Term (or in the case of DDA, after
the expiration of the DDA Lease Term) or any earlier termination of this Lease (or in the case of
the DDA, after the early termination of the DDA Lease); provided, however, any such early
termination would be subject to the rights of the Registered Leasehold Mortgagee under Section
18 of this Lease. If and only if Operating Tenant continues to occupy the Premises after such
expiration or termination after obtaining Landlord’s express, written consent thereto;
(a) such occupancy shall (unless the parties hereto otherwise agree in writing) be
deemed to be under a month-to-month tenancy, which shall continue until either party hereto
notifies the other in writing, by at least thirty (30) days before the end of any calendar month,
that the party giving such notice elects to terminate such tenancy at the end of such calendar
month, in which event such tenancy shall so terminate; and
(b) subject to the provisions of subparagraph 2.2.2, but anything in the remaining
provisions of this Section to the contrary notwithstanding, the monthly rent payable with respect
to each such monthly period shall equal one-twelfth (1/12) of the Annual Rent (such amount
being the “Monthly Rent”) for the Lease Year during which such expiration or termination
occurred, as aforesaid plus, the additional rent provided in subparagraph 2.2.2. below.
2.2.2. If Operating Tenant continues to occupy the Premises after the expiration of the
Term or any earlier termination of this Lease without having obtained Landlord’s express,
written consent thereto and the written consent of any existing Fee Mortgagee, then without
altering or impairing any of Landlord’s rights under this Lease or applicable law, (a) Operating
Tenant hereby agrees to pay to Landlord immediately on demand by Landlord as monthly rent
for the Premises, for each calendar month or portion thereof after such expiration of the Term or
such earlier termination of this Lease, as aforesaid, until Operating Tenant surrenders possession
9
of the Premises to Landlord, a sum equaling One Hundred and 00/100 Dollars ($100.00) per
each day of such holdover occupancy, and (b) Operating Tenant shall surrender possession of the
Premises to Landlord immediately on Landlord’s having demanded the same. Nothing in this
Lease shall be deemed in any way to give Operating Tenant any right to remain in possession of
the Premises after such expiration or termination, regardless of whether Operating Tenant has
paid any such rent to Landlord.
2.3. Title to and Alterations of Improvements. Notwithstanding any provision in this
Lease to the contrary, at all times during the Term of this Lease, the Improvements and all
alterations and additions shall be deemed owned by Operating Tenant for tax purposes (subject
to a right of reversion in favor of Landlord) and Operating Tenant alone shall be entitled to all of
the tax attributes of ownership, including, without limitation, the right to claim depreciation or
cost recovery deductions and the right to claim the federal historic rehabilitation tax credits
pursuant to Section 47 of the Internal Revenue Code of 1986, as amended (the “Code”) and the
right to amortize capital costs and to claim any other federal or state tax benefits attributable to
the Improvements. At the expiration or earlier termination of the Term of this Lease, or any
portion thereof, in accordance herewith, Operating Tenant shall peaceably leave, quit and
surrender the Premises in the manner required under paragraph 2.1.2, and said ownership of the
Improvements, including all alterations and improvements thereto, shall revert to the Landlord at
the time of such expiration or termination of this Lease. Upon such expiration or termination,
the Property, including any Improvements remaining (other than personal property and
equipment owned by Operating Tenant that are not fixtures and are removed by Operating
Tenant from the Property at or prior to the termination or expiration of the Lease), shall become
the sole property of the Landlord at no cost to Landlord in an “as is” condition, and subject to the
Permitted Encumbrances then outstanding and any other encumbrance consented to by Landlord
in writing, and Operating Tenant shall execute and deliver to Landlord such quit claim deed, bill
of sale and other instruments reasonably required by Landlord to confirm said ownership of the
Property to said Landlord.
Section 3. RENT.
3.1. Amount. As rent for the Premises, (i) DDA, during the DDA Lease Term, shall pay
to Landlord annual rent in the amount of One and No/100ths Dollars ($1.00) (“Annual Rent”)
payable in single annual installments for a period of forty nine (49) years beginning on the
Sublease Commencement Date, and (ii) thereafter Operating Tenant shall pay Annual Rent
directly to Landlord until the termination of the Lease. As rent for the Premises, Operating
Tenant shall pay to DDA annual rent in the amount of One and No/100ths Dollars ($1.00)
(“Annual Subrent”) payable in single annual installments for a period of forty nine (49) years
beginning on the Sublease Commencement Date. For convenience, the Operating Tenant may
pay its Annual Subrent directly to the Landlord, in satisfaction of both its obligation to pay
Annual Subrent to DDA and DDA’s obligation to pay Annual Rent to Landlord. Landlord, DDA
and Operating Tenant hereby acknowledge that the Annual Rent and Annual Subrent has been
pre-paid for the entire Term, and DDA and Operating Tenant agree that such pre-paid rent shall
be, notwithstanding any provisions herein to the contrary, non-refundable in the event of the
early termination of the Sublease, the DDA Lease or the Lease.
3.2. Security Deposit. None.
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3.3. Leasehold Obligations.
3.3.1. Net Lease. Other than as is expressly set forth in this Lease, all costs, expenses,
liabilities, charges or other deductions whatsoever with respect to the Property and the
construction, ownership, leasing, operation, maintenance, repair, rebuilding, use, occupation of,
or conveyance of any or all of the Property, or this Lease generally shall be the sole
responsibility of and payable by Operating Tenant, including, but not limited to any cost,
expenses, liabilities, charges or other sums, in connection with the closing of the loan secured by
the Registered Leasehold Mortgage. Landlord shall be and remain liable for all obligations
respecting the Premises incurred by Landlord as well as any property tax liability imposed upon
the Land (however, Operating Tenant shall pay any portion of such property tax liability
attributable to the Improvements, and if the invoice for said taxes does not allocate the taxes
between the Land and the Improvements, such allocation shall be made by Landlord in its
reasonable, good faith judgment). Operating Tenant shall be responsible for any property tax
liability attributable to the DDA Lease, the Operating Tenant’s Leasehold Estate and the
Improvements.
3.3.2 DDA’s Obligations. The parties understand and agree that the DDA shall not
have any financial obligations or liabilities relating to the ownership or operation of the Property,
unless and until the DDA assumes the obligations of the Operating Tenant, and DDA shall have
no right to terminate this Lease or the Sublease without the prior written consent of Landlord,
Operating Tenant, and the Registered Leasehold Mortgagee (if any). The DDA hereby
acknowledges that the Landlord and Operating Tenant are relying on the disbursement of
SPLOST Funds as and when contemplated in the SPLOST Agreement, and DDA agrees that
DDA will comply with and perform its obligations under the SPLOST Agreement and will not
agree to any amendment, modification or termination of the SPLOST Agreement without the
prior written consent of Landlord, Operating Tenant and the Registered Leasehold Mortgagee.
DDA hereby agrees to enter into such subordination, non-disturbance and attornment agreement
approved by Landlord, Operating Tenant, Fee Mortgagee and/or Registered Leasehold
Mortgagee and the investor in Borrower purchasing the federal Historic Tax Credits provided
such agreement does not place any liability on DDA beyond its interest in the Lease and any
rents, profits and/or income derived from the Property and recognizes the Public Use
Requirement provided in 3.4 below.
3.4 SPLOST Funds. DDA agrees to pay the SPLOST Funds immediately (and in any
event within five (5) days upon receipt) to Landlord in further consideration of the DDA’s
interest in this Lease. Landlord agrees to make the SPLOST Funds Landlord receives
immediately available to Operating Tenant for the purpose of using the funds in payment of the
costs of the Rehabilitation Plan. For convenience, DDA may pay the SPLOST Funds directly to
Operating Tenant or the Registered Leasehold Mortgagee.
The parties have agreed that during the Servitude the uses of the Property shall satisfy the
Public Use Requirement. In the event that during the Servitude the Operating Tenant (or any of
its affiliates or successors in interest) uses the Project such that the uses do not satisfy the Public
Use Requirement, or if Operating Tenant sells, disposes of or transfers title or ownership of the
Project, and subsequent to such sale, disposition or transfer the uses of the Project during the
Servitude do not satisfy the Public Use Requirement, DDA shall notify the Operating Tenant
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(with a copy to the Registered Leasehold Mortgagee) in writing of the violation of the Public Use
Requirement, and the Operating Tenant shall have ninety (90) days after receipt of such notice to
cure such violation, and if Operating Tenant does not cure such violation within said ninety (90)
day period, the Registered Leasehold Mortgagee shall have the extended cure rights under
Section 18 of this Lease.
For avoidance of doubt, at the conclusion of the Servitude or upon payment of the
SPLOST Repayment or termination of the DDA Lease, the Public Use Requirement shall no
longer be applicable and the DDA shall no longer have any rights under this paragraph regarding
the use of the Property.
At any time, the Operating Tenant and/or the Landlord may cause the termination of the
DDA Lease and the Public Use Requirement by paying to the DDA the SPLOST Repayment,
calculated as of the effective date of any such termination (with a credit for any payments made
pursuant to the SPLOST Agreement in re-payment of the SPLOST Funds), and upon such
payment, the DDA Lease shall terminate and the Sublease shall immediately become a direct
lease between the Landlord and Operating Tenant pursuant to the terms hereof, and DDA shall
have no further interest under this Lease. Nothing in this Lease (and for avoidance of doubt,
nothing in the Sublease) obligates the Operating Tenant, Landlord or any Mortgagee to pay, or
makes Operating Tenant, Landlord or any Mortgagee liable for the payment of, the SPLOST
Repayment, and any obligation under the SPLOST Agreement for the payment of the SPLOST
Repayment is an agreement between the DDA, Augusta and the Augusta Symphony, Inc. that is
outside the obligations of this Lease (and the Sublease). The fact a violation of the Public Use
Requirement could be cured by paying the SPLOST Repayment does not deem such violation to
be a monetary default but the same shall be deemed a non-monetary default (i.e., one that is not
curable by the payment of money) with respect to any and all notice, grace and cure provisions
contained in this Lease.
Section 4. USE OF PROPERTY.
4.1. Nature of Use. Operating Tenant may throughout the Term use and operate the
Property including the Improvements for the following uses and such other uses as are
reasonably and customarily attendant to such uses: rehabilitation, construction, development,
using or marketing for lease or license and leasing or licensing of space in the Property as a
performing arts center, any other uses satisfying the Public Use Requirement and/or any other
uses permitted by applicable law incident thereto. In particular, Operating Tenant agrees to
conduct rehabilitation and construction activities substantially consistent with the Rehabilitation
Plan (including any amendments thereto before or after the Effective Date so long as such
amendment is agreed to by Landlord).
4.2. Compliance with Environmental Laws. Operating Tenant, throughout the Term and
at its sole expense, in its rehabilitation, possession and use of the Improvements or other use of
the Property, shall not (a) cause or permit the escape, disposal or release of any biologically or
chemically active or other Hazardous Substances brought onto the Property by Operating Tenant
or its agents or contractors in violation of applicable laws and/or regulations, or (b) allow the
storage or use of such Hazardous Substances in any manner not sanctioned or permitted by law
or by the standards prevailing in the industry for the storage and use of such substances or
12
materials, or (c) allow any Hazardous Substances to be brought onto the Property except to use
in the ordinary course of Operating Tenant’s business and in compliance with Environmental
Laws. For purposes of this Lease, “Hazardous Substances” shall include those substances and
materials subject to regulation under any applicable Environmental Law. If any Mortgagee or
governmental agency responsible for monitoring Hazardous Substances reasonably requires
testing to ascertain whether or not there has been any release of hazardous materials on the
Property for which Operating Tenant is responsible hereunder while this Lease is in effect, then
the costs thereof shall be paid by Operating Tenant if such requirement applies to the Property.
Operating Tenant shall execute affidavits, representations and the like from time to time at
Landlord’s request concerning Operating Tenant’s best knowledge and belief regarding the
presence of hazardous substances or materials on the Property.
4.3. Representations, Warranties and Covenants of Landlord. As an inducement to DDA
and Operating Tenant to enter into and proceed under this Lease, Landlord warrants and
represents to DDA and Operating Tenant as follows, which warranties, representations and
covenants are true and correct as of the date of this Lease:
4.3.1. Landlord has good and marketable, fee simple title to the Premises, free and clear
of all other liens and encumbrances except for any Permitted Encumbrances, and has the right,
power and authority to enter into this Lease, to lease the Premises to DDA and Operating Tenant
in accordance with the terms, provisions and conditions contained in this Lease, and has received
all applicable governmental consents and approvals in connection therewith, and no other party
has any right or option to or in connection with the Premises other than AFB&T, a division of
Synovus Bank, as Fee Mortgagee and a Leasehold Mortgagee.
4.3.2. There is no litigation proceeding, or other action pending or, to the best knowledge
and belief of Landlord, threatened, affecting the Premises or Landlord’s estate therein;
4.3.3. Landlord has received no written notice, and has no knowledge, nor has Landlord
been otherwise advised, of any pending or threatened condemnation, building or zoning code
violation relating to all or any part of the Property;
4.3.4. Landlord has received no written notice and has no knowledge of the intention of
any party holding an easement affecting the Premises or any part thereof to expand the exercise
of any such easement beyond the scope of the present exercise thereof (as by replacing or
expanding existing facilities, conduits (including underground or overhead wires, cables or
pipes) or systems for sewers, water, electric, gas, cable and other utilities);
4.3.5. The entry by Landlord into this Lease with DDA and Operating Tenant and the
performance of all of the terms, provisions and conditions contained herein will not, or with the
giving of notice or the passage of time, or both, would not, violate or cause a breach or default
under any other agreement relating to the Property to which Landlord is a party or by which it is
bound;
4.3.6 The Property is unoccupied and vacant, except for the occupancy of Operating
Tenant, and there is no tenant, lessee or other occupant of the Property having any right or claim
to possession or use of the Premises except as provided in this Lease; and possession of the
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Premises is hereby delivered free of the rights or claims of any third party tenants, occupants or
other parties in possession of, or claiming any right to possession or use of the Premises;
4.3.7. There are no unpaid special assessments of which Landlord has received notice
for sewer, sidewalk, water, paving, gas, electrical or utility improvements or other capital
expenditures, matured or un-matured, affecting the Property;
4.3.8. There are no outstanding notices of, nor, to Landlord’s knowledge, any violations
of any applicable laws, ordinances, notices, orders, rules, regulations and requirements of
applicable federal, state and municipal governments, public or quasi-public authorities and all
departments, commissions, bureaus boards and officers thereof affecting any portion of the
Property (collectively the “Legal Requirements”);
4.3.9. Landlord is not obligated under any contract, lease (other than this Lease) or
agreement, oral or written, with respect to the ownership, use, operation or maintenance of the
Property, other than the Fee Mortgage and related documents with AFB&T, a division of
Synovus Bank; and
4.3.10. Landlord hereby consents to Operating Tenant’s encumbering its interest in the
Property with a Leasehold Mortgage; provided, however, at no times shall there be more than
one Leasehold Mortgage outstanding, unless such additional Leasehold Mortgage(s) are
consented to by Landlord, Operating Tenant, the Fee Mortgagee and the Registered Leasehold
Mortgagee.
4.4. Consent of DDA. DDA hereby consents to Operating Tenant’s encumbering its
interest in the Property with Leasehold Mortgage(s) and acknowledges the right of Landlord to
encumber its fee interest (and reversionary rights) with Fee Mortgage(s) provided such Fee
Mortgagees enter into a SNDA.
4.5 Consent of Operating Tenant. Operating Tenant hereby consents to Landlord
encumbering its interest in the Property with Fee Mortgage(s) provided, however, at no time
shall there be more than one Fee Mortgage outstanding at any one time that has priority over this
Lease and such Fee Mortgagee shall enter into a SNDA, and upon request of Landlord, neither
DDA nor Operating Tenant shall unreasonably withhold, condition or delay its execution of a
SNDA with respect to a Fee Mortgage provided there is no more than one Fee Mortgage
outstanding at any one time that has priority over this Lease and provided the SNDA is in
substantially the form of Exhibit C hereof. For avoidance of doubt, AFB&T, a division of
Synovus Bank (and its successors and assigns) is the current Fee Mortgagee and has the rights
and benefits of a Fee Mortgagee under this Lease. Only a Fee Mortgagee that has entered into a
SNDA shall have the rights and benefits of the Fee Mortgagee under this Lease.
Section 5. OPERATING EXPENSES.
5.1. Operating Expenses.
5.1.1. Operating Tenant’s Obligation. Operating Tenant will pay (or cause to be paid)
directly to the providers of such services all costs and expenses attributable to or incurred in
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connection with the development, construction, completion, marketing, leasing and occupancy of
the Property including the Improvements (collectively, “Operating Expenses”) including
without limitation (a) all energy sources for the Improvements, such as propane, butane, natural
gas, steam, electricity, solar energy and fuel oil; (b) all water, sewer and trash disposal services;
(c) all rehabilitation, maintenance, repair, replacement and rebuilding of the Improvements, (d)
all landscaping, maintenance, repair and striping of all parking areas; (e) all insurance premiums
relating to the Property including the Improvements, including fire and extended coverage,
public liability insurance, rental insurance and all risk insurance; and (f) the cost and expenses of
all capital improvements or repairs (whether structural or non-structural) required by any
governmental or quasi-governmental authority having jurisdiction over the Property including
the Improvements.
5.1.2. Permits and Licenses. Operating Tenant shall procure, or cause to be procured, at
Operating Tenant’s sole cost and expense, any and all necessary permits, licenses, or other
authorizations required for the rehabilitation, construction and occupancy of the Improvements
and the lawful and proper installation and maintenance upon the Premises of wires, pipes,
conduits, tubes, and other equipment and appliances for use in supplying any such service to the
Improvements and upon the Premises. Landlord agrees to use Landlord’s best reasonable
efforts, at Operating Tenant’s sole cost and expense, to cooperate with Operating Tenant in
obtaining any and all permits, licenses, easements and other authorizations required by any
governmental authority with respect to any construction or other work to be performed on the
Premises and grant (or cooperate in processing as regards third party providers), all permits,
licenses, easements and other governmental authorizations that are necessary or helpful for
electric, telephone, gas, cable television, water, sewer, drainage, access and such other public or
private utilities or facilities as may be reasonably necessary or desirable in connection with the
construction or operation of the Improvements. Landlord shall use Landlord’s reasonable
efforts, at Operating Tenant’s sole cost and expense, to cooperate in the relocation or termination
of easements currently encumbering the Premises to the extent that same may be reasonably
necessary or desirable in connection with the Improvements. Operating Tenant shall be entitled,
without payment to Landlord, for tap or connection fees, to tap into the existing lines, facilities
and systems of applicable electric, gas, cable, water, sewer, sewer treatment and other utilities
serving the Premises. Landlord agrees to use Landlord’s reasonable efforts to assist Operating
Tenant to obtain waiver, reduction or deferral, as applicable, of all fees and other charges
otherwise payable in connection with obtaining any permits, licenses, easements and other
authorizations required by any governmental authority with respect to any construction or other
work to be performed on the Property in connection with the Improvements.
Section 6. INSURANCE AND INDEMNIFICATION.
6.1. Insurance to be maintained by Operating Tenant. Operating Tenant shall maintain at
its expense throughout the Term casualty and commercial general liability insurance with respect
to the Property. The casualty insurance shall be in an amount equal to the full replacement cost
of the Improvements (and any upgrades and additions thereto) and the liability insurance shall be
in an amount equal to at least $1,000,000 per occurrence.
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6.2. Insureds. Each such policy shall name Landlord (and each Fee Mortgagee that has
entered into a SNDA and each Registered Leasehold Mortgagee) as an additional insured
thereon.
6.3. Insurer. All insurance required and all renewals of insurance shall be issued by
companies of recognized responsibility licensed to issue such policies and otherwise transact
business in the State of Georgia. All insurance policies will expressly provide that such policies
will not be cancelled or altered without thirty (30) days’ prior written notice to Landlord.
6.4. Subrogation. Anything in this Lease to the contrary notwithstanding, Operating
Tenant hereby waives any and all rights of recovery, claim, action, or cause of action, against
Landlord, its agents, officers, or employees, for any loss or damage that may occur to the
Property, or any Improvements, or any personal property of such party therein, or for any loss of
life or injury to persons by reason of fire, the elements, or any other cause(s) which are insured
against under the terms of the insurance policies referred to herein, regardless of cause or origin,
including negligence of Landlord, its agents, officers, or employees, and covenants that no
insurer shall hold any right of subrogation against Landlord. Operating Tenant’s insurance
policies shall include appropriate clauses waiving all rights of subrogation against Landlord with
respect to losses payable under such policies.
Section 7. IMPROVEMENTS TO PREMISES.
7.1. Rehabilitation of Improvements.
7.1.1. Alterations. Landlord and DDA agree that Operating Tenant shall have the right
to make such alterations, additions and changes to the Property as Operating Tenant deems
necessary or appropriate, including, without limitation, replacement and disposal thereof;
provided, however, material alterations, additions and changes that are not substantially in
accordance with the Rehabilitation Plan shall require the prior written approval of Landlord,
which approval will not be unreasonably withheld.
7.1.2. Estoppel Certificates. Landlord, DDA and Operating Tenant agree that at any
time and from time to time upon not less than twenty (20) days’ prior written notice by the other
party, or upon request from a Fee Mortgagee, Registered Leasehold Mortgagee, a permitted
assignee or other interested party, Landlord, DDA and/or Operating Tenant will execute,
acknowledge and deliver to the other party a statement in writing certifying: (a) that this Lease is
unmodified (or if modified, stating such modifications) and in full force and effect; (b) the date
through which the Rents have been paid and any outstanding payment obligations then due under
the Lease; and (c) that, to the knowledge of the Person executing such certification (if such be
the case), there is no default, set-off, defense or other claim against Landlord, DDA or Operating
Tenant, as applicable, other than those, if any, so specified under the provisions of this Lease;
and (d) as long as the DDA Lease is in effect, the amount of the SPLOST Repayment as of the
date of such certificate. It is intended that any such statement may be relied upon by any such
Persons.
7.1.3. DDA Lease. DDA shall not execute any Mortgage or other encumbrance or
security instrument with respect to DDA’s interest under this Lease (or the Sublease), without
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the prior written consent of Landlord, Operating Tenant, any Registered Leasehold Mortgagee
and the Fee Mortgagee that is a party to a SNDA, which consent may be withheld in the
reasonable discretion of such Persons, and without such consent, such encumbrance or security
instrument shall be void. For avoidance of doubt, Landlord and Operating Tenant have
consented to any such encumbrance by DDA to AFB&T, a division of Synovus Bank, as the
current Fee Mortgagee and Registered Leasehold Mortgagee.
7.1.4. Leasehold Mortgages. Operating Tenant shall provide written notice to Landlord
and DDA of the name and address of each Leasehold Mortgagee under this Lease. Such
Leasehold Mortgagee of which Landlord and DDA has been notified of in writing (such notice to
be given in the manner provided in the notice provision of Section 15 hereof and shall detail the
name and notice address of such Leasehold Mortgagee) shall be a Registered Leasehold
Mortgagee, and as hereinafter provided, at no time shall there be more than one Registered
Leasehold Mortgagee. Landlord and DDA hereby acknowledge that they have been properly
notified that AFB&T, a division of Synovus Bank holds a Leasehold Mortgage and hereby
confirm AFB&T, a division of Synovus Bank is the Registered Leasehold Mortgagee for all
purposes of this Lease, and as long as AFB&T, a division of Synovus Bank (or its successor
and/or assign) is the Registered Leasehold Mortgagee, there shall be no other Registered
Leasehold Mortgagee unless consented to in writing by AFB&T, a division of Synovus Bank (or
its successor or assign).
7.2. Joinder. Without limiting Landlord’s or DDA’s obligations under any other
provision of this Lease, Landlord and DDA shall, promptly at Operating Tenant’s request and
expense at any time during the Term (and provided that Landlord or DDA thereby assumes no
liability or obligation), join in any and all applications for building permits, subdivision plat
approvals or certificates of dedication thereon, public works or other agreements and permits for
sewer, water or other utility services, other instruments of dedication or other permits or
approvals, the granting of or entry into which by any governmental or quasi-governmental
authority having jurisdiction over the Property is necessary to permit (a) the development,
rehabilitation, improvement, use and occupancy of the Property for the purposes permitted by
this Lease, without violating applicable law; and (b) the dedication to Augusta-Richmond
County and/or the State of Georgia after the Commencement Date of such title to or easements
for utility, roadway and slope or storm drainage areas or facilities as are, in Operating Tenant’s
opinion, necessary or desirable in connection therewith; provided, however, any such easement,
transfer or dedication shall be subject to each Fee Mortgage and Leasehold Mortgage unless
consented to in writing by such Fee Mortgagee and Leasehold Mortgagee.
Section 8. REPAIRS AND MAINTENANCE.
8.1. Repairs. Operating Tenant shall, throughout the Term and at its expense,
(a) keep the Premises in good order and condition (ordinary wear and tear
excepted) and in compliance with applicable building and health and safety codes; and
(b) promptly make any and all repairs, ordinary or extraordinary, foreseen or
unforeseen, to the Property (including but not limited to the landscaping thereon) as are
necessary to maintain it in good condition, subject, in the event of casualty or
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condemnation to receipt of applicable insurance and/or condemnation proceeds therefor,
and Landlord shall have no obligation hereunder as to the same.
8.2. Maintenance. Operating Tenant shall keep and maintain all of the Property in a
clean and orderly condition, free of accumulation of dirt and rubbish.
Section 9. LANDLORD’S RIGHT OF ENTRY.
9.1. Inspection and Repair. Subject to the rights of any tenant under any lease of space
in the Property, Landlord shall be entitled to enter the Property during Operating Tenant’s
normal business hours to (a) inspect the Property at any time, upon forty-eight (48) hours’
advance written notice and (b) make any repairs thereto and/or take any other action therein
which is required by applicable law, or which Landlord is permitted to make by any provision of
this Lease, after giving Operating Tenant at least twenty (20) Business Days’ prior written notice
of Landlord’s intention to take such action and provided Operating Tenant doesn’t timely cure
same (and any sums expended by Landlord in making such repairs and/or taking any such
actions (and all interest thereon) shall be immediately due from Operating Tenant to Landlord
and from the date such sums are paid by Landlord, interest shall accrue daily on such sums at the
Default Rate). Landlord may, while taking any such action upon the Property, store therein any
and all necessary materials, tools and equipment, and Operating Tenant shall have no liability to
Landlord for any damage to or destruction of any such materials, tools and equipment, except if
and to the extent that such damage or destruction is proximately caused by the gross negligence
of Operating Tenant. Landlord shall use its best efforts to not disrupt the rights of tenants at the
Property. Provided further, in the event the Operating Tenant fails to pay or perform any
obligations of Operating Tenant under this Lease, the Landlord may pay and/or perform any such
obligations and any costs incurred by Landlord in connection therewith shall be immediately due
from Operating Tenant to Landlord, with interest thereon from the date incurred until re-paid at
the Default Rate. Nothing herein obligates Landlord to make any such inspection or any such
repairs or to cure any such failure on the part of Operating Tenant.
Section 10. FIRE AND OTHER CASUALTIES.
10.1. Damages or Destruction to Premises. Operating Tenant shall give prompt notice
to Landlord and DDA (if the DDA Lease is in effect) after the occurrence of any fire,
earthquake, act of God or other casualty to or in connection with the Property, the Improvements
or any portion thereof (hereinafter sometimes referred to as a “Casualty”). Subject to Section
10.2 below, if during the Term the Property shall be damaged or destroyed by Casualty, to the
extent permitted by the Registered Leasehold Mortgagee (which consent shall not be
unreasonably withheld), Operating Tenant shall repair or restore the Property, so long as
Operating Tenant reasonably determines that Restoration is feasible and provided that sufficient
insurance proceeds are available to do so. In the event that Operating Tenant shall determine by
notice to Landlord and DDA (if the DDA Lease is in effect) given within ninety (90) days after
such Casualty, that it is not economically practical to restore the Property to substantially the
same condition in which they existed prior to the occurrence of such Casualty (or that the
Registered Leasehold Mortgagee is not allowing the insurance proceeds to be used for
Restoration), then Operating Tenant may terminate this Lease as of a date that is not less than
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thirty (30) days after the date of such notice, subject to the rights of the Registered Leasehold
Mortgagee under Section 18 hereof.
10.2. Distribution of Insurance Proceeds. In the event that this Lease is terminated
pursuant to Section 10.1 hereof, the insurance proceeds received as the result of such Casualty
shall be distributed as follows: (a) first, to the Operating Tenant, in an amount equal to market
value of the Improvements less the residual value of the Improvements at the conclusion of the
Term (with such proceeds payable to the Operating Tenant being paid to the Registered
Leasehold Mortgagee pursuant to term of the Leasehold Mortgage and related loan documents
between Operating Tenant and Registered Leasehold Mortgagee), and (b) to the Landlord, the
remainder of the proceeds (with such proceeds payable to Landlord being paid to the Fee
Mortgagee pursuant to term of the Fee Mortgage and related loan documents between Landlord
and Fee Mortgagee); provided, however, if the Property is subject to the Public Use Requirement
and the Public Use Requirement is no longer being satisfied, any proceeds retained by Operating
Tenant after payment in full of the indebtedness owing to any Registered Leasehold Mortgagee
shall be applied to the SPLOST Repayment. For avoidance of doubt, and notwithstanding the
forgoing, as long as AFB&T, a division of Synovus Bank has a Leasehold Mortgage and/or a Fee
Mortgage encumbering all or any of the Property securing, inter alia, the construction loan for
the rehabilitation of the Project or any debt related to any amendment, modification, extension,
renewal, restructuring or refinancing thereof, all insurance proceeds shall be payable to AFB&T,
a division of Synovus Bank for application as provided in said Mortgages. DDA hereby
acknowledges that DDA has no interest in any such insurance proceeds other than with
application of proceeds to the SPLOST Repayment provided above and any insurance proceeds
payable to DDA as sublessor would be paid to Landlord (subject to the rights of any Fee
Mortgagee thereto).
Section 11. CONDEMNATION.
11.1. Notice of Taking. Forthwith upon receipt by either Landlord, DDA or Operating
Tenant of notice of the institution of any proceedings for the taking or condemnation of all or a
portion of the Property or Improvements by the government of the United States, State of
Georgia, Augusta-Richmond County, or any other governmental authority, or any corporation
under the right of eminent domain (a “Taking”), the party receiving such notice shall promptly
give notice thereof to the others, and such other parties may also appear in such proceeding and
be represented by counsel, who may be counsel for the party receiving such notice.
11.2. Special Account. If a Total Taking (as defined in Section 11.3), the full amount
of any award for any Taking (the “Award”), shall, notwithstanding any allocation made by the
awarding authority, be paid, and allocated (x) to the Operating Tenant, an amount equal to the
amount allocated to the Improvements minus the residual fair market value of the Improvements
as of the expiration of the Term, and (y) to the Landlord, the rest of the Award; provided,
however, any Award payable to Operating Tenant shall be paid to the Registered Leasehold
Mortgagee (with such portion of the Award being paid to the Registered Leasehold Mortgagee
having first priority) and any portion payable to Landlord shall be paid to any Fee Mortgagee
(with such portion of the Award being paid to the Fee Mortgagee having first priority). The
portion of the Award so allocated to the Landlord shall be known herein as the “Landlord’s
Award,” and the portion so allocated to the Operating Tenant shall be known herein as the
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“Operating Tenant’s Award.” For avoidance of doubt, and notwithstanding the forgoing, as
long as AFB&T, a division of Synovus Bank has a Leasehold Mortgage and/or a Fee Mortgage
encumbering all or any of the Property securing the construction loan for the rehabilitation of the
Project, or any debt related to any amendment, modification, extension, renewal, restructuring or
refinancing thereof, all Awards shall be payable to AFB&T, a division of Synovus Bank for
application as provided in said Mortgages.
11.3. Total Taking. In the event of a permanent Taking of the fee title to or of control
of the Premises or of the entire Leasehold Estate hereunder or the entire Improvements (a “Total
Taking”), this Lease shall thereupon terminate as of the effective date of such Total Taking,
without liability or further recourse to the parties (and the reversion of title to the Improvement
contemplated 2.3 shall be deemed to have occurred at the time of such termination), provided
that any Rent payable or obligations owed by the Operating Tenant to the Landlord as of the date
of said Total Taking shall be paid or otherwise carried out in full.
11.4. Partial Taking; Procedures and Criteria for Course of Action. In the event of a
permanent Taking of less than all of the Premises (a “Partial Taking”),
(a) if Operating Tenant reasonably determines that the continued use and
occupancy of the remainder of the Premises by the Operating Tenant is or can reasonably
be made to be economically viable, structurally sound, and otherwise feasible based upon
the amount of eminent domain proceeds available for the purpose of paying for such
restoration (the “Restoration Criteria”), then, upon receipt of the consent of the
Registered Leasehold Mortgagee having the first priority Registered Leasehold
Mortgage, the entire Award shall be applied to restoration of the Premises and the
Premises shall be restored pursuant to Section 10.1; or
(b) if the continued use and occupancy of the remainder of the Premises by the
Operating Tenant is not or cannot, in Operating Tenant’s reasonable judgment, be made
to be economically viable, structurally sound, and otherwise feasible (or if the first
priority Registered Leasehold Mortgagee does not permit such Restoration), then this
Lease may be terminated by Operating Tenant pursuant to Section 10.1 and the Award
applied pursuant to Section 11.2; provided, however, any such termination shall be
subject to the rights of the Registered Leasehold Mortgagee to a New Lease as
contemplated in Section 18 hereof.
11.5. Restoration. If a decision is made pursuant to Section 10.1 to restore the remainder
of the Property following receipt of the Award, the Operating Tenant shall promptly proceed, at
its expense, to commence and complete the restoration pursuant to the provisions of Section 10,
using the Award for such restoration, with any excess remaining after the completion of the
restoration being payable to Operating Tenant and Landlord, using the calculation set forth in
such Section 11.2. If Operating Tenant has decided pursuant to Section 10.1 to restore the
remainder of the Property, and if the cost of the restoration shall exceed the amount of the entire
Award, the deficiency shall be paid by the Operating Tenant. Operating Tenant’s obligation
hereunder shall be subject to receipt of the entire Award of funds and approval of the Registered
Leasehold Mortgagee.
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11.6. Termination upon Non-Restoration. Following a Partial Taking, if a decision is
made pursuant to Section 11.4(b) that the remaining portion of the Premises is not to be restored,
the DDA and Operating Tenant shall surrender the Premises to the Landlord and this Lease shall
thereupon be terminated without liability or further recourse to the parties hereto; provided,
however, if the Registered Leasehold Mortgagee elects to enter into (or have its nominee,
assignee or designee enter into) a New Lease under Section 18 hereof, the entire Award shall be
made available to such Registered Leasehold Mortgagee for the Restoration, and any remainder
after such Restoration shall may be retained by the tenant under such New Lease or retained by
said Registered Leasehold Mortgagee, in its sole discretion.
11.7. No Waiver. No provisions in this Lease limit the rights of any of the Landlord or
Operating Tenant to seek compensation from a condemning authority as provided by statute,
common law, or the United States Constitution. DDA hereby acknowledges that unless DDA
has taken over the Operating Tenant’s obligations under this Lease, the DDA shall not be entitled
to retain any Award and portion of any Award paid to DDA shall paid to Landlord in accordance
with the above.
Section 12. ASSIGNMENT AND SUBLETTING.
12.1. Transfer by Operating Tenant.
12.1.1. Operating Tenant shall have the right to assign, sublet and encumber its interest
under this Lease, from time to time, in full or in part, subject to the approval of Landlord (but
without requiring the approval of DDA), which consent shall not be unreasonably withheld or
delayed (provided, however, license or occupancy agreements, or similar agreements, entered
into by Operating Tenant in the ordinary course of business for the short-term rental or use of the
Property for performances, public or private functions and other uses shall not require the
approval of Landlord or DDA). In no event shall Operating Tenant be permitted to assign any
of its interest under this Lease without the prior written consent of the Registered Leasehold
Mortgagee, which consent may be withheld in the sole discretion of the Registered Leasehold
Mortgagee. During the Recapture Period, Operating Tenant shall not enter into any sublease of
any portion of the Premises whose occupancy thereof would, singularly, or in the aggregate with
other subtenants or sub-subtenants of the Premises, cause the Premises to be deemed to be “tax-
exempt use property” under Sections 47(c)(2)(B)(v) or 168(h) of the Code (or any corresponding
or related provision of the Code).
12.2. Transfer by Landlord.
12.2.1. Subject to the provisions of Section 12.2.2 below, Landlord may assign this Lease
and Landlord’s reversion hereunder without the necessity of obtaining DDA’s or Operating
Tenant’s consent or permission; provided, however, at all times the interest of the Landlord
under this Lease shall be held by the fee simple owner of the Land and the reversionary interest
in the Improvements run with the Land and pass to the owner of the Land (Landlord may not
assign its interest in the Lease or any reversionary interest herein contemplated to any Person
other than the Person owning the Land and/or pursuant to a Fee Mortgage); provided, however,
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any Fee Mortgage shall be subordinate to this Lease unless the Fee Mortgagee enters into a
SNDA (and each of Operating Tenant and DDA will, upon request of Landlord, enter into a
SNDA in substantially the form attached hereto as Exhibit C hereof and provided at no time
shall there be more than one Fee Mortgage outstanding having priority over this Lease (and that
Operating Tenant shall cause each Leasehold Mortgagee to join such SNDA and agrees that the
Leasehold Mortgage and Leasehold Mortgagee (and any party acquiring the Operating Tenant’s
interest in this Lease (and the Sublease) through the foreclosure or enforcement of, and/or
assignment in lieu of foreclosure with respect to, said Leasehold Mortgage shall be subject to the
terms of SNDA as a successor and assign to Operating Tenant). Notwithstanding the foregoing,
as long as AFB&T, a division of Synovus Bank is the holder of any Mortgage encumbering all or
any of the Property, no Fee Mortgage will be permitted, other than a Fee Mortgage in favor of
AFB&T, a division of Synovus Bank, without the prior written consent of AFB&T, a division of
Synovus Bank.
12.2.2. Notwithstanding anything herein to the contrary, during the Recapture Period,
Landlord shall not assign or transfer this Lease to a person or entity that would cause a recapture
or loss of all or any portion of the Historic Tax Credits.
12.3. Transfer by DDA.
12.3.1. DDA may not assign its interest in this Lease or enter into any property
management agreement with respect to the DDA’s interest in the Lease, without the necessity of
obtaining the prior written consent or permission of Landlord, Operating Tenant and any Fee
Mortgagee a party to an SNDA with DDA, which consent may be withheld in the reasonable
discretion of such Landlord, Operating Tenant and Fee Mortgagee, and any such assignment or
management agreement without such prior written consent shall be void and of no effect.
Operating Tenant and Landlord do hereby consent to DDA entering into an Assignment of
Leases and Rents with AFB&T, a division of Synovus Bank.
12.3.2. Notwithstanding anything herein to the contrary, DDA shall not assign or transfer
its interest in this Lease to a person or entity that would cause a recapture or loss of all or any
portion of the Historic Tax Credits.
Section 13. DEFAULT.
13.1. Definition. As used in this Lease, each of the following events shall constitute an
“Event of Default” by DDA, Operating Tenant or Landlord, as applicable, unless such Event of
Default is caused, in full or in part, by Force Majeure:
(a) if DDA or Operating Tenant fails (a) to pay any Annual Rent or Annual
Sub-Rent or other sum which it is obligated to pay under this Lease, when and as it is due and
payable hereunder, or (b) to perform any of its obligations under this Lease or observe or comply
with any provision of this Lease, in each case not cured within the grace or cure period set forth
below;
(b) if Landlord (a) fails to pay any sum which it is obligated to pay under this
Lease when and as it is due and payable hereunder, or (b) if Landlord fails to perform any of its
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obligations under this Lease, in each case not cured within the grace or cure period set forth
below;
(c) if DDA fails to pay (and Augusta does not otherwise directly pay)
SPLOST Funds to Landlord or Operating Tenant or the Registered Leasehold Mortgagee as and
when disbursement of such funds are made available for disbursement under the SPLOST
Agreement and in any event prior to April 1, 2018 (for avoidance of doubt, a default under this
subpart (c) may, at the option of Operating Tenant (with the consent of the Registered Leasehold
Mortgagee), terminate DDA’s interest in the Lease and Sublease but not the rights of Operating
Tenant to continue the Lease and Sublease directly with Landlord);
(d) if a Bankruptcy of DDA or Operating Tenant occurs (for avoidance of
doubt, the Bankruptcy of DDA shall terminate DDA’s interest in the Lease and Sublease but not
the rights of Operating Tenant to continue the Lease and Sublease directly with Landlord).
13.2. Notice; Grace Period. Anything in this Section to the contrary notwithstanding, if
an Event of Default occurs neither Landlord, DDA nor Operating Tenant shall exercise any right
or remedy on account thereof which it holds under this Lease or applicable law unless and until:
(a) The non-defaulting party gives written notice thereof to the defaulting
party;
(b) If such Event of Default consists of a failure to pay money, within twenty
(20) days after the non-defaulting party gives such written notice, the defaulting party
fails to pay all of such money, or if such Event of Default consists of something other
than a failure to pay money, within sixty (60) days after the non-defaulting party gives
such written notice such Event of Default is not cured, or if such Event of Default is not
reasonably curable within such period, the defaulting party has not commenced to
proceed within such period actively, diligently and in good faith to begin to cure such
Event of Default and to continue thereafter to do so until it is fully cured;
(c) Following the grace periods set forth in this Section 13.2, the non-
defaulting party shall be entitled, upon notice to the defaulting party, to pursue its
available remedies at law or in equity; provided, that if the default is a default by
Operating Tenant and is caused, directly or indirectly, by a default by a subtenant of
Operating Tenant, Operating Tenant shall be given such additional grace period as
reasonably necessary to cause its subtenant to cure such default.
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IN NO
EVENT WILL THIS LEASE (OR THE SUBLEASE) BE TERMINATED WITHOUT
THE PRIOR WRITTEN CONSENT OF AFB&T, A DIVISION OF SYNOVUS BANK
(OR ITS SUCCESSORS AND/OR ASSIGNS) AS LONG AS AFB&T, A DIVISION OF
SYNOVUS BANK IS THE HOLDER OF A LEASEHOLD MORTGAGE AND/OR FEE
MORTGAGE, BUT UNLESS THE PUBLIC USE REQUIREMENT HAS TERMINATED
AS PROVIDED HEREIN, THE PUBLIC USE REQUIREMENT SHALL REMAIN IN
EFFECT. THE DDA LEASE SHALL BE TERMINATED UPON THE PAYMENT IN
FULL OF THE SPLOST REPAYMENT AMOUNT CALCULATED AS OF THE DATE
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OF SUCH REPAYMENT AND THE DDA LEASE MAY BE TERMINATED AT THE
OPTION OF LANDLORD IN THE EVENT DDA FAILS TO MAKE ANY PAYMENT
OF SPLOST FUNDS AS AND WHEN DUE, UNLESS AUGUSTA CURES SUCH
FAILURE TO PAY (AND IN THE EVENT OF SUCH TERMINATION OF THE DDA
LEASE, THE SUBLEASE WILL SURVIVE AS A DIRECT LEASE BETWEEN
LANDLORD AND OPERATING TENANT).
Section 14. CONDITION OF TITLE AND PREMISES.
14.1. Quiet Enjoyment. Landlord hereby
(a) covenants and agrees that, at the time of the execution and delivery of this
Lease by the parties hereto, it (i) is the owner of a fee simple estate in and to the
Premises, subject to the operation and effect of and only of the Permitted Encumbrances,
and (ii) has the full right, power and authority to enter into this Lease and, thereby to
lease the Premises; and
(b) warrants that Operating Tenant will have quiet and peaceful possession of
the Premises during the Term so long as all of Operating Tenant’s obligations hereunder
are timely performed, except if and to the extent that such possession is terminated
pursuant to Sections 10, 11 or 13 or any other provision of this Lease.
Section 15. NOTICES.
15.1. Any notice, demand, consent, approval, request or other communication or
document to be provided hereunder to Landlord, DDA or Operating Tenant (a) shall be in
writing, and (b) shall be deemed to have been provided on the earlier of (i) (1) forty-eight (48)
hours after being sent as certified or registered mail in the United States mails, postage prepaid,
return receipt requested, or (2) the next Business Day after having been deposited (in time for
delivery by such service on such Business Day) with Federal Express or another national courier
service, or (3) (if such party’s receipt thereof is acknowledged in writing) upon having been sent
by telefax or another means of immediate electronic communication, in each case to the address
of such party set forth hereinabove or to such other address in the United States of America as
such party may designate from time to time by notice to each other party hereto, or (ii) (if such
party’s receipt thereof is acknowledged in writing) its having been given by hand or other actual
delivery to such party.
15.2. All notices required or permitted to be given under this Lease shall be deemed
given in accordance with the foregoing paragraph of this Section 15, and addressed as set forth in
Exhibit B. Any party may change its address by timely notice to the other party.
Section 16. [Intentionally Omitted].
Section 17. GENERAL.
17.1. Effectiveness. This Lease shall be effective as of the Effective Date.
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17.2. Complete understanding. This Lease represents the complete understanding
between the parties hereto as to the subject matter hereof.
17.3. Amendment. This Lease may be amended, modified and/or extended by and only
by an instrument executed and delivered by each party hereto, and as long as there is any Fee
Mortgage and the Fee Mortgagee has entered into a SNDA, any such amendment, modification
or extension shall not be effective without the written consent of the first priority Fee Mortgagee,
which consent may be withheld in the reasonable discretion of the Fee Mortgagee, and as long as
there is any Registered Leasehold Mortgage, any such amendment, modification or extension
shall not be effective without the prior written consent of the Registered Leasehold Mortgagee,
which consent may be withheld in the reasonable discretion of the Registered Leasehold
Mortgagee. NOTWITHSTANDING THE FOREGOING, AS LONG AS AFB&T, A
DIVISION OF SYNOVUS BANK HOLDS A MORTGAGE THEN THIS LEASE MAY NOT
BE AMENDED, MODIFIED AND/OR EXTENDED WITHOUT THE PRIOR WRITTEN
CONSENT OF AFB&T, A DIVISION OF SYNOVUS BANK, WHICH CONSENT MAYBE
WITHHELD IN THE REASONABLE DISCRETION OF AFB&T, A DIVISION OF
SYNOVUS BANK.
17.4. Waiver. No party hereto shall be deemed to have waived the exercise of any right
which it holds hereunder unless such waiver is made expressly and in writing (and, without
limiting the generality of the foregoing, no delay or omission by any party hereto in exercising
any such right shall be deemed a waiver of its future exercise). No such waiver made in any
instance involving the exercise of any such right shall be deemed a waiver as to any other such
instance, or any other such right.
17.5. Applicable law. This Lease shall be given effect and construed by application of
the law of the State of Georgia, and any action or proceeding arising hereunder shall be brought
in the courts of Georgia.
17.6. Time of essence. Time shall be of the essence of this Lease, except that, whenever
the last day for the exercise of any right or the discharge of any obligation hereunder falls on a
Saturday, Sunday or statutory holiday, the party having such right or obligation shall have until
5:00 p.m. (Eastern Time) on the next succeeding day which is not a Saturday, Sunday or
statutory holiday to exercise such right or discharge such obligation.
17.7. Headings. The headings of the Sections, subsections, paragraphs and
subparagraphs hereof are provided herein for and only for convenience of reference, and shall
not be considered in construing their contents.
17.8. Construction. As used herein, all references made (a) in the neutral, masculine or
feminine gender shall be deemed to have been made in all such genders, (b) in the singular or
plural number shall be deemed to have been made, respectively, in the plural or singular number
as well, and (c) to any Section, subsection, paragraph or subparagraph shall be deemed, unless
otherwise expressly indicated, to have been made to such Section, subsection, paragraph or
subparagraph of this Lease.
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17.9. Exhibits. Each writing or plat referred to herein as being attached hereto as an
exhibit or otherwise designated herein as an exhibit hereto is hereby incorporated herein and
made a part hereof.
17.10. Severability. No determination by any court, governmental or administrative body
or agency or otherwise that any provision of this Lease or any amendment hereof is invalid or
unenforceable in any instance shall affect the validity or enforceability of (a) any other such
provision, or (b) such provision in any circumstance not controlled by such determination. Each
such provision shall remain valid and enforceable to the fullest extent allowed by, and shall be
construed wherever possible as being consistent with, applicable law.
17.11. Disclaimer of Partnership Status. Nothing in this Lease shall be deemed in any
way to create between the parties hereto any relationship of partnership, joint venture or
association, and the parties hereto hereby disclaim the existence of any such relationship.
17.12. Commissions. Each party hereto hereby represents and warrants to the other that,
in connection with the leasing of the Premises hereunder, the party so representing and
warranting has not dealt with any real estate broker, agent or finder, and there is no commission,
charge or other compensation due on account thereof. Each party hereto shall defend, indemnify
and hold harmless the other against and from any liability, claim of liability or expense arising
out of any inaccuracy in such party’s representation.
17.13. Prevailing Party. In the event any party hereunder initiates judicial action against
the other in order to enforce the terms, covenants and provisions of this Lease, the non-prevailing
party in such judicial action shall reimburse the prevailing party in such judicial action for all
reasonable expenses, fees, costs, including reasonable attorneys’ fees actually incurred by the
prevailing party in connection with such judicial action.
17.14 Liability. Any liability of Landlord under this Lease shall be limited to the
Landlord’s interest in the Property. Any liability of DDA under this Lease shall be limited to the
DDA’s interest in the Property, and any liability of Operating Tenant under this Lease shall be
limited to the Operating Tenant’s interest in the Property. The parties understand and agree that
the DDA is an accommodating party serving without compensation to facilitate the
Rehabilitation Plan for the benefit of Augusta-Richmond County, Georgia, and shall have no
liability to Landlord, Operating Tenant or any third party during or following the termination of
this Lease, except for acts constituting known intentional wrong doing and except pursuant to
Section 17.13 hereof if the DDA is the non-prevailing party, and DDA has no right to terminate
this Lease or the Sublease, however, DDA may terminate the DDA Lease and thereby cause the
Sublease to be a direct lease between Landlord and Operating Tenant. Operating Tenant shall
reimburse DDA for its reasonable and necessary increase in costs, if any, incurred with respect to
its audited financial statements attributable to this Lease and for its attorney fees or other costs
incurred attributable to this Lease.
17.15. Benefit and Burden. This Lease shall be binding on and inure to the benefit of the
parties hereto and their respective successors and permitted assigns. Each Fee Mortgagee who
enters into a SNDA and each Registered Leasehold Mortgagee is a third party beneficiary of the
terms of this Lease, however, no Fee Mortgagee shall have any liability under this Lease unless
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such Fee Mortgagee succeeds to the interest of the Landlord under this Lease and then such
liability shall be limited to such Fee Mortgagee’s interest in the Property, and no Leasehold
Mortgagee (including, without limitation, any Registered Leasehold Mortgagee) shall have any
liability under this Lease unless such Leasehold Mortgagee succeeds to the interest of Operating
Tenant under this Lease and then such liability shall be limited to the such Leasehold
Mortgagee’s interest in the Property.
SECTION 18
Rights of Leasehold Mortgagees
18.1 Leasehold Mortgages.
(a) Operating Tenant may mortgage or convey security title to its entire
interest under this Lease and in and to the Improvements to a Leasehold Mortgagee;
provided however, only a Registered Leasehold Mortgage and a Registered Leasehold
Mortgagees shall have the benefits of this Section 18. Notwithstanding anything herein
to the contrary, at no time shall there be more than one Registered Leasehold Mortgage or
Registered Leasehold Mortgagee, and the parties agree that as of the date hereof the
Registered Leasehold Mortgagee is AFB&T, a division of Synovus Bank.
(i) No amendment or modification of this Lease shall be made without
the prior written consent of the Registered Leasehold Mortgagee, which consent
may be withheld in the reasonable discretion of such Registered Leasehold
Mortgagee.
(ii) Substantially concurrently with Landlord’s giving to DDA or
Operating Tenant, or DDA’s giving to Landlord or Operating Tenant, or
Operating Tenant’s giving to Landlord or DDA, any notice of default or other
notice given under or pursuant to this Lease, Landlord or DDA or Operating
Tenant, as applicable, will send a copy of such notice to the Registered Leasehold
Mortgagee pursuant to paragraph 18.2 below.
(b) Any restrictions contained in this Lease on the assignment or transfer of
Operating Tenant’s interest in this Lease shall not apply to any purchases at a foreclosure
sale (or sale under power of sale) under a Leasehold Mortgage, or the foreclosure or
enforcement by Leasehold Mortgagee (or its assignee, designee or nominee) of its
security title or interest herein, or the acceptance by Leasehold Mortgagee (or its
assignee, designee or nominee) of a deed in lieu thereof (such foreclosure purchaser or
Leasehold Mortgagee (or its assignee, designee or nominee), as applicable, a “Successor
Operating Tenant”), or to the assignment or transfer of such Leasehold Mortgagee’s (or
its designee’s or nominee’s) interest in this Lease.
18.2 Notices to Leasehold Mortgagees; Leasehold Mortgagee’s Right to Cure.
Whenever a Registered Leasehold Mortgage exists, Landlord shall deliver to any Registered
Leasehold Mortgagee written notice of any default by DDA or Operating Tenant or notice of
termination or election to terminate this Lease, the DDA Lease or the Sublease simultaneously
with providing notice to DDA and/or Operating Tenant, and no such notice to DDA or Operating
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Tenant, and no exercise of any remedy by Landlord or DDA as a result of any such default or
termination of this Lease, shall be effective against the Registered Leasehold Mortgagee until
such notice shall have been delivered to Registered Leasehold Mortgagee at its address specified
in its notice given to Landlord in accordance with paragraph 7.1.4 hereof (or in the case of
AFB&T, a division of Synovus Bank, at the address provided below). Landlord hereby
covenants and agrees that such Registered Leasehold Mortgagee shall have the right, but not the
obligation, to cure any default by DDA or Operating Tenant under this Lease (and DDA hereby
agrees Registered Leasehold Mortgagee shall have the right, but not the obligation, to cure any
default by Operating Tenant under the Sublease). The Registered Leasehold Mortgagee shall
have a period of twenty (20) Business Days with respect to the nonpayment of rent or any other
amount payable by Operating Tenant under this Lease (or the Sublease) beyond any cure period
expressly provided to Operating Tenant herein, or, ninety (90) days with respect to any other
Event of Default by Operating Tenant beyond any cure period expressly provided to Operating
Tenant herein, in which to cure or cause to be cured any such Event of Default; provided
however, in the event that any such default cannot, with reasonable diligence, be cured within
such ninety (90) day period, such longer time as may be required to complete such cure,
provided such Registered Leasehold Mortgagee commits in writing to Landlord (and if the DDA
Lease is in effect, commits to DDA) to cure such default and such Registered Leasehold
Mortgagee promptly commences and diligently pursues such cure to completion. Landlord (and
if applicable, DDA) shall accept any such performance by a Registered Leasehold Mortgagee as
though the same had been done or performed by Operating Tenant. Landlord hereby
acknowledges and agrees that AFB&T, a division of Synovus Bank, a Georgia banking
corporation (also known as Synovus Bank), has complied with the requirements of paragraph
7.1.4 hereof, is the “Registered Leasehold Mortgagee” and its Leasehold Mortgage (and any
amendments and/or modifications thereof) is the “Registered Leasehold Mortgage” as of the date
of this Lease, and its address for purposes hereof is: AFB&T, a division of Synovus Bank, Attn:
Mac McKnight, 1148 Broadway, P.O. Box 120, Columbus, Georgia 31902, with a copy to
AFB&T, a division of Synovus Bank, Attn: Mac McKnight, 150 West Hancock Avenue (P.O.
Box 1747), Athens, Georgia 30603.
18.3 Leasehold Mortgagee’s Obtaining of Possession. If a Registered Leasehold
Mortgagee cannot cure any such default as contemplated in 18.2 above without having taken
over possession of the Premises by a receiver or otherwise through enforcement of the remedies
under its Leasehold Mortgage, then neither Landlord nor DDA shall exercise any (if any) right
is has to terminate this Lease (or in the case of DDA, the Sublease) by reason of any Event of
Default which is not curable by the payment of money (which the parties agree includes, without
limitation, any violation of the Public Use Requirement) and which by its nature may only be
cured by the Registered Leasehold Mortgagee’s taking possession of the Premises and the
Improvements, or by reason of any default that is personal to Operating Tenant (e.g., bankruptcy,
breach of any use requirement etc.) which cannot be cured by the Registered Leasehold
Mortgagee, in each case as long as the Registered Leasehold Mortgagee (a) within the time
allotted for Registered Leasehold Mortgagee’s cure under Section 18.2 above, commits to
Landlord and/or DDA in writing that it shall proceed promptly and diligently to prosecute its
rights and remedies under and in respect of its Registered Leasehold Mortgage in order to obtain
possession of the Premises and the Improvements and obtain the Leasehold Estate in and to the
Premises by foreclosure or otherwise, and to thereafter cure such Event of Default (to the extent
same are susceptible of cure) that were the grounds for the termination of this Lease, and (b)
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thereafter does so within one hundred eighty (180) days of such written commitment (or such
longer period as is required if such obtaining of possession is restricted during the Recapture
Period, including, without limitation, any restriction in any subordination, non-disturbance or
attornment agreement entered into by Landlord, Operating Tenant, DDA, Registered Leasehold
Mortgagee and the investor in Borrower acquiring the federal Historic Tax Credits (regardless of
whether such Recapture Period could be terminated by paying any “recapture amount” to the
such investor; nothing herein obligates Registered Leasehold Mortgagee to pay any such
recapture amount to end the Recapture Period), or such longer time as may be reasonably
necessary under the circumstances so long as Registered Leasehold Mortgagee diligently and
continuously pursues the same to completion (provided, however, that any default that is
personal to Operating Tenant and cannot be cured by the Registered Leasehold Mortgagee shall
be deemed waived upon the Registered Leasehold Mortgagee taking possession of the Premises
and Improvements and foreclosing or accepting a deed in lieu of foreclosure as aforesaid). If a
Registered Leasehold Mortgagee succeeds to the interest of Operating Tenant, then for so long as
such Registered Leasehold Mortgagee is the “Operating Tenant” hereunder, the Registered
Leasehold Mortgagee’s liability hereunder shall be limited to its interest in the Premises and
when the Registered Leasehold Mortgagee disposes of its interest in the Premises, the Registered
Leasehold Mortgagee shall be relieved of any further liability to Landlord and/or DDA with
respect to this Lease.
18.4 Termination of Lease; New Lease.
(a) If the Lease or the Sublease is to be terminated or surrendered prior to the
expiration date of the Term for whatever reason, the Landlord will so notify the Registered
Leasehold Mortgagee in writing, and, at the option of the Registered Leasehold Mortgagee,
Landlord and DDA (if the DDA Lease remains in effect) hereby agrees to enter into a new lease
of the Premises and as applicable, the Property with such Registered Leasehold Mortgagee (or its
assignee, designee or nominee) for the remainder of the original stated Term of this Lease at the
rent and upon substantially all of the covenants, agreements, terms, provisions and limitations of
this Lease and the Sublease but with such modifications as may be reasonably necessary or
appropriate to reflect the terms of this Section 18.4 and changes in the factual circumstances
reflected herein (the “New Lease”), effective as of the date of such termination, but only if such
Registered Leasehold Mortgagee commits in writing to Landlord and DDA (if the DDA Lease
remains in effect), in a written notice delivered to Landlord, within ninety (90) days after
Landlord delivers the termination notice to such Registered Leasehold Mortgagee, that the
Registered Leasehold Mortgagee (or its assignee, designee or nominee) will enter into a New
Lease).
(b) If Landlord, the DDA (if the DDA Lease remains in effect) and Registered
Leasehold Mortgagee, or its nominee, assignee or designee (the “New Operating Tenant”), enter
into a New Lease pursuant to this Section 18.4, any interest of the prior Operating Tenant in the
Improvements that reverted to Landlord or DDA upon termination of this Lease shall be deemed
the property of the New Operating Tenant under the New Lease on and subject to the terms and
provisions of the New Lease, to the same extent as the prior Operating Tenant’s interest therein
under this Lease and subject to the Landlord’s reversionary interest therein and thereto.
29
(c) Nothing contained in this Section 18.4 shall be deemed to limit or affect
Landlord’s interest in and to such property existing upon the expiration of the Term of the New
Lease. The provisions of this Section 18.4 shall survive the termination of this Lease and shall
continue in full force and effect thereafter to the same extent as if this Section 18.4 were a
separate and independent contract made by Landlord, DDA (if the DDA Lease remains in effect)
and the Registered Leasehold Mortgagee, and (provided that the Registered Leasehold
Mortgagee shall have affirmed in writing its intent to enter into (or have its assignee, designee or
assignee enter into) and be bound by a New Lease) from the effective date of such termination of
this Lease to the date of execution and delivery of the New Lease, the Registered Leasehold
Mortgagee (or its assignee, designee or nominee) may use and enjoy the Leasehold Estate
created by this Lease and the Improvements without hindrance by Landlord or DDA, but only on
and subject to the terms and provisions of this Lease (and the Sublease contained herein). Any
Fee Mortgage (and related fee loan documents) existing as of the date of execution of any New
Lease shall continue to constitute a collateral assignment of Landlord’s interest in such New
Lease (and such New Lease shall maintain the benefits and rights under any SNDA that existed
with respect to this Lease as a replacement of this Lease), however, if requested by the New
Operating Tenant, the existing Fee Mortgagee, DDA (if the DDA Lease remains in effect) and
Landlord shall enter into a SNDA with respect to the New Lease.
(d) Intentionally Omitted.
(e) If a Registered Leasehold Mortgagee enters into a New Lease with Landlord
directly under this Section 18.4, then for so long as Registered Leasehold Mortgagee is the
“Operating Tenant” thereunder, the Registered Leasehold Mortgagee’s liability under the New
Lease shall be limited to its interest in the Premises, and when the Registered Leasehold
Mortgagee disposes of its interest in the Premises, the Registered Leasehold Mortgagee shall be
relieved of any further liability to Landlord or DDA with respect to such New Lease. The
restrictions contained in this Lease on the assignment or transfer of Operating Tenant’s interest
in this Lease shall not apply to the assignment or transfer of such Registered Leasehold
Mortgagee’s interest in such a New Lease, except during the Recapture Period, the New
Operating Tenant shall not be a person that would cause a recapture or loss of all or a portion of
the Historic Tax Credits.
18.5 Rejection by Bankruptcy Trustee; New Lease.
(a) If this Lease (or the Sublease contained herein) is rejected or disaffirmed pursuant
to any bankruptcy law or proceeding or other similar law or proceedings affecting creditors’
rights generally, Landlord and DDA (if applicable) shall, if timely requested to do so by a
Registered Leasehold Mortgagee as provided herein, enter into a New Lease of the Premises and
as applicable, the Property with the Registered Leasehold Mortgagee (or its assignee, designee or
nominee) not later than sixty (60) days after the Registered Leasehold Mortgagee delivers to
Landlord its written request therefor, which New Lease shall be effective as of the date of such
rejection or disaffirmance, but the Landlord will be obligated to do so only if such Registered
Leasehold Mortgagee commits in writing to Landlord, in a written notice delivered to Landlord,
within ninety (90) days after the effective date that Registered Leasehold Mortgagee receives
written notice of such rejection or disaffirmance, as the case may be, that the Registered
Leasehold Mortgagee (or its assignee, designee or nominee) will enter into a New Lease and in
30
such case, such New Lease will be entered promptly after such commitment is sent by the
Registered Leasehold Mortgagee and in substantially the same for as the Lease for the
remaining term of this Lease.
(b) Notwithstanding anything to the contrary contained herein, if Landlord, DDA (if
applicable) and a Registered Leasehold Mortgagee (or its assignee, designee or nominee), as a
“New Operating Tenant”, enter into a New Lease pursuant to this Section 18.5, any interest of
the prior Operating Tenant in the Improvements which reverts to Landlord upon the termination
of this Lease shall be deemed the property of the New Operating Tenant under the New Lease on
and subject to the terms and provisions of the New Lease, to the same extent as the interest
therein of the prior Operating Tenant under this Lease, subject to the Landlord’s reversionary
interest therein and thereto.
(c) Nothing contained in this Section 18.5 shall be deemed to limit or affect
Landlord’s interest in and to such property existing upon the expiration of the Term of the New
Lease. The provisions of this Section 18.5 shall survive the rejection or disaffirmance of this
Lease (or Sublease) and shall continue in full force and effect thereafter to the same extent as if
this Section 18.5 were a separate and independent contract made by Landlord, DDA and the
Registered Leasehold Mortgagee, and (provided that the Registered Leasehold Mortgagee shall
have affirmed in writing its intent to enter into (or have its assignee, designee or nominee enter
into) and be bound by a New Lease) from the effective date of such rejection or disaffirmance of
this Lease to the date of execution and delivery of the New Lease, the Registered Leasehold
Mortgagee (or its assignee, designee or nominee) may use and enjoy the Leasehold Estate
created by this Lease without hindrance by Landlord or DDA, but only on and subject to the
terms and provisions of this Lease. Any Fee Mortgage (and related fee loan documents) existing
as of the date of execution of any New Lease shall continue to constitute a collateral assignment
of Landlord’s interest in such New Lease (and such New Lease shall maintain the benefits and
rights under any SNDA that existed with respect to this Lease as a replacement of this Lease),
however, if requested by the New Operating Tenant, the existing Fee Mortgagee, DDA (if the
DDA Lease remains in effect) and Landlord shall enter into a SNDA with respect to the New
Lease.
(d) Intentionally Omitted.
(e) If a Registered Leasehold Mortgagee enters into a New Lease with Landlord
directly under this Section 18.5, then for so long as Registered Leasehold Mortgagee is the “New
Operating Tenant” thereunder, Registered Leasehold Mortgagee’s liability under the New Lease
shall be limited to its interest in the Premises and when the Registered Leasehold Mortgagee
disposes of its interest in the Premises, the Registered Leasehold Mortgagee shall be relieved of
any further liability to Landlord with respect to such New Lease. The restrictions contained in
this Lease on the assignment or transfer of operating tenant’s interest in this Lease shall not
apply to the assignment or transfer of such Registered Leasehold Mortgagee’s interest in such a
New Lease, except during the Recapture Period, the New Operating Tenant shall not be a person
that would cause a recapture or loss of all or a portion of the Historic Tax Credits.
18.6 Recognition by Landlord of Leasehold Mortgagee. If there is more than one
Leasehold Mortgagee, only the Registered Leasehold Mortgagee, to the exclusion of all other
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Leasehold Mortgagees, shall have the benefit of and right to exercise the leasehold lender
protections under this Section 18 and elsewhere in this Lease (including, without limitation, any
right to receive notices of default and termination, any right to grant consents or approvals, any
Leasehold Mortgagee cure rights, and the right to enter into a New Lease under Sections 18.4
and 18.5), unless such Registered Leasehold Mortgagee has designated in writing another
Leasehold Mortgagee to exercise such rights. As of the date hereof, Landlord and DDA and
Operating Tenant agree that AFB&T, a division of Synovus Bank shall be deemed to have the
rights as the Registered Leasehold Mortgagee hereunder.
18.7 Extension of Periods. Any cure or notice provisions provided in this Section 18
shall be tolled for the time period that the Registered Leasehold Mortgagee is prohibited from
exercising any rights afforded the Registered Leasehold Mortgagee hereunder or under the
Leasehold Mortgage, including, without limitation, if during the Recapture Period the Registered
Leasehold Mortgagee is prohibited or restricted from foreclosing or enforcing its rights under the
Registered Leasehold Mortgage pursuant to any subordination, non-disturbance and attornment
agreement entered into by, inter alia, Landlord, DDA, Operating Tenant, Fee Mortgagee (and/or
Registered Leasehold Mortgagee) and any investor in Operating Tenant acquiring the Historic Tax
Credits, such notice and cure periods of the Registered Leasehold Mortgagee shall be tolled (and nothing
herein shall obligate Registered Leasehold Mortgagee to pay any recapture amount to end such Recapture
Period).
18.8 Surrender. Operating Tenant may not cancel or surrender this Lease (including,
without limitation, the Sublease) without the prior written consent of Registered Leasehold
Mortgagee, and even with such consent, such Registered Leasehold Mortgagee shall maintain its
right to a New Lease as contemplated under this Section 18.
18.9 Amendments and Modifications. Landlord and DDA hereby agree that
references herein to any Registered Leasehold Mortgage shall apply to any amendments,
modifications, extensions and/or restatements thereof, and any such amendments, modifications,
extensions and/or restatements shall not require consent by DDA or Landlord.
[SIGNATURES – NEXT PAGE]
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IN WITNESS WHEREOF, each party hereto has caused this Lease to be executed on
its behalf by its duly authorized representatives, to be made effective the day and year first above
written.
LANDLORD:
MILLER THEATER, LLC, a Georgia limited liability company
By:
DDA:
DOWNTOWN DEVELOPMENT AUTHORITY OF AUGUSTA,
GEORGIA
By:
OPERATING TENANT:
MT AUGUSTA PROPERTY, LLC, a Georgia limited liability
company
By:
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00930167-2
EXHIBIT B
Notice Addresses
Landlord:
Miller Theater, LLC
1301 Greene St; Suite 200
Augusta, GA 30901
Attn: President
DDA:
Downtown Development Authority of Augusta, Georgia
__________
Augusta, GA _____
Attn: __________
Operating Tenant :
MT Augusta Property, LLC
1301 Greene St; Suite 200
Augusta, GA 30901
Attn: President
With copies to the following parties:
Augusta Symphony, Inc.
1301 Greene St; Suite 200
Augusta, GA 30901
Attn: Executive Director
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UPON RECORDING RETURN TO:
George W. Mize, Jr., Esq.
Page, Scrantom, Sprouse,
Tucker & Ford, P.C.
P.O. Box 1199
Columbus, Georgia 31902
STATE OF GEORGIA
COUNTY OF RICHMOND
ASSIGNMENT OF LEASES AND RENTS
THIS ASSIGNMENT OF LEASES AND RENTS (this “Assignment”) is made and
entered into as of July ____, 2017 by and between DOWNTOWN DEVELOPMENT
AUTHORITY OF AUGUSTA-RICHMOND COUNTY, as assignor (hereinafter referred to as
the “Authority") whose address is ________________________, and AFB&T, A DIVISION
OF SYNOVUS BANK, a banking corporation organized under the laws of the State of Georgia,
as assignee, whose address is 1148 Broadway, Columbus, Georgia 31901 and whose mailing
address is P. O. Box 120, Columbus, Georgia 31902 (hereinafter referred to as "Lender");
W I T N E S S E T H T H A T :
THAT FOR AND IN CONSIDERATION of the sum of Ten and No/l00ths ($l0.00)
Dollars and other good and valuable consideration, the receipt and sufficiency whereof are
hereby acknowledged, and in order to secure the indebtedness, liabilities and other obligations
hereinafter set forth, the Authority does hereby grant, transfer and assign to Lender, its
successors, successors-in-title and assigns, all of the Authority’s right, title and interest in, to and
under each and every lease, sublease, rental agreement, tenant contract, and rental contract,
whether written or oral, which may now exist or hereafter be made in which the Authority is
lessor, sublessor, landlord or holds a similar designation, including any and all extensions,
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renewals and modifications thereof and guaranties of the performance or obligations of any
tenants or lessees (or sublessees) thereunder (said leases, subleases, agreements and contracts are
hereinafter referred to collectively as the "Leases", and said tenants, lessees and sublessees are
hereinafter referred to collectively as "Tenants" or individually as "Tenant" as the context
requires), which cover, affect or relate to all or any portion of that certain property located in
Richmond County, Georgia, more particularly described on Exhibit "A" attached hereto and
made a part hereof, together with all or any portion of the improvements now or hereafter located
thereon (such land and improvements hereinafter referred to as the "Premises"); together with all
of the Authority’s rights, title and interest in and to all rents, issues, cash flow, revenues and
profits from the Leases and from the Premises.
TO HAVE AND TO HOLD unto Lender, its successors and assigns forever, subject to
and upon the terms and conditions set forth herein.
This Assignment is made for the purpose of securing (a) the full and prompt payment
when due, whether by acceleration, at maturity or otherwise, with such interest as may accrue
thereon, either before or after maturity thereof, the indebtedness, liabilities and obligations MT
AUGUSTA PROPERTY LLC, a Georgia limited liability company, as assignor (hereinafter
referred to as the “Borrower") (whether now existing or hereafter arising) evidenced by or
arising at any time and from time to time under that certain Promissory Note dated as of June 14,
2017 made by Borrower payable to the order of Lender in the stated principal amount of Ten
Million and No/100th Dollars ($10,000,000.00), together with any and all renewals,
modifications, consolidations, restatements and/or extensions thereof (such Promissory Note and
all amendments, modifications, extensions, renewals and/or restatements thereof, hereinafter
referred to as the "Note"); (b) the full and prompt payment and performance of any and all
indebtedness, liabilities and obligations of Miller Theater, LLC (“Owner”) to Lender secured by
that certain Deed to Secure Debt, Security Agreement and Assignment of Leases and Rents
between Owner, as grantor, and Lender, as grantee, dated as of June 14, 2017, which encumbers
to the Premises and secures, inter alia, the indebtedness, liabilities and obligations of Borrower
under the Note and is recorded in Book ____, Page _______ of the records of the Office of the
Clerk of Superior Court of Richmond County, Georgia (such Deed to Secure Debt, Security
Agreement and Assignment of Leases and Rents and all amendments, modifications, extensions,
and restatements thereof, hereinafter referred to as the "Security Instrument") together with all
amendments, extensions and/or restatements thereof, (c) the full and prompt payment and
performance of any and all other indebtedness, liabilities and obligations of Borrower to Lender
under any other instruments now or hereafter evidencing, securing, or otherwise relating to the
indebtedness, liabilities and obligations evidenced by the Note, including, without limitation, that
certain Construction Loan Agreement dated June 14, 2017 entered into by Borrower and Lender,
together with all amendments, modifications and/or restatements thereof (such Construction
Loan Agreement, as the same may be amended and/or modified from time to time, the “Loan
Agreement”) and the full and prompt payment and performance of the Indebtedness (as defined
in the Loan Agreement), and (d) the full and prompt payment when due of all other indebtedness,
obligations and liabilities of Borrower and/or Owner to Lender of every kind and description
whatsoever, direct or indirect, absolute or contingent, due or to become due, now existing or
hereafter incurred, contracted or arising, or acquired by Lender from any source, joint or several,
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liquidated or un-liquidated, regardless of how they arise or by agreement or instrument they may
be evidenced or whether they are evidenced by any agreement or instrument, and whether
incurred as maker, endorser, surety, guarantor or otherwise and any and all extensions,
restatements and renewals of any of the same (the Note, Security Instrument, the Loan
Agreement and said other instruments and all amendments, modifications, extensions or
renewals of any thereof are hereinafter referred to collectively as the "Security Documents", and
said indebtedness, liabilities and obligations secured hereby are hereinafter referred to as the
"Indebtedness").
1. Warranties of the Authority. The Authority hereby warrants and represents as
follows:
(a) The Authority is the sole holder of the sublessor’s interest under the Leases, is
entitled to receive the rents, issues and profits from the Leases and from the Premises, and has
good right to sell, assign, transfer and set over the same and to grant to and confer upon Lender
the rights, interests, powers, and authorities herein granted and conferred;
(b) The Authority has made no assignment other than this Assignment (and other,
if any, assignments in favor of Lender) of any of its rights under any of the Leases or with
respect to any of said rents, issues or profits;
(c) The Authority has neither done any act nor to its knowledge, omitted to do
any act which might prevent Lender from, or limit Lender in, acting under any of the provisions
of this Assignment;
(d) Neither the execution and delivery of this Assignment or any of the Leases,
the performance of each and every covenant of the Authority under this Assignment and the
Leases, nor the meeting of each and every condition contained in this Assignment, conflicts with,
or constitutes a breach or default under any agreement, indenture or other instrument to which
the Authority is a party, or any law, ordinance, administrative regulation or court decree which is
applicable to the Authority;
(e) The Authority knows of no default or the existence of any state of facts
which would, with the passage of time or the giving of notice, or both, constitute a default or
event of default under any of the Leases; and
(f) No action has been brought or, so far as is known to the Authority, is
threatened, which would interfere in any way with the right of the Authority to execute this
Assignment and perform all of its obligations contained in this Assignment and in the Leases.
2. Covenants of the Authority. The Authority hereby covenants and agrees as follows:
(a) The Authority shall (i) fulfill, perform and observe each and every material
condition and covenant of the Authority contained in each of the Leases; (ii) at no cost or
expense to Lender, enforce, short of termination, the performance and observance of each and
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every material covenant and condition of each of the Leases to be performed or observed by the
Tenant thereunder; and (iii) appear in and defend any action arising out of, or in any manner
connected with, any of the Leases, or the obligations or liabilities of the Authority thereunder, or
of the Tenant or any guarantor thereunder;
(b) The Authority shall not, without the prior written consent of Lender, which
consent may be withheld in the reasonable discretion of Lender, (i) enter into any Leases or
modify or amend any of the Leases or enter into any management agreement for the
management, leasing, and/or operating of the Premises; (ii) terminate the term or accept the
surrender of any of the Leases; (iii) waive or release the Tenant from the performance or
observance by the Tenant of any obligation or condition of any of the Leases; (iv) permit the
prepayment of any rents or other payments under any of the Leases for more than one (1) month
prior to the accrual thereof; (v) give any consent to any assignment or sublease by the Tenant
under any of the Leases; or (vi) assign all or any portion of its interest in, to or under the Leases
or the rents, issues, cash flow, revenues and/or profits from the Leases and from the Premises to
any person or entity other than Lender;
(c) Without the prior written approval of Lender, which approval may be withheld
in the reasonable discretion of Lender, the Authority shall take no action which will cause or
permit the estate of the Tenant under any of the Leases to merge with the interest of the
Authority in the Premises or any portion thereof;
(d) Lender shall not be obligated to perform or discharge, nor does it hereby
undertake to perform or discharge, any obligation, duty or liability under the Leases, or under or
by reason of this Assignment. In the exercise of the powers herein granted to the Lender, no
liability shall be asserted or enforced against the Lender by the Authority, all such liability being
expressly waived and released by the Authority. The Authority shall protect, indemnify and save
harmless Lender from and against all liabilities, obligations, claims, damages, penalties, causes
of action, costs and expenses (including, without limitation, attorney's fees and expenses)
imposed upon or incurred by Lender by reason of this Assignment and any claim or demand
whatsoever which may be asserted against Lender by reason of any alleged obligation or
undertaking to be performed or discharged by Lender under this Assignment, except for any such
claims, demands or damages caused by the gross negligence of Lender. In the event Lender
incurs any liability, loss or damage by reason of this Assignment, or in the defense of any claim
or demand arising out of or in connection with this Assignment, the amount of such liability, loss
or damage shall be added to the Indebtedness, shall bear interest at the Default Rate (as defined
in the Security Instrument) from the date incurred until paid and shall be payable on demand;
(e) The Authority shall authorize and direct, and does hereby authorize and direct
each and every present and future Tenant of the whole or any part of the Premises to pay all
rental to Lender upon receipt of written demand from Lender to so pay the same; and
(f) From time to time, within thirty (30) days after request by Lender, the
Authority will furnish Lender copies of all executed Leases.
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3. Covenants of Lender. Lender hereby covenants and agrees with the Authority as
follows:
(a) Although this Assignment constitutes a present and current assignment of all
rents, issues and profits from the Leases and Premises, so long as there shall exist no Event of
Default, as defined in Paragraph 4 below, Lender shall not demand that such rents from the
Leases be paid directly to Lender, and the Authority, except as otherwise provided in any other
agreement to which the Authority is a party, shall have a revocable license to collect, but not
more than one (1) month prior to accrual, such rents from the Leases. Upon the occurrence of an
Event of Default, as hereinafter defined, the license granted to the Authority to collect such rents
herein shall automatically be revoked without notice to the Authority or any further action on the
part of Lender and Lender shall immediately be entitled to possession of all rents and sums
received pursuant to any Lease whether or not Lender enters upon or takes control of the
Premises; and
(b) Upon the final and indefeasible payment in full of the Indebtedness, with
Lender having no further commitment or obligation to advance funds to or on account of the
Borrower and the recording or filing of an instrument of satisfaction or full cancellation of the
Security Instrument signed by Lender without the recording of another security instrument in
favor of Lender affecting the Premises or any portion thereof, this Assignment shall be
terminated and released of record by Lender and shall thereupon be of no further force or effect
4. Event of Default. The term "Event of Default", as used herein, shall mean any one or
more the following events:
(a) The occurrence of any "Default" or "Event of Default" (as defined in such
other documents) under the Note, the Loan Agreement or any of the Security Documents; or
(b) The failure by the Authority duly and fully to comply with any covenant,
condition or agreement of this Assignment (provide, however, except, respect to any failure
addressed elsewhere in this Section 4, the Authority shall have ten (10) days after written notice
of such failure is given by Lender to the Authority to cure any such failure that can be cured by
the payment of money and shall have thirty (30) days after written notice of such failure is given
by Lender to the Authority to cure any such failure that is susceptible to cure but cannot be cured
by the payment of money); or
(c) The breach of any warranty by the Authority contained in this Assignment.
Any cure period contained herein shall run concurrently and not consecutively with any
cure period contained in any of the other Security Documents.
5. Remedies. Upon the occurrence of any Event of Default, Lender may at its option,
with or without notice or demand of any kind, exercise any one or more of the following
remedies:
(a) Declare any part or all of the Indebtedness to be due and payable, whereupon
the same shall become immediately due and payable;
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(b) Perform any and all obligations of the Authority under any or all of the
Leases or this Assignment and exercise any and all rights of the Authority herein or therein as
fully as the Authority itself could do, including, without limiting the generality of the foregoing:
Enforcing, modifying, compromising, waiving or increasing any or all of the rents payable
thereunder; and obtaining new tenants and entering into new leases on the Premises on any terms
and conditions deemed desirable by Lender, and, to the extent Lender shall incur any costs in
connection with the performance of any such obligations of the Authority, including costs of
litigation, then all such costs shall become a part of the Indebtedness, shall bear interest from the
incurring thereof until repaid at the Default Rate (as defined in the Security Instrument) and
shall be due and payable on demand;
(c) In the Authority’s or Lender's name, institute any legal or equitable action
which Lender in its sole discretion deems desirable to collect and receive any or all of the rents,
issues and profits assigned herein; and/or
(d) Collect the rents, issues and profits and any other sums due under the Leases
and with respect to the Premises, and apply the same in such order as Lender in its sole
discretion may elect against (i) all costs and expenses, including, without limitation, reasonable
attorneys' fees, incurred in connection with the operation of the Premises, the performance of the
Authority’s obligations under the Leases and collection of the rents thereunder; (ii) all the costs
and expenses, including, without limitation, reasonable attorney's fees, incurred in the collection
of any or all of the Indebtedness, including, without limitation, all costs, expenses and attorneys'
fees incurred in seeking to realize on or to protect or preserve Lender's interest in any other
collateral securing any or all of the Indebtedness; and (iii) the Indebtedness, in such order of
application determined by Lender.
Lender shall have full right to exercise any or all of the foregoing remedies without
regard to the adequacy of security for any or all of the Indebtedness, and with or without the
commencement of any legal or equitable action or the appointment of any receiver or trustee, and
shall have full right to enter upon, take possession of, use and operate all or any portion of the
Premises which Lender in its sole discretion deems desirable to effectuate any or all of the
foregoing remedies. Notwithstanding such rights, Lender may also apply for the appointment of
a receiver of the rents, incomes, issues and profits of or from the Premises, without notice to the
Authority. The Authority hereby consents to the appointment of such receiver and agrees that
Lender shall be entitled to the appointment of such receiver as a matter of right, without regard to
the value of the Premises as security for the debt secured hereby or the solvency of any person or
legal entity liable for the payment of all or any part of such debt.
6. Successors and Assigns. This Assignment shall inure to the benefit of and be binding
upon the Authority and Lender and their respective successors and assigns. Whenever a
reference is made in this Assignment to "Authority" or "Lender", such reference shall be deemed
to include a reference to the successors and assigns of the Authority or Lender.
7. Terminology. All personal pronouns used in this Assignment, whether used in the
masculine or neuter gender, shall include all other genders, and the singular shall include the
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plural, and vice versa. Titles of articles are for convenience only and neither limit nor amplify
the provisions of this Assignment.
8. Severability. If any provision of this Assignment or the application thereof to any
person or circumstance shall be invalid or unenforceable to any extent, the remainder of this
Assignment and the application of such provisions to other persons or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by law.
9. Applicable Law. This Assignment shall be interpreted, construed and enforced
according to the laws of the state in which the Premises is situated.
10. No Third Party Beneficiaries. This Assignment is made solely for the benefit of
Lender and its successors and assigns. No Tenant under any of the Leases nor any other person
shall have standing to bring any action against Lender as the result of this Assignment, or to
assume that Lender will exercise any remedies provided herein, and no person other than Lender
shall under any circumstances be deemed to be a beneficiary of any provision of this
Assignment.
11. No Oral Modifications. Neither this Assignment nor any provisions hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in writing signed by
the party against whom enforcement of the change, waiver, discharge or termination is sought.
12. Cumulative Remedies. The remedies herein provided shall be in addition to and not
in substitution for the rights and remedies vested in Lender in any of the Security Documents or
in law or equity, all of which herein provided or otherwise available to Lender shall be
cumulative and may be exercised concurrently. The failure to exercise any of the remedies
herein provided shall not constitute a waiver thereof, nor shall use of any of the remedies herein
provided prevent the subsequent or current resort to any other remedy or remedies. It is intended
that this clause shall be broadly construed so that all remedies herein provided or otherwise
available to Lender shall continue and be each and all available to Lender until the Indebtedness
shall have been paid in full.
13. Cross-Default. The occurrence of an Event of Default under this Assignment shall
constitute the occurrence of an Event of Default under, and as defined in, the Note and other
Security Documents.
14. Counterparts. This Assignment may be executed in any number of counterparts all of
which taken together shall constitute one and the same instrument, and any of the parties or
signatories hereto may execute this Assignment by signing any such counterpart.
15. Further Assurance. At any time and from time to time, upon request by Lender, the
Authority will make, execute and deliver, or cause to be made, executed and delivered, to Lender
and, where appropriate, cause to be recorded and/or filed and from time to time thereafter to be
re-recorded and/or refiled at such time and in such offices and places as shall be deemed
desirable by Lender, any and all such other and further assignments, financing statements,
continuation statements, instruments of further assurance, certificates and other documents as
may, in the opinion of Lender, be necessary or desirable in order to effectuate, complete, or
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perfect, or to continue and preserve (a) the obligations of the Authority under this Assignment
and (b) the security interest created by this Assignment as a valid lien and security interest upon
the Leases and the rents, issues and profits from the Premises. Upon any failure by the Authority
so to do, Lender may make, execute, record, file, re-record and/or refile any and all such
assignments, deeds to secure debt, mortgages, deeds of trust, security agreements, financing
statements, continuation statements, instruments, certificates, and documents for and in the name
of the Authority, and the Authority hereby irrevocably appoints Lender the agent and attorney-
in-fact of the Authority so to do.
16. Notices. Any and all notices, elections or demands permitted or required to be made
under this Assignment shall be in writing, signed by the party giving such notice, election or
demand and shall be delivered personally, or sent by certified United States Mail, postage
prepaid, return receipt requested, or sent by a nationally recognized overnight courier provided a
receipt for delivery is obtained from the recipient to the other party at the address set forth below,
or at such other address within the continental United States of America as may have theretofore
been designated in writing to the other party. Any such notice or other document shall be
deemed delivered (i) if personally delivered, when actually received by the party to whom
directed at the address specified pursuant to this Section, or (ii) if sent by U.S. Mail, three (3)
days after such notice or document is deposited in the United States Mail, addressed as provided
herein, or (iii) if sent by overnight courier, addressed as provided herein, on the date of receipt or
refusal to accept delivery, as evidenced on the return receipt or other shipping invoice. For the
purposes of this Assignment:
The address of Lender is: AFB&T, a Division of Synovus Bank
Attention: Mac McKnight
1148 Broadway
P.O. Box 120
Columbus, Georgia 31902
With a copy to: AFB&T, a Division of Synovus Bank
Attention: Mac McKnight
150 West Hancock Avenue
P.O. Box 1747
Athens, Georgia 30603
The Address of Authority is: Downtown Development Authority of Augusta-
Richmond County
________________________________________
17. Modifications, etc. The Authority hereby consents and agrees that Lender may at any
time, and from time to time, without notice to or further consent from the Authority, either with
or without consideration, surrender any property or other security of any kind or nature
whatsoever held by it or by any person, firm or corporation on its behalf or for its account,
9
securing the Indebtedness; substitute for any collateral so held by it, other collateral of like kind,
or of any kind; agree to modification of the terms of any of the Security Documents; extend or
renew any of the Security Documents for any period; grant releases, compromises and
indulgences with respect to the Security Documents to any person or entity now or hereafter
liable thereunder or hereunder; release any guarantor or endorser of the Note, the Security
Instrument, or any other Security Documents; or take or fail to take any action of any type
whatsoever; and no such action which Lender shall take or fail to take in connection with the
Security Documents, or any of them, or any security for the payment of the Indebtedness or for
the performance of any obligations or undertakings of the Authority, nor any course of dealing
with the Authority, Borrower or any other person, shall release the Authority’s obligations
hereunder, affect this Assignment in any way or afford the Authority any recourse against
Lender.
18. Intentionally Omitted
19. Definitions. Capitalized terms not otherwise defined herein that are defined in the
Loan Agreement shall have the meaning assigned thereto in the Loan Agreement which
meanings are incorporated herein by reference. Defined terms in the singular shall include the
plural as well as the singular and vice versa.
20. Other Instruments. All references in this Assignment to a separate instrument are to
such separate instrument as the same may be amended, supplemented, renewed or extended from
time to time.
21. Person. As used in this Assignment, the term “person” shall include any individual,
corporation, limited liability company, partnership, joint venture, association, trust,
unincorporated organization, any entity of any other type whatsoever and any government
agency or any agency or political subdivision thereof.
22. The Authority, on behalf of the Authority and its successors, assigns, transferees, and
other entities acting by, through or on its behalf, does hereby represent, warrant and covenant
that it will receive a direct substantial benefit by Lender extending credit to Borrower and that
the value of such benefit exceeds, or is reasonably equivalent to, the value of the Authority’s
promises, covenants, assignments, obligations and agreements hereunder.
23. Lender shall not enforce the liabilities and obligations of the Authority contained in
this Assignment by any action or proceeding wherein a money judgment shall be sought against
the general assets of the Authority, except that Lender may take appropriate action or proceeding
to enable Lender to enforce and realize upon and collect rents, issues, profits, cash flows,
revenues and income from the Premises hereby granted and assigned to Lender; provided,
however, that any judgment in any such action or proceeding shall be enforceable against the
Authority only to the extent of the Authority’s interest in the Premises and the rents, issues,
profits, cash flows, revenues and income from the Premises.
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IN WITNESS WHEREOF, the undersigned have duly executed and delivered this
Assignment, under seal, as of the date first above written.
AUTHORITY:
DOWNTOWN DEVELOPMENT AUTHORITY OF
AUGUSTA-RICHMOND COUNTY
By: _________________________________
Name: ___________________________
Title: ___________________________
Attest: _________________________________
Name: ___________________________
Title: ___________________________
(SEAL)
Signed, sealed and delivered
in the presence of:
___________________________
Witness
___________________________
Notary Public
My Commission Expires:
(NOTARIAL SEAL)
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LENDER:
AFB&T, A DIVISION OF SYNOVUS BANK, a
Georgia banking corporation
By: _________________________________
Name: Mac McKnight
Title: Senior Vice President
(CORPORATE SEAL)
Signed, sealed and delivered
in the presence of:
___________________________
Witness
___________________________
Notary Public
My Commission Expires:
(NOTARIAL SEAL)
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Acknowledged and consented to by:
MT AUGUSTA PROPERTY LLC,
a Georgia limited liability company
By: ______________________________
Levi W. Hill, IV, its President
(SEAL)
Signed, Sealed and Delivered
in the presence of:
____________________________
Witness
____________________________
Notary
My Commission Expires:
[Notary Seal]
MILLER THEATER, LLC,
a Georgia limited liability company
By: ______________________________
Levi W. Hill, IV, its President
(SEAL)
Signed, Sealed and Delivered
in the presence of:
____________________________
Witness
____________________________
Notary
My Commission Expires:
[Notary Seal]
EXHIBIT “A”
Property Description
ALL THAT TRACT or parcel of land, with improvements thereon, situate, lying and being in the
State of Georgia, County of Richmond and being shown and designated as Tract “A” on that certain plat
of survey prepared for Miller Theater, LLC by Cranston Engineering Group, P.C., dated September 4,
2013, and recorded in the Office of the Clerk of Superior Court of Richmond County, Georgia, in Plat
Book 10, page 24. Reference is hereby made to said plat for a more complete and accurate description as
to the metes, bounds and location of said property. Said property is known under the current system of
street numbering in August-Richmond County, Georgia as 708 Broad Street, Augusta, Georgia 30901.
Tax Map and Parcel No. 047-1-051-00-0
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(DDA SNDA)
Upon recording return to: Cross Reference:
_____________________ Memorandum of Lease
_____________________ recorded in Book _____, Page _____
_____________________ of the records of the Office of the
_____________________ Clerk of Superior Court of Richmond,
County, Georgia; Deed to Secure
Debt, Security Agreement and
Assignment of Leases and Rents
recorded in Book ______, Page
_____, aforesaid records.
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT (this "Agreement") is made as of the ________ day of ____________, 2017 by
and among SYNOVUS BANK, a Georgia banking corporation (also known as AFB&T, a division
of Synovus Bank), having an address of P.O. Box 120, 1148 Broadway, Columbus, Georgia 31902,
as grantee under the below-referenced Security Instrument (together with its successors and assigns,
"Fee Mortgagee"), MILLER THEATER, LLC, a Georgia limited liability company, having an
address at 1301 Greene Street, Suite 200, Augusta, Georgia 30901 (“Landlord”), DOWNTOWN
DEVELOPMENT AUTHORITY OF AUGUSTA, GEORGIA, having an address of
________________________ (“DDA”), and MT AUGUSTA PROPERTY LLC, a Georgia limited
liability company, having an address at 1301 Greene Street, Suite 200, Augusta, Georgia 30901
("Operating Tenant").
RECITALS:
A. Landlord, as landlord, DDA, as lessee/sub-lessor, and Operating Tenant, as
tenant/sub-lessee, have entered into that certain Lease dated __________, 2017, whereby Landlord
leases to DDA the property described on Exhibit “A” attached hereto and incorporated herein by
this reference and any improvements thereon (the “Property”) and DDA subleases said property to
Operating Tenant (as amended and modified through the date hereof, such Lease (and DDA Lease
(as defined in the Lease) and the Sublease (as defined in the Lease) contained therein) is herein
referred to as the “Lease”) (as used herein, and in the Lease, the lease within the Lease by Landlord
to DDA is called the “DDA Lease” and the sublease from DDA to Operating Tenant within the
Lease is referred to in the Lease and herein as the “Sublease”); and
B. The Property is encumbered by a Deed to Secure Debt, Security Agreement and
Assignment of Leases and Rents (together with any amendments, modifications and/or restatements
thereof, the "Security Instrument") from Landlord in favor of Fee Mortgagee and recorded in
Book _____, Page _____, of the records of the Office of the Clerk of Superior Court of Richmond
County, Georgia; and
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(DDA SNDA)
C. DDA and Operating Tenant have agreed to subordinate the Lease, and their
respective interest therein and in the Property, to the Security Instrument and to the security title and
security interest thereof and to Fee Mortgagee’s interest in the Property, and Fee Mortgagee has
agreed to grant non-disturbance to DDA under the DDA Lease on the terms and conditions
hereinafter set forth.
AGREEMENT:
NOW, THEREFORE, for good and valuable consideration flowing among the parties
hereto, the receipt and sufficiency of which is hereby acknowledged, the parties hereto mutually
agree as follows:
1 Subordination. The Lease, as in effect on the date hereof and as the same may be
hereafter amended, modified, extended and/or restated, is currently (and for avoidance of doubt, is
hereby made) and shall remain at all times, subject and subordinate in all respects to the security
title and security interest and terms of the Security Instrument, to any and all advances to be made
thereunder and to all renewals, modifications, amendments, consolidations, restatements,
replacements and extensions thereof.
2 Non-disturbance of DDA Lease. Except as provided below, the DDA Lease will
not be disturbed during the term of the DDA Lease by reason of a foreclosure (as hereinafter
defined). Notwithstanding the preceding sentence, such non-disturbance of the DDA Lease shall
not apply, and Fee Mortgagee shall be entitled to cancel and terminate the DDA Lease and/or
entire Lease upon foreclosure (as hereinafter defined) after the earlier to occur of the (i)
expiration or early termination of the DDA Lease or (ii) the expiration of the Servitude (as defined
in the Lease) or (iii) the payment of the SPLOST Repayment (as defined in the Lease), or (iv) taking
of a material portion of the Property through condemnation or eminent domain, or (v) the failure or
refusal of DDA and/or Augusta, Georgia to disburse SPLOST Funds as and when required under
the SPLOST Agreement (as defined in the Lease) or as and when required in the Lease or (vi) the
amendment or modification of the SPLOST Agreement (as defined in the Lease) in a manner that
affects the payment of SPLOST Funds without the prior written approval of Landlord, Operating
Tenant and Fee Mortgagee.
For purposes of this Agreement, a "foreclosure" shall mean a sale under the power of sale
contained in the Security Instrument, the foreclosure of the Security Instrument under applicable
law, and any other transfer of the Landlord's interest in the Property under peril of foreclosure of the
Security Instrument, including, without limitation, to the generality of the foregoing, an assignment
or sale in lieu of foreclosure.
Nothing contained herein shall be deemed or construed as limiting or restricting the
enforcement by Fee Mortgagee of any of the terms, covenants, provisions or remedies of the
Security Instrument with respect to Landlord or Landlord’s interest in the Property or prohibit
Fee Mortgagee’s right to foreclose, or sell under power of sale, or accept a deed in lieu of
3
(DDA SNDA)
foreclosure, with respect to the Security Instrument or exercise any other rights and/or remedies
under any of the Loan Documents (as defined in the Security Instrument).
3 Attornment. Each of DDA and Operating Tenant agrees to attorn to, be
bound to, accept and recognize any person or entity which acquires the Property through a
foreclosure (together with their successors and assigns, a "Successor Landlord") as the landlord
under the Lease for the then remaining balance of the term of the Lease. The foregoing provision
shall be self-operative and shall not require the execution of any further instrument or agreement by
DDA or Operating Tenant as a condition to its effectiveness. Each of DDA and Operating Tenant
agrees, however, to execute and deliver, at any time and from time to time, upon the request of
Successor Landlord any reasonable instrument which may be necessary or appropriate to evidence
such attornment.
4. Replacement Sublease. The DDA hereby agrees that the DDA will not exercise
any, if any, right of the DDA to terminate the Sublease without the prior written consent of
Landlord and Fee Mortgagee (and any such termination would be subject to the rights of the
Registered Leasehold Mortgagee provided in the Lease), and in the event the Sublease is terminated
or cancelled (other than in connection with a New Lease (as defined in the Lease)), the DDA shall
not enter into any sublease of the Property without the prior written consent of Landlord (or
Successor Landlord, if applicable) and Fee Mortgagee, and instead, the DDA, as the tenant under
the Lease, shall enter into a new sublease of the Property with a replacement subtenant (the
“Replacement Operating Tenant”) as is reasonably required by Landlord (or if applicable,
Successor Landlord), and approved by the Fee Mortgagee (the “Replacement Sublease”) provided
such Replacement Sublease: (i) requires that uses of the Property include “Public Uses” (as defined
in the Lease); (ii) provides that DDA shall have no pecuniary obligations or pecuniary liability
under said Replacement Sublease; (iii) provides for rents and terms (including, without limitation,
terms with respect to distribution and allocation of insurance proceeds and condemnation awards)
acceptable to Landlord (or Successor Landlord, if applicable) and Fee Mortgagee; and (iv)
provides that all such rents due under the Replacement Sublease shall be payable to Landlord (or as
applicable, Successor Landlord), and not DDA, as additional rent under the Lease due the Landlord
(or as applicable, Successor Landlord) under the Lease. In the event of the termination or
cancellation of any Replacement Sublease, the requirements of this section 4 shall continue as to
any subsequent Replacement Sublease. The failure of DDA to enter into any such Replacement
Sublease as and when reasonably requested shall be considered a default on the part of DDA
hereunder and under the Lease. The provisions of this section 4 shall survive the foreclosure or
termination of the Security Instrument and are a continuing agreement between Landlord (and any
Successor Landlord) and DDA as long as the DDA Lease is in effect. If required by Landlord (or
Successor Landlord) or Fee Mortgagee, prior to entering into any Replacement Sublease, an
amendment to the Lease reasonably acceptable to Landlord (or Successor Landlord, as applicable)
and Fee Mortgagee shall be entered by Landlord (or Successor Landlord), DDA, and the
Replacement Operating Tenant to reflect the intent of this paragraph and any amendment to the rent
and terms contemplated hereby.
4
(DDA SNDA)
5 No Liability. Notwithstanding anything to the contrary contained herein or in the
Lease, it is specifically understood and agreed that neither Fee Mortgagee nor any Successor
Landlord shall be:
(a) liable for any act, omission, negligence or default of any prior landlord
(including, without limitation, Landlord);
(b) liable for any failure of any prior landlord (including, without limitation,
Landlord) to construct any improvements or liable to complete any construction of improvements
on the Property;
(c) subject to any offsets, credits, claims or defenses which DDA or Operating
Tenant might have against any prior landlord (including, without limitation, Landlord);
(d) bound by any rent or additional rent which DDA or Operating Tenant might
have paid for more than one (1) month in advance to any prior landlord (including, without
limitation, Landlord), except of the Annual Rent and Annual Sub-Rent that has been pre-paid as
provided in Section 3.1 of the Lease;
(e) bound by any supplement to the Lease or any amendment, modification
and/or restatement of the Lease or termination of the Sublease contained in the Lease not expressly
consented to in writing by Fee Mortgagee; or
(f) liable to DDA or Operating Tenant hereunder or under the terms of the
Lease beyond its interest in the Property.
Landlord, DDA and Operating Tenant each acknowledges that the assignment of the
Lease to Fee Mortgagee pursuant to the Security Instrument or any other security instrument
does not impose on Fee Mortgagee any liability with respect to any of Landlord’s obligations
under the Lease accruing before Fee Mortgagee becomes owner of the Property by foreclosure or
otherwise, and then the Fee Mortgagee’s liability shall be limited to its interest in the Property as
provided above.
6 Rent. Each of DDA and Operating Tenant has notice that the Lease and the rents
and all other sums due Landlord thereunder have been (or will be) assigned to Fee Mortgagee as
security for the indebtedness secured by the Security Instrument. In the event Fee Mortgagee
notifies DDA and Operating Tenant of the occurrence of a default under the Security Instrument
and demands that rents and all other sums due or to become due to Landlord under the Lease
directly to Fee Mortgagee, DDA and Operating Tenant shall honor such demand and pay its rent
and all other sums due from DDA and/or Operating Tenant to Landlord under the Lease directly to
Fee Mortgagee or as otherwise authorized in writing by Fee Mortgagee. Landlord hereby
irrevocably authorizes DDA and Operating Tenant to make the foregoing payments to Fee
Mortgagee upon such notice and demand. If Fee Mortgagee exercises this right to receive rents
and other sums payable by DDA and/or Operating Tenant to Landlord under the Lease, Fee
5
(DDA SNDA)
Mortgagee shall not thereby become obligated for the performance of any of the terms,
covenants, conditions or agreements of Landlord under the Lease.
7 Fee Mortgagee to Receive Notices. Operating Tenant shall notify Fee Mortgagee in
writing of any default by Landlord or DDA under the Lease. Likewise, DDA shall notify Fee
Mortgagee in writing of any default by Landlord or Operating Tenant under the Lease of which
DDA has notice. DDA and Operating Tenant agree that, notwithstanding any provisions of the
Lease to the contrary, neither DDA nor Operating Tenant may cancel the Lease (or the Sublease) or
exercise any remedies under the Lease (or under the Sublease) unless Fee Mortgagee has received
from Operating Tenant and/or DDA written notice of the default giving rise to such right of
cancellation or exercise of remedies by Operating Tenant and/or DDA under the Lease, and Fee
Mortgagee shall have failed within sixty (60) days after receipt of such notice to cure such default,
or if such default cannot be cured within sixty (60) days, shall have failed within sixty (60) days
after receipt of such notice to commence and thereafter diligently pursue any action necessary to
cure such default. Nothing herein obligates Fee Mortgagee to pursue any cure of any default under
the Lease (or under the Sublease contained in the Lease). Additionally, nothing herein prevents the
early termination of the DDA Lease pursuant to the terms of the Lease or voluntary termination of
the DDA Lease by DDA; provided, however, such termination of the DDA Lease shall not
terminate the Lease (and in the event of the termination of the DDA Lease, the Sublease shall
continue in accordance with its terms as a direct lease between Landlord and Operating Tenant), and
following the termination of the DDA Lease, DDA shall have no further rights or obligations under
the Lease or this Agreement.
8 NOTICES. All notices or other written communications hereunder shall be deemed
to have been properly given (i) upon delivery, if delivered in person with receipt acknowledged by
the recipient thereof, (ii) one (1) Business Day (hereinafter defined) after having been deposited for
overnight delivery with any reputable overnight courier service, or (iii) three (3) Business Days after
having been deposited in any post office or mail depository regularly maintained by the U.S. Postal
Service and sent by registered or certified mail, postage prepaid, return receipt requested, addressed
to the receiving party at its address set forth below:
If to Fee Mortgagee: Synovus Bank
Attention: Mac McKnight (AFB&T)
1148 Broadway
P.O. Box 120
Columbus, Georgia 31902
With a copy to: Synovus Bank
Attention: Mac McKnight (AFB&T)
150 West Hancock Avenue
P.O. Box 1747
Athens, Georgia 30603
If to Operating Tenant: MT Augusta Property LLC
6
(DDA SNDA)
Attention: President
1301 Greene Street, Suite 200
P.O. Box 579
Augusta, GA 30901
If to Landlord: Miller Theater, LLC
Attention: President
1301 Greene Street, Suite 200
P.O. Box 579
Augusta, GA 30901
If to DDA: Downtown Development Authority of Augusta,
Georgia
Attention: President
_____________________________
Augusta, GA 30901
or addressed as such party may from time to time designate by written notice to the other parties.
For purposes of this Paragraph 8, the term "Business Day" shall mean any day other than Saturday,
Sunday or any other day on which banks are required or authorized to close in Columbus, Georgia.
Any party by notice to the other parties may designate additional or different addresses for
subsequent notices or communications.
9 Successors. The obligations and rights of the parties pursuant to this Agreement
shall bind and inure to the benefit of the successors, assigns, heirs and legal representatives of the
respective parties.
10. Registered Leasehold Mortgagee. Landlord, Fee Mortgagee, DDA and
Operating Tenant further hereby recognize Synovus Bank (also known as AFB&T, a division of
Synovus Bank) as the Registered Leasehold Mortgagee under, and as defined in, the Lease, and
recognizes the rights of said Registered Leasehold Mortgagee under the Lease and agree that the
exercise of any rights and/or remedies of the Registered Leasehold Mortgagee under the Registered
Leasehold Mortgage shall not constitute a default under the Sublease. Nothing contained herein
shall be deemed or construed as limiting or restricting the enforcement by Registered Leasehold
Mortgagee (as defined in the Lease) of any of the terms, covenants, provisions or remedies of the
Registered Leasehold Mortgage (as defined in the Lease) or any other security instrument with
respect to Operating Tenant or Operating Tenant’s interest in the Property or Sublease or
prohibit Registered Leasehold Mortgagee’s right to foreclose, or sell under power of sale, or
accept a deed in lieu of foreclosure, with respect to the Registered Leasehold Mortgage or any
other security instrument entered into by Operating Tenant with, or in favor of, Registered
Leasehold Mortgagee. The DDA and Landlord each hereby agrees that they will recognize as
the sub-lessee under the Sublease (i.e., “Operating Tenant” under the Lease) any person or entity
7
(DDA SNDA)
(including, without limitation, Registered Leasehold Mortgagee) who succeeds to the interest of
Operating Tenant under the Lease by virtue of a leasehold foreclosure (as hereinafter defined)
without the need for any further approval or consent by DDA or Landlord (however, as long as
the DDA Lease is in effect, the use of the Premises will remain subject to the Public Use
Requirement (as provided in the Lease)).
For purposes of this Agreement, a "leasehold foreclosure" shall mean a sale under the power
of sale contained in the Registered Leasehold Mortgage, the foreclosure of the Registered Leasehold
Mortgage under applicable law, and any other transfer of the Operating Tenant’s interest under the
Lease under peril of foreclosure of the Registered Leasehold Mortgage, including, without
limitation, to the generality of the foregoing, an assignment or sale in lieu of foreclosure.
11. Duplicate Originals; Counterparts. This Agreement may be executed in any number
of duplicate originals and each duplicate original shall be deemed to be an original. This Agreement
may be executed in several counterparts, each of which counterparts shall be deemed an original
instrument and all of which together shall constitute a single Agreement. The failure of any party
hereto to execute this Agreement, or any counterpart hereof, shall not relieve the other signatories
from their obligations hereunder.
12. Governing Law. This Agreement shall be governed by the laws of the State of
Georgia.
13. Severability; Amendments. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other provision of this
Agreement, all of which shall remain in full force and effect. This Agreement contains the
complete and entire agreement among the parties as to the matters covered, rights granted and
the obligations assumed in this Agreement. This Agreement may not be amended or modified
except by written agreement signed by the parties hereto.
14. Defined Terms. Unless otherwise provided herein, all capitalized terms used
herein that are not defined herein but are defined in the Lease shall have the meaning ascribed
thereto in the Lease.
[SIGNATURE PAGE FOLLOWS]
8
(DDA SNDA)
IN WITNESS WHEREOF, Operating Tenant, Landlord, Fee Mortgagee and DDA have
duly executed this Agreement as of the date first above written.
OPERATING TENANT:
MT AUGUSTA PROPERTY LLC,
a Georgia limited liability company
By: ________________________________
Levi W. Hill, IV, its President
(SEAL)
Signed, sealed and delivered
in the presence of:
___________________________
Witness
___________________________
Notary Public
My Commission Expires:
(NOTARIAL SEAL)
9
(DDA SNDA)
LANDLORD:
MILLER THEATER, LLC,
a Georgia limited liability company
By: ________________________________
Levi W. Hill, IV, its President
(SEAL)
Signed, sealed and delivered
in the presence of:
___________________________
Witness
___________________________
Notary Public
My Commission Expires:
(NOTARIAL SEAL)
10
(DDA SNDA)
FEE MORTGAGEE:
SYNOVUS BANK, a
Georgia banking corporation
By: _________________________________
Name: Mac McKnight
Title: Authorized Signer
(CORPORATE SEAL)
Signed, sealed and delivered
in the presence of:
___________________________
Witness
___________________________
Notary Public
My Commission Expires:
(NOTARIAL SEAL)
11
(DDA SNDA)
DDA:
DOWNTOWN DEVELOPMENT AUTHORITY OF
AUGUSTA, GEORGIA
By: _________________________________
Name: ___________________________
Title: ___________________________
Attest: _________________________________
Name: ___________________________
Title: ___________________________
(SEAL)
Signed, sealed and delivered
in the presence of:
___________________________
Witness
___________________________
Notary Public
My Commission Expires:
(NOTARIAL SEAL)
12
(DDA SNDA)
Acknowledged and consented to by the undersigned Registered Leasehold Mortgagee:
AFB&T, A DIVISION OF SYNOVUS BANK, a
Georgia banking corporation
By: _________________________________
Name: Mac McKnight
Title: Senior Vice President
(CORPORATE SEAL)
Signed, sealed and delivered
in the presence of:
___________________________
Witness
___________________________
Notary Public
My Commission Expires:
(NOTARIAL SEAL)
13
(DDA SNDA)
EXHIBIT “A”
See Attached Legal Description
\
Finance Committee Meeting
8/29/2017 1:20 PM
Miller Theater Project - SPLOST VI
Department:Administrator/Finance
Presenter:Janice Allen Jackson
Caption:Motion to approve a Memorandum of Understanding between
Augusta and the Downtown Development Authority of Augusta,
Georgia (“DDA”) regarding the use of SPLOST funds for the
renovation and rehabilitation of the Miller Theater.
Background:The Miller Project is a downtown revitalization and quality of life
project led by the Symphony Orchestra Augusta (“SOA”) and
supported by numerous private and public supporters. The project
will renovate the historic Miller Theater and a neighboring
building (the old Cullum’s Department Store) into a 1,300 seat,
modern performing arts venue that will accommodate a wide
variety of artistic and cultural performances and events. The
Miller Project is a $23,000,000 project. All funding has been
secured, and the renovation is scheduled to be complete in the Fall
of 2017. Funding for this project includes a $5,142,856 allocation
from Richmond County’s SPLOST VI (the SOA’s required
twenty-five percent match has been met and verified and the
source of funding for the balance of the construction cost has been
verified). The funding for the project includes approximately
$7,000,000 in state and federal historic tax credits that have been
awarded to this project.
Analysis:The motion and MOU is a request to have the SPLOST funding
paid the DDA in order for the SOA to take advantage of the
significant tax credits available for the project. By utilizing the
DDA to receive the funds and for the structuring and leasing of
the project, the public’s interest in the project can be preserved
while allowing for the necessary lease structure needed to qualify
for the tax credits. Under the proposed structure, the SPLOST
allocation would be directed to the DDA, and the DDA would
then be responsible, with oversight by Augusta, to reimburse the
SOA upon proof of payment of construction costs. The attached
MOU addresses the obligations of the DDA to utilize the funds as
directed by the Commission.
Financial Impact:The SPLOST allocation will be expended on the project.
Approving the MOU facilitates the SOA’s ability to obtain and
utilize tax credits.
Alternatives:Approve the MOU to facilitate the SOA’s obtaining the tax credits
at no cost to Augusta or not approve the MOU.
Recommendation:Approve the MOU.
Funds are Available
in the Following
Accounts:
328-06-4310
REVIEWED AND APPROVED BY:
Finance.
Law.
Administrator.
Clerk of Commission
Finance Committee Meeting Commission Chamber - 81812017
ATTENDANCE:
Present: Hons. Frantom, Chairman; Sias, Vice Chairrnan; Hasan, member.
Absent: Hons. Hardie Davis, Jr., Mayor; Guilfoyle, member.
FINANCE
1. Motion to approve the minutes of the Finance Committee held on July 25,2017. Item
Action:
Approved
Motions
Motion
Type
Approve
3-0.
2. Report from the Finance Department regarding the classifications of the list of Item
the outside agencies which will be considered in the 2018 budget discussions. Action:
Approved
Motion Text Made By
Motion toapprove. Commissioner
Motion Passes Sammie Sias
seconded By f.".XiI
Commissioner Ben passes
seconded By f;Xil
Motions
i^,[':" Motion rext Made By
Motion to approve
a _-^-.^__^ receiving this item as Commissioner CommissionerApprove .-;-- --_Z^_--- ;_ ^ -:'-;:^'-^ :-";;',""',""-^ passesinformation. Sammie Sias Ben Hasan
Motion Passes 3-0.
www.auqustaga.gov
Finance Committee Meeting
8/29/2017 1:20 PM
Minutes
Department:Clerk of Commission
Presenter:
Caption:Motion to approve the minutes of the Finance Committee held on
August 8, 2017.
Background:
Analysis:
Financial Impact:
Alternatives:
Recommendation:
Funds are Available
in the Following
Accounts:
REVIEWED AND APPROVED BY:
From:
Sent:
To:
Cc:
Subiect:
Ms Bonner,
Commissioner Sammie Sias
Thursday, August 24,2017 8:1-3 AM
Lena Bonner
Nancy Morawski
Non Profits - General Fund
Please add this to the Finance Committee Agenda for 29 Aug2Ol7.
Agenda ltem:
Consider the following changes for no profit organizations that request funds from the General Fund.
A cap of S25K for all General Fund requests
Consider an accounting review process that is not detrimentalthe smaller non profits
The followings non profits would be considered exempt up to the amount of S120K
o
The ARC Museum of History
The Lucy Craft Laney Museum
The Arts Council
We must find opportunities to reduce discretionary spending. I consider this a first step with
additional options to follow.
Sammie L. Sias
Commissioner,
Augusta Richmond County
"Failure is not an Option"
Please consider the environment before printing this email.
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Finance Committee Meeting
8/29/2017 1:20 PM
Non Profit Organizations
Department:Clerk of Commission
Presenter:
Caption:Consider the following changes for no profit organizations that
request funds from the General Fund: 1. A cap of $25K for all
General Fund requests. 2. Consider an accounting review process
that is not detrimental to the smaller non profits. The following
non profits would be considered exempt up to the amount of
$120K: The ARC Museum of History, The Lucy Craft Laney
Museum, and The Arts Council. We must find opportunities to
reduce discretionary spending. I consider this a first step with
additional options to follow. (Requested by Commissioner
Sammie Sias)
Background:
Analysis:
Financial Impact:
Alternatives:
Recommendation:
Funds are Available
in the Following
Accounts:
REVIEWED AND APPROVED BY:
37367848v3
________________________________________________________
SERIES 2017 BOND RESOLUTION
_______________________________________________________
ADOPTED SEPTEMBER 5, 2017
BY THE AUGUSTA-RICHMOND COUNTY COMMISSION
RELATING TO
AUGUSTA, GEORGIA
WATER AND SEWERAGE REVENUE REFUNDING BONDS,
SERIES 2017
(i)
37367848v3
TABLE OF CONTENTS
This Table of Contents is for convenience of reference only and is not part of this Series
2017 Bond Resolution.
Page
ARTICLE I DEFINITIONS .........................................................................................................7
Section 1.1. Definitions ...................................................................................................7
ARTICLE II THE SERIES 2017 BONDS ...................................................................................9
Section 2.1. Authorization; Designation of Series 2017 Bonds ...................................9
Section 2.2. Parity Certification ....................................................................................9
Section 2.3. Series 2017 Bond Details .........................................................................10
Section 2.4. Form of Series 2017 Bonds ......................................................................10
Section 2.5. Global Form; Securities Depository; Ownership of Series 2017
Bonds .........................................................................................................19
ARTICLE III REDEMPTION OF SERIES 2017 BONDS .....................................................21
Section 3.1. Optional and Mandatory Redemption of Series 2017 Bonds...............21
ARTICLE IV SALE OF SERIES 2017 BONDS AND APPLICATION OF
PROCEEDS; REFUNDING PROGRAM.....................................................22
Section 4.1. Sale of Series 2017 Bonds ........................................................................22
Section 4.2. Application of Proceeds of Series 2017 Bonds; Transfer of
Funds Held Under Prior Lien Resolution ..............................................22
Section 4.3. Redemption of Refunded Bonds .............................................................22
Section 4.4. Direction to Paying Agent for the Refunded Bonds .............................22
Section 4.5. Creation of 2007 Defeasance Account ....................................................23
Section 4.6. 2017 Expense Account .............................................................................23
Section 4.7. Termination of Rights; Effect Thereof ..................................................23
ARTICLE V GENERAL PROVISIONS ...................................................................................25
Section 5.1. Continuing Disclosure for Series 2017 Bonds .......................................25
ARTICLE VI MISCELLANEOUS PROVISIONS ..................................................................26
Section 6.1. Continuance and Effect of Bond Resolution .........................................26
Section 6.2. Designation of Bond Registrar and Paying Agent for the Series
2017 Bonds ................................................................................................26
Section 6.3. Validation of Series 2017 Bonds .............................................................26
(ii)
37367848v3
Section 6.4. Preliminary Official Statement; Official Statement; and
Deemed Final Certificate .........................................................................26
Section 6.5. Authorization of Series 2017 Registrar and Paying Agent
Agreement .................................................................................................27
Section 6.6. Effective Date ...........................................................................................27
Section 6.7. Repeal of Conflicting Resolutions...........................................................27
Section 6.8. General Authorization .............................................................................27
Section 6.9. Waiver of Bond Audit ..............................................................................28
Section 6.10. Bond Resolution Constitutes a Contract................................................28
SIGNATURES AND SEAL ....................................................................................................... 30
EXHIBIT A - NOTICE OF CALL FOR REDEMPTION
-3-
37367848v3
SERIES 2017 BOND RESOLUTION
A SERIES 2017 BOND RESOLUTION TO RATIFY, REAFFIRM,
SUPPLEMENT, AND AMEND THAT CERTAIN MASTER BOND
RESOLUTION ADOPTED ON OCTOBER 16, 2012, AS
SUPPLEMENTED AND AMENDED BY THOSE CERTAIN
SUPPLEMENTAL RESOLUTIONS ADOPTED ON JUNE 18, 2013,
JULY 16, 2013, AUGUST 25, 2014, AND SEPTEMBER 16, 2014; TO
PROVIDE FOR THE ISSUANCE BY AUGUSTA, GEORGIA OF ITS
WATER AND SEWERAGE REVENUE REFUNDING BONDS,
SERIES 2017, FOR THE PURPOSE OF REFUNDING ITS
OUTSTANDING WATER AND SEWERAGE REVENUE
REFUNDING BONDS, SERIES 2007, MATURING OCTOBER 1,
2018 AND THEREAFTER; TO PROVIDE TERMS, PROVISIONS,
AND CONDITIONS FOR THE ISSUANCE OF ITS WATER AND
SEWERAGE REVENUE REFUNDING BONDS, SERIES 2017; AND
FOR OTHER RELATED PURPOSES.
WHEREAS, Augusta, Georgia (the “Consolidated Government”), acting by and through
its governing body, the Augusta-Richmond County Commission (the “Commission”), by a
Master Bond Resolution duly and validly adopted on October 16, 2012 (the “Master
Resolution”), as supplemented and amended by a Parity Bond Resolution duly and validly
adopted on June 18, 2013 and a Supplemental Bond Resolution duly and validly adopted on July
16, 2013 (collectively the “Series 2013 Resolution”), as further supplemented and amended by a
Series 2014 Bond Resolution duly and validly adopted on August 25, 2014 and a Supplemental
Series 2014 Bond Resolution duly and validly adopted on September 16, 2014 (collectively the
“Series 2014 Resolution”), authorized, issued, and delivered (1) $138,830,000 in original
aggregate principal amount of its Water and Sewerage Revenue Refunding and Improvement
Bonds (Second Resolution), Series 2012 (the “Series 2012 Bonds”), all of which are currently
outstanding; (2) $22,070,000 in original aggregate principal amount of its Water and Sewerage
Taxable Revenue Bonds (Second Resolution), Series 2013 (the “Series 2013 Bonds”), which are
currently outstanding in the aggregate principal amount of $19,440,000; and (3) $169,180,000 in
original aggregate principal amount of its Water and Sewerage Revenue Refunding and
Improvement Bonds (Second Resolution), Series 2014 (the “Series 2014 Bonds”), which are
currently outstanding in the aggregate principal amount of $167,515,000; and
WHEREAS, terms used in this Series 2017 Bond Resolution and not otherwise defined
herein shall have the meaning assigned to such terms in the Master Resolution, as supplemented
and amended by the Series 2013 Resolution and the Series 2014 Resolution (collectively the
“Prior Resolution”); and
WHEREAS, under the terms of the Prior Resolution, the Series 2012 Bonds, the Series
2013 Bonds, and the Series 2014 Bonds (collectively the “Prior Bonds”) are special limited
-4-
37367848v3
obligations of the Consolidated Government payable solely from and secured by a second
priority pledge of and lien on the Pledged Revenues; and
WHEREAS, the Prior Bonds were issued and the Prior Resolution, authorizing the Prior
Bonds, was adopted, subject to and in conformity with the provisions of a Bond Resolution duly
and validly adopted by the Commission on October 21, 1996, as supplemented and amended (as
more specifically defined in the Prior Resolution, the “Prior Lien Resolution”); and
WHEREAS, the Consolidated Government, by the Prior Lien Resolution, authorized,
issued, and delivered $177,010,000 in original aggregate principal amount of its Water and
Sewerage Revenue Refunding Bonds, Series 2007 (the “Series 2007 Bonds”), which are
currently outstanding in the aggregate principal amount of $133,380,000; and
WHEREAS, under the terms of the Prior Lien Resolution, the Series 2007 Bonds are
special limited obligations of the Consolidated Government payable solely from and secured by
a first priority pledge of and lien on the “pledged revenues” (as defined in the Prior Lien
Resolution) of the System; and
WHEREAS, the Series 2007 Bonds are the only water and sewerage revenue bonds or
obligations of the Consolidated Government presently outstanding and secured by amounts
pledged under the Prior Lien Resolution; and
WHEREAS, pursuant to the Prior Resolution, notwithstanding anything in the Prior Lien
Resolution to the contrary, the Consolidated Government has agreed that it will not issue any
additional bonds or obligations of any kind under the Prior Lien Resolution; and
WHEREAS, the Prior Resolution provides for the issuance under certain conditions of
Additional Bonds payable from and secured by Pledged Revenues and ranking on a parity as to
the pledge of and lien on the Pledged Revenues with the Prior Bonds; and
WHEREAS, after a thorough and detailed review and upon the recommendation of its
financial advisor, Davenport & Company LLC (the “Financial Advisor”), the Consolidated
Government has determined that due to present market conditions and in order to achieve debt
service savings, the Consolidated Government at this time should refund the Series 2007 Bonds
maturing October 1, 2018 and thereafter (the “Refunded Bonds”), which are currently
outstanding in the aggregate principal amount of $123,755,000 (the remaining $9,625,000 in
aggregate principal amount of outstanding Series 2007 Bonds to be paid at maturity on October
1, 2017); and
WHEREAS, the Financial Advisor has further recommended and the Consolidated
Government has concurred that such refunding of the Refunded Bonds should be accomplished
by making due and legal provision for the redemption of the Refunded Bonds on the date of
redemption provided herein by paying the principal amount and premium thereof and the interest
to accrue thereon until such date of redemption and the payment of all expenses necessary to
accomplish the foregoing, all as hereinafter provided; and
WHEREAS, the Consolidated Government has determined that it is in the best interests
of the citizens of the area served by the System for the Consolidated Government to refund all of
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the outstanding Refunded Bonds and to finance the costs of the foregoing by issuing its Water
and Sewerage Revenue Refunding Bonds, Series 2017 (the “Series 2017 Bonds”) in an aggregate
principal amount not to exceed $125,000,000; and
WHEREAS, the Series 2007 Bonds and the Prior Bonds are the only presently
outstanding revenue bonds or obligations of the Consolidated Government secured by a pledge
of and lien on the Pledged Revenues, and the Consolidated Government is now complying in all
respects with the terms, provisions, and covenants of the Prior Lien Resolution and the Prior
Resolution and is maintaining the respective special funds therein created in the full amount as
required; and
WHEREAS, the Series 2017 Bonds to be issued by the Consolidated Government shall
be Additional Bonds payable from and secured by Pledged Revenues and shall rank on a parity
as to the pledge of and lien on the Pledged Revenues with the Prior Bonds, as permitted under
Article VI of the Master Resolution; and
WHEREAS, Section 6.6 of the Master Resolution provides that (1) the Consolidated
Government will adopt a Series Resolution authorizing the issuance of any additional Bonds and
reciting that the requirements of Article VI of the Master Resolution have been satisfied, and will
set forth in such proceedings, among other things, the date or dates such additional Bonds will
bear and the rate or rates of interest, interest payment date or dates, maturity date or dates, and
redemption provisions with respect to such additional Bonds and any other matters applicable to
such additional Bonds as the Consolidated Government may deem advisable; (2) any such Series
Resolution will restate and reaffirm, by reference, all of the applicable terms, conditions, and
provisions of the Bond Resolution not modified by the Series Resolution; and (3) all additional
Bonds, any Series Resolution providing for such additional Bonds, and all proceedings relative
thereto and the security therefor shall be validated as then prescribed by law; and
WHEREAS, the Master Resolution requires a Series Resolution to establish the date or
dates of the pertinent series of Bonds, the schedule of maturities of such Bonds, whether any
such Bonds will be Compound Interest Bonds, the name of the purchaser(s) of such series of
Bonds, the purchase price thereof, the rate or rates of interest to be borne thereby, whether fixed
or variable, the interest payment dates for such Bonds, the terms and conditions, if any, under
which such Bonds may be made subject to redemption (mandatory or optional) prior to maturity,
the form of such Bonds, and such other details as the Consolidated Government may determine;
and
WHEREAS, upon the issuance of the Series 2017 Bonds and the refunding of the
Refunded Bonds (and after payment of the Series 2007 Bonds maturing on October 1, 2017), no
Prior Lien Bonds (as defined herein) will remain outstanding and accordingly the Prior Lien
Resolution shall be null and void and of no force and effect, the lien created thereunder on the
revenues of the System shall be fully and completely discharged, and provision should be made
to transfer, simultaneously with the issuance of the Series 2017 Bonds, all moneys then on hand,
after the withdrawal of the sums to be applied toward the refunding of the Refunded Bonds, in
the special funds heretofore created and now being maintained under the Prior Lien Resolution
into funds heretofore created and now being maintained under the Prior Resolution; and
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WHEREAS, upon the issuance of the Series 2017 Bonds and the refunding of the
Refunded Bonds, the Prior Bonds and the Series 2017 Bonds will be the only outstanding water
and sewerage revenue bonds having a lien on the Pledged Revenues; the Prior Bonds shall no
longer be junior lien obligations of the System; and the Prior Bonds, the Series 2017 Bonds, and
any Additional Bonds will be payable solely from, and secured by, a first priority pledge of and
lien on Pledged Revenues; and
NOW, THEREFORE, BE IT RESOLVED by the Augusta-Richmond County
Commission, as follows:
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions. The definitions contained in the Prior Resolution are hereby
amended, modified, and supplemented as follows, and the following terms shall have the
meanings specified below, unless the context clearly requires otherwise.
“Authorized Denominations” means, with respect to the Series 2017 Bonds, $5,000 and
any integral multiple thereof.
“Bond Registrar” means, with respect to the Series 2017 Bonds, U.S. Bank National
Association.
“Interest Payment Date” means, with respect to the Series 2017 Bonds, each April 1
and October 1, commencing April 1, 2018.
“Paying Agent” means, with respect to the Series 2017 Bonds, U.S. Bank National
Association.
“Prior Bonds” means, collectively, the Series 2012 Bonds, the Series 2013 Bonds, and
the Series 2014 Bonds.
“Prior Lien Bonds” means the Outstanding Series 2007 Bonds issued pursuant to the
Prior Lien Resolution.
“Prior Resolution” means the Master Resolution, as supplemented and amended by the
Series 2013 Resolution and the Series 2014 Resolution.
“Record Date” means, with respect to the Series 2017 Bonds, the 15th day (whether or
not a business day) of the calendar month next preceding an Interest Payment Date.
“Refunded Bonds” means, with respect to this Series 2017 Resolution, the Series 2007
Bonds maturing October 1, 2018 and thereafter.
“Series 2007 Bonds” means the Consolidated Government’s Water and Sewerage
Revenue Refunding Bonds, Series 2007, issued in the original aggregate principal amount of
$177,010,000 pursuant to the terms of the Prior Lien Resolution.
“Series 2017 Bonds” means the Consolidated Government’s Water and Sewerage
Revenue Refunding Bonds, Series 2017, in the original aggregate principal amount not to exceed
$125,000,000, authorized under Section 2.1.
“Series 2017 Disclosure Certificate” means the continuing disclosure certificate
executed in connection with the issuance of the Series 2017 Bonds.
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“Series 2017 Paying Agent and Bond Registrar Agreement” means the Paying Agent
and Bond Registrar Agreement, to be dated the date of its execution and delivery, between the
Consolidated Government and U.S. Bank National Association, relating to the Series 2017
Bonds, as amended, modified, or replaced.
“Series 2017 Resolution” means this Series 2017 Bond Resolution.
“Standard and Poor’s” or “S&P” means S&P Global Ratings, a division of Standard &
Poor’s Financial Services LLC, or, if such corporation is dissolved or liquidated or otherwise
ceases to perform securities rating services, such other nationally recognized securities rating
agency as may be designated in writing by the Consolidated Government. The notice address of
Standard & Poor’s shall be 55 Water Street, New York, New York 10041.
“2007 Defeasance Account” means the 2007 Defeasance Account established in Section
4.5.
“2007 Paying Agent” means U.S. Bank National Association, as paying agent for the
Series 2007 Bonds pursuant to the Prior Lien Resolution.
“2017 Expense Account” means the 2017 Expense Account established in Section 4.6.
[End of Article I]
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ARTICLE II
THE SERIES 2017 BONDS
Section 2.1. Authorization; Designation of Series 2017 Bonds. The Consolidated
Government hereby authorizes the execution, issuance, and delivery of a series of Bonds, in the
original aggregate principal amount not to exceed $125,000,000, to be designated “Augusta,
Georgia Water and Sewerage Revenue Refunding Bonds, Series 2017,” which shall be executed,
issued, and delivered under, and secured by, the Prior Resolution, as supplemented and amended
by this Series 2017 Resolution.
Section 2.2. Parity Certification. The Series 2017 Bonds shall be Additional Bonds
payable from and secured by Pledged Revenues and shall rank on a parity as to the pledge of and
lien on the Pledged Revenues with the Prior Bonds, pursuant to authorization granted by
Article VI of the Master Resolution. The Consolidated Government hereby finds, determines,
declares, and certifies that it has fulfilled, or will fulfill, prior to the issuance and delivery of the
Series 2017 Bonds, all of the applicable requirements of Article VI of the Master Resolution that
are conditions precedent to the issuance of the Series 2017 Bonds as Additional Bonds, namely:
(a) The Consolidated Government will execute a certificate, to be attached to a
Supplemental Resolution to be adopted by the Governing Body: (i) setting forth the
aggregate amount of interest and principal of all Prior Lien Bonds and Senior Bonds
falling due during the then current Fiscal Year and for each subsequent Fiscal Year to and
including the Fiscal Year of the last maturity of any Prior Lien Bonds and Senior Bonds
then Outstanding (A) with respect to all Prior Lien Bonds and Senior Bonds Outstanding
immediately prior to the date of authentication and delivery of the Series 2017 Bonds and
(B) with respect to all Prior Lien Bonds and Senior Bonds to be Outstanding immediately
thereafter; and (ii) demonstrating that the amount set forth for each Fiscal Year pursuant
to (i)(B) above is no greater than the amount set forth for such Fiscal Year pursuant to
(i)(A) above.
(b) None of the Series 2017 Bonds will bear interest at a Variable Rate.
(c) The Consolidated Government will receive an opinion of Bond Counsel,
dated as of the date of issuance of the Series 2017 Bonds, to the effect that this Series
2017 Resolution and any related Supplemental Resolution have been duly adopted by the
Consolidated Government.
The Consolidated Government hereby certifies and recites that the requirements of
Article VI of the Master Resolution for the issuance of the Series 2017 Bonds as Additional
Bonds have been, or will, prior to the issuance and delivery of the Series 2017 Bonds, be,
satisfied, and the Series 2017 Bonds shall be treated as Additional Bonds secured under and
pursuant to the Bond Resolution equally and ratably with the Prior Bonds.
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Section 2.3. Series 2017 Bond Details. The Series 2017 Bonds shall be dated the date
of issuance and delivery thereof. The Series 2017 Bonds shall be numbered in a convenient
manner, established by the Bond Registrar and shown by the Bond Register.
The Series 2017 Bonds shall bear interest at the rates per annum to be specified in a
Supplemental Resolution to be adopted by the Governing Body (but which shall not in any event
exceed a maximum per annum rate of interest of 5.00%), computed on the basis of a 360-day
year consisting of twelve 30-day months, payable on April 1, 2018, and semiannually thereafter
on each October 1 and April 1 of each year and shall mature on October 1, in the years (with a
final maturity not later than October 1, 2030) and in the principal amounts to be specified in a
Supplemental Resolution to be adopted by the Governing Body (provided the principal of and
interest on the Series 2017 Bonds payable in any Fiscal Year shall not in any event exceed a
maximum amount of $17,000,000), unless earlier called for redemption.
The Series 2017 Bonds that mature on October 1 of the years to be specified in a
Supplemental Resolution to be adopted by the Governing Body may be Term Bonds.
Section 2.4. Form of Series 2017 Bonds. The Series 2017 Bonds, the Validation
Certificate, and the Bond Registrar’s Certificate of Authentication shall be in substantially the
form set out below, with such variations, omissions, substitutions, and insertions as are required
or permitted by the Bond Resolution.
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[FORM OF SERIES 2017 BOND]
Unless this Bond is presented by an authorized representative of The Depository Trust
Company (“DTC”), a New York corporation, to the Consolidated Government or its
agent for registration of transfer, exchange, or payment, and any Bond issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or to such
other entity as is requested by an authorized representative of DTC), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an
interest herein.
UNITED STATES OF AMERICA
STATE OF GEORGIA
AUGUSTA, GEORGIA
WATER AND SEWERAGE REVENUE REFUNDING BOND,
SERIES 2017
Number R- ___ $_______________
Maturity
Date
Interest
Rate Dated CUSIP
October 1, 20__ ________, 2017
Registered Owner: Cede & Co.
Principal Amount:
KNOW ALL MEN BY THESE PRESENTS that AUGUSTA, GEORGIA (the
“Consolidated Government”), a political subdivision of the State of Georgia, existing as such
under and by virtue of the Constitution, statutes and laws of the State of Georgia, for value
received, hereby promises to pay (but only out of the sources provided) to the registered owner
identified above, or registered assigns, on the Maturity Date stated above, unless this Bond shall
have been called for redemption prior to maturity and payment of the redemption price shall
have been duly made or provided for, the principal amount identified above and to pay (but only
out of the sources provided) interest on the balance of such principal sum from time to time
remaining unpaid from and including the date hereof or from and including the most recent
Interest Payment Date (as hereinafter defined) with respect to which interest has been paid or
duly provided for, until payment of such principal sum has been made, at the interest rate per
annum shown above (computed on the basis of a 360-day year consisting of twelve 30-day
months) on April 1 and October 1 of each year (each an “Interest Payment Date”) commencing
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April 1, 2018, until the payment of the principal amount of this Bond in full, and promises to pay
interest on overdue principal and, to the extent permitted by law, on overdue premium, if any,
and interest, at such rate.
Principal of and redemption premium, if any, on this Bond are payable when due in
lawful money of the United States of America upon presentation and surrender of this Bond at
the designated corporate trust office of U.S. Bank National Association, Atlanta, Georgia, as
registrar and paying agent (the “Bond Registrar” or the “Paying Agent”). Payment of interest on
this Bond shall be made to the registered owner and shall be paid in lawful money of the United
States of America by check or draft mailed on the applicable Interest Payment Date to such
registered owner as of the close of business on the 15th day of the calendar month (the “Record
Date”) immediately preceding such Interest Payment Date at its address as it appears on the
registration books (the “Bond Register”) of the Consolidated Government maintained by the
Bond Registrar, or at such other address as is furnished in writing by such registered owner to the
Bond Registrar.
Notwithstanding the foregoing, however, interest on this Bond shall be payable to any
registered owner of more than $1,000,000 in aggregate principal amount of the Bonds of the
same series as this Bond (including this Bond) by deposit of immediately available funds to the
account of such registered owner maintained with the Paying Agent or transmitted by wire
transfer to such registered owner at an account maintained at a commercial bank located within
the United States of America, if the Paying Agent receives from such registered owner written
deposit or wire transfer instructions prior to the Record Date preceding the Interest Payment Date
for which the deposit or wire transfer is requested.
This Bond is one of a series of $__________ in original aggregate principal amount of
revenue bonds designated “Augusta, Georgia Water and Sewerage Revenue Refunding Bonds,
Series 2017” (the “Series 2017 Bonds”), issued by the Consolidated Government pursuant to and
in full compliance with the provisions of the Constitution and statutes of the State of Georgia,
including specifically, but without limitation, Article 3 of Chapter 82 of Title 36 of the Official
Code of Georgia Annotated, known as the “Revenue Bond Law,” as amended. The Series 2017
Bonds have been authorized by a Series 2017 Bond Resolution duly adopted by the Consolidated
Government on September 5, 2017, as supplemented and amended by a Supplemental Series
2017 Bond Resolution duly adopted by the Consolidated Government on __________, 2017
(collectively the “Series 2017 Resolution”), for the purpose of refunding $123,755,000 in
aggregate principal amount of the Consolidated Government’s Water and Sewerage Revenue
Refunding Bonds, Series 2007 maturing October 1, 2018 and thereafter (the “Refunded Bonds”),
and paying the expenses necessary to accomplishing the foregoing.
The Series 2017 Bonds are issued under, and the Series 2017 Resolution was adopted
subject to and in conformity with, the provisions of a Master Bond Resolution (the “Master
Resolution”) duly adopted by the Consolidated Government on October 16, 2012, as
supplemented and amended by a Parity Bond Resolution duly adopted on June 18, 2013 and a
Supplemental Bond Resolution duly adopted on July 16, 2013 (collectively the “Series 2013
Resolution”), as further supplemented and amended by a Series 2014 Bond Resolution duly
adopted on August 25, 2014 and a Supplemental Series 2014 Bond Resolution duly adopted on
September 16, 2014 (collectively the “Series 2014 Resolution”), authorizing the issuance of
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37367848v3
(i) $138,830,000 in original aggregate principal amount of the Consolidated Government’s
Water and Sewerage Revenue Refunding and Improvement Bonds (Second Resolution), Series
2012 (the “Series 2012 Bonds”), all of which are currently outstanding; (ii) $22,070,000 in
original aggregate principal amount of the Consolidated Government’s Water and Sewerage
Taxable Revenue Bonds (Second Resolution), Series 2013 (the “Series 2013 Bonds”), which are
currently outstanding in the aggregate principal amount of $19,440,000; and (iii) $169,180,000
in original aggregate principal amount of the Consolidated Government’s Water and Sewerage
Revenue Refunding and Improvement Bonds (Second Resolution), Series 2014 (the “Series 2014
Bonds”), which are currently outstanding in the aggregate principal amount of $167,515,000.
Under the terms of the Master Resolution, as supplemented and amended by the Series 2013
Resolution and the Series 2014 Resolution (collectively the “Prior Resolution”), the Series 2012
Bonds, the Series 2013 Bonds, and the Series 2014 Bonds (collectively the “Prior Bonds”) were
payable solely from and secured by a second priority pledge of and lien on the Pledged Revenues
(as defined in the Bond Resolution (as hereinafter defined)), subject to and in conformity with
the provisions of that certain resolution adopted by the Consolidated Government on October 21,
1996, as supplemented and amended (as more specifically defined in the Bond Resolution, the
“Prior Lien Resolution”).
The Master Resolution provides for the issuance under certain conditions of Additional
Bonds (as defined in the Master Resolution) payable from and secured by Pledged Revenues and
ranking on a parity as to the pledge of and lien on the Pledged Revenues with the Prior Bonds.
The Series 2017 Bonds have been issued under the provisions of the Master Resolution
authorizing the issuance of Additional Bonds and, as Additional Bonds, will be payable from and
secured by Pledged Revenues and will rank on a parity as to the pledge of and lien on the
Pledged Revenues with the Prior Bonds. The Series 2017 Bonds are all issued under and,
together with the Prior Bonds, are equally and ratably secured by and entitled to the benefit of
the Prior Resolution, as supplemented and amended by the Series 2017 Resolution (collectively
the “Bond Resolution”).
By the issuance of the Series 2017 Bonds and the refunding of the Refunded Bonds, the
Prior Bonds and the Series 2017 Bonds are the only outstanding water and sewerage revenue
bonds having a lien on the Pledged Revenues; the Prior Bonds are no longer junior lien
obligations of the System (as defined in the Bond Resolution); and the Prior Bonds and the
Series 2017 Bonds are, and any Additional Bonds will be, payable solely from, and secured by, a
first priority pledge of and lien on Pledged Revenues.
The Series 2017 Bonds maturing on or before October 1, 20__, may not be called for
optional redemption prior to maturity. The Series 2017 Bonds maturing on or after October 1,
20__, are subject to redemption prior to maturity at the option of the Consolidated Government
on or after October 1, 20__, in whole or in part at any time, at the redemption price equal to the
principal amount of the Series 20__ Bonds to be redeemed plus accrued interest on such
redemption date.
The Series 2017 Bonds maturing on October 1, 20__, are subject to mandatory sinking
fund redemption on October 1, 20__ and on each October 1 thereafter, in accordance with the
Bond Resolution, at a redemption price equal to the principal amount of each Series 2017 Bond
(or portion thereof) to be redeemed plus accrued interest to the date fixed for redemption, in the
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following principal amounts and on the dates set forth below (the October 1, 20__ amount to be
paid rather than redeemed):
October 1
of the Year Principal Amount
Notice of redemption, unless waived, is to be given by first class mail at least 30 days and
not more than 60 days prior to the date fixed for redemption to the registered owner of each
Series 2017 Bond to be redeemed at the address shown on the Bond Register or at such other
address as is furnished in writing by such registered owner to the Bond Registrar. All such
Series 2017 Bonds called for redemption and for the retirement of which funds are duly provided
shall, on the redemption date designated in such notice, become and be due and payable at the
redemption price provided for redemption of such Series 2017 Bonds on such date, and interest
on the Series 2017 Bonds or portions of Series 2017 Bonds so called for redemption shall cease
to accrue, such Series 2017 Bonds or portions of Series 2017 Bonds shall cease to be entitled to
any lien, benefit, or security under the Bond Resolution, and the owners of such Series 2017
Bonds or portions of Series 2017 Bonds shall have no rights in respect thereof except to receive
payment of the redemption price. Any defect in any notice of redemption shall not affect the
validity of proceedings for the redemption of any Series 2017 Bonds.
The Consolidated Government has established a book-entry system of registration for the
Series 2017 Bonds. Except as specifically provided otherwise in the Bond Resolution, an agent
will hold this Bond on behalf of the beneficial owner hereof. By acceptance of a confirmation of
purchase, delivery, or transfer, the beneficial owner of this Bond shall be deemed to have agreed
to such arrangement. While the Series 2017 Bonds are in the book-entry system of registration,
the Bond Resolution provides special provisions relating to the Series 2017 Bonds, which
override certain other provisions of the Bond Resolution. This Bond is transferable by the
registered owner at the designated corporate trust office of the Bond Registrar but only in the
manner, subject to the limitations, and upon payment of the charges provided in the Bond
Resolution and upon surrender of this Bond. Upon such transfer, a new registered Bond or
Bonds of the same series, maturity, interest rate, aggregate principal amount, and tenor, of any
authorized denomination or denominations, and bearing numbers not then outstanding, will be
issued to the transferee in exchange for this Bond. The Series 2017 Bonds are issuable as fully
registered Bonds in the denomination of $5,000 or any integral multiple thereof. The Bond
Registrar is not required to transfer or exchange any Series 2017 Bond after notice calling such
Series 2017 Bond for redemption has been given or during the period of 15 days (whether or not
a business day for the Bond Registrar, but excluding the redemption date and including such 15th
day) immediately preceding the giving of such notice of redemption.
The Prior Bonds, Series 2017 Bonds, and such revenue bonds of the Consolidated
Government as may in the future be issued on a parity therewith, are equally and ratably secured
by pledge of the “Pledged Revenues” of the System, which are defined in the Bond Resolution to
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37367848v3
include gross operating revenues of the System after provision for payment of all reasonable
expenses of operation and maintenance, moneys and securities from time to time on deposit in
the funds and accounts established in the Bond Resolution, earnings on investments made with
the foregoing moneys and securities, and Hedge Receipts (as defined in the Bond Resolution)
and to exclude any amounts required in the Bond Resolution to be set aside pending, or used for,
rebate to the United States government pursuant to Section 148(f) of the Internal Revenue Code
of 1986, as amended, including, but not limited to, amounts in the Rebate Fund (as defined in the
Bond Resolution).
THIS BOND SHALL NEVER CONSTITUTE AN INDEBTEDNESS OR GENERAL
OBLIGATION OF THE STATE OF GEORGIA, THE CONSOLIDATED GOVERNMENT,
OR ANY OTHER POLITICAL SUBDIVISION OF THE STATE OF GEORGIA, WITHIN
THE MEANING OF ANY CONSTITUTIONAL PROVISION OR STATUTORY
LIMITATION WHATSOEVER, NOR A PLEDGE OF THE FAITH AND CREDIT OR
TAXING POWER OF ANY OF THE FOREGOING, NOR SHALL ANY OF THE
FOREGOING BE SUBJECT TO ANY PECUNIARY LIABILITY HEREON. THIS BOND
SHALL NOT BE PAYABLE FROM NOR A CHARGE UPON ANY FUNDS OTHER THAN
THE REVENUES PLEDGED TO THE PAYMENT HEREOF AND SHALL BE A LIMITED
OR SPECIAL OBLIGATION OF THE CONSOLIDATED GOVERNMENT PAYABLE
SOLELY FROM THE FUNDS PROVIDED THEREFOR IN THE BOND RESOLUTION. NO
OWNER OF THIS BOND SHALL EVER HAVE THE RIGHT TO COMPEL THE EXERCISE
OF THE TAXING POWER OF THE STATE OF GEORGIA, THE CONSOLIDATED
GOVERNMENT, OR ANY OTHER POLITICAL SUBDIVISION OF THE STATE OF
GEORGIA TO PAY THE PRINCIPAL OF THIS BOND OR THE INTEREST OR ANY
PREMIUM HEREON, OR TO ENFORCE PAYMENT HEREOF AGAINST ANY PROPERTY
OF THE FOREGOING, NOR SHALL THIS BOND CONSTITUTE A CHARGE, LIEN, OR
ENCUMBRANCE, LEGAL OR EQUITABLE, UPON ANY PROPERTY OF THE
FOREGOING. NEITHER THE MEMBERS OF THE GOVERNING BODY OF THE
CONSOLIDATED GOVERNMENT NOR ANY PERSON EXECUTING THIS BOND SHALL
BE LIABLE PERSONALLY ON THIS BOND BY REASON OF THE ISSUANCE HEREOF.
The Consolidated Government has covenanted and hereby covenants and agrees while
any Series 2017 Bonds are outstanding and unpaid to prescribe, fix, maintain, and collect rates,
fees, and other charges for the services, facilities, and commodities furnished by the System fully
sufficient at all times to: (i) provide for 100% of the expenses of operation and maintenance of
the System and for the accumulation in the Revenue Fund (as defined in the Bond Resolution) of
a reasonable reserve therefor, and (ii) produce net operating revenues in each Fiscal Year (as
defined in the Bond Resolution) that, together with certain investment earnings, will: (a) equal at
least 110% of the debt service requirement on all Senior Bonds (as defined in the Bond
Resolution) then outstanding and 100% of the debt service requirement on all Subordinate Bonds
(as defined in the Bond Resolution) then outstanding, (b) enable the Consolidated Government to
make all required payments into the Debt Service Reserve Account and the Rebate Fund and to
any Financial Facility Issuer, any Reserve Account Credit Facility Provider, and any Qualified
Hedge Provider (as each is defined in the Bond Resolution), (c) enable the Consolidated
Government to accumulate an amount to be held in the Utility General Fund (as defined in the
Bond Resolution), which in the judgment of the Consolidated Government is adequate to meet
the costs of major renewals, replacements, repairs, additions, betterments, and improvements to
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the System, necessary to keep the same in good operating condition or as is required by any
governmental agency having jurisdiction over the System, and (d) remedy all deficiencies in
required payments into any of the funds and accounts mentioned in the Bond Resolution from
prior Fiscal Years.
The Bond Resolution contains a more particular statement of the covenants and
provisions securing the Series 2017 Bonds, the conditions under which the owner of this Bond
may enforce covenants (other than the covenant to pay principal of and interest on this Bond
when due from the sources provided, the right to enforce which is unconditional), the conditions
upon which additional revenue bonds may be issued on a parity or achieve parity status with this
Bond under the Bond Resolution, and the conditions upon which the Bond Resolution may be
amended with the consent of the owners of a majority in aggregate principal amount of the
Bonds (as defined in the Bond Resolution) of each class (senior and subordinate) outstanding or
the issuer of any Credit Facility (as defined in the Bond Resolution), if any, of such Bonds.
Upon the occurrence of an Event of Default under the Bond Resolution, the owner of this Bond
shall be entitled to the remedies provided by the Bond Resolution and the Revenue Bond Law.
It is hereby certified, recited, and declared that all acts, conditions, and things required to
exist, happen, and be performed precedent to and in the issuance of this Bond do exist, have
happened, and have been performed in due time, form, and manner as required by law.
This Bond shall not be entitled to any security or benefit under the Bond Resolution or
become valid or obligatory for any purpose until the certificate of authentication hereon shall
have been duly executed by the Bond Registrar.
IN WITNESS WHEREOF, the Consolidated Government has caused this Bond to be
executed by the manual signature of its Mayor and has caused the official seal of the
Consolidated Government to be impressed on this Bond and attested by the manual signature of
its Clerk of Commission.
(SEAL)
AUGUSTA, GEORGIA
By:
Mayor
Attest:
Clerk of Commission
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[FORM OF CERTIFICATE OF AUTHENTICATION]
BOND REGISTRAR’S CERTIFICATE OF AUTHENTICATION
This Bond is one of the bonds of the series described in the within mentioned Bond
Resolution.
U.S. BANK NATIONAL ASSOCIATION,
as Bond Registrar
By:
Authorized Signatory
Date of Registration
and Authentication:
_____________________, ______
[FORM OF VALIDATION CERTIFICATE]
VALIDATION CERTIFICATE
STATE OF GEORGIA )
)
COUNTY OF RICHMOND )
The undersigned Clerk of the Superior Court of Richmond County, State of Georgia,
DOES HEREBY CERTIFY that this Bond and the security therefor was validated and
confirmed by judgment of the Superior Court of Richmond County, on the ____ day of
__________ 2017, that no intervention or objection was filed opposing the validation of this
Bond and the security therefor, and that no appeal of such judgment of validation has been taken.
IN WITNESS WHEREOF, I have hereunto set my hand and have impressed hereon the
official seal of the Superior Court of Richmond County, Georgia.
(SEAL)
Clerk, Superior Court of
Richmond County, Georgia
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37367848v3
The following abbreviations, when used in the inscription on this Bond or in the
assignment below, shall be construed as though they were written out in full according to
applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common and not as community property
UNIF TRANS
MIN ACT -
______________________ Custodian ______________________
(Custodian) (Minor)
under Uniform Transfers to Minors Act _____________________
(State)
Additional abbreviations may be used although not in the above list.
[FORM OF ASSIGNMENT]
ASSIGNMENT AND TRANSFER
FOR VALUE RECEIVED, the undersigned sells, assigns, and transfers unto
(Name and Address of Assignee)
(Insert Social Security or Taxpayer
Identification Number of Assignee)
the within revenue bond of Augusta, Georgia and does hereby irrevocably constitute and appoint
______________________________ attorney to transfer the Bond on the books kept for
registration thereof with full power of substitution in the premises.
Dated:
(Signature Guaranteed)
Notice: Signature(s) must be guaranteed by an
eligible guarantor institution (such as banks,
stockbrokers, savings and loan associations,
and credit unions) with membership in an
approved Signature Guarantee Medallion
Program pursuant to S.E.C. Rule 17Ad-15.
Registered Owner
Notice: The signature(s) on this assignment
must correspond with the name as it appears on
the face of the within bond in every particular
without alteration or enlargement or any
change whatsoever.
[END OF BOND FORM]
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Section 2.5. Global Form; Securities Depository; Ownership of Series 2017 Bonds.
(a) Upon the initial issuance, the ownership of each Series 2017 Bond shall be registered
in the name of the Securities Depository or the Securities Depository Nominee, and ownership
thereof shall be maintained in Book-Entry Form by the Securities Depository for the account of
the Participants thereof. Initially, each maturity of the Series 2017 Bonds shall be registered in
the name of Cede & Co., as the nominee of DTC. Beneficial Owners will not receive Series
2017 Bonds from the Paying Agent evidencing their ownership interests. Except as provided in
subsection (c) of this Section 2.5, the Series 2017 Bonds may be transferred, in whole but not in
part, only to the Securities Depository or the Securities Depository Nominee, or to a successor
Securities Depository selected or approved by the Consolidated Government or to a nominee of
such successor Securities Depository.
(b) With respect to Series 2017 Bonds registered in the name of the Securities
Depository or the Securities Depository Nominee, the Consolidated Government, the Paying
Agent and the Bond Registrar shall have no responsibility or obligation to any Participant or
Beneficial Owner. Without limiting the foregoing, the Consolidated Government, the Paying
Agent, the Bond Registrar and their respective affiliates shall not have any responsibility or
obligation with respect to:
(i) the accuracy of the records of the Securities Depository, the Securities
Depository Nominee or any Participant with respect to any beneficial ownership interest
in the Series 2017 Bonds;
(ii) the delivery to any Participant, any Beneficial Owner or any other person,
other than the Securities Depository or the Securities Depository Nominee, of any notice
with respect to the Series 2017 Bonds; or
(iii) the payment to any Participant, any Beneficial Owner or any other person,
other than the Securities Depository or the Securities Depository Nominee, of any
amount with respect to the principal, premium, if any, or interest on the Series 2017
Bonds.
So long as any Series 2017 Bonds are registered in Book-Entry Form, the Consolidated
Government and the Paying Agent may treat the Securities Depository as, and deem the
Securities Depository to be, the absolute owner of such Series 2017 Bonds for all purposes
whatsoever, including without limitation:
(i) the payment of principal, premium, if any, and interest on such Series 2017
Bonds;
(ii) giving notices of redemption and other matters with respect to such Series
2017 Bonds;
(iii) registering transfers with respect to such Series 2017 Bonds;
(iv) the selection of Series 2017 Bonds for redemption; and
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37367848v3
(v) voting and obtaining consents under the Bond Resolution.
So long as any Series 2017 Bonds are registered in Book-Entry Form, the Paying Agent
shall pay all principal, premium, if any, and interest on the Series 2017 Bonds only to the
Securities Depository or the Securities Depository Nominee as shown in the Bond Register, and
all such payments shall be valid and effective to fully discharge the Consolidated Government’s
obligations with respect to payment of principal of, premium, if any, and interest on the Series
2017 Bonds to the extent so paid.
(c) If at any time (i) the Consolidated Government determines that the Securities
Depository is incapable of discharging its responsibilities described herein, (ii) the Securities
Depository notifies the Consolidated Government that it is unwilling or unable to continue as
Securities Depository with respect to the Series 2017 Bonds, or (iii) the Securities Depository
shall no longer be registered or in good standing under the Securities Exchange Act of 1934 or
other applicable statute or regulation and a successor Securities Depository is not appointed by
the Consolidated Government within 90 days after the Consolidated Government receives notice
or becomes aware of such condition, as the case may be, then this Section 2.5 shall no longer be
applicable and the Consolidated Government shall execute and the Bond Registrar shall
authenticate and deliver bonds representing the Series 2017 Bonds to the owners of the Series
2017 Bonds. Series 2017 Bonds issued pursuant to this paragraph (c) shall be registered in such
names and Authorized Denominations as the Securities Depository, pursuant to instructions from
the Participant or otherwise, shall instruct the Bond Registrar. Upon exchange, the Bond
Registrar shall deliver such certificates representing the Series 2017 Bonds to the persons in
whose names such Series 2017 Bonds are so registered on the business day immediately
preceding the date of such exchange.
[End of Article II]
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ARTICLE III
REDEMPTION OF SERIES 2017 BONDS
Section 3.1. Optional and Mandatory Redemption of Series 2017 Bonds. The
Series 2017 Bonds will be subject to optional and mandatory redemption prior to maturity as
specified in a Supplemental Resolution to be adopted by the Governing Body.
[End of Article III]
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ARTICLE IV
SALE OF SERIES 2017 BONDS AND
APPLICATION OF PROCEEDS; REFUNDING PROGRAM
Section 4.1. Sale of Series 2017 Bonds. The Series 2017 Bonds shall be sold as a unit,
and a certified copy of this Series 2017 Resolution shall be filed with the Bond Registrar.
Section 4.2. Application of Proceeds of Series 2017 Bonds; Transfer of Funds Held
Under Prior Lien Resolution. Upon the written request of the Consolidated Government, the
Bond Registrar shall authenticate and deliver the Series 2017 Bonds to the purchaser or
purchasers and shall receive a receipt for the Series 2017 Bonds. The estimated application of
the proceeds of the sale of the Series 2017 Bonds shall be set forth in a Supplemental Resolution
to be adopted by the Governing Body. Such application shall provide, among other things, that
the Consolidated Government shall deposit (a) a sufficient sum, together with sinking fund
accruals, if any, allocable to the Refunded Bonds held in the debt service account of Sinking
Fund No. 1 and other lawfully available funds, into the 2007 Defeasance Account, to pay, upon
redemption prior to maturity, all outstanding Refunded Bonds as provided in Section 4.5, and
(b) a sufficient sum, together with other lawfully available funds, into the 2017 Expense Account
to pay all costs and expenses in connection with the Series 2017 Bonds and the refunding of the
Refunded Bonds as provided in Section 4.6.
In addition, simultaneously with the issuance and delivery of the Series 2017 Bonds, all
moneys remaining on deposit in the debt service reserve account of Sinking Fund No. 1 and in
the Hedge Payments Fund and any other fund or account held under the Prior Lien Resolution
(excluding the Revenue Fund and the Utility General Fund) shall be withdrawn therefrom and
deposited into the Debt Service Reserve Account held within the Sinking Fund to fund the Debt
Service Reserve Requirement under the Bond Resolution relating to the Series 2017 Bonds in
such amount as specified in a Supplemental Resolution to be adopted by the Governing Body,
and the balance of any such amount withdrawn from such funds and accounts shall be deposited
into the Utility General Fund.
Section 4.3. Redemption of Refunded Bonds. The Refunded Bonds be and the same
are hereby called for redemption on October 19, 2017 or such other date as may be specified by
the Administrator of the Consolidated Government in a written notice to the 2007 Paying Agent
the “Redemption Date”), but only if funds for their redemption are on deposit at the place of
redemption on the Redemption Date, at a redemption price of 101.0% of the principal amount
outstanding thereof plus accrued interest to the date of redemption. The owners of the Refunded
Bonds should present the same for payment on the Redemption Date; provided, however, the
Refunded Bonds shall be deemed not to have been called for redemption on the Redemption
Date if funds for the redemption of all of the Refunded Bonds called for redemption are not on
deposit at the place of payment on Redemption Date.
Section 4.4. Direction to Paying Agent for the Refunded Bonds. The Consolidated
Government hereby authorizes and directs the 2007 Paying Agent to forthwith take all steps that
may be necessary under the applicable redemption provisions of the Prior Lien Resolutio, including,
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without limitation, to mail the notice of redemption of the Refunded Bonds not less than 30 days
nor more than 60 days prior to the Redemption Date to the registered owners of the Refunded
Bonds to be redeemed at the addresses that appear on the bond registration book kept by the
bond registrar for the Refunded Bonds, which notice shall be in substantially the form attached
hereto as Exhibit A.
Section 4.5. Creation of 2007 Defeasance Account. Simultaneously with the
issuance and delivery of the Series 2017 Bonds herein authorized to be issued, a sufficient sum
derived from the sale of the Series 2017 Bonds, together with sinking fund accruals allocable to
the Refunded Bonds and other lawfully available funds, shall be deposited in trust with the 2007
Paying Agent in a special segregated account hereby created and designated the “2007
Defeasance Account,” to pay the principal and premium of and interest on the Refunded Bonds
on the Redemption Date. The moneys so deposited with the 2007 Paying Agent and all income
derived from such moneys shall be subject to a lien and charge in favor of the owners of, and are
hereby pledged to the payment of, the Refunded Bonds, shall not be commingled with other
moneys on deposit with the 2007 Paying Agent, and shall be held in trust for the security of the
owners of the Refunded Bonds until used and applied as hereinafter provided.
The amount of moneys to be so deposited in trust in the 2007 Defeasance Account shall
be set forth in a Supplemental Resolution to be adopted by the Governing Body and shall be
calculated as being sufficient and shall be used to redeem all of the Refunded Bonds by making
payment on the Redemption Date.
Any moneys remaining in the 2007 Defeasance Account following the redemption of the
Refunded Bonds on the Redemption Date shall be deposited to the Debt Service Account and
applied to pay interest on the Series 2017 Bonds.
Section 4.6. 2017 Expense Account. There is hereby created a separate account
designated as the “2017 Expense Account,” to be held by U.S. Bank National Association,
Atlanta, Georgia. All payments from the 2017 Expense Account shall be applied at the written
direction of the Consolidated Government to the payment of costs and expenses incurred by the
Consolidated Government in connection with the issuance and delivery of the Series 2017 Bonds
and the refunding of the Refunded Bonds. Moneys remaining in the 2017 Expense Account after
the earlier of (i) the payment of all costs and expenses in connection with the Series 2017 Bonds
and the refunding of the Refunded Bonds or (ii) six month after the date of issuance and delivery
of the Series 2017 Bonds shall be transferred upon direction of the Consolidated Government to
the Debt Service Account and applied to pay interest on the Series 2017 Bonds.
Section 4.7. Termination of Rights; Effect Thereof. The Consolidated Government
acknowledges and intends that, by virtue of the deposits into the 2007 Defeasance Account, the
Refunded Bonds shall be deemed to have been paid and that, consequently, the rights granted to
the owners of the Refunded Bonds under the Prior Lien Resolution (except for purposes of
payment, registration, exchange, and transfer), shall cease, determine, and become void and no
Prior Lien Bonds shall remain outstanding pursuant to the Prior Lien Resolution. Further, as a
result thereof, (i) the Prior Lien Resolution shall be null and void and of no further force and
effect; (ii) no further payments shall be required from the Revenue Fund pursuant to paragraphs
(b) or (c) of Section 5.3 of the Master Resolution; (iii) Sinking Fund No. 1 and the Hedge
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Payments Fund shall be closed (after the transfers from such funds specified in Section 4.2 have
been made); (iv) all payments that are required to be made from the Revenue Fund on and after
the date that no Prior Lien Bonds remain outstanding pursuant to the Prior Lien Resolution
(including, without limitation, pursuant to paragraphs (e), (g), (h), (k), (l) of Section 5.3 of the
Master Resolution) shall commence, and all other provisions and requirements of the Master
Resolution that are to take effect on and after the date that no Prior Lien Bonds remain
outstanding pursuant to the Prior Lien Resolution shall take effect, including, without limitation,
the requirement pursuant to paragraphs (m) of Section 5.3 of the Master Resolution that the
Consolidated Government maintain a working capital reserve in the Revenue Fund; and (v) for
the avoidance of doubt all references to, and the requirements of, the Prior Lien Resolution in the
Bond Resolution shall be deemed deleted and of no further force and effect.
[End of Article IV]
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ARTICLE V
GENERAL PROVISIONS
Section 5.1. Continuing Disclosure for Series 2017 Bonds. The Consolidated
Government hereby covenants and agrees that it shall comply with and carry out all of the
provisions of the Continuing Disclosure Certificate executed by the Consolidated Government
and to be dated as of the date of the issuance and delivery of the Series 2017 Bonds, as originally
executed and as it may be amended from time to time in accordance with its terms (the “Series
2017 Disclosure Certificate”). Notwithstanding any other provision of the Bond Resolution,
failure of the Consolidated Government to comply with the Series 2017 Disclosure Certificate
shall not be considered a default or an Event of Default under the Bond Resolution. It is
expressly provided, however, that any beneficial owner of the Series 2017 Bonds may take such
action, to the extent and in such manner as may be allowed by applicable law, as may be
necessary and appropriate, including seeking mandamus or specific performance by court order,
to cause the Consolidated Government to comply with its obligations under this Section 5.1.
[End of Article V]
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ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.1. Continuance and Effect of Bond Resolution. The Consolidated
Government hereby confirms the existence and applicability of the Bond Resolution and ratifies,
restates, and reaffirms its representations, warranties, covenants, and agreements and all of the
applicable terms, conditions, and provisions as set forth in the Bond Resolution and as
supplemented and amended by this Series 2017 Resolution. Except where otherwise expressly
indicated in this Series 2017 Resolution, the provisions of the Bond Resolution are to be read as
part of this Series 2017 Resolution as though copied verbatim herein, and provisions of this
Series 2017 Resolution shall be read as additions to, and not as substitutes for or modifications of
(except as otherwise specifically provided herein), the provisions of the Bond Resolution.
Except as expressly amended, modified, or supplemented by this Series 2017 Resolution, all of
the terms, conditions, and provisions of the Bond Resolution shall remain in full force and effect.
In executing and delivering this Series 2017 Resolution, the Consolidated Government shall be
entitled to all powers, privileges, and immunities afforded to the Consolidated Government and
shall be subject to all the duties, responsibilities, and obligations of the Consolidated
Government under the Bond Resolution. Except as expressly amended, modified, or
supplemented by this Series 2017 Resolution, all of the terms, conditions, and provisions of the
Bond Resolution are hereby declared applicable to and broadened and extended so as to cover
the Series 2017 Bonds and shall for all purposes apply to the Series 2017 Bonds as if the Series
2017 Bonds had been originally issued under the Consolidated Government of the Bond
Resolution simultaneously with the Prior Bonds.
Section 6.2. Designation of Bond Registrar and Paying Agent for the Series 2017
Bonds. The Consolidated Government hereby designates U.S. Bank National Association,
Atlanta, Georgia, as Bond Registrar and Paying Agent for the Series 2017 Bonds.
Section 6.3. Validation of Series 2017 Bonds. The Consolidated Government shall
deliver a certified copy of this Series 2017 Resolution with an appropriate notice to the District
Attorney for the Augusta Judicial Circuit accompanied by the request that the District Attorney
proceed with the validation of the Series 2017 Bonds.
Section 6.4. Preliminary Official Statement; Official Statement; and Deemed Final
Certificate. The Series 2017 Bonds are hereby authorized to be sold pursuant to competitive
sale and there is hereby authorized a Notice of Sale and a Preliminary Official Statement to be
prepared and distributed to all securities dealers deemed to have an interest in purchasing all, but
not a part, of the Series 2017 Bonds. Once the bids are received for the sale of the Series 2017
Bonds pursuant to the Notice of Sale, the Administrator of the Consolidated Government is
authorized to identify the bid with the lowest total interest cost and the Governing Body will
adopt a Supplemental Resolution accepting the winning bid for the Series 2017 Bonds and
setting forth, among other things, the final interest rates on, maturities, redemption provisions,
principal amount of the Series 2017 Bonds, which interest rates and principal amounts shall be
within the parameters set forth in this Series 2017 Bond Resolution.
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The Consolidated Government hereby authorizes the Mayor to deem the Preliminary
Official Statement final, except for “Permitted Omissions,” as of its date for purposes of Rule
15c2-12 promulgated under the Securities Exchange of 1934, as amended (the “Rule”). As used
herein, “Permitted Omissions” shall mean the offering price(s), interest rate(s), selling
compensation, aggregate principal amount, principal amount per maturity, delivery dates,
ratings, the identity of the underwriter or bond insurer and other terms of the Series 2017 Bonds
and any underlying obligations depending on such matters, all with respect to the Series 2017
Bonds and any underlying obligations. The execution and delivery of the “deemed final
certificate” required by the Rule are hereby authorized and approved. The execution of the
“deemed final certificate” by the Mayor as hereby authorized shall be conclusive evidence of the
approval of any changes to the Preliminary Official Statement. In addition, the Supplemental
Resolution will provide for the preparation and distribution of a final Official Statement.
Section 6.5. Authorization of Series 2017 Registrar and Paying Agent Agreement.
The form, terms, and conditions and the execution, delivery, and performance of the Series 2017
Registrar and Paying Agent Agreement, which has been filed with the Consolidated
Government, are hereby approved and authorized. The Series 2017 Registrar and Paying Agent
Agreement shall be in substantially the form submitted to the Governing Body with such
changes, corrections, deletions, insertions, variations, additions, or omissions as may be
approved by the Mayor, whose approval thereof shall be conclusively evidenced by the
execution of such contract. The Mayor is hereby authorized and directed to execute on behalf of
the Consolidated Government the Series 2017 Registrar and Paying Agent Agreement, and the
Clerk of Commission is hereby authorized and directed to affix thereto and attest the seal of the
Consolidated Government, upon proper execution and delivery of the other party thereto,
provided, that in no event shall any such attestation or affixation of the seal of the Consolidated
Government be required as a prerequisite to the effectiveness thereof, and the Mayor and Clerk
of Commission are authorized and directed to deliver such contract on behalf of the Consolidated
Government.
Section 6.6. Effective Date. This Series 2017 Resolution shall take effect immediately
upon its adoption.
Section 6.7. Repeal of Conflicting Resolutions. Any and all resolutions, or parts of
resolutions, if any, in conflict with this Series 2017 Resolution are hereby repealed.
Section 6.8. General Authorization. From and after the date of adoption of this
Series 2017 Resolution, the officials, employees, and agents of the Consolidated Government are
hereby authorized to do all such acts and things and to execute and deliver any and all other
documents, agreements, certificates (including, without limitation, the Series 2017 Disclosure
Certificate), and instruments as may be necessary or desirable in connection with the execution,
delivery, and sale of the Series 2017 Bonds, the investment of the proceeds of the Series 2017
Bonds, and the transactions contemplated on the part of the Consolidated Government by the
Series 2017 Resolution. The Mayor and Clerk of Commission are hereby authorized and
directed to prepare and furnish to the purchasers of the Series 2017 Bonds, when the Series 2017
Bonds are issued, certified copies of all proceedings and records of the Consolidated
Government relating to the Series 2017 Bonds or to this Series 2017 Resolution, and such other
affidavits and certificates as may be required to show the facts relating to the legality and
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marketability of the Series 2017 Bonds as such facts appear from the books and records in the
officers’ custody and control or as otherwise known to them. All such certified copies,
certificates, and affidavits, including any heretofore furnished, shall constitute representations of
the Consolidated Government as to the truth of all statements contained therein.
The Mayor Pro Tem may take any action, or execute and deliver any document,
agreement, or other writing, which the Mayor is authorized to execute and deliver pursuant to
this Series 2017 Resolution. An Assistant or Deputy Clerk of Commission may attest any
execution of any document, agreement, or writing by the Mayor or the Mayor Pro Tem, in the
same manner as the Clerk of Commission would be authorized to attest any such execution.
Section 6.9. Waiver of Bond Audit. The Consolidated Government hereby approves
the publication of the requisite legal notice waiving the performance audit and performance
review requirements of Section 36-82-100 of the Official Code of Georgia Annotated.
Section 6.10. Bond Resolution Constitutes a Contract. This Series 2017 Resolution
supplements and amends a contract with the Bondholders binding the Consolidated Government,
and therefore it is proper and appropriate for the Mayor to execute the same on behalf of the
Consolidated Government and for the Clerk of Commission to attest the same.
[Signatures on following page]
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PASSED, ADOPTED, SIGNED, APPROVED, and EFFECTIVE this 5th day of
September 2017.
AUGUSTA, GEORGIA
(SEAL) By: Mayor
Attest:
Clerk of Commission
37367848v3
EXHIBIT A
NOTICE OF CALL FOR REDEMPTION
AUGUSTA, GEORGIA
WATER AND SEWERAGE REVENUE REFUNDING BONDS,
SERIES 2007
NOTICE IS HEREBY GIVEN that, pursuant to the provisions of that certain 2007
Parity Bond Resolution adopted by the Augusta-Richmond County Commission on September
26, 2007, authorizing the issuance by Augusta, Georgia of $177,010,000 in aggregate principal
amount of its revenue bonds known as “Augusta, Georgia Water and Sewerage Revenue Refunding
Bonds, Series 2007” (the “Bonds”), dated October 18, 2007, bearing interest at the rate per annum
set forth below opposite the principal maturity, all interest payable on April 1 and October 1 in each
year, and the principal maturing on October 1 in the years and the amounts set forth below:
Year Amount Rate CUSIP
2018 $ 5,925,000 5.00%
2019 10,595,000 5.00
2020 11,125,000 5.00
2021 11,680,000 5.00
2022 12,260,000 5.00
2023 7,500,000 5.00
2024 7,875,000 5.00
2025 8,270,000 5.00
2026 8,685,000 5.00
2027 9,115,000 5.00
2028 9,575,000 5.00
2030 21,150,000 5.00
have been called for redemption on __________, 2017 (the “Redemption Date”), but only if
funds for their redemption are on deposit at the place of redemption on the Redemption Date, at a
redemption price of 101.0% of the principal amount outstanding thereof plus accrued interest to
the date of redemption.
Funds for the redemption and payment of the Bonds and the interest then due thereon to the
Redemption Date will be available at U.S. Bank National Association, on the Redemption Date,
but only if funds for the redemption of all Bonds are on deposit at the place of redemption on the
Redemption Date, and all Bonds should be presented to said bank for redemption and payment on
said date.
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All Bonds shall cease to bear interest on and after the Redemption Date, provided funds
for the redemption of all Bonds called for redemption are on deposit at the place of payment on
the Redemption Date. All Bonds delivered for redemption shall be accompanied by proper
instruments in blank. If funds for the redemption of all Bonds called for redemption are not on
deposit at the place of payment on the Redemption Date, the Bonds shall be deemed not to have
been called for redemption on the Redemption Date and shall remain outstanding and shall
continue to bear interest.
U.S. BANK NATIONAL ASSOCIATION,
as Paying Agent and Bond Registrar
By:
Authorized Officer
37367848v3
STATE OF GEORGIA
RICHMOND COUNTY
CLERK’S CERTIFICATE
I, LENA J. BONNER, Clerk of Commission of Augusta, Georgia, DO HEREBY
CERTIFY that the foregoing pages constitute a true and correct copy of the Series 2017 Bond
Resolution adopted by the Augusta-Richmond County Commission (the “Commission”) at an
open public meeting duly called and lawfully assembled at 2:00 p.m., on the 5th day of
September 2017, in connection with the issuance and sale of not to exceed $125,000,000 in
original aggregate principal amount of revenue bonds designated “Augusta, Georgia Water and
Sewerage Revenue Refunding Bonds, Series 2017,” the original of such Series 2017 Bond
Resolution being duly recorded in the Minute Book of the Commission, which Minute Book is in
my custody and control.
I do hereby further certify that the Mayor, Hardie Davis, Jr., and the following members
of the Commission were present at such meeting:
William Fennoy
Dennis Williams
Mary Davis
Sammie Sias
Andrew Jefferson
Ben Hasan
Sean Frantom
Wayne Guilfoyle
Marion Williams
Grady Smith
and that the following members were absent:
and that such resolution was duly adopted by a vote of:
Aye ___ Nay ___
WITNESS my hand and the official seal of Augusta, Georgia, this the 5th day of
September 2017.
(SEAL) Clerk of Commission
Finance Committee Meeting
8/29/2017 1:20 PM
Refinancing of Augusta Utilities Revenue Bonds, Series 2007
Department:Utilities / Finance
Presenter:Tom Wiedmeier
Caption:Approve Water and Sewer Revenue Bonds, Series 2017 bond
resolution and authorize the Mayor and Clerk to sign all necessary
documents to refund the Augusta, Georgia Water and Sewer
Revenue Bonds, Series 2007, currently outstanding in the
aggregate principal amount of $123,755,000.
Background:Augusta issued bonds in 2007 to finance water and sewer system
improvements. The bond documents provided that the bonds
could be called (refinanced) after ten years.
Analysis:Current interest rates on tax exempt municipal bonds are lower
that the rates on the existing bonds which makes refunding these
bonds a prudent financial decision. Current projections show
present value interest savings of approximately $19,400,000 if the
bonds are refunded at today’s prevailing interest rates.
Financial Impact:Described above
Alternatives:a) Issue bonds to refund the existing bonds. b) Not refund the
existing bonds.
Recommendation:Refund the existing bonds and recognize savings.
Funds are Available
in the Following
Accounts:
This is an enterprise fund and does not impact the General Fund
budget. Receipts from operations will pay debt service.
REVIEWED AND APPROVED BY:
Finance.
Law.
Administrator.
Clerk of Commission
Finance Committee Meeting
8/29/2017 1:20 PM
September Budget Work Session
Department:
Presenter:
Caption:Discuss having a budget workshop in September to discuss the
2018 budget needs. (Requested by Commissioner Frantom)
Background:
Analysis:
Financial Impact:
Alternatives:
Recommendation:
Funds are Available
in the Following
Accounts:
REVIEWED AND APPROVED BY: