EXHIBIT 10.1
EQUIPMENT LEASE
COMMITMENT
THIS EQUIPMENT LEASE COMMITMENT
(“Agreement”) is made and entered into this 19th day of
September, 2006, by and between DHW Leasing, L.L.C., a South Dakota
limited liability company, 230 S. Phillips Avenue, Suite 202, Sioux
Falls, SD 57104 (“DHW”) and Granite City Food &
Brewery, Ltd., a Minnesota corporation, 5402 Parkdale, Suite 101,
St. Louis Park, MN 55416 (“GCFB”).
In consideration of the mutual
promises herein contained, and for other valuable consideration,
the parties agree as follows:
1.
Equipment Finance
Lease . On the terms and conditions set forth in this
Agreement, DHW agrees to provide GCFB equipment leases of equipment
costing up to Sixteen Million Dollars ($16,000,000). Subject
to the total cost limitation of up to Sixteen Million Dollars
($16,000,000), the term stated in Section 4 and the per restaurant
minimum and maximum cost limitations set forth below, DHW shall
acquire and lease to GCFB all furniture, fixtures and equipment, as
specified by GCFB (the “Equipment”) including without
limitation computer office equipment, point of sale, hardware,
software, smallwares and brewery equipment reasonably necessary for
the operation of up to sixteen (16) GCFB restaurants. DHW and
GCFB will enter into a master lease in the form attached hereto as
Exhibit A (“Master Lease”), which sets forth the
general terms and conditions upon which each restaurant equipment
lease will be governed. Any capitalized terms not otherwise
defined in this Agreement shall have the meaning set forth in the
Master Lease. A separate Schedule A will be completed and
executed by the parties with respect to each restaurant for which
Equipment will be purchased under this Agreement. Each
Schedule A (each referred to as a “Lease”) will be for
Equipment which costs a minimum of $800,000 per restaurant and a
maximum of $1,400,000 per restaurant. Such amount shall
include the sales and/or use tax on such Equipment.
Notwithstanding, DHW shall have the right to reject any request for
financing for any restaurant that is not being developed and
constructed by Dunham Capital Management, L.L.C.
2.
Rates, Payments and
Fees . The payments due under any Schedule A shall be
based on a five- year amortization of the purchase price of
the Equipment under such Schedule, calculated at an interest rate
equal to the blended rate resulting from the following
formula:
Bank Base Rate plus (6.00% X 80%)
plus (3.00% X 20%) = Lease Rate
For example if the Bank Base Rate
equals 8.5%, the Lease Rate equals:
8.50% + (6.00% X 80%) + (3.00% X
20%) =
8.5% + 4.8% + .6% =
13.9%
“Bank Base Rate” shall
be the actual interest rate charged by DHW’s lender with
respect to the term loan financing used to purchase the Equipment
subject to any particular Lease.
GCFB shall pay DHW an origination
fee equal to 0.25% of the principal amount financed under each
Lease at the time each such Lease is executed by DHW and
GCFB. GCFB shall be responsible for all other filing and
recording fees connected with origination of each loan underlying a
Lease. There shall be no other origination, commitment or
other fees charged to GCFB.
3.
DHW Financing
. DHW shall enter into loan commitments substantially the
same as the (i) two million dollar ($2,000,000.00) loan commitment
with Dacotah Bank dated September 8 with no prepayment or
refinancing penalty and accruing interest on any term loan made
pursuant to such commitment at a rate equal to New York Prime less
0.5% (“Dacotah Bank Commitment”); (ii) a four million
dollar ($4,000,000.00) loan commitment with CorTrust Bank
dated September 1, 2006 with no prepayment or refinancing penalty
and accruing interest on any term loan made pursuant to such
commitment at a rate equal to Wall Street Journal Prime
(“CorTrust Commitment”); and (iii) a ten million dollar
($10,000,000.00) loan commitment with Great Western Bank, dated
September 1, 2006 with a 1% refinance penalty applied to term loans
if refinanced with outside debt and accru
