Exhibit 10.21
GROUND LEASE
AGREEMENT
(Drinking Water
Plant)
This Ground Lease Agreement is
entered into as of March 31, 1999 by REYNOLDS METALS COMPANY
(“Reynolds”) and WISE ALLOYS LLC
(“Buyer”).
RECITALS
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1.
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This Lease is
being executed and delivered in accordance with Section 7.4 of the
Asset Purchase Agreement, dated December 30, 1998 (the “Asset
Purchase Agreement”), by and among Reynolds, Southern
Reclamation Company, Inc., Reynolds Aluminum Partners and Buyer.
Unless otherwise defined in this Lease, all capitalized terms shall
have the meanings given to them in the Asset Purchase
Agreement.
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2.
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Pursuant to the
terms of the Asset Purchase Agreement, Reynolds has agreed to sell
to Buyer and Buyer has agreed to purchase the buildings, fixtures
and equipment constituting the drinking water plant (“the
Drinking Water Plant”) located at the site of Reynolds’
Listerhill reduction plant, as is more specifically described in
the Asset Purchase Agreement.
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3.
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Pursuant to the
Asset Purchase Agreement, Reynolds has agreed to lease to Buyer and
Buyer has agreed to lease from Reynolds the real property upon
which the Drinking Water Plant is situated.
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4.
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Reynolds will
continue operations at certain facilities in Colbert County,
Alabama not sold to Buyer (the “Reynolds Real
Property”).
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5.
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Buyer has
agreed to provide, at no charge to Reynolds, drinking water
services to the Reynolds Real Property.
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THEREFORE, for valuable
consideration, receipt of which is acknowledged, Reynolds and Buyer
agree as follows:
ARTICLE I
DEMISED DWP
PROPERTY/USE
1.1 DWP Property .
Reynolds hereby leases to Buyer and Buyer leases from Reynolds for
the term, at the rental, and upon all of the conditions set forth
herein that certain real property located in Colbert County,
Alabama upon which the Drinking Water Plant is situated as is more
particularly [described/depicted] in Exhibit A attached hereto and
incorporated herein (the “DWP Property”).
1.2 Use . The DWP
Property shall be used and occupied only for the ownership,
operation, maintenance, repair and replacement of the Drinking
Water Plant for the purpose of providing drinking water to the
Alloys Plant, the Alabama Reclamation Plant and to Reynolds under
the terms of this Lease. Except as is necessary for the ownership,
operation, maintenance,
repair and replacement of the Drinking Water
Plant, Buyer shall not construct any permanent improvement on the
DWP Property without the prior written consent of Reynolds, which
consent shall not be unreasonably withheld.
1.3 Improvements/Personal
Property .
(a) Upon the termination or
expiration of this Lease, title to the Drinking Water Plant and any
other improvements on the DWP Property shall be deemed to be and
become part of the realty and the sole and absolute property of
Reynolds as of the expiration or termination of this Lease and
shall be surrendered to Reynolds at that time, free and clear of
all liens of mortgages, deeds of trust, liens of mechanics,
laborers or materialmen and all other liens or
encumbrances.
(b) All personal property on the DWP
Property shall remain the property of Buyer regardless of the
termination or expiration of this Lease. Buyer may remove from the
DWP Property all such personal property within thirty (30) business
days after the termination or expiration of this Lease and shall
repair at its sole cost and expense, any damage to the DWP Property
caused by such removal. Any personal property not removed by the
aforesaid date shall be deemed abandoned and may be used or
disposed of by Reynolds without compensation to Buyer.
1.4 Drinking Water Service to
Reynolds . Beginning on the Commencement Date, Buyer shall,
at no charge to Reynolds, provide Reynolds’ Smelter
Technology Laboratory facilities [described/depicted] in Exhibit B
attached hereto and incorporated herein (the “Smelter
Laboratory”) with drinking water services at substantially
the same rate and level as such services were being provided
immediately prior to the Commencement Date. Reynolds shall have the
right, from time to time, to increase its demand for drinking water
services (at no expense to Reynolds); provided that drinking water
service is limited to that required to support the Smelter
Laboratory.
1.5 Access . Reynolds
hereby grants to Buyer, for the term of this Lease (a) a
non-exclusive leasehold easement for pedestrian and vehicular
ingress to and egress from the DWP Property through Reynolds’
former Listerhill reduction plant (the “Reduction Plant
Property”) main gate entrance located on Second Street and
over the existing internal gravel road leading from Second Street
to the DWP Property (the “Entrance Road”) and (b) a
non-exclusive leasehold easement across, over and under such
portions of the Reduction Plant Property as are reasonably
necessary for access to and maintenance of the fiber optic cable
lines from outfall 004 to the Drinking Water Plant (the
“Cables”). Reynolds shall have the right, exercisable
at any time and from time to time, to relocate the Entrance Road
and the Cables. In the event that Reynolds relocates the Entrance
Road and/or the Cables, Reynolds shall either permit Buyer to use
the Entrance Road and/or Cables, as relocated, or provide Buyer
with suitable alternative access to the DWP Property and the
Cables. Buyer shall take all actions as may reasonably be required
to prevent trespassers from entering on to the DWP
Property.
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ARTICLE II
RENT
2.1 Base Rent . Buyer
shall pay to Reynolds as base rent for the DWP Property the sum of
$10.00 per year subject to the adjustments, if any, set forth
below. The first base rent payment shall be due and payable on the
Commencement Date (defined below). Each subsequent base rent
payment shall be due and payable annually on the anniversary of the
Commencement Date. Rent shall be paid to Reynolds Metals Company at
6601 West Broad Street, Richmond, Virginia 22320, Attn: Real Estate
Department, or at such other address as may be specified in written
notice to Buyer.
2.2 Additional Rent .
The parties intend this to be an absolute net lease. In addition to
the Base Rent set forth above, Buyer shall pay as “additional
rent” any and all charges applicable to the DWP Property,
including without limitation, real property taxes and insurance as
more fully set forth below, and any other costs, fees, expenses or
other charges whether or not contemplated by the parties as of the
Commencement Date.
ARTICLE III
TERM/TERMINATION
3.1 Term . The term of
this Lease shall commence on March 31, 1999 (the
“Commencement Date”), and shall end ninety-nine (99)
years thereafter on March 30, 2098 (the “Expiration
Date”).
3.2 Termination .
Notwithstanding section 3.1, Reynolds may terminate this Lease
prior to the Expiration Date in the event that Buyer (i) ceases to
provide the drinking water services as required by section 1.4 of
this Lease, (ii) ceases to operate the Drinking Water Plant or
(iii) sells, transfers or assigns this Lease or the Drinking Water
Plant without the prior consent of Reynolds. In the event this
Lease is terminated pursuant to this section 3.2, the provisions of
section 1.3 shall apply.
ARTICLE IV
REYNOLDS
OBLIGATIONS
4.1 Quiet Enjoyment .
If, and as long as, Buyer shall faithfully perform the agreements,
terms, covenants and conditions hereof, Buyer shall and may
(subject, however, to the provisions, reservations, terms and
conditions of this Lease) peaceably and quietly have, hold and
enjoy the DWP Property for the term hereby granted without
molestation or disturbance by or from Reynolds.
4.2 No Representations By
Reynolds . Buyer acknowledges that Reynolds makes no
representations or warranties in respect of the DWP Property.
Reynolds makes no representation or warranty, and expressly
disclaims any representation or warranty with respect to the
condition, value or quality of the DWP Property and the DWP
Property is leased to Buyer “AS IS” AND “WHERE
IS.”
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ARTICLE V
BUYER’S RIGHTS AND
OBLIGATIONS
5.1 Buyer Compliance With
Laws . Buyer warrants that its use of the DWP Property and
the Entrance Road and operation of the Drinking Water Plant shall
not violate any federal, state or local law, ordinance, order,
rule, regulation, or any other applicable law affecting the DWP
Property or the Entrance Road. Buyer may contest the application to
Buyer or the validity of, any applicable law, provided that Buyer
shall fully indemnify and hold Reynolds harmless from and against
the consequences of any such contest.
5.2 Waste and Nuisance
. Buyer warrants that it shall not use the DWP Property or the
Entrance Road or permit the DWP Property or the Entrance Road to be
used in any manner that would tend to create waste or
nuisance.
ARTICLE VI
ENVIRONMENTAL
MATTERS
Buyer represents, warrants and
covenants that it (i) shall not use the DWP Property or the
Entrance Road for the storage, generation, transportation,
processing, handling or disposal of any Hazardous Materials in
violation of any Environmental Law or Environmental Permit, (ii)
not cause or in any way, directly or indirectly, contribute to any
condition that is or may be characterized by any federal, state or
local government or agency as an actual or potential threat or
endangerment to the environment, (iii) shall comply strictly with
all applicable Environmental Laws, (iv) immediately notify Reynolds
of any notice of violation, noncompliance or other written
communication by any governmental authority or others of any
violation of any Environmental Law and (v) immediately inform
Reynolds if Buyer becomes aware of or causes a release of Hazardous
Materials on the DWP Property or the Entrance Road which is
reportable to a local, state or federal regulatory authority. For
releases deemed by Buyer as not reportable, copies of any
documentation relating to such release shall be maintained by Buyer
and made available for review by Reynolds upon request.
ARTICLE VII
TAXES AND
INSURANCE
7.1 Real Property
Taxes . Reynolds shall pay prior to delinquency all real
property taxes assessed against the DWP Property and the
improvements constituting the Drinking Water Plant. Reynolds shall
invoice Buyer for 100% of the taxes assessed against the
improvements constituting the Drinking Water Plant and for
Buyer’s share of the taxes assessed against the tax parcel
that includes the DWP Property based upon the percentage that the
square footage of the DWP Property bears to the total square
footage of such tax parcel. Buyer shall reimburse Reynolds within
30 days of the date of the invoice.
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7.2 Personal Property
Taxes . Buyer shall pay prior to delinquency all taxes
assessed against and levied upon its equipment and all other
personal property located at the DWP Property.
7.3 Insurance . Buyer
shall, at its expense, obtain and keep in force during the term of
this Lease, commercial general liability insurance with a combined
single limit of not less than $5,000,000 per occurrence for bodily
injury (including death) and property damage, insuring both
Reynolds and Buyer against liability arising out of Buyer’s
use or occupancy of the DWP Property and the Entrance Road. In
addition, Buyer shall, at its expense, obtain and keep in force
during the term of this Lease, a policy or policies of insurance
covering loss or damage to the Drinking Water Plant providing
protection against all perils included within the classification of
fire, lightning, all risk and extended coverage.
7.4 Insurance
Certificates . All such policies of insurance required
under section 7.3 shall designate Reynolds as an additional
insured. Buyer shall deliver to Reynolds certificates of insurance
for the insurance required under section 7.3 on the Commencement
Date. Such policies shall not be cancelable or subject to reduction
in coverage without 30 days prior written notice to Reynolds. Buyer
shall, within a reasonable time prior to the expiration of such
policies, furnish Reynolds with certificates of insurance
evidencing renewal thereof. Such insu
