THIRD AMENDMENT TO LEASE AGREEMENT
THIS THIRD AMENDMENT TO LEASE
AGREEMENT (the “ Third Amendment ”) is made
and entered into effective as of June ___, 2006, by and between
SPIRIT MASTER FUNDING, LLC , a Delaware limited liability
company, as successor-in-interest to Spirit Finance Acquisitions,
LLC, a Delaware limited liability company (“ Lessor
”), and SIGNIFICANT EDUCATION, INC ., a Delaware
corporation, as successor-in-interest to Significant Education,
LLC, a Delaware limited liability company (“ Lessee
”).
Recitals
WHEREAS , Lessor and Lessee
entered into that certain Lease Agreement dated as of June 28,
2004, as amended pursuant to that certain Amendment to Lease
Agreement dated effective as of September 24, 2004, and as
further amended pursuant to that certain Second Amendment to Lease
Agreement dated effective as of August 23, 2005 (collectively,
the “ Lease ”), with respect to the real
property and improvements as described in the Lease. Terms not
defined in this Third Amendment shall have the meanings ascribed to
them in the Lease.
WHEREAS , Lessee has
requested, and Lessor has agreed to provide, additional funding for
additional tenant improvements pursuant to and in accordance with
the terms of this Third Amendment.
NOW, THEREFORE , in
consideration of the foregoing recitals and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, Lessor and Lessee agree as follows:
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Additional Tenant Improvements. The following new
subsections D and E shall be added to the end of Section 44 of
the Lease. |
D. Additional Tenant
Improvements . Lessor shall reimburse Lessee an additional
aggregate amount not to exceed Five Million Eight Hundred Thousand
and 00/100 Dollars ($5,800,000.00) (collectively, the “
Additional Funds ”) for the construction, completion,
rehabilitation, renovation or installation of improvements to the
Property related to the operation to the Permitted Facility that
are described on Exhibit E attached hereto and
incorporated herein (collectively, the “ Additional Tenant
Improvements ”). Lessor shall disburse the Additional
Funds in accordance with, and upon Lessee’s satisfaction of,
Lessor’s standard disbursement procedures (including without
limitation, the completion, execution and delivery of the Draw
Request Certification in the form attached hereto as
Exhibit F (the “ Draw request ”)),
in three (3) separate installments as follows: (i) an
initial disbursement of $1,044,089.00 shall be made on the date of
execution and delivery of this Third Amendment, the Draw Request,
and any other documents reasonably requested by Lessor in
connection with such initial disbursement; (ii) an interim
disbursement not to exceed the amount of $3,071,562.00 shall be
made on July 31, 2006 (provided that Lessee has complied in
all respects with Lessor’s disbursement procedures); and
(iii) a final disbursement not to exceed $1,684,349.00 shall
be made upon completion of the Additional Tenant Improvements
(provided that Lessee has complied in all respects with
Lessor’s disbursement
procedures).
Lessor reserves the right to utilize the services of a construction
management firm in connection with the Additional Tenant
Improvements. Lessor further reserves the right to require Lessee
to enter into one or more written agreements to govern the
disbursement of any Additional Funds and/or to provide such other
documentation reasonably requested by Lessor in connection with the
disbursement of any Additional Funds. All reasonable costs and
expenses incurred by Lessor with respect to any Additional Tenant
Improvement, including, without limitation, attorneys’ fees,
construction management fees, inspection costs and title insurance
policy endorsement fees, shall be paid by Lessee and all such costs
and expenses may be withheld from the Additional Funds in
Lessor’s discretion. Lessor and Lessee acknowledge and agree
that the Additional Funds will be available to Lessee up to and
including December 31, 2006 (“ Final Disbursement
Date ”). To the extent that any Additional Tenant
Improvement remains uncompleted as of the Final Disbursement Date,
Lessor shall have no obligation to disburse any further Additional
Funds to Lessee; provided, however, that the foregoing shall
in no way eliminate or diminish Tenant’s obligation to
complete such Additional Tenant Improvements in a good and
workmanlike manner, or to otherwise perform its obligations under
this Lease. All Additional Tenant Improvements shall constitute
part of the Property and shall be owned Lessor.
E. Rent Adjustments .
Simultaneously with the disbursement of any Additional Funds,
Lessor and Lessee agree to amend the Lease to increase the Base
Annual Rental by the amount of such disbursement multiplied
by a cap rate of ten and one-half percent (10.5%).
2. Exhibits E and F.
Exhibit E and Exhibit F attached hereto
shall be added to the Lease as if fully set forth therein.
3. Definitions. The
following definitions shall be added to Exhibit A of
the Lease:
“Additional
Funds” has the meaning set forth in
Section 44.D.
“Additional Tenant
Improvements” has the meaning set forth in
Section 44.D.
“Base Annual
Rent” shall mean $3,574,629.35.
“Final Disbursement
Date” has the meaning set forth in
Section 44.D.
4. Lessor’s Total
Investment. The definition of “Lessor’s Total
Investment” in Exhibit A of the Lease shall be
deleted in its entirely, and the following new definition shall be
inserted in lieu thereof:
“Lessor’s Total
Investment” means, with respect to any Property, the sum
of (a) the gross purchase price paid for the Property by
Lessor (or Lessor’s predecessor-in-interest) (including,
without limitation, any mortgage debt incurred or assumed in
connection therewith and any Contingent Purchase Price paid by
Lessor), plus (b) all amounts disbursed and all costs and
expenses incurred by Lessor pursuant to Section 44 of this
Lease, plus (c) the closing costs and expenses incurred by
Lessor (or Lessor’s predecessor-in-interest) with respect to
the purchase of the Property.
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