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EXHIBIT 10.22
PARTICIPATION AGREEMENT
Dated as of October 28, 1999
among
TENNECO PACKAGING INC.,
as Lessee, and Guarantor
FIRST SECURITY BANK, N.A.,
not individually, except as expressly
stated herein, but solely as Owner Trustee
under the Temple Trust 1997-1
THE VARIOUS BANKS AND OTHER
LENDING INSTITUTIONS WHICH ARE PARTIES
HERETO FROM TIME TO TIME,
as the Holders
THE VARIOUS BANKS AND OTHER
LENDING INSTITUTIONS WHICH
ARE PARTIES HERETO FROM TIME TO TIME,
as the Lenders
and
BANK OF AMERICA N.A.,
as Administrative Agent for the
Lenders
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TABLE OF CONTENTS
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SECTION 1. The Loans........................................................1
SECTION 2. Holder Fundings..................................................1
SECTION 3. Summary of Transactions..........................................2
3.1. Operative Agreements.............................................2
3.2. Property Purchase................................................2
SECTION 4. The Closings.....................................................2
4.1. Execution Date and Initial Closing Date..........................2
4.2. Initial Closing Date; Property Closing Dates.....................2
SECTION 5. Fundings; Lessee Delivery of Notices.............................3
5.1. General..........................................................3
5.2. Procedures for Funding...........................................3
5.3. Conditions to the Holders' and the Lenders' Obligations
to Advance Funds on the Initial Closing Date or Funds for the
Acquisition of Property..........................................4
5.4. Inspection of Documents; Hold Harmless; Removal of Properties....7
SECTION 6. Conditions of the Initial Closing................................8
6.1. Conditions to the Lessor's and the Holders' Obligations..........8
6.2. Conditions to the Lessee's Obligations...........................9
6.3. Conditions to the Agent's Obligations...........................11
SECTION 7. Representations and Warranties on the Initial Closing Date......12
7.1. Representations and Warranties of the Initial Holders...........12
7.2. Representations and Warranties of the Owner Trustee.............13
7.3. Representations and Warranties of the Lessee....................15
7.4. Representations and Warranties of the Agent.....................24
SECTION 8. General Covenants of the Lessee and the Guarantor...............25
8.1. Covenants of the Lessee.........................................25
SECTION 9. Payment of Certain Expenses.....................................35
9.1. Transaction Expenses............................................35
9.2. Certain Fees and Expenses.......................................36
9.3. Unused Fee and Holder Unused Fee................................36
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SECTION 10. Other Covenants and Agreements..................................37
10.1. Cooperation with the Lessee.....................................37
10.2. Covenants of the Owner Trustee and the Holders..................37
10.3. Lessee Covenants, Consent and Acknowledgment....................39
10.4 . Sharing of Certain Payments.....................................41
10.5. Grant of Easements, Voting at Meetings, etc.....................41
SECTION 11. Credit Agreement and Trust Agreement.............................41
11.1. Lessee's Credit Agreement Rights................................41
11.2. Lessee's Trust Agreement Rights.................................42
SECTION 12. Transfer of Interest.............................................42
12.1. Restrictions on Transfer........................................42
12.2. Effect of Transfer..............................................43
SECTION 13. Indemnification..................................................43
13.1. General Indemnity...............................................43
13.2. General Tax Indemnity...........................................46
SECTION 14. Miscellaneous....................................................50
14.1. Survival of Agreements..........................................50
14.2. No Broker, etc..................................................50
14.3. Notices.........................................................51
14.4. Counterparts....................................................52
14.5. Amendments and Termination......................................52
14.6. Headings, etc...................................................52
14.7. Parties in Interest.............................................52
14.8. GOVERNING LAW; WAIVERS OF JURY TRIAL............................52
14.9. Submission to Jurisdiction; Waivers.............................53
14.10. Severability....................................................53
14.11. Liability Limited...............................................53
14.12. Rights of Lessee................................................55
14.13. Further Assurances..............................................55
14.14. Calculations under Operative Agreements.........................55
14.15. Confidentiality.................................................55
14.16. Calculation of Rent, Interest, Holder Yield and Fees............56
14.17. Assignment Clause...............................................56
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Schedule I Initial Holders
Schedule II Litigation
Schedule III Liens
Exhibit A Requisition Form A
Schedule 1 Legal Description of Land
Schedule 2 Description of Improvements
Schedule 3 Description of Equipment
Exhibit B Tenneco Packaging Inc. Officer's Certificate
Schedule 1 [itemized expenditures]
Exhibit C Form of Opinion of Counsel to Tenneco Packaging Inc. and Tenneco Inc.
Exhibit D Tenneco Packaging Inc. Officer's Certificate
Exhibit E Tenneco Packaging Inc. Secretary's Certificate
Exhibit F First Security Bank, N.A. Officer's Certificate
Exhibit G First Security Bank, N.A. Certificate of Assistant Secretary
Exhibit H Form of Opinion of Counsel to First Security Bank, N.A.
Exhibit I Description of Land for Temple Property
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PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT, dated as of October 28, 1999 (as amended,
modified, restated or supplemented from time to time, this "Agreement"), is by
and among TENNECO PACKAGING INC., a Delaware corporation ("Tenneco Packaging"),
as Lessee (Tenneco Packaging and any permitted assignee thereof under the Lease
being referred to as the "Lessee") and as Guarantor ("Tenneco Packaging" or the
"Guarantor"); FIRST SECURITY BANK, N.A., a national banking association, not
individually (in its individual capacity, the "Trust Company"), except as
expressly stated herein, but solely as Owner Trustee under the Temple Trust
0000-0 (xxx "Xxxxx Xxxxxxx", "Xxxxxxxx" or the "Lessor"); BANK OF AMERICA N.A.,
as Administrative Agent (in such capacity, the "Agent") for the Lenders; BANK OF
AMERICA N.A., a national banking association and the various other banks and
lending institutions which are parties hereto from time to time as Holders; BANK
OF AMERICA N.A., and the various other banks and lending institutions which are
parties hereto from time to time as Lenders. Capitalized terms used but not
otherwise defined in this Agreement shall have the meanings set forth in
Appendix A hereto.
In consideration of the mutual agreements herein contained and other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
SECTION 1. The Loans. The Lenders have agreed to make Loans to the
Lessor from time to time in an aggregate principal amount of up to the aggregate
amount of the Commitments of the Lenders in order for the Lessor to acquire or
refinance, as applicable, the Properties and certain Improvements and Equipment
pursuant to the terms and provisions hereof, and in consideration of the receipt
of the proceeds of such Loans, the Lessor will issue the Notes (together with
any note or notes issued in exchange or substitution therefor in accordance with
the Credit Agreement, the "Notes"). The Loans shall be made and the Notes shall
be issued pursuant to the Credit Agreement. Pursuant to Section 5 of this
Agreement and Section 2 of the Credit Agreement, the Loans will be made to the
Lessor from time to time upon the appropriate submission by the Lessee of a
Requisition therefor, in accordance with this Agreement and the other Operative
Agreements. The Loans and the obligations of the Lessor under the Credit
Agreement shall be secured by the Collateral.
SECTION 2. Holder Fundings. Subject to the terms and conditions of this
Agreement and in reliance on the representations and warranties of each of the
parties hereto contained herein or made pursuant hereto on each date Fundings
are made in accordance with Section 5 hereof, each Holder shall make a Holder
Funding on a pro rata basis to the Owner Trustee with respect to the Temple
Trust 1997-1 based on its Holder Commitment in an amount in immediately
available funds such that the aggregate of all Holder Fundings shall be three
and seventy-five one hundredths percent (3.75%) of the amount of the Funding
being funded on such date; provided, no Holder shall be obligated for any Holder
Funding in excess of its pro rata share of the Available Holder Commitment. The
aggregate amount of Holder Fundings shall be
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up to the aggregate amount of the Holder Commitments. No prepayment or any other
payment with respect to any Funding shall be permitted such that the Holder
Funding with respect to such Funding is less than 3.75% of the outstanding
amount of such Funding, except in connection with termination or expiration of
the Term or in connection with the exercise of remedies relating to the
occurrence of a Lease Event of Default. The representations, warranties,
covenants and agreements of the Holders herein and in the other Operative
Agreements are several, not joint, and not joint and several.
SECTION 3. Summary of Transactions.
3.1. Operative Agreements. On the date hereof (the "Execution Date"),
each of the respective parties hereto and thereto shall execute and deliver this
Agreement, the Lease, the Credit Agreement, the Notes, the Certificates, the
Trust Agreement, the Security Agreement and such other documents, instruments,
certificates and opinions of counsel as agreed to by the parties hereto.
3.2. Property Purchase. On the Initial Closing Date and on each
Property Closing Date thereafter and subject to the terms and conditions of this
Agreement (a) the Holders will each make a Holder Funding in accordance with
Sections 2 and 5 of this Agreement and the terms and provisions of the Trust
Agreement, (b) the Lenders will make Loans in accordance with Sections 1 and 5
of this Agreement and the terms and provisions of the Credit Agreement, and (c)
the Lessor will purchase, refinance or lease pursuant to a Ground Lease, the
applicable Property identified by the Lessee, and grant the Agent a Lien on such
Property by execution of the required Security Documents.
SECTION 4. The Closings.
4.1. Execution Date and Initial Closing Date. All documents and
instruments required to be delivered on either the Execution Date or the Initial
Closing Date shall be delivered at the offices of Xxxxx, Xxxxx & Xxxxx, 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at such other location as may be
determined by the Lessor, the Agent and the Lessee.
4.2. Initial Closing Date; Property Closing Dates. The Lessee shall
deliver to the Lessor and the Agent a requisition (a "Requisition"), in the form
attached hereto as Exhibit A-1 (for the Initial Closing Date) and Exhibit A-2
(for each Property Closing Date after the Initial Closing Date) or in such other
form as is reasonably satisfactory to the Lessor, and the Agent, in connection
with (a) the Initial Closing Date relating to the Transaction Expenses and other
fees, expenses and disbursements payable by the Lessor pursuant to Section
9.1(a) with invoices (in form and substance reasonably acceptable to the Agent
and the Lessor) for such Transaction Expenses and other fees, expenses and
disbursements attached to such Requisition, and (b) each Property Closing Date
relating to each Acquisition Funding pursuant to Section 5.3. Upon the written
request of any Lender to the Agent, the Agent shall deliver a copy of said
Requisition to such Lender.
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SECTION 5. Fundings; Lessee Delivery of Notices.
5.1. General. To the extent funds have been made available to the
Lessor as Loans by the Lenders and Holder Fundings by the Holders, the Lessor
will use such funds from time to time in accordance with the terms and
conditions of this Agreement and the other Operative Agreements at the direction
of the Lessee to acquire Properties (including Equipment) in accordance with the
terms of this Agreement, the Lease and the other Operative Agreements, and (ii)
to pay Transaction Expenses, fees, expenses and other disbursements payable by
the Lessor under Sections 9.1 (a) and (b).
5.2. Procedures for Funding.
(a) The Lessee shall designate the date for Fundings hereunder
in accordance with the terms and provisions hereof. Contemporaneously
with the consummation of the Spin-Off, the Lessee shall deliver to, the
Lessor and the Agent with respect to the Initial Closing Date, a
Requisition as described in Section 4.2 hereof (including without
limitation such information regarding the Land, Improvements and
Equipment included within the Group I Properties as the Agent and the
Lessor shall reasonably require). Not less than (i) one (1) Business
Day prior to the date of any requested Base Rate Funding and (ii) three
(3) Business Days prior to the date of any requested Eurodollar
Funding, the Lessee shall deliver to the Lessor and the Agent, with
respect to each Property Closing Date after the Initial Closing Date, a
Requisition as described in Section 4.2 hereof (including without
limitation a legal description of the Land, a schedule of the
Improvements, if any, and a schedule of the Equipment, if any, to be
acquired on such date and a Completion Certificate with respect to any
improvements on such Land, each of the foregoing in a form reasonably
acceptable to the Lessor and the Agent).
(b) Each Requisition shall: (i) be irrevocable, (ii) request
funds in an amount that is not in excess of the total aggregate of the
Available Commitments plus the Available Holder Commitments at such
time, and (iii) request that the Holders make Holder Fundings and that
the Lenders make Loans to the Lessor for the payment of the Property
Acquisition Costs.
(c) Subject to the terms and conditions of the Credit Agreement
and the Trust Agreement and subject to the satisfaction of the
conditions precedent set forth in Section 5.3, as applicable, on the
Initial Closing Date and on each Property Closing Date after the
Initial Closing Date, (i) the Lenders shall make Loans to the Lessor in
an aggregate amount equal to 96.25% of the Requested Funds specified in
any Requisition such loans to be apportioned as follows, (y) with
respect to the Group I Properties, such loans to be apportioned 81.00%
to the Series A Loans and 15.25% to the Series B Loans, and (z) with
respect to the Group II Properties, 84.50% to Series A Loans and 11.75%
to Series B Loans, up to aggregate principal amount equal to the
Available Commitments, (ii) each
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Holder shall make a pro rata Holder Funding based on its Holder
Commitment in an amount such that the aggregate of all Holder Fundings
at such time shall be 3.75% of the balance of the Requested Funds
specified in such Requisition, provided no such Holder Funding shall
exceed such Holder's pro rata share of the Available Holder
Commitments; and (iii) the total amount of such Loans and Holder
Fundings made on such date shall (w) be used by the Lessor to pay the
Property Acquisition Costs within three (3) Business Days after the
receipt by the Lessor of such Funding, (y) be used by the Lessor to
pay Transaction Expenses, fees, expenses and other disbursements to
the extent permitted under Section 5.3, or (z) be disbursed by the
Lessor, on the date of such Funding, to the Lessee to pay Property
Costs, as applicable. Any such amounts held by the Lessor (or the
Agent on behalf of the Lessor) shall be subject to the lien of the
Security Agreement.
5.3. Conditions to the Holders' and the Lenders' Obligations to Advance
Funds on the Initial Closing Date or Funds for the Acquisition of Property.
(a) The obligations of each Holder to make Holder Fundings,
and of each Lender to make Loans, to the Lessor on the Initial Closing
Date and each Property Closing Date thereafter for the purpose of
providing funds to the Lessor necessary to pay Transaction Expenses,
fees, expenses and other disbursements payable by the Lessor under
Section 9.1 of this Agreement, are subject to the prior or
contemporaneous satisfaction or waiver of the following conditions
precedent:
(i) the correctness in all material respects on such
Property Closing Date of the representations and warranties of
the Owner Trustee, the Lessee and the Holders (other than such
Holder) contained herein and in each of the other Operative
Agreements;
(ii) the performance in all material respects by the
Lessee of its agreements contained herein and in the other
Operative Agreements which covenants are to be performed by
them on or prior to each such Property Closing Date;
(iii) the satisfaction of all conditions to any such
Holder Funding or Loan set forth in any Operative Agreement;
(iv) the Agent and the Owner Trustee shall have
received a fully executed copy of a counterpart of any
Requisition, appropriately completed;
(v) title to each Property being acquired on such
Property Closing Date shall conform to the representations and
warranties set forth in Section 7.3(j) hereof;
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(vi) except with respect to the Temple Property, the
Lessee shall have delivered to the Lessor a copy of the Deed
with respect to the Land and existing Improvements (if any), a
copy of the Ground Lease (if any) with respect to the Land,
and a copy of the Xxxx of Sale with respect to the Equipment,
in each case for such of the foregoing as are being acquired
on such Property Closing Date; and such Land and existing
Improvements shall be located in an Approved State;
(vii) there shall not have occurred and be continuing
any Default or Event of Default under any of the Operative
Agreements and no Default or Event of Default under any of the
Operative Agreements shall have occurred after giving effect
to the Funding requested by such Requisition;
(viii) the Lessee shall have delivered to the Agent
and the Owner Trustee, title insurance commitments to issue
policies in favor of the Owner Trustee and the Agent with
respect to each Property being acquired on such Property
Closing Date, such policies being in form and substance
reasonably acceptable to the Owner Trustee and the Agent, with
such title exceptions thereto as are reasonably acceptable to
the Owner Trustee and the Agent; and the Lessee shall deliver
to the Owner Trustee and the Agent, as soon as possible after
such Property Closing Date, the final title insurance policies
for each such Property, taking no specific exception for any
Lien filed on account of materials furnished or labor
performed in connection with the Property, and otherwise
showing no additional exceptions to coverage (other than those
exceptions to title constituting Permitted Encumbrances);
(ix) the Lessee shall have delivered to the Agent and
the Owner Trustee a "Phase I" environmental site assessment
with respect to each such Property, prepared by an independent
recognized professional reasonably acceptable to the Agent and
the Owner Trustee and in a form and substance that is
reasonably acceptable to the Agent and the Owner Trustee;
(x) the Lessee shall have delivered to the Agent and
the Owner Trustee a survey of each such Property, prepared by
an independent recognized professional meeting the then
current minimum standard detail requirements for American Land
Title Association/American Congress of Surveying and Mapping
(ALTA/ACSM) Land Title Surveys certified to the Agent and
otherwise reasonably acceptable to the Agent;
(xi) the Lessee shall have caused to be delivered to
the Agent and the Owner Trustee a legal opinion (in form and
substance reasonably satisfactory to the Agent and the Owner
Trustee) from counsel located in the state where each such
Property is located or, if the Agent and the Owner Trustee
have previously received an opinion from counsel in such
state, the Agent and the Owner Trustee
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(in their discretion) may accept an update or a reaffirmation of
the previous opinion, in each case addressed to each Lender;
(xii) the Owner Trustee and the Agent shall be
satisfied, in their sole discretion, that the acquisition or
ground leasing of each such Property and the execution of the
Mortgage Instrument and the other Security Documents will not
adversely affect in any material respect the rights of the
Owner Trustee, the Holders, the Agent or the Lenders under or
with respect to the Operative Agreements in effect as of such
Property Closing Date;
(xiii) the Lessee shall have delivered to the Agent
and the Owner Trustee, with respect to each such Property,
invoices for the various Transaction Expenses and other fees,
expenses and disbursements referenced in Section 9.1 (a) or
(b) of this Agreement;
(xiv) the Lessor shall have delivered to the Agent a
Mortgage Instrument and Lender Financing Statements with
respect to each such Property in a form reasonably acceptable
to the Agent and Lessee;
(xv) the Lessee shall have delivered to the Lessor
with respect to each such Property, a Lease Supplement and a
memorandum regarding the Lease and such Lease Supplement (such
memorandum to be substantially in the form attached to the
Lease as Exhibit C, and in each case in form suitable for
recording);
(xvi) the Lessee shall have delivered to the Lessor
with respect to each such Property Lessor Financing Statements
(or continuation statements, as applicable) executed by the
Lessee;
(xvii) if any such Property is subject to a Ground
Lease, the Lessee shall have caused a lease memorandum (in
form and substance satisfactory to the Agent) to be delivered
to the Agent for such Ground Lease;
(xviii) counsel for the ground lessor of each such
Property subject to a Ground Lease shall have issued to the
Lessor, the Agent and the Holders, an opinion satisfactory to
the Agent;
(xix) all necessary Governmental Actions required by
any law or regulation enacted, imposed or adopted on or prior
to each such date or by any change in facts or circumstances
on or prior to each such date, shall have been obtained or
made and be in full force and effect;
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(xx) the Lessee shall cause (i) Uniform Commercial
Code lien searches, tax lien searches and judgment lien searches
regarding each of the Lessee and the Lessor to be conducted (and
copies thereof to be delivered to the Agent and the Owner
Trustee) in the state and county (or other jurisdiction) in which
such Property is located, by a nationally recognized search
company acceptable to the Owner Trustee and the Agent and (ii)
the liens referenced in such lien searches which are
objectionable to the Owner Trustee or the Agent to be either
removed or otherwise handled in a manner reasonably satisfactory
to the Owner Trustee and the Agent;
(xxi) by the later to occur of (A) each Property
Closing Date or (B) the date that is ninety (90) days after
the Initial Closing Date or any Property Closing Date
thereafter, as applicable, the Agent shall have received an
Appraisal for the Property or Properties described in the
applicable Requisition showing that each such Property has a
value at least equal to ninety-five percent (95%) of the
expected total Property Cost of such Property and all
Improvements constructed thereon; and
(xxii) the Lessee will deliver to the Agent, and the
Lessor an Officer's Certificate in the form attached hereto as
Exhibit B - specifying (a) with respect to the Property for
which a Requisition is submitted, the Completion Date for the
construction of Improvements at the Property, (b) the
aggregate Property Cost for the Property and (c) if any of the
Property consists of Tangible Personal Property, a separate
statement of the Property Cost attributable to such Tangible
Personal Property. Such Officer's Certificate shall also
include, in form and in detail reasonably acceptable to the
Agent and the Holders, a summary of the Property Cost figures
and a certification to the effect that all Improvements have
been made in accordance with all applicable material Legal
Requirements, in a good and workmanlike manner and otherwise
in substantial compliance with the standards and practices of
the Lessee with respect to similar properties and improvements
owned by the Lessee, and that no consent or approval of any
Person is required for such Improvements except for consents
and approvals which have already been obtained and consents
and approvals the lack of which would not be reasonably likely
to (A) materially and adversely affect the use and occupancy
of the Improvements or (B) have a Material Adverse Effect.
5.4. Inspection of Documents; Hold Harmless; Removal of Properties. Any
document or item (including without limitation any environmental report)
delivered to the Agent shall be available for inspection at any time during
ordinary business hours upon reasonable notice by any Lender or Holder. The
Agent shall not incur any liability to any Lender, any Holder, the Owner Trustee
or any other Person (and each Lender, each Holder, the Owner Trustee, and the
Lessee hereby holds the Agent harmless from any such liability) as a result of
any such document or item, any information contained therein, the failure to
receive any such document, or the Agent's
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approval of any Property. In the event the Majority Lenders reasonably determine
that any environmental site assessment reveals an Environmental Violation and
they or the Agent so notify the Lessee, then the Lessee shall remedy or purchase
such Property in accordance with Section 15.2 of the Lease.
SECTION 6. Conditions of the Initial Closing.
6.1. Conditions to the Lessor's and the Holders' Obligations. The
obligations of the Lessor and the Holders to consummate the transactions
contemplated by this Agreement are subject to (i) the accuracy and correctness
in all material respects on the Initial Closing Date of the representations and
warranties of the other parties hereto contained herein, (ii) the accuracy and
correctness in all material respects on the Initial Closing Date of the
representations and warranties of the other parties hereto contained in any
other Operative Agreement or certificate delivered pursuant hereto or thereto,
(iii) the performance in all material respects by the other parties hereto of
their respective agreements contained herein and in the other Operative
Agreements and to be performed by them on or prior to the Initial Closing Date
and (iv) the satisfaction, or waiver by the Lessor and the Holders, of all of
the following conditions on or prior to the Initial Closing Date:
(a) Each of the Operative Agreements shall have been duly
authorized, executed and delivered by the parties thereto, other than
the Lessor and the Holders, and shall be in full force and effect, and
no Default or Event of Default shall exist thereunder (both before and
after giving effect to the transactions contemplated by the Operative
Agreements), and the Lessor shall have received a fully executed copy
of each of the Operative Agreements (other than the Notes of which it
shall have received specimens). The Operative Agreements (or memoranda
thereof), any supplements thereto and any financing statements and
fixture filings in connection therewith required under the Uniform
Commercial Code shall have been filed or shall be promptly filed, if
necessary, in such manner as to enable the Lessee's counsel to render
its opinion referred to in Section 6.1(g) hereof;
(b) All taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the
Operative Agreements shall have been paid or provision for such payment
shall have been made to the reasonable satisfaction of the Lessor and
the Agent;
(c) No action or proceeding shall have been instituted, nor
shall any action or proceeding be threatened, before any Governmental
Authority, nor shall any order, judgment or decree have been issued or
proposed to be issued by any Governmental Authority (i) to set aside,
restrain, enjoin or prevent the full performance of this Agreement, any
other Operative Agreement or any transaction contemplated hereby or
thereby or (ii) which is reasonably likely to have a Material Adverse
Effect;
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(d) In the reasonable opinion of the Lessor and the Holders
and their counsel, the transactions contemplated by the Operative
Agreements do not and will not violate any material Legal Requirements
and do not and will not subject the Lessor or the Holders to any
materially adverse regulatory prohibitions or constraints;
(e) The Lessor and the Agent shall each have received an
Officer's Certificate of the Lessee, dated as of the Initial Closing
Date, in the form attached hereto as Exhibit D or in such other form as
is reasonably acceptable to such parties stating that (i) each and
every representation and warranty of the Lessee contained in the
Operative Agreements to which it is a party is true and correct in all
material respects on and as of the Initial Closing Date; (ii) no
Default or Event of Default has occurred and is continuing under any
Operative Agreement; (iii) each Operative Agreement to which Lessee is
a party is in full force and effect with respect to it; and (iv) the
Lessee has performed and complied in all material respects with all
covenants, agreements and conditions contained herein or in any
Operative Agreement required to be performed or complied with by it on
or prior to the Initial Closing Date;
(f) The Lessor and the Agent shall each have received (i) a
certificate of the Secretary or an Assistant Secretary of Lessee in the
form attached hereto as Exhibit E or in such other form as is
reasonably acceptable to such parties attaching and certifying as to
(A) the resolutions of its Board of Directors duly authorizing the
execution, delivery and performance by Lessee of each of the Operative
Agreements to which it is or will be a party, (B) its certificate of
incorporation and by-laws, in each case certified as of a recent date
by the Secretary of State of the State of its incorporation, and (C)
the incumbency and signature of persons authorized to execute and
deliver on its behalf the Operative Agreements to which it is a party
and (ii) a good standing certificate from the appropriate officer of
each of the State of Texas and the state in which the Lessee's chief
executive office is located; and
(g) Counsel for the Lessee and the Guarantor reasonably
acceptable to the other parties hereto shall have issued to the Lessor,
the Agent, the Lenders and the Holders the opinions in the form
attached hereto as Exhibit C or in such other form as is reasonably
acceptable to such parties.
6.2. Conditions to the Lessee's Obligations. The obligation of the
Lessee to consummate the transactions contemplated by this Agreement is subject
to (i) the accuracy and correctness on the Initial Closing Date of the
representations and warranties of the other parties hereto contained herein,
(ii) the accuracy and correctness on the Initial Closing Date of the
representations and warranties of the other parties hereto contained in any
other Operative Agreement or certificate delivered pursuant hereto or thereto,
(iii) the performance by the other parties hereto of their respective agreements
contained herein and in the other Operative Agreements, in each case to be
performed by them on or prior to the Initial Closing Date, and (iv)
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the satisfaction or waiver by the Lessee of all of the following conditions on
or prior to the Initial Closing Date:
(a) Each of the Operative Agreements to be entered into on the
Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Lessee, and shall be
in full force and effect, and no Default, other than Defaults of the
Lessee, shall exist thereunder, and the Lessee shall have received a
fully executed copy of each of the Operative Agreements (other than
Notes of which it shall have received a specimen);
(b) In the reasonable opinion of the Lessee and its counsel,
the transactions contemplated by the Operative Agreements do not
violate any material Legal Requirements and will not subject Lessee to
any materially adverse regulatory prohibitions or constraints;
(c) No action or proceeding shall have been instituted nor
shall any action or proceeding be threatened, before any Governmental
Authority, nor shall any order, judgment or decree have been issued or
proposed to be issued by any Governmental Authority (i) to set aside,
restrain, enjoin or prevent the full performance of this Agreement, any
other Operative Agreement or any transaction contemplated hereby or
thereby or (ii) which is reasonably likely to have a Material Adverse
Effect;
(d) The Lessee and the Agent shall each have received an
Officer's Certificate of the Lessor dated as of the Initial Closing
Date in the form attached hereto as Exhibit F or in such other form as
is reasonably acceptable to Lessee and the Agent, stating that (i) each
and every representation and warranty of the Lessor contained in the
Operative Agreements to which it is a party is true and correct on and
as of the Initial Closing Date; (ii) each Operative Agreement to which
the Lessor is a party is in full force and effect with respect to it,
and (iii) the Lessor has duly performed and complied with all
covenants, agreements and conditions contained herein or in any
Operative Agreement required to be performed or complied with by it on
or prior to the Initial Closing Date;
(e) The Lessee and the Agent shall each have received (i) a
certificate of the Secretary, an Assistant Secretary, Trust Officer or
Vice President of the Trust Company in the form attached hereto as
Exhibit G or in such other form as is reasonably acceptable to Lessee
and the Agent, attaching and certifying as to (A) the signing
resolutions, (B) its articles of incorporation or other equivalent
charter documents, as the case may be, certified as of a recent date by
an appropriate officer of the Trust Company, (C) its by-laws and (D)
the incumbency and signature of persons authorized to execute and
deliver on its behalf the Operative Agreements to which it is a party
and (ii) a good standing certificate from the state of incorporation of
the Trust Company and, to the extent required by applicable Law, good
standing or comparable certificates for the Trust Company or the Owner
Trustee from each state in which the Properties are located; and
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(f) Counsel for the Lessor acceptable to the other parties
hereto shall have issued to the Lessee, the Holders, the Lenders and
the Agent an opinion in the form attached hereto as Exhibit H or in
such other form as is reasonably acceptable to such parties.
6.3. Conditions to the Agent's Obligations. The obligation of the Agent
to consummate the transactions contemplated by this Agreement on the Initial
Closing Date is subject to (i) the accuracy and correctness on the Initial
Closing Date of the representations and warranties of the other parties hereto
contained herein, (ii) the accuracy and correctness on the Initial Closing Date
of the representations and warranties of the other parties hereto contained in
any other Operative Agreement or certificate delivered pursuant hereto or
thereto, (iii) the performance by the other parties hereto of their respective
agreements contained herein and in the other Operative Agreements, in each case
to be performed by them on or prior to the Initial Closing Date, and (iv) the
satisfaction, or waiver by the Agent, of all of the following conditions on or
prior to the Initial Closing Date:
(a) Each of the Operative Agreements to be entered into on the
Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Agent, and shall be in
full force and effect, and no Default or Event of Default shall exist
thereunder (both before and after giving effect to the transactions
contemplated by the Operative Agreements), and the Agent shall have
received a fully executed copy of each of the Operative Agreements
(including the Notes). The Operative Agreements (or memoranda thereof),
any supplements thereto and any financing statements and fixture
filings in connection therewith required under the Uniform Commercial
Code shall have been filed or shall be promptly filed, if necessary, in
such manner as to enable the Lessor's counsel to render its opinion
referred to in Section 6.2(f) hereof;
(b) The satisfaction of each of the conditions set forth in
Sections 6.1(b), (c), (e) and (f) and Sections 6.2(d), (e) and (f)
hereof; and
(c) In the reasonable opinion of the Agent and its counsel,
the transactions contemplated by the Operative Agreements do not and
will not violate any material Legal Requirements and do not and will
not subject the Agent to any materially adverse regulatory prohibitions
or constraints.
SECTION 7. Representations and Warranties on the Initial Closing Date.
7.1. Representations and Warranties of the Initial Holders. Effective
as of the Initial Closing Date, each Holder on such date represents and warrants
to each of the other parties hereto that:
(a) It is a national banking association, or a corporation
that is a commercial finance company, in each case duly organized,
validly existing and in good standing
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under the laws of the United States or the country or state of its
organization and has the power and authority to carry on its business
as now conducted and to enter into and perform its obligations under
each Operative Agreement to which it is or will be a party and each
other agreement, instrument and document to be executed and delivered
by it on or before each Closing Date in connection with or as
contemplated by each such Operative Agreement to which it is or will
be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party have been duly authorized
by all necessary action on its part and neither the execution and
delivery thereof, nor the consummation of the transactions contemplated
thereby, nor compliance by it with any of the terms and provisions
thereof (i) requires or will require any approval of the stockholders
of, or approval or consent of any trustee or holder of any indebtedness
or obligations of, such Holder which have not been obtained and be in
full force and effect, (ii) violates or will violate any Legal
Requirement applicable to or binding on it (except no representation or
warranty is made as to any Legal Requirement to which it may be subject
solely as a result of the activities of the Lessee) as of the date
hereof, (iii) violates or will violate or result in any breach of or
constitute any default under, or result in the creation of any Lien
upon any Property or any of the Improvements (other than Liens created
by the Operative Agreements) under its certificate of incorporation or
other equivalent charter documents, or any indenture, mortgage, chattel
mortgage, deed of trust, conditional sales contract, bank loan or
credit agreement or other agreement or instrument to which it is a
party or by which it or its properties is bound or affected or (iv)
requires or will require any Governmental Action by any Governmental
Authority (other than arising solely by reason of the business,
condition or activities of the Lessee or any Affiliate thereof or the
construction or use of the Properties or the Improvements);
(c) There is no action or proceeding pending or, to its
knowledge, threatened against it before any Governmental Authority that
questions the validity or enforceability of any Operative Agreement to
which it is or will become a party or that, if adversely determined,
would materially and adversely affect its ability to perform its
obligations under the Operative Agreements to which it is a party;
(d) It has not assigned or transferred any of its right, title
or interest in or under the Lease except in accordance with the
Operative Agreements;
(e) No Default or Event of Default under the Operative
Agreements attributable to it has occurred and is continuing;
(f) It is not a "holding company" or a "subsidiary company" of
a "holding company" or an "affiliate" of a "holding company" or a
"public utility" within the meaning of the Public Utility Holding
Company Act of 1935, as amended, or a "public utility" within the
meaning of the Federal Power Act, as amended. It is not an
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"investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act or an
"investment adviser" within the meaning of the Investment Advisers Act
of 1940, as amended; and
(g) It is acquiring its interest in the Trust Estate for its
own account for investment and not with a view to any distribution (as
such term is used in Section 2(11) of the Securities Act) thereof, and
if in the future it should decide to dispose of its interest in the
Trust Estate, it understands that it may do so only in compliance with
the Securities Act and the rules and regulations of the Securities and
Exchange Commission thereunder and any applicable state securities
laws. Neither it nor anyone authorized to act on its behalf has taken
or will take any action which would subject, as a direct result of such
action alone, the issuance or sale of any interest in any Property, the
Trust Estate or the Lease to the registration requirements of Section 5
of the Securities Act. No representation or warranty contained in this
Section 7.1(g) shall include or cover any action or inaction of the
Lessee or any Affiliate thereof whether or not purportedly on behalf of
the Holders, the Owner Trustee or any of their Affiliates.
7.2. Representations and Warranties of the Owner Trustee. Effective as
of the Initial Closing Date, Trust Company in its individual capacity and as the
Owner Trustee, as indicated, represents and warrants to each of the other
parties hereto as follows, provided, that the representations in paragraphs (g),
(h), (i) and (j) below are made solely in its capacity as the Owner Trustee:
(a) It is a national banking association duly organized,
validly existing and in good standing under the laws of the United
States of America and has the power and authority to enter into and
perform its obligations under the Trust Agreement and (assuming due
authorization, execution and delivery of the Trust Agreement by the
Holders) has the corporate and trust power and authority to act as the
Owner Trustee and to enter into and perform the obligations under each
of the other Operative Agreements to which Trust Company or the Owner
Trustee, as the case may be, is or will be a party and each other
agreement, instrument and document to be executed and delivered by it
on or before each Closing Date in connection with or as contemplated by
each such Operative Agreement to which Trust Company or the Owner
Trustee, as the case may be, is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party, either in its individual
capacity or (assuming due authorization, execution and delivery of the
Trust Agreement by the Holders) as the Owner Trustee, as the case may
be, has been duly authorized by all necessary action on its part and
neither the execution and delivery thereof, nor the consummation of the
transactions contemplated thereby, nor compliance by it with any of the
terms and provisions thereof (i) requires or will require any approval
of its stockholders, Certificate holders or any approval or consent of
any trustee or holders of any of its indebtedness or
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obligations, (ii) violates or will violate any current law,
governmental rule or regulation relating to its banking or trust
powers, (iii) violates or will violate or result in any breach of or
constitute any default under, or result in the creation of any Lien
upon any of its property under, (A) its charter or by-laws, or (B) any
indenture, mortgage, chattel mortgage, deed of trust, conditional
sales contract, bank loan or credit agreement or other agreement or
instrument to which it is a party or by which it or its properties may
be bound or affected, which violation, breach, default or Lien under
clause (B) would materially and adversely affect its ability, in its
individual capacity or as Owner Trustee, to perform its obligations
under the Operative Agreements to which it is a party or (iv) requires
or will require any Governmental Action by any Governmental Authority
regulating its banking or trust powers;
(c) The Trust Agreement and, assuming the Trust Agreement is
the legal, valid and binding obligation of the Holders, each other
Operative Agreement to which the Trust Company or the Owner Trustee, as
the case may be, is or will be a party have been, or will be, duly
executed and delivered by Trust Company or the Owner Trustee, as the
case may be, and the Trust Agreement and each such other Operative
Agreement to which Trust Company or the Owner Trustee, as the case may
be, is a party constitutes, or upon execution and delivery will
constitute, a legal, valid and binding obligation enforceable against
Trust Company or the Owner Trustee, as the case may be, in accordance
with the terms thereof;
(d) There is no action or proceeding pending or, to its
knowledge, threatened to which it is or will be a party, either in its
individual capacity or as the Owner Trustee, before any Governmental
Authority that, if adversely determined, would materially and adversely
affect its ability, in its individual capacity or as Owner Trustee, to
perform its obligations under the Operative Agreements to which it is a
party or would question the validity or enforceability of any of the
Operative Agreements to which it is or will become a party;
(e) It has not assigned or transferred any of its right, title
or interest in or under the Lease except in accordance with the
Operative Agreements;
(f) No Default or Event of Default under the Operative
Agreements attributable to it has occurred and is continuing;
(g) Neither the Owner Trustee nor any Person authorized by the
Owner Trustee to act on its behalf has offered or sold any interest in
the Trust Estate or the Notes, or in any similar security relating to
a Property, or in any security the offering of which for the purposes
of the Securities Act would be deemed to be part of the same offering
as the offering of the aforementioned securities to, or solicited any
offer to acquire any of the same from, any Person other than, in the
case of the Notes, the Lenders, and neither the Owner Trustee nor any
Person authorized by the Owner Trustee
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to act on its behalf will take any action which would subject, as a
direct result of such action alone, the issuance or sale of any
interest in the Trust Estate or the Notes to the provisions of Section
5 of the Securities Act, or require the qualification of any Operative
Agreement under the Trust Indenture Act of 1939, as amended;
(h) The Owner Trustee's chief place of business, chief
executive office and office where the documents, accounts and records
relating to the transactions contemplated by this Agreement and each
other Operative Agreement are kept are located at First Security Bank,
N.A., 00 Xxxxx Xxxx Xxxxxx, Xxxx Xxxx Xxxx, Xxxx, 00000;
(i) The Owner Trustee is not engaged principally in, and does
not have as one of its important activities, the business of extending
credit for the purpose of purchasing or carrying any margin stock
(within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System of the United States), and no part of the
proceeds of the Loans or the Holder Fundings will be used by it to
purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any such margin stock or for any
purpose that violates, or is inconsistent with, the provisions of
Regulations G, T, U, or X of the Federal Reserve Board; and
(j) The Owner Trustee is not a "holding company" or a
"subsidiary company" of a "holding company" or an "affiliate" of a
"holding company" or a "public utility" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or a "public
utility" within the meaning of the Federal Power Act, as amended. The
Owner Trustee is not an "investment company" or a company "controlled"
by an "investment company" within the meaning of the Investment Company
Act or an "investment adviser" within the meaning of the Investment
Advisers Act of 1940, as amended.
7.3. Representations and Warranties of the Lessee. The Lessee, in its
capacity as Lessee and Guarantor, represents and warrants to each of the other
parties hereto that the following shall be true and correct on and as of each of
the Initial Closing Date, each Property Closing Date and the date of each
Funding unless otherwise indicated:
(a) Corporate Existence; Authority. The Lessee is a duly
organized, and validly existing corporation. The Lessee is in good
standing under the laws of the State of Delaware, is duly qualified and
authorized to do business in the states where any Properties are
located and has all governmental licenses, authorizations, consents and
approvals required to carry on its business as now conducted, except
for such licenses, authorizations, consents and approvals the lack of
which would not be reasonably likely to have a Material Adverse Effect.
(b) Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Lessee of
this Agreement and the other Operative Agreements to which it is a
party are within its corporate powers, have been
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duly authorized by all necessary corporate action of the Lessee,
require no action by or in respect of, or filing with, any
governmental body, agency or official (except for those required in
connection with the Spin-Off) and do not contravene, or constitute a
default under, any provision of applicable Law or of the certificate
of incorporation or by-laws of the Lessee or of any agreement,
judgment, injunction, order, decree or other instrument binding upon
the Lessee or result in the creation or imposition of any Lien on any
asset of the Lessee (except as contemplated by the Operative
Agreements and do not or will not require any approval or consent of
the Lessee, or any trustee or holders of any indebtedness or
obligations of Lessee which have not been duly obtained).
(c) Binding Effect. This Agreement and the other Operative
Agreements to which the Lessee is a party constitute the legal, valid
and binding obligations of the Lessee, enforceable against it in
accordance with their respective terms except as enforceability may be
limited by applicable bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally or by equitable
principles relating to enforceability.
(d) Financial Condition. (1) The combined financial statements
of the Lessee and its Subsidiaries dated as of December 31, 1998, and
the related consolidated statements of income or operations,
shareholders' equity and cash flows for the fiscal year ended on that
date reported on by Xxxxxx Xxxxxxxx LLP and set forth in the Lessee's
filings on Form 10 and Form S-4 (as referenced in the definition of
Spin-Off), and (2) the interim combined financial statements of the
Lessee and its Subsidiaries dated June 30, 1999, and the related
consolidated statements of income or operations, shareholders' equity
and cash flows for the fiscal quarter ended on that date reported on by
Xxxxxx Xxxxxxxx LLP and set forth in the Lessee's filings on Form 10
and Form S-4 (as referenced in the definition of Spin-Off):
(i) were prepared in accordance with GAAP consistently
applied for the periods covered thereby, except as otherwise expressly
noted therein (subject, in the case of the unaudited interim
statements, to ordinary, good faith year-end audit adjustments); and
(ii) fairly present (subject, in the case of the
unaudited interim statements, to ordinary, good faith year-end audit
adjustments) the financial condition of the Company and its
Subsidiaries as of the dates thereof and the results of operations for
the periods covered thereby.
(3) Since June 30, 1999, there has been no Material Adverse
Effect with respect to the Lessee.
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(e) Litigation. Except as disclosed in Schedule II, there are
no actions, suits, proceedings, claims, disputes pending or, to the
Knowledge of the Lessee, threatened, at law, in equity, in arbitration
or before any Governmental Authority, against the Lessee or any
Subsidiary or any of their respective properties which: (i) purport to
affect or pertain to this Agreement or any other Operative Agreement,
or any of the transactions contemplated hereby or thereby; or (ii) if
determined adversely to the Lessee or its Subsidiaries, could in the
reasonable judgment of the Lessee be expected to have a Material
Adverse Effect. No injunction, writ, temporary restraining order or
other order of any nature has been issued by any court or other
Governmental Authority purporting to enjoin or restrain the execution,
delivery or performance of this Agreement or any other Operative
Agreements, or directing that the transactions provided for herein or
therein not be consummated as herein or therein provided.
(f) Status. The Lessee or any Subsidiary is not an "investment
company" or controlled by an "investment company" within the meaning of
the Investment Company Act of 1940, as amended, nor is it subject to
regulation under the Investment Advisors Act, the Public Utility
Holding Company Act of 1935, the Federal Power Act or the Interstate
Commerce Act, or under any other state or Federal Law limiting its
ability to execute and deliver any Operative Agreement or perform its
obligations thereunder.
(g) Compliance with Margin Regulations. No proceeds of any
Loan or Holder Funding have been or will be used in violation of any
applicable Law (including, without limitation, Regulation D, Regulation
G, Regulation T, Regulation U and Regulation X of the Federal Reserve
Board, as in effect from time to time), giving effect to the
transactions contemplated to be consummated on the Initial Closing Date
and on the date of each subsequent Loan and Holder Funding.
(h) No Default. No Default, Event of Default or Major
Environmental Event has occurred and is continuing.
(i) Consents. The execution, delivery and performance by the
Lessee of each Operative Agreement to which it is a party and any other
agreement which it has entered into in connection with the transactions
contemplated thereby, the consummation of the transactions contemplated
thereby and its compliance with the terms thereof does not require the
consent of any Person or the approval or authorization of, or filing,
registration or qualification with, any Federal, state or local
governmental authority on the part of the Lessee as a condition to such
execution, delivery, performance and compliance except those consents
which have already been obtained by the Lessee and copies of which have
been delivered to the Lessor, the Agent, the Lenders and the Holders,
and those consents that will be obtained on or before the Initial
Closing Date.
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(j) Title to the Property.
(i) On and after the Property Closing Date for each
Property, the Lessor will have good and marketable title to
such Property (other than any Land subject to a Ground Lease),
together with the right to use any necessary easements or
rights-of-way or similar property rights, subject only to
Permitted Encumbrances.
(ii) On and after the Property Closing Date for each
Property that is subject to a Ground Lease, the Lessor will
have a good and marketable leasehold interest in the Land that
is subject to a Ground Lease, together with the right to use
any necessary easements or rights-of-way or similar property
rights, subject only to Permitted Encumbrances.
(iii) On or after the Property Closing Date for each
Property, the Lessee does not have actual knowledge or written
notice that such Property contains any defect or feature
making it unsuitable for the proper operation thereof.
(k) Compliance with Law. The Lessee is not in violation of any
Law in any material respect with respect to any Property or any part
thereof, or with respect to its leasing, ownership, or operation of any
Property or any part thereof, or with respect to the conduct of its
business relating to any Property or any part thereof in each case to
the extent the violation of such Law would have a Material Adverse
Effect. To the Knowledge of the Lessee, the Lessee has not received any
notice of, or citation for, any violation of any Law which has not been
resolved, which notice or citation relates to the ownership, leasing or
operation of any Property or any part thereof and the violation of
which would have a Material Adverse Effect. The Lessee is in compliance
in all material respects with all applicable Laws, the violation of
which would have a Material Adverse Effect.
(l) Recordation and Filing. On and as of the Property Closing
Date for each Property, the memoranda of Ground Lease, memoranda of
Lease, and the Mortgage Instruments and all Lender Financing Statements
and Lessor Financing Statements, to be recorded or filed, shall have
been duly recorded, published, registered and filed by the Lessee and
are in a form sufficient to create or publish notice of the interests
in such Property or any part thereof purported to be created thereby.
Upon the recordation of the memoranda of Ground Lease, the memoranda of
Lease and the Mortgage Instruments and the filing of such Lender
Financing Statements and Lessor Financing Statements, each to be
recorded or filed in such places as the Lessee shall notify the Agent
and the Lessor prior to such Property Closing Date, such documents will
have been recorded or filed in each place in which recording or filing
is required to publish notice, under applicable Law, of the interests
created thereby and to protect the validity and effectiveness thereof,
and all Taxes, fees and other public charges payable in connection with
the publishing,
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filing and recordation of the memoranda of Ground Lease, the memoranda
of Lease, the Mortgage Instruments, the Lender Financing Statements
and Lessor Financing Statements will have been paid in full by the
Lessee.
(m) Rights to Property, Etc.
(i) On and after the Property Closing Date with
respect to any Property, the Lessor has the right to use all
rights-of-way, easements and real property licenses,
environmental allowances, rights in real property (including,
without limitation, fixtures and appurtenances), utilities and
other services necessary for the day-to-day operation of the
Property and the construction of the Improvements and (A) such
rights-of-way, easements, licenses, environmental allowances,
utilities and other services are valid and in full force and
effect in accordance with their terms, (B) there is presently
no default with respect to any such rights-of-way, easements,
licenses, utilities and other services by the Lessee or Lessor
or, to the knowledge of the Lessee, by any other Person, and
(C) all utility services necessary for the construction of the
Improvements and operation of the Property for their intended
purposes are or will be available at the boundaries of the
Property.
(ii) On and after the Initial Closing Date, none of
the Permitted Encumbrances will interfere with the use or
possession of any Property or any part thereof or any other
asset used in connection therewith or the use of or the
exercise by the Agent of its rights either under any Operative
Agreement or to the Property.
(iii) On and after the Property Closing Date with
respect to any Property, except for the Permitted
Encumbrances, each Property will be situated wholly within the
boundary lines of the respective Land and will not encroach
upon any contiguous or adjoining property; no Property or any
part thereof is considered part of a larger zoning or tax lot;
the Improvements will not encroach on any easements or
rights-of-way affecting any Property or any part thereof, will
not violate any rights granted thereunder or any covenants or
restrictions affecting any Property, or any part thereof, and
any future violation will not result in a reversion or
forfeiture of title, right of re-entry or power of
termination; and the easements, rights-of-way, covenants and
restrictions affecting any Property or any part thereof will
not interfere with the use or occupancy of any Property or any
part thereof, or any asset owned or used in connection
therewith, nor will the exercise of rights or remedies
thereunder result in any damage to any Property or diminution
of value of any Property, or any part thereof.
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(n) Environmental Compliance. Subject to Section 15.2 of the
Lease:
(i) each Property complies in all material respects
with all Environmental Laws; all necessary Environmental
Permits have been obtained and are in effect for each Property
and no circumstances exist that could be reasonably likely to
(A) form the basis of an Environmental Action against any
Property or (B) cause any Property to be subject to any
restrictions on ownership, occupancy, industrial use or
transferability under any Environmental Law; and
(ii) except as a result of the Temple Property's RCRA
status or the USEPA's RCRA Facility assessment (as reflected,
in either case, in (A) the "Phase I" environmental site
assessment prepared by Xxx X. Xxxxxx, Inc., a copy of which
has been delivered by the Lessee to the Agent, or (B) portions
of the "Phase I" and "Phase II" environmental site assessments
prepared by CH2M Hill relating to the Temple Property, copies
of which have been delivered by the Lessee to the Agent),
neither any Property nor any part thereof is listed or
proposed for listing on the NPL or on CERCLIS or any analogous
state list of sites requiring investigation or cleanup;
(iii) all Hazardous Materials generated, used,
treated, handled or stored at or transported to or from any
Property or any part thereof by the Lessee, the Guarantor or
any of its Subsidiaries, have been disposed of in compliance
with all Environmental Laws and Environmental Permits;
(iv) except with respect to the Canadaiqua Property,
the Lessee has not received any written or other notice,
mandate, order, Lien or request which remains pending under an
Environmental Law concerning any Property or any part thereof
or relating to an alleged violation of an Environmental Law
concerning any Property or any part thereof or relating to any
potential adverse action in any way involving environmental,
health or safety matters affecting any Property or any part
thereof;
(v) except with respect to the Canadaiqua Property,
there is no proceeding pending or, to the knowledge of the
Lessee, threatened in writing, against the Lessee, by any
Federal, state, or local court, tribunal, administrative
agency, department, commission, board or other authority or
instrumentality with respect to the presence on or release of
any Hazardous Material from any Property or any part thereof;
and
(vi) except with respect to the release at or near
the Canadaiqua Property reflected in the Phase II
environmental reports prepared by Dames & Xxxxx and Sear
Xxxxx, copies of which have been delivered by the Lessee to
the Agent, no Hazardous Materials have been released from or
on any Property or any
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part thereof for which remedial action could reasonably be
required under any Environmental Law or may be necessary to
prevent or eliminate a "significant risk to human health or
the environment" that have not already been remediated (as
defined in Section 15.2 of the Lease).
(o) No Condemnation, Casualty or Force Majeure. Neither any
Property nor any part thereof has suffered a Condemnation or a Casualty
or any other damage or destruction which renders such Property unusable
in whole or in material part, and, under applicable Law,
each Property may be used for the purposes contemplated by the Lessee
in accordance with the Lease. No Force Majeure Event has occurred and
is continuing which would adversely affect the operation of any
Property or any material part thereof or the construction, renovation
and operation of the Improvements.
(p) Permits. All Permits (including Environmental Permits)
that are or will become Applicable Permits have been obtained, except
Applicable Permits which are permitted by Law to be obtained after the
Property Closing Date with respect to any Property or after any date on
which any Funding shall occur, as applicable. All such Permits that are
or will become Applicable Permits are in proper form, in full force and
effect and not subject to any further appeal or further contest or to
any unsatisfied condition that may allow modification or revocation.
(q) Insurance. The Lessee is in compliance with all Insurance
Requirements, and all insurance policies required by Section 14 of the
Lease are in full force and effect.
(r) Taxes. The Lessee and its Subsidiaries have filed or
caused to be filed all United States federal income tax returns and all
other material domestic tax returns which to the Knowledge of the
Lessee are required to be filed (as of each applicable date) and have
paid or provided for the payment before the same became delinquent, all
Taxes due pursuant to such federal income tax returns and other
material domestic tax returns other than those Taxes being contested in
good faith by appropriate proceedings. The charges, accruals and
reserves on the books of the Lessee and its Subsidiaries in respect of
Taxes are, in the opinion of the Lessee, adequate to the extent
required by GAAP. There is no proposed tax assessment against the
Lessee or any Subsidiary that would, if made, have a Material Adverse
Effect.
(s) No Material Adverse Event. No applicable Law prohibits,
and no litigation, governmental investigation or other proceeding is
pending or, to the Knowledge of the Lessee threatened, in which there
is a reasonable possibility of an unfavorable judgment, decree, order
or other determination which could prevent or make unlawful, or impose
any material adverse condition upon, any Property or the acquisition,
construction, use, ownership, operation or leasing thereof.
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(t) Full Disclosure. No statement or material furnished by or
on behalf of the Lessee to the Agent, the Lenders, the Holders, or the
Lessor, in connection with any Operative Agreements or any transaction
contemplated thereby contains any untrue statement of a material fact
or omits a material fact necessary to make the statements contained
therein or herein not misleading.
(u) Fair Price. The Properties to be acquired are being
acquired at a price that is not in excess of fair market value, and
such Properties consist of (i) unimproved Land, or (ii)
Land and existing Improvements thereon which Improvements are either
suitable for occupancy at the time of acquisition or will be removed,
renovated or modified in accordance with the terms of this Agreement,
or (iii) Equipment. Each of the Properties is located at the site set
forth on the applicable Requisition, which is in one of the Approved
States.
(v) Flood Hazard. Except for certain portions of the Xxxxxxxxx
Property and the Temple Property, no portion of any Property being
acquired by the Lessor on any Property Closing Date is located in an
area identified as a special flood hazard area by the Federal Emergency
Management Agency or other applicable agency, or if any such Property
is located in an area identified as a special flood hazard area by any
such agency, then flood insurance has been obtained for such Property
to the extent required by Section 14.2(b) of the Lease and in
accordance with the National Flood Insurance Act of 1968, as amended.
(w) Bankruptcy, Etc. The Lessee has not admitted in writing
its inability to pay its debts generally or has not made a general
assignment for the benefit of creditors; no proceeding has been
instituted by or against the Lessee seeking to adjudicate it a bankrupt
or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or
its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order
for relief or the appointment of a receiver, trustee, custodian or
other similar official for it or for any substantial part of its
property the Lessee taken any corporate action to authorize any of the
actions set forth above in this subsection (w).
(x) Conditions Precedent. All conditions precedent contained
in this Agreement and in the other Operative Agreements relating to
each Funding have been substantially satisfied on the date of such
Funding.
(y) Governmental Authorization. Except those required in
connection with the Spin-Off, no approval, consent, exemption,
authorization or other action by, or notice to, or filing with, any
Governmental Authority (other than any of the foregoing which has been
obtained or made and is in full force and effect) is necessary or
required in connection with the execution, delivery or performance by
the Lessee of this Agreement or any other Operative Agreement.
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(z) ERISA Compliance.
(i) Each Plan is in compliance in all material
respects with the applicable provisions of ERISA, the Code and
other federal or state law. Each Plan which is intended to
qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS, and to the
Knowledge of the Lessee, nothing has occurred which would
cause the loss of such qualification. The Lessee and each
ERISA Affiliate has made all required contributions to any
Plan subject to Section 412 of the Code and no application for
a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect
to any Plan.
(ii) There are no pending or, to the Knowledge of
Lessee, threatened claims, actions or lawsuits, or action by
any Governmental Authority, with respect to any Plan which has
resulted or could reasonably be expected to result in a
Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules
with respect to any Plan which has resulted or could
reasonably be expected to result in a Material Adverse Effect.
(iii) (a) No ERISA Event has occurred or is
reasonably expected to occur; (b) no contribution failure has
occurred with respect to a Pension Plan sufficient to give
rise to a Lien under Section 302(f) of ERISA; (c) no Pension
Plan has any material Unfunded Pension Liability; (d) neither
the Lessee nor any ERISA Affiliate has incurred, or reasonably
expects to incur, any material liability under Title IV of
ERISA with respect to any Pension Plan (other than premiums
due and not delinquent under Section 4007 of ERISA); (e)
neither the Lessee nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any material liability (and no
event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under
Section 4201 or 4243 of ERISA with respect to a Multiemployer
Plan; and (f) neither the Lessee nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069
or 4212(c) of ERISA.
(aa) Material Subsidiaries. Each of the Material Subsidiaries is a
corporation duly incorporated, validly existing and in good standing, in each
case under the laws of its jurisdiction of incorporation, except where failure
of a Material Subsidiary of the Lessee to be duly incorporated, validly existing
and in good standing would not have a Material Adverse Effect.
(bb) The Lessee and its Subsidiaries have reviewed the areas within
their business and operations which could be adversely affected by, and have
developed programs to address on a timely basis, the "Year 2000 Problem" (that
is, the risk that computer applications used by the Lessee may be unable to
recognize and perform properly date sensitive functions involving certain dates
prior to any date after December 31, 1999). Based on such review and programs,
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the Lessee reasonably believes that the "Year 2000 Problem" will not result in a
Material Adverse Effect.
(cc) Solvency, etc. On the Execution Date, and immediately prior to and
after giving effect to each Borrowing hereunder and the use of the proceeds
thereof, (a) the Lessee's assets will exceed its liabilities and (b) the Lessee
will be solvent, will be able to pay its debts as they mature, will own property
with fair saleable value greater than the amount required to pay its debts and
will have capital sufficient to carry on its business as then constituted.
7.4. Representations and Warranties of the Agent. Effective as of the
Initial Closing Date, the Agent represents and warrants to each of the other
parties hereto that:
(a) It is a national banking association duly organized and
validly existing under the laws of the United States of America and has
the full power and authority to enter into and perform its obligations
under this Agreement and each other Operative Agreement to which it is
or will be a party;
(b) The execution, delivery and performance by the Agent of
this Agreement and each other Operative Agreement to which it is or
will be a party are not, and will not be, inconsistent with the
articles of incorporation or by-laws or other charter documents of the
Agent, do not and will not contravene any applicable Law of the State
of New York or of the United States of America governing its activities
and will not contravene any provision of, or constitute a default under
any indenture, mortgage, contract or other instrument to which it is a
party or by which it or its properties are bound, or require any
consent or approval of any Governmental Authority under any applicable
law, rule or regulation of the State of New York or any federal law,
rule or regulation of the United States of America governing its
activities; and
(c) Each of this Agreement and each other Operative Agreement
to which it is a party has been, or when executed and delivered will
be, duly authorized by all necessary corporate action on the part of
the Agent and has been, or on such Closing Date will be, duly executed
and delivered by the Agent.
SECTION 8. General Covenants of the Lessee and the Guarantor.
8.1. Covenants of the Lessee.
(a) Information. The Lessee shall deliver to the Agent, for
distribution to the Lessor, Lenders and Holders, in form and detail
satisfactory to the Lessor, Lenders and the Holders (it being
understood that for purposes hereof, the form and detail required by
the SEC for annual and quarterly reports filed pursuant to the Exchange
Act shall be deemed satisfactory):
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(i) as soon as available, but not later than 90 days
after the end of each fiscal year, a copy of the audited
consolidated balance sheet of the Lessee and its Subsidiaries
as at the end of such year and the related consolidated
statements of income or operations, shareholders' equity and
cash flows for such year, setting forth in each case in
comparative form the figures for the previous fiscal year, and
accompanied by the opinion of Xxxxxx Xxxxxxxx LLC or another
nationally-recognized independent public accounting firm
("Independent Auditor"), which opinion (i) shall state that
such consolidated financial statements present fairly the
Lessee's consolidated financial position for the periods
indicated in conformity with GAAP and (ii) shall not be
qualified or limited because of a restricted or limited
examination by the Independent Auditor of any material portion
of the Lessee's or any Subsidiary's records; and
(ii) as soon as available, but not later than 50 days
after the end of each of the first three fiscal quarters of
each fiscal year (commencing with the fiscal quarter ending
September 30, 1999), a copy of the unaudited consolidated
balance sheet of the Lessee and its Subsidiaries as of the end
of such quarter and the related consolidated statements of
income, shareholders' equity and cash flows for the period
commencing on the first day and ending on the last day of such
quarter, and certified by a Responsible Officer as fairly
presenting, in accordance with GAAP (subject to ordinary, good
faith year-end audit adjustments), the financial position and
the results of operations of the Lessee and its Subsidiaries
as of such date and for such period.
(iii) simultaneously with the delivery of each set of
financial statements referred to in clauses (i) and (ii)
above, a certificate of an authorized financial officer or
accounting officer of the Lessee (1) setting forth in
reasonable detail the calculations required to establish
whether the Lessee was in compliance with the requirements of
Section 8.1(o) as at the date of such financial statements and
reconciling such calculations with the information presented
in such financial statements, and (2) stating whether to the
best knowledge of such officer, there exists on the date of
such certificate any Lease Event of Default or any Major
Environmental Event or event which, with the giving of notice
or lapse of time, or both, would constitute a Lease Event of
Default or a Major Environmental Event and, if so, setting
forth the details thereof and the action which the Lessee has
taken and proposes to take with respect thereto.
(iv) as soon as is possible and in any event within
five Business Days after a change in, or issuance of, any
rating of any of the Lessee's senior unsecured long-term
Debt by S&P or Xxxxx'x which causes a change in the applicable
Rating, notice to the Agent of such change;
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(v) promptly upon the mailing thereof to the
shareholders of the Lessee generally, copies of all financial
statements, proxy statements, and other reports so mailed;
(vi) promptly after their becoming available, copies
of all financial statements and reports that the Lessee sends
to its shareholders, and copies of all financial statements
and regular, periodic or special reports (including Forms 10K,
10Q and 8K) that the Lessee or any Subsidiary may make to, or
file with, the SEC;
(vii) promptly after the filing or receiving thereof,
copies of all reports and notices which the Lessee files under
ERISA with the Internal Revenue Service or the PBGC or the
U.S. Department of Labor or which the Lessee receives from
such entities other than immaterial regular periodic notices
and reports and notices and reports of general circulation;
(viii) such other information respecting the
condition or operations, financial or otherwise, of the
Lessee, in each case as are relevant to the Operative
Agreements, as any Holder, the Lessor, the Agent or any Lender
may from time to time reasonably request from the Lessee
through the Agent;
(ix) as soon as possible and in any event within five
Business Days after a Responsible Officer of the Lessee has
obtained Knowledge thereof, notice of the occurrence of any
Lease Event of Default, or any Major Environmental Event
continuing on the date of such notice, and a certificate of an
authorized financial officer or accounting officer of the
Lessee setting forth details of such Lease Event of Default,
or such Major Environmental Event and the action which the
Lessee has taken and proposes to take with respect thereto;
(x) promptly, but in any event within thirty (30)
days after the date Lessee has actual knowledge thereof,
Lessee shall provide to Lessor written notice of any
Reportable Environmental Event. All such notices shall
describe in reasonable detail the nature of the Reportable
Environmental Event and Lessee's proposed response thereto. In
addition, Lessee shall provide to Lessor, within five (5)
Business Days of Lessor's request therefor, copies of all
material written communications with any Governmental
Authority relating to any Environmental Law in connection with
any Property. Lessee shall also promptly provide such detailed
reports of any material Environmental Claims as may reasonably
be requested by Lessor; and
(xi) promptly after their becoming available, any
management letter issued by the Company's Independent Auditor
regarding the "Year 2000" exposure or programs of the Company
and its Subsidiaries;
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(b) Compliance with Environmental Laws. Subject to Section
15.2 of the Lease, the Lessee shall comply, and cause other Persons
operating or occupying any Property to comply with all Environmental
Laws now existing or hereafter enacted and Environmental Permits with
respect to any Property or any part thereof; obtain and renew all
Environmental Permits necessary for ownership and operation of any
Property or any part thereof; and conduct any investigation, study,
sampling and testing, and undertake any cleanup, removal, and remedial
or other action necessary to remove and clean up all Hazardous
Materials from any Property or any part thereof pursuant to the lawful
order of any regulatory authority and generally in accordance with the
requirements of all Environmental Laws.
(c) Maintenance of Property. The Lessee shall keep all
property used or useful in its business in good working order and
condition, ordinary wear and tear excepted (and otherwise in compliance
with the requirements of the Lease) except where the failure to do so
would not have a Material Adverse Effect.
(d) Maintenance of Existence.
(i) The Lessee shall preserve and maintain its
corporate existence or the corporate existence of a successor permitted
under Section 8.1(j).
(ii) The Lessee shall preserve and maintain its
rights (charter and statutory), and franchises except if, in the
reasonable business judgment of the Lessee, it is in its best economic
interest not to preserve and maintain such rights or franchises and
such failure to preserve and maintain such rights or franchises would
not materially adversely affect the rights of the Holders, the Lenders,
the Agent or the Lessor or the ability of the Lessee to perform its
obligations hereunder and under the other Operative Agreements to which
it is a party.
(e) Compliance with Laws. The Lessee shall comply in all
material respects with all applicable Laws (other than Environmental
Laws, which are the subject of Section 7.3(n) hereof) rules,
regulations and orders, such compliance to include, without limitation,
paying before the same become delinquent all United States federal
income taxes and all other material domestic taxes, assessments and
governmental charges imposed upon it or upon its property except to the
extent the necessity of compliance therewith is contested in good faith
by appropriate proceedings and the Lessee establishes and maintains
adequate reserves if and to the extent required under GAAP.
(f) Inspection of Property and Books and Records. The Lessee
shall, and shall cause each Subsidiary to, maintain proper books of
record and account, in which full, true and correct entries (sufficient
to permit the preparation of consolidated financial statements in
conformity with GAAP) shall be made of all financial transactions and
matters involving the assets and business of the Lessee and such
Subsidiary. The Lessee
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shall permit, and shall cause each Subsidiary to permit, the
Administrative Agent, any Lender or their respective representatives,
subject to such limitations as the Lessee may reasonably impose to
ensure compliance with any applicable legal or contractual
restrictions, to visit and inspect the Property, to examine their
respective corporate, financial and operating records with respect to
the Property, and make copies thereof or abstracts therefrom, and to
discuss the affairs, finances and accounts of the Lessee or any
Subsidiary in each case as are relevant to the Operative Agreements
with their respective officers at such reasonable times during normal
business hours as may be reasonably desired, upon reasonable advance
notice to the Lessee; provided that when a Lease Event of Default
exists the Agent, any Holder or any Lender may do any of the foregoing
at any time during normal business hours and without advance notice.
(g) Use of Proceeds; Application of Proceeds to Actual Project
Costs. The Lessee shall use proceeds of the Loans and Holder Fundings
received by it solely to pay for the costs and expenses described in
Section 5.1, and none of the Loans or Holder Advances will be used in
violation of any applicable Law, including, without limitation,
Regulation D, Regulation G, Regulation T, Regulation U and Regulation X
of the Federal Reserve Board (as in effect from time to time).
(h) Performance. The Lessee shall observe and perform all
provisions to be observed or performed by it contained in each
Operative Agreement to which it is a party, in accordance with the
terms thereof and within the times permitted thereby (including any
grace or cure periods provided thereby) and will maintain, or cause to
be maintained, the validity and effectiveness as to the Lessee of each
such Operative Agreement to which it is a party.
(i) Intellectual Property Rights. The Lessee shall preserve,
protect and maintain its rights in and to all patents, patent
applications, trademarks (whether registered or not), trademark
applications, trade names, proprietary computer software, "know-how"
and copyrights used or to be used in the ordinary course of the
operation of each Property (the "Intellectual Property Rights") in
accordance with prudent industry practice.
(j) Mergers. The Lessee will not merge or consolidate with any
other Person or sell, lease, transfer or otherwise dispose of its
property and assets as, or substantially as, an entirety to any Person,
unless (i) either the Lessee shall be the continuing or surviving
corporation, or the successor or acquiring corporation shall be a
solvent corporation organized under the laws of any State of the United
States of America and shall expressly assume in writing all of the
obligations of the Lessee under this Agreement and other Operative
Agreements, including all covenants herein and therein contained, and
such successor or acquiring corporation shall succeed to and be
substituted for the Lessee with the same effect as if it had been named
herein as a party hereto, provided that no such sale shall release the
Lessee from any of its obligations and
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liabilities under this Agreement or other Operative Agreements unless
such sale is followed by the complete liquidation of the Lessee and
substantially all the assets of the Lessee immediately following such
sale are distributed in such liquidation, and (ii) there shall not
exist, as to the Lessee as the continuing or surviving corporation or
the successor or acquiring corporation, as the case may be, shall not
immediately after such merger or consolidation, or such sale or other
disposition, any Lease Default, Lease Event of Default or Major
Environmental Event.
(k) Maintenance of Insurance. The Lessee shall maintain, and
shall cause each of its Subsidiaries to maintain, insurance with
financially sound and reputable insurance companies or associations (or
maintain self-insurance as provided below), in such amounts and
covering such risks as is usually carried by companies engaged in
similar businesses and owning similar properties as the Lessee;
provided that self-insurance by the Lessee shall not be deemed a
violation of this covenant to the extent that such self-insurance
complies with the limits set forth in Section 14 of the Lease.
(l) Payment of Obligations. The Lessee shall, and shall cause
each Subsidiary to, pay and discharge, as the same become due and
payable: (i) all material tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets and (ii) all
material claims which, if unpaid, would by law become a Lien upon its
property, unless, in each case, the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by the Lessee or such Subsidiary.
(m) Compliance with ERISA. The Lessee shall, and shall cause
each of its ERISA Affiliates to: (i) maintain each Plan in compliance
in all material respects with the applicable provisions of ERISA, the
Code and other federal or state law; (ii) cause each Plan which is
qualified under Section 401(a) of the Code to maintain such
qualification; and (iii) make all required contributions to any Plan
subject to Section 412 of the Code.
(n) ERISA Event. The Lessee shall promptly and in any event
within 10 days notice of the occurrence of any of the following events
known to the Lessee which affect the Lessee or any ERISA Affiliate, and
deliver to the Agent and each Lender a copy of any notice with respect
to such event that is filed with a Governmental Authority and any
notice delivered by a Governmental Authority to the Lessee or any ERISA
Affiliate:
(i) an ERISA Event;
(ii) a contribution failure with respect to a Pension
Plan sufficient to give rise to a Lien under Section 302(f) of
ERISA;
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(iii) a material increase in the Unfunded Pension
Liability of any Pension Plan;
(iv) the adoption of, or the commencement of
contributions to, any Pension Plan by the Company or any ERISA
Affiliate that, in either case, requires material
contributions; or
(v) the adoption of any amendment to a Pension Plan
if such amendment results in a material increase in
contributions or Unfunded Pension Liability.
(o) Financial Covenants. Beginning on the Initial Closing Date
and continuing so long as any Lender or Holder shall have any
Commitment hereunder, or any Loan or Holder Amount shall remain unpaid
or unsatisfied, unless the Majority Lenders waive compliance in
writing:
(i) Minimum Interest Coverage Ratio. The Lessee shall
not permit, as of the last day of any fiscal quarter
(beginning with the first fiscal quarter ending after the
Initial Closing Date), its Interest Coverage Ratio to be less
than (a) for each Computation Period ending prior to October
1, 2000, 3.0 to 1 and (b) for each Computation Period ending
thereafter, 3.5 to 1.
(ii) Maximum Total Debt to EBITDA Ratio. The Lessee
shall not at any time permit the Total Debt to EBITDA Ratio to
be greater than (a) 3.85 to 1 at any time prior to the earlier
of (i) April 1, 2000 and (ii) the consummation of the PCA
initial public offering and (b) 3.5 to 1 at any time
thereafter.
(iii) Limitation on Liens. The Lessee shall not, and
shall not suffer or permit any Subsidiary to, directly or
indirectly, make, create, incur, assume or suffer to exist any
Lien, other than Permitted Encumbrances, upon or with respect
to any part of its property, whether now owned or hereafter
acquired, other than the following:
(1) any Lien existing on the Initial Closing
Date and set forth in Schedule III, and any
extension, renewal or replacement of any such Lien so
long as the principal amount secured thereby is not
increased (other than an increase resulting solely
from a change in applicable rates of exchange between
U.S. Dollars, on the one hand, and any other currency
in which such principal amount is denominated, on the
other hand) and the scope of the property subject to
such Lien is not extended;
(2) Liens imposed by law for taxes,
assessments or charges of any Governmental Authority
for claims not yet due, or to the extent that
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non-payment thereof is permitted by Section 8.1(l),
provided that no notice of Lien has been filed or
recorded under the Code;
(3) statutory Liens of landlords and Liens
of carriers, warehousemen, mechanics, materialmen and
other Liens imposed by law or created in the ordinary
course of business which are not delinquent or remain
payable without penalty or which are being contested
in good faith by appropriate proceedings;
(4) Liens (other than any Lien imposed by
ERISA) consisting of pledges or deposits required in
the ordinary course of business in connection with
workers' compensation, unemployment insurance and
other social security legislation;
(5) Liens on the property of the Lessee or
any Subsidiary securing (i) the non-delinquent
performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, (ii)
surety bonds (excluding appeal bonds and other bonds
posted in connection with court proceedings or
judgments) and (iii) other non-delinquent obligations
of a like nature in each case incurred in the
ordinary course of business, provided all such Liens
in the aggregate would not (even if enforced) cause a
Material Adverse Effect;
(6) Liens consisting of judgment or judicial
attachment liens and liens securing contingent
obligations on appeal bonds and other bonds posted in
connection with court proceedings or judgments,
provided that (i) in the case of judgment and
judicial attachment liens, the enforcement of such
Liens is effectively stayed and (ii) all such liens
in the aggregate at any time outstanding for the
Lessee and its Subsidiaries do not exceed
$20,000,000;
(7) easements, rights-of-way, covenants,
conditions, restrictions and other similar
encumbrances incurred in the ordinary course of
business which, individually or in the aggregate, do
not materially interfere with the ordinary conduct of
the respective businesses of the Lessee and its
Subsidiaries;
(8) Liens securing obligations in respect of
Capital Leases on assets subject to such leases,
provided that such Capital Leases are otherwise
permitted hereunder;
(9) Liens arising solely by virtue of any
statutory or common law provision relating to
banker's liens, rights of set-off or similar rights
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and remedies as to deposit accounts or other funds
maintained with a creditor depository institution;
provided that (i) such deposit account is not a
dedicated cash collateral account and is not subject
to restrictions against access by the Lessee in
excess of those set forth by regulations promulgated
by the Federal Reserve Board, and (ii) such deposit
account is not intended by the Lessee or any
Subsidiary to provide collateral to the depository
institution;
(10) any Lien on property existing at the
time of acquisition of such property by the Lessee or
a Subsidiary, or Liens to secure the payment of all
or part of the purchase price of property upon the
acquisition of property by the Lessee or a Subsidiary
or to secure any Debt incurred or guaranteed prior
to, at the time of, or within one hundred eighty
(180) days after, the later of the date of
acquisition of such property and the date such
property is placed in service, for the purpose of
financing all or any part of the purchase price
thereof, or Liens to secure any Debt incurred or
guaranteed for the purpose of financing the cost to
the Lessee or a Subsidiary or improvements to such
acquired property;
(11) other Liens, in addition to those
permitted by clauses (1) through (10), securing Debt
or arising in connection with Securitization
Transactions; provided that the sum (without
duplication) of all such Debt, plus the aggregate
investment or claim held at any time by all
purchasers, assignees or other transferees of (or of
interests in) receivables and other rights to payment
in all Securitization Transactions, shall not at any
time exceed in the aggregate $200,000,000; and
(12) rights of first refusal, rights of
Governmental Authorities to approve transfers and
other similar restrictions on transfer of any
ownership interest of the Lessee or any of its
Subsidiaries in any joint venture or similar
investment in an entity (other than a Subsidiary)
operating primarily outside of the United States.
(p) Restrictions on Subsidiaries. The Lessee (a) will not
enter into any agreement or understanding pursuant to which
Subsidiary and (b) will not, and will not permit any Subsidiary to,
enter into any agreement or understanding which by its terms limits
or restricts the ability of such Subsidiary to make funds available
to the Lessee (whether by way of a dividend or other distribution,
by repayment of any inter-company advance or otherwise) if, in any
such case referred to in (a) or (b) above, there is, at the time any
such agreement is entered into, a reasonable likelihood that all
such agreements and understandings referred to in (a)
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or (b) above, considered together, would materially and adversely
affect the ability of the Lessee to meet its obligations as they become
due.
(q) Limitation on Subsidiary Debt. The Lessee shall not permit
its Subsidiaries to create, incur, assume or suffer to exist, or
otherwise become or remain directly or indirectly liable with respect
to, any Debt (excluding obligations in respect of Securitization
Transactions) at any time outstanding in an aggregate amount in excess
of the greater of (a) $100,000,000 and (b) 12.5% of Total Debt.
(r) Transactions with Affiliates. The Lessee shall not, and
shall not permit any Subsidiary to, enter into any transaction with any
Affiliate of the Lessee (other than the Lessee or a Subsidiary), except
upon fair and reasonable terms no less favorable to the Lessee or such
Subsidiary than would obtain in a comparable arm's-length transaction
with a Person not an Affiliate of the Lessee or such Subsidiary.
(s) Change in Business. The Lessee and its Subsidiaries taken
as a whole shall continue the primary businesses in which they are
engaged on the Execution Date and lines of business reasonably related
thereto.
(t) Change in Accounting Policies. As soon as practicable and
in any event within 10 days notice of any material change in accounting
policies or financial reporting practices by the Lessee and its
consolidated Subsidiaries.
(u) Preservation of Corporate Existence, Etc. The Lessee
shall, and shall cause each Subsidiary to (provided that nothing in
this Section 8.1(u) shall prevent the voluntary liquidation,
dissolution or winding up, not under any bankruptcy or insolvency law,
of any Subsidiary so long as no Lease Event of Default exists and no
Lease Event of Default or Lease Default will result therefrom):
(i) preserve and maintain in full force and
effect its existence and good standing under the laws
of its jurisdiction of organization;
(ii) preserve and maintain in full force and
effect all governmental rights, privileges,
qualifications, permits, licenses and franchises
necessary or desirable in the normal conduct of its
business (except in connection with transactions and
sales of assets permitted by Section 8.1(j)); and
(iii) preserve or renew all of its
registered patents, trademarks, trade names and
service marks, the non-preservation of which could
reasonably be expected to have a Material Adverse
Effect; provided, however that the Lessee shall have
the right to assign to an Affiliate of Tenneco Inc.,
or not preserve or renew, certain trademarks of
Tenneco Inc.
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that are currently owned by the Lessee or any
Subsidiary, but which are not used by the Lessee or
such Subsidiary.
(v) Negative Pledge. (a) ERISA. The Lessee shall not, and
shall not permit any of its ERISA Affiliates to: (a) engage in a
prohibited transaction or material violation of the fiduciary
responsibility rules with respect to any Plan which has resulted or
could reasonably be expected to result in liability of the Lessee in an
aggregate amount in excess of $5,000,000; or (b) engage in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
(w) Securitization Transactions. The Lessee shall not, and
shall not permit its Subsidiaries to enter into Securitization
Transaction to the extent that the aggregate investment or claims held
at any time by all purchasers, assignees, transferees of (or of
interests in) receivables and other rights to payment in all
Securitization Transactions would at any time exceed $200,000,000.
SECTION 9. Payment of Certain Expenses.
9.1. Transaction Expenses.
(a) Lessor agrees on the Initial Closing Date, to pay, or
cause to be paid, all reasonable fees, expenses and disbursements of
the various legal counsels for the Lessor and the Agent in connection
with the transactions contemplated by the Operative Agreements and
incurred in connection with the Initial Closing Date, including all
Transaction Expenses (arising in connection with the Initial Closing
Date), and all other reasonable fees, expenses and disbursements in
connection with the Initial Closing Date, and including, without
limitation, all fees, taxes and expenses for the recording,
registration and filing of documents; provided, however, that the
Lessor shall pay such amounts described in this Section 9.1 (a) only if
(i) such amounts are properly described in a Requisition delivered on
or before the Initial Closing Date, and (ii) funds are made available
by the Lenders and the Holders in connection with such Requisition in
an amount sufficient to allow such payment. On the Initial Closing
Date, after delivery and receipt of the Requisition referenced in
Section 4.2(a) hereof and satisfaction of the other conditions
precedent for such date, the Holders shall make Holder Fundings and the
Lenders shall make Loans to the Lessor to pay for the Transaction
Expenses, fees, expenses and other disbursements referenced in this
Section 9.1 (a). The Lessee agrees to pay all amounts referred to in
this Section 9.1(a) to the extent not paid by Lessor.
(b) Lessor agrees on each Property Closing Date (including the
Initial Closing Date), to pay, or cause to be paid, all reasonable
fees, expenses and disbursements of the various legal counsels for the
Lessor and the Agent in connection with the transactions contemplated
by the Operative Agreements and billed in connection with such Property
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Closing Date, or the date of such Funding, including all Transaction
Expenses (arising with respect to the Initial Closing Date, such
Property Closing Date, the date of such Funding), all fees,
expenses and disbursements paid by the Lessee or incurred with respect
to the various items referenced in Section 5.3, (including without
limitation the cost of any Appraisals or environmental site
assessments, any developer's fees, any consultant's fees, any premiums
for title insurance policies and charges for any updates to such
policies) and all other reasonable fees, expenses and disbursements in
connection with such Property Closing Date, or the date of such Funding
including, without limitation, all expenses relating to and all fees
(including brokers' fees), taxes (including any and all stamp, transfer
or similar taxes) and expenses for the recording, registration and
filing of documents; provided, however, the Lessor shall pay such
amounts described in this Section 9.1(b) only if (i) such amounts are
properly described in a Requisition delivered on the applicable date
and (ii) funds are made available by the Lenders and the Holders in
connection with such Requisition in an amount sufficient to allow such
payment. On each Property Closing Date, after delivery of the
applicable Requisition and satisfaction of the other conditions
precedent for such date, the Holders shall make a Holder Funding and
the Lenders shall make Loans to the Lessor to pay for the Transaction
Expenses, fees, expenses and other disbursements referenced in this
Section 9.1(b). The Lessee agrees to pay all amounts referred to in
this Section 9.1(b) to the extent not paid by the Lessor.
9.2. Certain Fees and Expenses. Lessee agrees to pay or cause to be
paid (i) the initial and annual Owner Trustee's fee and all reasonable expenses
of the Owner Trustee and any necessary co-trustees (including reasonable counsel
fees and expenses) or any successor owner trustee, for acting as owner trustee
under the Trust Agreement, (ii) all reasonable costs and expenses (including
reasonable counsel fees and expenses) incurred by the Lessee, the Agent, the
Lenders, Holders or the Lessor in entering into any future amendments or
supplements requested by the Lessee with respect to any of the Operative
Agreements, whether or not such amendments or supplements are ultimately entered
into, or giving or withholding of waivers of consents hereto or thereto which
have been requested by the Lessee, or any purchase of any Property by the Lessee
pursuant to Article XX of the Lease, and (iii) all reasonable costs and expenses
(including reasonable counsel fees and expenses) incurred by the Lessor, the
Lessee, the Holders, the Lenders or the Agent in connection with the enforcement
of any Operative Agreement or any exercise of remedies under any Operative
Agreement.
9.3. Unused Fee and Holder Unused Fee. From the date hereof (provided,
however, that no payments shall be made until the Initial Closing Date) through
the Expiration Date and thereafter so long as any Rent or other amounts remain
outstanding under the Operative Agreements, the Lessee agrees to pay (a) to the
Agent, for the pro rata benefit of the Lenders of each Category of Loans based
on the Commitment Percentage of each such Lender during the period for which
payment is made, the Unused Fee; and (b) to the Lessor, for the pro rata benefit
of the Holders based on the Holder Commitment of each such Holder during the
period for which
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payment is made, the Holder Unused Fee. Such payments of fees provided for in
this Section 9.3 shall be due in arrears on each Unused Fee Payment Date.
Notwithstanding the foregoing, so long as any Lender or Holder fails (in
violation of the Operative Agreements) to make available any portion of its
Commitment or Holder Commitment when requested, such Person shall not be
entitled to receive payment of pro rata share of its Unused r Holder Unused Fee
(as the case may be) until such Person shall make available such portion. Each
such fee shall be calculated on the basis of a year of 360 days for the actual
number of days elapsed. If all or a portion of any Unused Fee or Holder Unused
Fee shall not be paid when due, such overdue amount shall bear interest, payable
by the Lessee on demand, at a rate per annum equal to the Base Rate plus 2%,
from the date of such non-payment until such amount is paid in full (as well
after as before judgment).
SECTION 10. Other Covenants and Agreements.
10.1. Cooperation with the Lessee. The Holders, the Owner Trustee (at
the direction of the Holders) and the Agent shall, to the extent reasonably
requested by the Lessee (but without assuming additional liabilities on account
thereof), at the Lessee's expense, cooperate with the Lessee in connection with
its covenants contained herein including, without limitation, at any time and
from time to time, upon the request of the Lessee, promptly and duly executing
and delivering any and all such further instruments, documents and financing
statements (and continuation statements related thereto) as the Lessee may
reasonably request in order to perform such covenants.
10.2. Covenants of the Owner Trustee and the Holders. Each of the Owner
Trustee and the Holders hereby agree that so long as this Agreement is in
effect:
(a) None of the Holders and the Owner Trustee (both in its
capacity and in its individual capacity) will create or permit to exist
at any time, and each of the Holders and the Owner Trustee will, at its
own cost and expense, promptly take such action (and notify Lessee of
such action) as may be necessary duly to discharge, or to cause to be
discharged, all Lessor Liens attributable to it on the Properties;
provided, however, that the Holders and the Owner Trustee shall not be
required to discharge any such Lessor Lien while the same is being
contested in good faith by appropriate proceedings diligently
prosecuted so long as (a) such proceedings shall not involve any
material danger of impairment of the Liens of the Security Documents or
of the sale, forfeiture or loss of, any Property or title thereto or
any interest therein or the payment of Rent, (b) such proceedings do
not materially interfere with the construction of Improvements on any
Property or the acquisition or refinancing of any Property, and (c)
such proceedings shall not materially interfere with the disposition of
any Property or title thereto or interest therein or the payment of
Rent:
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(b) Without prejudice to any right of the Owner Trustee under
the Trust Agreement to resign (subject to requirement set forth in the
Trust Agreement that such resignation shall not be effective until a
successor shall have agreed to accept such appointment), or the
Holders' rights under the Trust Agreement to remove the institution
acting as Owner Trustee (after consent to such removal by the Agent as
provided in the Trust Agreement), each of the Holders and the Owner
Trustee hereby agrees with the Lessee and the Agent (i) not to
terminate or revoke the trust created by the Trust Agreement except as
permitted by Article VIII of the Trust Agreement, (ii) not to amend,
supplement, terminate or revoke or otherwise modify any provision of
the Trust Agreement in such a manner as to adversely affect the rights
of the Lessee or the Agent without the prior written consent of such
party and (iii) to comply with all of the terms of the Trust Agreement;
(c) The Owner Trustee or any successor may resign or be
removed by the Holders as Owner Trustee, a successor Owner Trustee may
be appointed and a corporation may become the Owner Trustee under the
Trust Agreement, only in accordance with the provisions of Article IX
of the Trust Agreement and, with respect to such appointment, with the
consent of the Lessee, which consent shall not be unreasonably
withheld, conditioned or delayed;
(d) The Owner Trustee, in its capacity as Owner Trustee under
the Trust Agreement, and not in its individual capacity, shall not
contract for, create, incur or assume any indebtedness, or enter into
any business or other activity, other than pursuant to or under the
Operative Agreements;
(e) The Holders will not instruct the Owner Trustee to take
any action in violation of the terms of any Operative Agreement;
(f) Neither any Holder nor the Owner Trustee shall (i)
commence any case, proceeding or other action with respect to the Owner
Trustee under any existing or future law of any jurisdiction, domestic
or foreign, relating to bankruptcy, insolvency, reorganization,
arrangement, winding-up, liquidation, dissolution, composition or other
relief with respect to it or its debts, or (ii) seek appointment of a
receiver, trustee, custodian or other similar official with respect to
the Owner Trustee or for all or any substantial benefit of the
creditors of the Owner Trustee; and neither any Holder nor the Owner
Trustee shall take any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any of the acts set forth
in this paragraph;
(g) The Owner Trustee shall give prompt notice to the Lessee
and the Agent if the Owner Trustee's chief place of business or chief
executive office, or the office where the records concerning the
accounts or contract rights relating to a Property are kept, shall
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cease to be located at First Security Bank, N.A., 00 Xxxxx Xxxx Xxxxxx,
Xxxx Xxxx Xxxx, Xxxx, 00000, or if it shall change its name;
(h) Provided that no Lease Event of Default has occurred and
is continuing, neither the Owner Trustee nor any Holder shall, without
the prior written consent of the Lessee, consent to or permit any
amendment, supplement or other modification of the terms and provisions
of the Credit Agreement or the Notes or (to the extent such amendment,
supplement or modification would have an adverse effect on the rights
or obligations of the Lessee under the Lease) any other Operative
Agreement;
(i) Neither the Owner Trustee nor any Holder shall consent to
or permit any amendment, supplement or other modification of the terms
and provisions of any Operative Agreement, in each case without the
prior written consent of the Agent except as described in Section 10.5
of this Agreement;
(j) The Owner Trustee (i) shall take such actions and shall
refrain from taking such actions with respect to the Operative
Agreements or the Properties and shall grant such approvals and
otherwise act or refrain from acting with respect to the Operative
Agreements or the Properties in each case as directed in writing by the
Agent or, in connection with Section 10.5 hereof, the Lessee,
notwithstanding any contrary instruction or absence of instruction by
any Holder or Holders; and (ii) shall not take any action, grant any
approvals or otherwise act under or with respect to the Operative
Agreements or any matters relating to the Properties without first
obtaining the prior written consent of the Agent (and without regard to
any contrary instruction or absence of instruction by any Holder);
provided, however, that notwithstanding the foregoing provisions of
this subparagraph (j) the Owner Trustee, the Agent and the Holders each
acknowledge, covenant and agree that, with respect to all matters under
the Operative Agreements that require the consent or concurrence of all
of the Lenders pursuant to the terms of Section 9.1 of the Credit
Agreement (the "Unanimous Vote Matters"), neither the Owner Trustee nor
the Agent shall act or refrain from acting with respect to any
Unanimous Vote Matter until such party has received the approval of
each Lender and each Holder with respect thereto; and
(k) Except as otherwise contemplated by the Operative
Agreements, neither the Owner Trustee nor any Holder shall use the
proceeds of any Loan or Holder Funding for any purpose other than the
payment of Transaction Expenses and the fees, expenses and other
disbursements referenced in Sections 9.1 (a) and (b) of this Agreement,
the purchase, refinance or lease of Properties, the acquisition or
refinancing of Equipment, the acquisition or refinancing of
Improvements and the payment of interest regarding the Loans and the
payment of the Holder Yield regarding the Holder Fundings, in each case
accrued under the Credit Agreement or Trust Agreement, as the case may
be.
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10.3. Lessee Covenants, Consent and Acknowledgment.
(a) Lessee acknowledges and agrees that the Owner Trustee,
pursuant to the terms and conditions of the Security Agreement and the
Mortgage Instruments, shall create Liens respecting the various
personal property, fixtures and real property described therein in
favor of the Agent. Lessee hereby irrevocably consents to the creation,
perfection and maintenance of such Liens.
(b) Lessor hereby instructs Lessee, and Lessee hereby
acknowledges and agrees, that until such time as the Loans and all
other amounts under the Operative Agreements are paid in full, (i) any
and all Rent and any and all other amounts of any kind or type under
any of the Operative Agreements due and owing or payable to the Lessor
or the Owner Trustee shall instead be paid directly to the Agent or as
the Agent may direct from time to time and (ii) Lessee shall cause all
notices, certificates, financial statements, communications and other
information which is delivered, or is required to be delivered, to the
Lessor, the Owner Trustee or any Holder also to be delivered at the
same time to the Agent.
(c) Lessee shall not consent to or permit any amendment,
supplement or other modification of the terms or provisions of any
Operative Agreement without, in each case, obtaining the prior written
consent of the Agent and, to the extent required by the proviso at the
end of Section 10.2(j) hereof, each of the Holders.
(d) Except as otherwise contemplated by the Operative
Agreements, the Lessee shall not use the proceeds of any Holder Funding
or Loan for any purpose other than the payment of Transaction Expenses
and the fees, expenses and other disbursements referenced in Section
9.1(a) and (b) of this Agreement, the purchase or lease of Properties,
the acquisition of Equipment, the construction of Improvements, the
payment of interest regarding the Loans and the payment of the Holder
Yield regarding the Holder Fundings, in each case accrued under the
Credit Agreement or Trust Agreement, as the case may be, during the
period prior to the Acquisition Date with respect to a particular
Property.
(e) The Lessee shall restrict the amount of Equipment located
in or on each Property, so that at all times the Property Cost of the
Equipment located in or on a given Property shall be less than or equal
to 15% of the total Property Cost of such Property, provided, however,
that this percentage limitation shall not apply to any such Equipment
consisting of Fixtures or other goods incorporated into or customarily
considered to be part of a building or structure erected on real
property (such as heating, ventilating, air-conditioning, electrical
and mechanical equipment or systems, escalators, elevators, wall and
floor coverings, plumbing, pumps, tanks, conduits, wiring, lighting,
security systems, sprinklers and other fire prevention and
extinguishing apparatus). This 15% limitation
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shall apply to removable Equipment (including without limitation
racking and picking equipment) that (i) is not incorporated into a
building or structure or (ii) is customarily considered to be trade
fixtures or operating equipment for the business of the Lessee.
(f) The Lessee shall not create or permit to exist at any time
(and the Lessee shall, at its own expense, take such action as may be
necessary to duly discharge, or cause to be discharged) any Lien
against any Property other than Permitted Encumbrances.
(g) The Lessee shall pay (or cause to be paid) to the Agent
the administrative fee (described in the Fee Letter) when and as due
from time to time.
10.4. Sharing of Certain Payments. The parties hereto acknowledge and
agree that all payments due and owing by the Lessee to the Lessor under the
Lease or any of the other Operative Agreements shall be made by the Lessee
directly to the Agent as more particularly provided in Section 10.3 hereof. The
Holders and the Agent, on behalf of the Lenders, acknowledge the terms of
Section 8 of the Credit Agreement regarding the allocation of payments and other
amounts made or received from time to time under the Operative Agreements and
agree all such payments and amounts are to be allocated as provided in Section 8
of the Credit Agreement. In connection therewith the Holders hereby (a) appoint
the Agent to act as collateral agent for the Holders in connection with the Lien
granted by the Mortgage Instruments to secure the Holder Amount and (b)
acknowledge and agree and direct that the rights and remedies of the
beneficiaries of the Lien of the Mortgage Instruments shall be exercised by the
Agent on behalf of the Lenders and the Holders as directed from time to time by
the Lenders without notice to or consent from the Holders.
10.5. Grant of Easements, Voting at Meetings, etc. The Agent and the
Holders hereby agree that, so long as no Event of Default shall have occurred
and be continuing, and until such time as the Agent gives instructions to the
contrary to the Owner Trustee, the Owner Trustee shall, from time to time at the
request of the Lessee, in connection with the transactions contemplated by the
Lease or the other Operative Agreements, (i) grant easements and other rights in
the nature of easements with respect to any Property, (ii) release existing
easements or other rights in the nature of easements which are for the benefit
of any Property, (iii) execute and deliver to any Person any instrument
appropriate to confirm or effect such grants or releases, and (iv) execute and
deliver to any Person such other documents or materials in connection with the
acquisition, development or operation of any Property, including, without
limitation, reciprocal easement agreements, operating agreements, development
agreements, plats, replats or subdivision documents; provided, that each of the
agreements and documents referred to in this Section 10.5 shall be of the type
normally executed by the Lessee in the ordinary course of the Lessee's business
and shall be on commercially reasonable terms so as not to diminish the value of
any Property in any material respect.
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SECTION 11. Credit Agreement and Trust Agreement.
11.1. Lessee's Credit Agreement Rights. Notwithstanding anything to the
contrary contained in the Credit Agreement, the Agent, the Lessee and the Owner
Trustee hereby agree that, prior to the occurrence and continuation of any Lease
Default or Lease Event of Default, the Lessee (as designated below) shall have
the following rights:
(a) the Lessee shall have the right to terminate or reduce the
Commitments pursuant to Section 2.5(a) of the Credit Agreement and to
make an Extension Request pursuant to Section 2.5(c) of the Credit
Agreement;
(b) the Lessee shall have the right to exercise the conversion
and continuation options pursuant to Section 2.7 of the Credit
Agreement;
(c) the Lessee shall have the right to approve any successor
agent pursuant to Section 7.9 of the Credit Agreement;
(d) the Lessee shall have the right to consent to any
assignment by a Lender to which the Lessor has the right to consent
pursuant to Section 9.8 of the Credit Agreement; and
(e) without limiting the foregoing clauses (a) through (d),
and in addition thereto, the Lessee shall have the right to exercise
any other right of the Owner Trustee under the Credit Agreement upon
not less than five (5) Business Days' prior written notice from the
Lessee to the Owner Trustee and the Agent.
11.2. Lessee's Trust Agreement Rights. Notwithstanding anything to the
contrary contained in the Trust Agreement, the Lessee, the Owner Trustee and the
Holders hereby agree that, prior to the occurrence and continuation of any Lease
Default or Lease Event of Default, the Lessee (as designated below) shall have
the following rights:
(a) the Lessee shall have the right to exercise the conversion
and continuation options pursuant to Section 3.8 of the Trust
Agreement;
(b) no removal of the Owner Trustee or appointment of a
successor Owner Trustee pursuant to Section 9.1 of the Trust Agreement
shall be made without the prior written consent (not to be unreasonably
withheld or delayed) of the Lessee; and
(c) the Holders and the Owner Trustee shall not amend,
supplement or otherwise modify any provision of the Trust Agreement in
such a manner as to adversely affect the rights of the Lessee without
the prior written consent (not to be unreasonably withheld or delayed)
of the Lessee.
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SECTION 12. Transfer of Interest.
12.1. Restrictions on Transfer. The Holders may, directly or
indirectly, assign, convey or otherwise transfer any of their right, title or
interest in or to the Trust Estate or the Trust Agreement with the prior written
consent of the Agent, and (provided, no Default or Event of Default has occurred
and is continuing) the Lessee, provided that such consents shall not be required
for an assignment to an Affiliate of a Lender. The Owner Trustee may, subject to
the Lien of the applicable Security Documents, but only with the prior written
consent of the Agent, the Holders (which consent may be withheld by the Agent or
the Holders in their sole discretion) and (provided no Default or Event of
Default has occurred and is continuing) the Lessee, directly or indirectly,
assign, convey, appoint an agent with respect to enforcement of, or otherwise
transfer any of the Owner Trustee's right, title or interest in or to any
Property, the Lease, the Trust Agreement, this Agreement (including, without
limitation, any right to indemnification thereunder), or any other document
relating to a Property or any interest in a Property as provided in the Trust
Agreement and the Lease. The provisions of the immediately preceding sentence
shall not apply to the obligations of the Owner Trustee to transfer Property to
Lessee or a third party purchaser pursuant to Article XXII of the Lease upon
payment for such Property in accordance with each of the terms and conditions of
the Lease.
12.2. Effect of Transfer. From and after any transfer effected in
accordance with this Section 12, the transferor shall be released, to the extent
of such transfer, from its liability hereunder and under the other documents to
which it is a party in respect of obligations to be performed on or after the
date of such transfer; provided, however, that any transferor Holder shall
remain liable under Article XI of the Trust Agreement to the extent that the
transferee Holder shall not have assumed the obligations of the transferor
Holder thereunder. Upon any transfer by the Owner Trustee or a Holder as above
provided, any such transferee shall assume the obligations of the Owner Trustee
and Lessor or the obligations of a Holder, as the case may be, and shall be
deemed an "Owner Trustee", "Lessor" or "Holder", as the case may be, for all
purposes of such documents and each reference herein to the transferor shall
thereafter be deemed a reference to such transferee for all purposes, except as
provided in the preceding sentence. Notwithstanding any transfer of all or a
portion of the transferor's interest as provided in this Section 12, the
transferor shall be entitled to all benefits accrued and all rights vested prior
to such transfer including, without limitation, rights to indemnification under
any such document.
SECTION 13. Indemnification.
13.1. General Indemnity. Whether or not any of the transactions
contemplated hereby shall be consummated, the Indemnity Provider hereby assumes
liability for and agrees to defend, indemnify and hold harmless each Indemnified
Person on an After Tax Basis from and against any Claims which may be imposed
on, incurred by or asserted against an Indemnified Person by any other Person
(but not to the extent such Claims arise from the gross negligence or willful
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misconduct of such Indemnified Person) in any way relating to or arising, or
alleged (by any Person asserting such a claim against an Indemnified Person) to
arise, out of the execution, delivery, performance or enforcement of this
Agreement, the Lease, any other Operative Agreement or on or with respect to any
Property or any part thereof, including, without limitation, Claims in any way
relating to or arising or alleged to arise out of (a) the financing,
refinancing, purchase, acceptance, rejection, ownership, design, construction,
refurbishment, development, delivery, acceptance, nondelivery, leasing,
subleasing, possession, use, operation, repair, modification, transportation,
condition, sale, return, repossession (whether by summary proceedings or
otherwise), or any other disposition of a Property, or any part thereof,
including the acquisition, holding or disposition of any interest in any
Property, lease or agreement comprising a portion of any thereof; (b) any latent
or other defect in any property whether or not discoverable by an Indemnified
Person or the Indemnity Provider; (c) any Environmental Claim, any violation of
Environmental Laws, or any other loss of or damage to any property or the
environment relating to any Property, the Lease or the Indemnity Provider; (d)
the Operative Agreements, or any transaction contemplated thereby (except for
such Claims for which such Indemnified Person shall be required to indemnify the
Indemnity Provider pursuant to the terms of the Operative Agreements); (e) any
breach by the Lessee of any of its representations or warranties under the
Operative Agreements to which it is a party or failure by the Lessee to perform
or observe any covenant or agreement to be performed by it under any of the
Operative Agreements; (f) the transactions contemplated hereby or by any other
Operative Agreement, in respect of the application of Parts 4 and 5 of Subtitle
B of Title I of ERISA; (g) any personal injury, death or property damage,
including, without limitation, Claims based on strict or absolute liability in
tort; (h) any easement, right, agreement or document referred to in Section 10.5
of this Agreement; or (i) any Lien on any Property (other than Liens created by
the Operative Agreements), provided, that the Indemnity Provider shall not be
required to indemnify the Lessor for any Lessor Liens.
If a written Claim is made against any Indemnified Person or if any
proceeding shall be commenced against such Indemnified Person (including a
written notice of such proceeding) for any Claim, such Indemnified Person shall
promptly notify the Indemnity Provider in writing and shall not take action with
respect to such Claim without the consent of the Indemnity Provider for thirty
(30) days after the receipt of such notice by the Indemnity Provider; provided,
however, that, in the case of any such Claim, if action shall be required by law
or regulation to be taken prior to the end of such 30- day period, such
Indemnified Person shall endeavor, in such notice to the Indemnity Provider, to
inform the Indemnity Provider of such shorter period, and no action shall be
taken with respect to such Claim without the consent of the Indemnity Provider
before seven (7) days before the end of such shorter period; provided, further,
that the failure of such Indemnified Person to give the notices referred to in
this sentence shall not diminish the Indemnity Provider's obligation hereunder
except to the extent such failure precludes the Indemnity Provider from
contesting such Claim.
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If, within thirty (30) days after receipt of such notice from the
Indemnified Person (or such shorter period as the Indemnified Person has
notified the Indemnity Provider is required by law or regulation for the
Indemnified Person to respond to such Claim), the Indemnity Provider shall
request in writing that such Indemnified Person respond to such Claim, the
Indemnified Person shall, at the expense of the Indemnity Provider, in good
faith conduct and control such action (including, without limitation by pursuit
of appeals) (provided, however, that (A) if such Claim can be pursued by the
Indemnity Provider on behalf of or in the name of such Indemnified Person, the
Indemnified Person, at the Indemnity Provider's request, shall allow the
Indemnity Provider to conduct and control the response to such Claim and (B) in
the case of any Claim, the Indemnified Person may request the Indemnity Provider
to conduct and control the response to such Claim (with counsel to be selected
by the Indemnity Provider and consented to by such Indemnified Person, such
consent not to be unreasonably withheld, conditioned or delayed); provided,
however that any Indemnified Party may retain separate counsel at the expense of
the Indemnity Provider in the event of a conflict that arises after the initial
response to such Claim); by, in the sole discretion of the Person conducting and
controlling the response to such Claim, (1) resisting payment thereof, (2) not
paying the same except under protest, if protest is necessary and proper, (3) if
the payment be made, using reasonable efforts to obtain a refund thereof in
appropriate administrative and judicial proceedings, or (4) taking such other
action as is reasonably requested by the Indemnity Provider from time to time.
The party controlling the response to any Claim shall consult in good
faith with the non-controlling party and shall keep the non-controlling party
reasonably informed as to the conduct of the response to such Claim; provided,
that all decisions ultimately shall be made in the discretion of the controlling
party, except that the Indemnity Provider may not agree to any dismissal or
settlement of, or other agreement in connection with, any claim without the
prior written consent of such Indemnified Person, if such dismissal, settlement
or agreement would require any admission or acknowledgment of any culpability or
wrongdoing by such Indemnified Person or provide for any nonmonetary relief to
be performed by such Indemnified Person. The parties agree that an Indemnified
Person may at any time decline to take further action with respect to the
response to such Claim and may settle such Claim if such Indemnified Person
shall waive its rights to any indemnity from the Indemnity Provider that
otherwise would be payable in respect of such Claim (and any future Claim, the
pursuit of which is precluded by reason of such resolution of such Claim) and
shall pay the Indemnity Provider any amount previously paid or advanced by the
Indemnity Provider pursuant to this Section 13.1 by way of indemnification or
advance for the payment of any amount regarding such Claim other than expenses
of the action relating to such Claim.
Notwithstanding the foregoing provisions of this Section 13.1, an
Indemnified Person shall not be required to take any action and no Indemnity
Provider shall be permitted to respond to any Claim in its own name or that of
the Indemnified Person unless (A) the Indemnity Provider shall have agreed to
pay and shall pay to such Indemnified Person on demand and on an After Tax Basis
all reasonable costs, losses and expenses that such Indemnified Person actually
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incurs in connection with such Claim, including, without limitation, all
reasonable legal, accounting and investigatory fees and disbursements, (B) the
Indemnified Person shall have reasonably determined the action to be taken will
not result in any material danger of sale, forfeiture or loss of any Property,
or any part thereof or interest therein, will not interfere with the payment of
Rent, and will not result in risk of criminal liability, (C) if such Claim shall
involve the payment of any amount prior to the resolution of such Claim, the
Indemnity Provider shall provide to the Indemnified Person an interest-free
advance in an amount equal to the amount that the Indemnified Person is required
to pay (with no additional net after-tax cost to such Indemnified Person), (D)
in the case of a Claim that must be pursued in the name of an Indemnified Person
(or an Affiliate thereof), the Indemnity Provider shall have provided to such
Indemnified Person a letter from a Responsible Officer stating that a reasonable
basis exists to contest such Claim, and (E) no Lease Event of Default shall have
occurred and be continuing. In addition, an Indemnified Person shall not be
required to contest any Claim in its name (or that of an Affiliate) if the
subject matter thereof shall be of a continuing nature and shall have previously
been decided adversely by a court of competent jurisdiction pursuant to the
contest provisions of this Section 13.1, unless there shall have been a change
in law (or interpretation thereof) and the Indemnified Person shall have
received, at the Indemnity Provider's expense, an opinion of independent counsel
selected by the Indemnified Person and reasonably acceptable to the Indemnity
Provider stating that as a result of such change in law (or interpretation
thereof), it is more likely than not that the Indemnified Person will prevail in
such contest.
13.2. General Tax Indemnity.
(a) The Indemnity Provider shall pay and assume liability for,
and does hereby agree to indemnify, protect and defend each Property
and all Indemnified Persons, and hold them harmless against, all
Impositions on an After Tax Basis.
(b) (i) Subject to the terms of Section 13.2(f) hereof and
Section 13.1 of the Lease, the Indemnity Provider shall pay or cause to
be paid all Impositions directly to the taxing authorities where
feasible and otherwise to the Indemnified Person, as appropriate, and
the Indemnity Provider shall at its own expense, upon such Indemnified
Person's reasonable request, furnish to such Indemnified Person copies
of official receipts or other satisfactory proof evidencing such
payment.
(ii) In the case of Impositions for which no contest is
conducted pursuant to Section 13.2(f) hereof or Section 13.1 of the
Lease, and which the Indemnity Provider pays directly to the taxing
authorities, the Indemnity Provider shall pay such Impositions prior to
the latest time permitted by the relevant taxing authority for timely
payment. In the case of Impositions for which the Indemnity Provider
reimburses an Indemnified Person, the Indemnity Provider shall do so
within thirty (30) days after receipt by the Indemnity Provider of
demand by such Indemnified Person describing in reasonable detail the
nature of the Imposition and the basis for the demand (including the
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computation of the amount payable). In the case of Impositions for
which a contest is conducted pursuant to Section 13.2(f) hereof or
Section 13.1 of the Lease, the Indemnity Provider shall pay such
Impositions or reimburse such Indemnified Person for such Impositions
to the extent not previously paid or reimbursed, prior to the latest
time permitted by the relevant taxing authority for timely payment
after conclusion of all contests under Section 13.2(f) hereof and
Section 13.1 of the Lease.
(iii) Impositions imposed with respect to a Property for a
billing period during which the Lease expires or terminates with
respect to such Property (unless the Lessee has exercised the Purchase
Option with respect to such Property or the Lessee has otherwise
purchased such Property) shall be adjusted and prorated on a daily
basis between the Indemnity Provider and the Lessor, whether or not
such Imposition is imposed before or after such expiration or
termination and each party shall pay its pro rata share thereof.
(iv) At the Indemnity Provider's request, the amount of
any indemnification payment by the Indemnity Provider pursuant to
subsection (a) shall be verified and certified by an independent public
accounting firm mutually acceptable to the Indemnity Provider and the
Indemnified Person. The fees and expenses of such independent public
accounting firm shall be paid by the Indemnity Provider unless such
verification shall result in an adjustment in the Indemnity Provider's
favor of 10% or more of the payment as computed by the Indemnified
Person, in which case such fee shall be paid by the Indemnified Person.
(c) The Indemnity Provider shall be responsible for preparing
and filing any real and personal property or ad valorem tax returns
with respect to each Property. In case any other report or tax return
shall be required to be made with respect to any obligations of the
Indemnity Provider under or arising out of subsection (a) and of which
the Indemnity Provider has knowledge or written notice, the Indemnity
Provider, at its sole cost and expense, shall notify the relevant
Indemnified Person of such requirement and (except if such Indemnified
Person notifies the Indemnity Provider that such Indemnified Person
intends to file such report or return) (A) to the extent required or
permitted by and consistent with Legal Requirements, make and file in
Indemnity Provider's name such return, statement or report; and (B) in
the case of any other such return, statement or report required to be
made in the name of such Indemnified Person, advise such Indemnified
Person of such fact and prepare such return, statement or report for
filing by such Indemnified Person or, where such return, statement or
report shall be required to reflect items in addition to any
obligations of the Indemnity Provider under or arising out of
subsection (a), provide such Indemnified Person at the Indemnity
Provider's expense with information sufficient to permit such return,
statement or report to be properly made with respect to any obligations
of the Indemnity Provider under or arising out of subsection (a). Such
Indemnified Person shall, upon the Indemnity
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Provider's request and at the Indemnity Provider's expense, provide any
data maintained by such Indemnified Person (and not otherwise available
to or within the control of the Indemnity Provider) with respect to any
Property which the Indemnity Provider may reasonably require to prepare
any required tax returns or reports.
(d) If as a result of the payment or reimbursement by the
Indemnity Provider of any Imposition or other reasonable expenses of
the Lessor or the payment of any Transaction Expenses incurred in
connection with the transactions contemplated by the Operative
Agreements, the Lessor or the Holders shall suffer a net increase in
any federal, state or local income tax liability, the Indemnity
Provider shall indemnify such Persons (without duplication of any
indemnification required by subsection (a)) on an After Tax Basis for
the amount of such increase. The calculation of any such net increase
shall take into account any current or future tax savings realized or
reasonably expected to be realized by such Person in respect thereof,
as well as any interest, penalties and additions to tax payable by such
Lessor, or such Holder, in respect thereof.
(e) As between the Indemnity Provider on one hand, and the
Lessor or the Agent, any Lender or any Holder on the other hand, the
Indemnity Provider shall be responsible for, and the Indemnity Provider
shall indemnify and hold harmless the Lessor, the Agent, the Lenders
and each Holder (without duplication of any indemnification required by
subsection (a)) on an After Tax Basis against, any obligation for
United States or foreign withholding taxes imposed in respect of
payments on the Notes or Certificates or with respect to Rent payments
under the Lease (and, if the Lessor, the Agent, any Lender or any
Holder receives a demand for such payment from any taxing authority,
the Indemnity Provider shall discharge such demand on behalf of the
Lessor, the Agent, such Lender or such Holder); provided, however, that
the right of any Lender to make a claim for indemnification under this
Section 13.2(e) is subject to the compliance by such Lender with the
requirements of Section 2.13 of the Credit Agreement.
(f) If a written Claim is made against any Indemnified Person,
or if any proceeding shall be commenced against such Indemnified Person
(including a written notice of such proceeding), for any Impositions,
such Indemnified Person shall promptly notify the Indemnity Provider in
writing and shall not take action with respect to such Claim or
proceeding without the consent of the Indemnity Provider for thirty
(30) days after the receipt of such notice by the Indemnity Provider;
provided, however, that, in the case of any such Claim or proceeding,
if action shall be required by law or regulation to be taken prior to
the end of such 30-day period, such Indemnified Person shall, in such
notice to the Indemnity Provider, inform the Indemnity Provider of such
shorter period, and no action shall be taken with respect to such Claim
or proceeding without the consent of the Indemnity Provider before
seven (7) days before the end of such shorter period; provided,
further, that the failure of such Indemnified Person to give the
notices referred
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to this sentence shall not diminish the Indemnity Provider's obligation
hereunder except to the extent such failure precludes the Indemnity
Provider from contesting such Claim.
(i) Subject to Section 13.2(g) below regarding
contests of Property Taxes by the Lessee, if, within thirty
(30) days after receipt of such notice from the Indemnified
Person (or such shorter period as provided in this Section
13.2(f)), the Indemnity Provider shall request in writing that
such Indemnified Person contest such Imposition, the
Indemnified Person shall, at the expense of the Indemnity
Provider, in good faith conduct and control such contest
(including, without limitation, by pursuit of appeals)
relating to the validity, applicability or amount of such
Imposition (provided, however, that (A) if such contest can be
pursued independently from any other proceeding involving a
tax liability of such Indemnified Person, the Indemnified
Person, at the Indemnity Provider's request, shall allow the
Indemnity Provider to conduct and control such contest and (B)
in the case of any contest, the Indemnified Person may request
the Indemnity Provider to conduct and control such contest
(with counsel to be selected by the Indemnity Provider and
consented to by such Indemnified Person, such consent not to
be unreasonably withheld, conditioned or delayed; provided,
however, that any Indemnified Person may retain separate
counsel at the expense of the Indemnity Provider in the event
of a conflict that first arises after the initial response to
such Claim) by, in the sole discretion of the Person
conducting and controlling such contest, (1) resisting payment
thereof, (2) not paying the same except under protest, if
protest is necessary and proper, (3) if the payment be made,
using reasonable efforts to obtain a refund thereof in
appropriate administrative and judicial proceedings, or (4)
taking such other action as is reasonably requested by the
Indemnity Provider from time to time.
(ii) Subject to Section 13.2(g) below regarding
contests of Property Taxes by the Lessee, the party
controlling any contest shall consult in good faith with the
non-controlling party and shall keep the non-controlling party
reasonably informed as to the conduct of such contest;
provided, that all decisions ultimately shall be made in the
sole discretion of the controlling party, except that the
Indemnity Provider may not agree to any dismissal or
settlement of, or other agreement in connection with, any
claim without the prior written consent of such Indemnified
Person, if such dismissal, settlement or agreement would
require any admission or acknowledgment of any culpability or
wrongdoing by such Indemnified Person or provide for any
nonmonetary relief to be performed by such Indemnified Person.
The parties agree that an Indemnified Person may at any time
decline to take further action with respect to the contest of
any Imposition and may settle such contest if such Indemnified
Person shall waive its rights to any indemnity from the
Indemnity Provider that otherwise would be payable in respect
of such Imposition (and any future Claim by any taxing
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authority, the contest of which is precluded by reason of such
resolution of such contest) and shall pay to the Indemnity
Provider any amount previously paid or advanced by the
Indemnity Provider pursuant to this Section 13.2 for the
payment of any amount regarding such Imposition other than
expenses of such contest.
(iii) Subject to Section 13.2(g) below regarding
contests of Property Taxes by the Lessee, notwithstanding the
foregoing provisions of this Section 13.2, an Indemnified
Person shall not be required to take any action and no
Indemnity Provider shall be permitted to contest any
Imposition in its own name or that of the Indemnified Person
unless (A) the Indemnity Provider shall have agreed to pay and
shall pay to such Indemnified Person on demand and on an After
Tax Basis all reasonable costs, losses and expenses that such
Indemnified Person actually incurs in connection with
contesting such Imposition, including, without limitation, all
reasonable legal, accounting and investigatory fees and
disbursements, (B) the Indemnified Person shall have
reasonably determined that the action to be taken will not
result in any material danger of sale, forfeiture or loss of
any Property, or any part thereof or interest therein, will
not interfere with the payment of Rent, and will not result in
risk of criminal liability, (C) unless payment of such
Imposition is not yet due or is stayed pending such contest,
the Indemnity Provider shall either pay such Imposition or
provide to the Indemnified Person an interest-free advance in
an amount equal to the Imposition that the Indemnified Person
is required to pay (with no additional net after-tax cost to
such Indemnified Person), (D) in the case of a Claim that must
be pursued in the name of an Indemnified Person (or an
Affiliate thereof), the Indemnity Provider shall have provided
to such Indemnified Person an opinion of independent or
in-house tax counsel selected by the Indemnified Person and
reasonably satisfactory to the Indemnity Provider stating that
a reasonable basis exists to contest such Claim, and (E) no
Event of Default shall have occurred and be continuing.
(g) Sections 13.2(f)(i) through (iii) shall not apply to
contests by the Lessee of Property Taxes (and Property Tax assessments)
with respect to any Property. Such contests are governed by Section
13.1 of the Lease. However, Sections 13.2(f)(i) through (iii) shall
apply if Lessee (or any other Indemnity Provider) requests that any
Indemnified Person control the contest of such Property Taxes.
SECTION 14. Miscellaneous.
14.1. Survival of Agreements. The representations, warranties,
covenants, indemnities and agreements of the parties provided for in the
Operative Agreements, and the parties' obligations under any and all thereof,
shall survive the execution and delivery of this Agreement, the transfer of any
Property to the Owner Trustee, the acquisition of any Equipment, the
construction of any Improvements, any disposition of any interest of the Owner
Trustee in any
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Property or any interest of the Holders in the Owner Trust, the payment of the
Notes and any disposition thereof, and shall be and continue in effect
notwithstanding any investigation made by any party and the fact that any party
may waive compliance with any of the other terms, provisions or conditions of
any of the Operative Agreements. Except as otherwise expressly set forth herein
or in other Operative Agreements, the indemnities of the parties provided for in
the Operative Agreements shall survive the expiration or termination of any
thereof.
14.2. No Broker, etc. Each of the parties hereto (other than the Lessee
and the Guarantor) represents to the other parties hereto that it has not
retained or employed any broker, finder or financial adviser to act on its
behalf in connection with this Agreement, nor has it authorized any broker,
finder or financial adviser retained or employed by any other Person so to act.
Any party who is in breach this representation shall indemnify and hold the
other parties harmless from and against any liability arising out of such breach
of this representation. The Lessee and the Guarantor covenants that (a) it will
not permit any broker, finder, financial adviser or other Person employed by it
so to act to have any Lien against any Property or the Trust Estate or any part
thereof, and (b) (without limiting the generality of Article XIII) it will
indemnify and hold each Indemnified Person harmless from and against any
liability arising out of any fee or other Claim of any such broker, finder,
financial advisor or other Person employed by the Lessee or the Guarantor so to
act.
14.3. Notices. Unless otherwise specifically provided herein, all
notices, consents, directions, approvals, instructions, requests and other
communications required or permitted by the terms hereof to be given to any
Person shall be given in writing by United States certified or registered mail
(postage prepaid), by nationally recognized courier service, by hand or by
telecopy with confirming notice and any such notice shall become effective upon
receipt and shall be directed to the address of such Person as indicated:
If to the Lessee or to the Guarantor, to it at the following address:
Tenneco Packaging Inc.
0000 Xxxx Xxxxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telephone No.: 847/000-0000
Telefacsimile No.: 847/482-4738
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If to the Owner Trustee, to it at the following address:
First Security Bank, N.A.
00 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Attention: Xxx Xxxxx
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
If to Bank of America, N.A., as a Holder or a Lender, to it at the following
address:
Bank of America, N.A.
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxxx Xxxxx
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
with all notices of requests for Loans or Holder Fundings, or
conversion, continuation or prepayment of any Loans or Holder Funding,
to be sent to:
Bank of America, N.A.
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxxx Xxxxx
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
If to the Agent, to it at the following address:
Bank of America, N.A.
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxxx Xxxxx
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
with all notices of borrowing, conversion, continuation or prepayment of any
Loan to be delivered to the address set forth in Section 9.2 of the Credit
Agreement.
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If to any other Lender or Holder, to it at the address specified in the
signature pages to the Credit Agreement or Trust Agreement (as applicable), any
applicable amendment thereto, or any applicable Assignment and Assumption.
From time to time any party may designate a new address for purposes of notice
hereunder by notice to each of the other parties hereto.
14.4. Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument.
14.5. Amendments and Termination. Neither this Agreement nor any of the
terms hereof may be terminated, amended, supplemented, waived or modified except
by an instrument in writing signed by the Lessor, the Lessee and (subject to
Section 9.1 of the Credit Agreement), the Agent. This Agreement may be
terminated by an agreement signed in writing by the Owner Trustee, the Holders,
the Lessee and the Agent.
14.6. Headings, etc. The Table of Contents and headings of the various
Articles and Sections of this Agreement are for convenience of reference only
and shall not modify, define, expand or limit any of the terms or provisions
hereof.
14.7. Parties in Interest. Except as expressly provided herein, none of
the provisions of this Agreement are intended for the benefit of any Person
except the parties hereto; provided, that the Lenders are intended to be
third-party beneficiaries of this Agreement.
14.8. GOVERNING LAW; WAIVERS OF JURY TRIAL.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK,
WITHOUT REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF CONFLICT OF
LAWS.
(b) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH OF
THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY
IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND FOR
ANY COUNTERCLAIM THEREIN.
14.9. Submission to Jurisdiction; Waivers. Each of the parties hereto
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Operative
Agreements to which it is a party, or for
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recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New
York and the courts of the United States of America, in each case
sitting in New York, New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have
to the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same,
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail) postage
prepaid, to the respective party at its address set forth in Section
14.3 hereof or at such other address of which the Administrative Agent
shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit
the right to xxx in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this Section 14.9 any special, exemplary, punitive or
consequential damages.
14.10. Severability. Any provision of this Agreement that is prohibited
or enforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining visions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render such
provision unenforceable in any other jurisdiction.
14.11. Liability Limited.
(a) The Agent, the Lessee and the Holders each acknowledge and
agree that the Owner Trustee is (except as otherwise expressly provided
herein or therein) entering into this Agreement and the other Operative
Agreements to which it is a party (other than the Trust Agreement and
other than as set forth in Section 7.2 of this Agreement), solely in
its capacity as trustee under the Trust Agreement and not in its
individual capacity and that Trust Company shall not be liable or
accountable under any circumstances whatsoever in its individual
capacity for or on account of any statements, representations,
warranties, covenants or obligations stated to be those of the Owner
Trustee, except for its own gross negligence or willful misconduct and
except as otherwise expressly provided herein or in the other Operative
Agreements.
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(b) Anything to the contrary contained in this Agreement, the
Credit Agreement, the Notes or in any other Operative Agreement
notwithstanding, neither the Lessor nor any Holder (in its capacity as
a Holder) nor any officer, director, shareholder, or partner thereof,
nor any of the successors or assigns of the foregoing (all such Persons
being hereinafter referred to collectively as the "Exculpated
Persons"), shall be personally liable in any respect for any liability
or obligation hereunder or under any other Operative Agreement
including the payment of the principal of, or interest on, the Notes,
or for monetary damages for the breach of performance of any of the
covenants contained in the Credit Agreement, the Notes, this Agreement,
the Security Agreement or any of the other Operative Agreements. The
Agent (for itself and on behalf of the Lenders) agrees that, in the
event the Agent or any Lender pursues any remedies available to them
under the Credit Agreement, the Notes, this Agreement, the Security
Agreement, the Mortgage Instruments or under any other Operative
Agreement, neither the Lenders nor the Agent shall have any recourse
against any Exculpated Person, for any deficiency, loss or Claim for
monetary damages or otherwise resulting therefrom, and recourse shall
be had solely and exclusively against the Trust Estate and the Lessee
(with respect to the Lessee's obligations under the Lease, and the
Participation Agreement); but nothing contained herein shall be taken
to prevent recourse against or the enforcement of remedies against the
Trust Estate in respect of any and all liabilities, obligations and
undertakings contained herein, in the Credit Agreement, in the Notes,
in the Security Agreement, the Mortgage Instruments or in any other
Operative Agreement. Notwithstanding the provisions of this Section,
nothing in this Agreement, the Credit Agreement, the Notes, the
Security Agreement, the Mortgage Instruments or any other Operative
Agreement shall: (i) constitute a waiver, release or discharge of any
indebtedness or obligation evidenced by the Notes or arising under this
Agreement, the Security Agreement, the Mortgage Instruments or the
Credit Agreement or secured by the Security Agreement, the Mortgage
Instruments or any other Operative Agreement, but the same shall
continue until paid or discharged; (ii) relieve the Lessor or any
Exculpated Person from liability and responsibility for (but only to
the extent of the damages arising by reason of): (a) active waste
knowingly committed by such Lessor or such Exculpated Person with
respect to the Properties or (b) any fraud, gross negligence, willful
misconduct or willful breach on the part of such Lessor or such
Exculpated Person; (iii) relieve such Lessor or such Exculpated Person
from liability and responsibility for (but only to the extent of the
moneys misappropriated, misapplied or not turned over) (a)
misappropriation or misapplication by such Lessor (i.e., application in
a manner contrary to any Operative Agreement) of any insurance proceeds
or condemnation award paid or delivered to such Lessor by any Person
other than the Agent, or (b) any rents or other income received by such
Lessor from the Lessee that are not turned over to the Agent; or (iv)
affect or in any way limit the Agent's rights and remedies under any
Operative Agreement with respect to the Rents and its rights thereunder
or its right to obtain a judgment against the Lessor's interest in the
Properties.
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14.12. Rights of Lessee. Notwithstanding any provision of the Operative
Agreements, if at any time all obligations (i) of the Owner Trustee under the
Credit Agreement, the Security Documents, the Trust Agreement and the other
Operative Agreements and (ii) of the Lessee under the Operative Agreements have
in each case been satisfied or discharged in full, then the Lessee shall be
entitled to (a) terminate the Lease and (b) receive all amounts then held under
the Operative Agreements and proceeds with respect to any of the Properties.
Upon the termination of the Lease pursuant to the foregoing clause (a), the
Lessor shall transfer to the Lessee all of its right, title and interest free
and clear of the Lien of the Lease and all Lessor Liens in and to any Properties
then subject to the Lease and any amounts or proceeds referred to in the
foregoing clause (b) shall be paid over to the Lessee.
14.13. Further Assurances. The parties hereto shall promptly cause to
be taken, executed, acknowledged or delivered, at the sole expense of the
Lessee, all such further acts, conveyances, documents and assurances as the
other parties may from time to time reasonably request in order to carry out and
effectuate the intent and purposes of this Participation Agreement, the other
Operative Agreements and the transactions contemplated hereby and thereby
(including, without limitation, the preparation, execution and filing of any and
all Uniform Commercial Code financing statements and other filings or
registrations which the parties hereto may from time to time request to be filed
or effected). The Lessee, at its own expense and without need of any prior
request from any other party, shall take such action as may be necessary
(including any action specified in the preceding sentence), or (if Owner Trustee
shall so request) as so requested, in order to maintain and protect all security
interests provided for hereunder or under any other Operative Agreement.
14.14. Calculations under Operative Agreements. The parties hereto
agree that all calculations and numerical determinations to be made under the
Operative Agreements by the Owner Trustee shall be made by the Agent and that
such calculations and determinations shall be conclusive and binding on the
parties hereto the absence of manifest error.
14.15. Confidentiality. Each of the Owner Trustee, the Holders, the
Agent and the Lenders severally agrees to use reasonable efforts to keep
confidential all non-public information pertaining to the Lessee or its
Subsidiaries which is provided to it by the Lessee or its Subsidiaries, and
shall not intentionally disclose such information to any Person except:
(a) to the extent such information is public when received by
such Person or becomes public thereafter due to the act or omission of
any party other than such Person;
(b) to the extent such information is independently obtained from
a source other than the Guarantor or any of its Subsidiaries and such
information from such source is not, to such Person's knowledge,
subject to an obligation of confidentiality or, if such information is
subject to an obligation of confidentiality, that disclosure of such
information is permitted;
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(c) to any Affiliate of any such Person or to counsel, auditors
or accountants retained by any such Person or any such Affiliate,
provided they agree to keep such information confidential as if such
Person or Affiliate were party to this Agreement and to financial
institution regulators, including examiners of any Lender, the Agent or
the Owner Trustee, any Holder or any Affiliate in the course of
examinations of such Persons;
(d) in connection with any litigation or the enforcement or
preservation of the rights of the Agent, the Owner Trustee, the Lessor,
any Lender or any Holder under the Operative Agreements;
(e) to the extent required by any applicable statute, rule or
regulation or court order (including, without limitation, by way of
subpoena) or pursuant to the request of any regulatory or Governmental
Authority having jurisdiction over any such Person; provided, however,
that such Person shall endeavor (if not otherwise prohibited by Law) to
notify the Guarantor prior to any disclosure made pursuant to this
clause (e), except that no such Person shall be subject to any
liability whatsoever for any failure to so notify the Guarantor;
(f) the Agent, the Owner Trustee, any Lender or any Holder may
disclose such information to the Agent, the Owner Trustee, any Lender
or any Holder; or
(g) to the extent disclosure to any other financial institution
or other Person is appropriate in connection with any proposed or
actual (i) assignment or grant of a participation by any of the Lenders
of interests in the Credit Agreement or any Note to such other
financial institution or (ii) assignment by any Holder of interests in
the Trust Agreement to another Person.
14.16. Calculation of Rent, Interest, Holder Yield and Fees. Except as
otherwise expressly set forth in the Operative Agreements, all calculation of
Rent, interest, Holder Yield, Overdue Rate, Holder Overdue Rate, Facility Fees,
or Holder Facility Fees payable hereunder shall be computed based on the actual
number of days elapsed over a year of 360 days.
14.17. Assignment Clause. Notwithstanding anything to the contrary
contained herein, any Bank (a "Granting Bank") may grant to a special purpose
funding vehicle (an "SPC"), identified as such in writing from time to time by
the Granting Bank to the Administrative Agent and the Borrower, the option to
provide to the Borrower all or any part of any Advance that such Granting Bank
would otherwise be obligated to make to the Borrower pursuant to this Agreement;
provided that (i) nothing herein shall constitute a commitment by any SPC to
make any Advance, (ii) if an SPC elects not to exercise such option or otherwise
fails to provide all or any part of such Advance, the Granting Bank shall be
obligated to make such Advance pursuant to the terms hereof. The making of an
Advance by an SPC hereunder shall utilize the Commitment of the Granting Bank to
the same extent, and as if, such Advance were made by
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61
such Granting Bank. Each party hereto hereby agrees that no SPC shall be liable
for any indemnity or similar payment obligation under this Agreement (all
liability for which shall remain with the Granting Bank). In furtherance of the
foregoing, each party hereto hereby agrees (which agreement shall survive the
termination of this Agreement) that, prior to the date that is one year and one
day after the payment in full of all outstanding commercial paper or other
senior indebtedness of any SPC any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the United States or any
State thereof. In addition, notwithstanding anything to the contrary contained
in this Section 14.17, any SPC may (i) with notice to, but without the prior
written consent of, the Borrower and the Administrative Agent and without paying
any processing fee therefor, assign all or a portion of its interests in any
Advances to the Granting Bank or to any financial institutions (consented to by
the Borrower and Administrative Agent) providing liquidity and/or credit support
to or for the account such SPC to support the funding or maintenance of Advances
and (ii) disclose on a confidential basis any non-public information relating to
its Advances to any rating agency, commercial paper dealer or provider of any
surety, guarantee or credit or liquidity enhancement to such SPC. This section
may not be amended without the written consent of the SPC.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
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62
IN WITNESS WHEREOF, the parties hereto have caused this Participation
Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
TENNECO PACKAGING INC.,
as Lessee and Guarantor
By:
-------------------------------------
Name:
Title:
63
FIRST SECURITY BANK, N.A., not
individually, except as expressly stated
herein, but solely as Owner Trustee
under the Temple Trust 1997-1
By:
------------------------------------
Name:
Title:
64
BANK OF AMERICA N.A.,
as Administrative Agent
By:
------------------------------------
Name:
Title:
BANK OF AMERICA N.A.,
as a Holder
By:
------------------------------------
Name:
Title:
BANK OF AMERICA N.A.,
as a Lender
By:
------------------------------------
Name:
Title:
FUNDING OFFICE:
65
SCHEDULE I
Initial Holders
Holder
Name Commitment
Bank of America, N.A $ 656,250.00
Credit Suisse First Boston $ 656,250.00
Bank One, NA $ 656,250.00
Banque Nationale de Paris $ 656,250.00
The Bank of New York $ 468,750.00
CSL Leasing, Inc. $ 468,750.00
Commerzbank AG $ 468,750.00
First Union National Bank $ 468,750.00
Barclays Bank PLC $ 468,750.00
IBJTC Leasing $ 375,000.00
Corporation/BSC
Bank Hapoalim B.M $ 843,750.00
BBL International (U.K.) $ 375,000.00
Limited
66
SCHEDULE II
TENNECO PACKAGING INC.
MEMORANDUM OF LITIGATION AND CLAIMS
67
SCHEDULE III
PERMITTED LIENS
68
EXHIBIT A
REQUISITION FORM
(Pursuant to Sections 4.2 and 5.2 of the Participation Agreement)
69
EXHIBIT B
TENNECO PACKAGING INC.
OFFICER'S CERTIFICATE
(Pursuant to Section 5.3(xxii) of the Participation Agreement)
70
EXHIBIT C
FORM OF OPINION
OF COUNSEL TO
TENNECO PACKAGING INC.
71
EXHIBIT D
TENNECO PACKAGING INC.
OFFICER'S CERTIFICATE
(Pursuant to Section 6.1 (e) of the Participation Agreement)
72
EXHIBIT E
TENNECO PACKAGING INC.
SECRETARY'S CERTIFICATE
(Pursuant to Section 6.1 (f) of the Participation Agreement)
73
EXHIBIT F
FIRST SECURITY BANK, N.A.
OFFICER'S CERTIFICATE
(Pursuant to Section 6.2(d) of the Participation Agreement)
74
EXHIBIT G
FIRST SECURITY BANK, N.A.
CERTIFICATE OF ASSISTANT SECRETARY
(Pursuant to Section 6.2(e) of the Participation Agreement)
75
EXHIBIT H
FORM OF
OPINION OF COUNSEL
TO FIRST SECURITY BANK, N.A.
76
EXHIBIT I
DESCRIPTION OF LAND FOR TEMPLE PROPERTY
