

MASTER LEASE
dated as of ……………
between
LEASE XYZ ...... ......, INC., as
the Lessor
WWW INC.,
as the Lessee
THIS MASTER LEASE (as amended, supplemented or otherwise modified from time to
time, this "Lease"), dated as of ……………., is by and between
LEASE XYZ ...... ......, INC., an ...... corporation,
having its principal office at 135 S. ...... Street ......,
...... ......, as the lessor (together with its permitted successors and
assigns, the "Lessor") and WWW INC., a
W I T N E S S E T H:
A. WHEREAS, the Lessor will
purchase the Phase I Facility on the Land Interest Acquisition Date therefor
and will purchase the Phase II Facility on the Land Interest Acquisition Date
therefor, and each of the Phase I Facility and the Phase II Facility will be
leased to the Lessee subject to the terms of this Lease from and after the
relevant Land Interest Acquisition Date; and
B. WHEREAS, on the
applicable Lease Term Commencement Date, the Lessor desires to lease to the
Lessee and the Lessee desires to lease from the Lessor, the relevant portion of
the Property pursuant to this Lease.
NOW, THEREFORE, in consideration of the foregoing, and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I.
1.1 Definitions; Interpretation.
Capitalized terms used but not otherwise defined in this Lease have the
respective meanings specified in Appendix 1 to this Lease; and the rules
of interpretation set forth in Appendix 1 to this Lease shall apply to
this Lease.
ARTICLE II.
2.1 Acceptance and Lease of
Property. Effective as of the Closing Date, the Lessor, subject
to the satisfaction or waiver of the applicable conditions set forth in Section
6 of the Participation Agreement, hereby agrees to acquire the Phase I Facility
on the initial Land Interest Acquisition Date pursuant to the terms of the
Participation Agreement, and to lease to the Lessee hereunder for the Term (as
defined in Section 2.3), the Lessor's interest in such Phase I Facility
and, subject to satisfaction or waiver of the applicable conditions set forth
in Section 6 of the Participation Agreement, effective as of the Land Interest
Acquisition Date in respect of the Phase II Facility, the Phase II Facility,
and the Lessee hereby agrees, expressly for the direct benefit of the Lessor,
to lease commencing on the applicable Lease Commencement Date from the Lessor
for the Term, the Lessor's interest in each such portion of the Property to be
delivered on the applicable Land Interest Acquisition Date and any Improvements
thereon pursuant to this Lease or the Participation Agreement.
2.2 Acceptance Procedure;
Appointment as Agent. The Lessor hereby authorizes one or more
employees of the Lessee, to be designated by the Lessee, as the authorized
representative or representatives of the Lessor to accept delivery on behalf of
the Lessor of the relevant portion of the Property identified on the applicable
Acquisition Request. The Lessee hereby agrees that such acceptance of
delivery by such authorized representative or representatives and the execution
and delivery by the Lessee on each Land Interest Acquisition Date of a Lease
Supplement in the form of Exhibit A hereto with respect to the
applicable portion of the Property (appropriately completed) shall, without
further act, constitute the irrevocable acceptance by the Lessee of the portion
of the Property which is the subject thereof for all purposes of this Lease and
the other Operative Documents on the terms set forth therein and herein. In
addition, the Lessor hereby irrevocably designates and appoints the Lessee as
its agent for the purpose of supervising and monitoring the performance of the
Existing Owner in the completion, following each applicable Land Interest
Acquisition Date, of all outstanding punch list items in respect of the
relevant Improvements and all other obligations of the Existing Owner in
respect of the Property following each Land Interest Acquisition Date.
The Lessee hereby unconditionally agrees to act as said agent on behalf of the
Lessor.
2.3 Lease Term.
The term of this Lease (the "Term") shall begin (1) with
respect to the Phase I Facility, on the Land Interest Acquisition Date
applicable thereto; and (2) with respect to the Phase II Facility, on the Land
Interest Acquisition Date applicable thereto and, in each case, shall end on
the fifth anniversary of the Closing Date, unless the Term is renewed or
earlier terminated in accordance with the provisions of this Lease.
2.4 Title. The
Property is leased to the Lessee without any representation or warranty of
title, condition of any of the Improvements or permitted uses, express or
implied, by the Lessor and subject to the rights of parties in possession, the
existing state of title (including, without limitation, the Permitted
Exceptions) and all applicable Requirements of Law. The Lessee shall in
no event have any recourse against the Lessor for any defect in or exception to
title to the Property, other than for any such defect or exception constituting
a Lessor Lien.
ARTICLE III.
3.1 Rent.
(a) During the Term, the Lessee
shall pay Basic Rent on each Payment Date, on the date required under Section
22.1(i) in connection with the Lessee's exercise of the Remarketing Option
and on any date on which this Lease shall terminate.
(b) Neither the Lessee's inability or
failure to take possession of all or any portion of the Property when delivered
by the Lessor, nor the Lessor's inability or failure to deliver all or any
portion of the Property to the Lessee on or before the contemplated Lease
Commencement Date therefor, whether or not attributable to any act or omission
of the Lessee or any act or omission of the Lessor, or for any other reason
whatsoever (including any act or omission of the Existing Owner), shall delay
or otherwise affect the Lessee's obligation to pay Rent for the Property from
and after commencement of the Term.
3.2 Payment of Basic Rent.
Basic Rent shall be paid absolutely net to the Lessor, so that this Lease shall
yield to the Lessor the full amount thereof, without setoff, deduction or
reduction, whether or not the Lessee's quiet possession of the Property is
disturbed.
3.3 Supplemental Rent. The Lessee shall pay to the Lessor or the Person entitled
thereto any and all Supplemental Rent promptly as the same shall become due and
payable, and if the Lessee fails to pay any Supplemental Rent, the Lessor shall
have all rights, powers and remedies provided herein or by law or equity or
otherwise in the case of nonpayment of Basic Rent. The Lessee shall pay
to the Lessor, as Supplemental Rent, among other things, on demand, to the
extent permitted by Applicable Law, interest at the applicable Overdue Rate on
any installment of Basic Rent not paid when due for the period for which the
same shall be overdue and on any payment of Supplemental Rent not paid when due
or demanded by the Lessor for the period from the due date or the date of any
such demand, as the case may be, until the same shall be paid. The
expiration or other termination of the Lessee's obligations to pay Basic Rent
hereunder shall not limit or modify the obligations of the Lessee with respect
to Supplemental Rent. Unless expressly provided otherwise in this Lease,
in the event of any failure on the part of the Lessee to pay and discharge any
Supplemental Rent as and when due, the Lessee shall also promptly pay and
discharge any fine, penalty, interest or cost which may be assessed or added
under any agreement with a third party for nonpayment or late payment of such
Supplemental Rent, all of which shall also constitute Supplemental Rent.
3.4 Method of Payment. Each payment of Rent shall be made by the Lessee to the Lessor
by 12:00 noon, ...... time, at the place of payment designated by Agent in
funds consisting of lawful currency of the United States of ...... which shall
be immediately available on the scheduled date when such payment shall be due,
unless such scheduled date shall not be a Business Day, in which case such
payment shall be made on the next succeeding Business Day or as otherwise
required by the definition of the term "Interest Period" set forth in
Appendix 1 hereto. Payments initiated after
ARTICLE IV.
4.1 Utility Charges.
Subject to the Lessee's rights under the terms of Article XIII relating
to permitted contests, the Lessee shall pay or cause to be paid all charges for
electricity, power, gas, oil, water, telephone, sanitary sewer service and all
other rents and utilities used in or on the Property during the Term. The
Lessee shall be entitled to seek and receive any credit or refund with respect
to any utility charge paid by the Lessee and the amount of any credit or refund
received by the Lessor on account of any utility charges paid by the Lessee,
net of the costs and expenses reasonably incurred by the Lessor in obtaining
such credit or refund, shall be promptly paid over to the Lessee. All
charges for utilities imposed with respect to the Property for a billing period
during which this Lease expires or terminates shall be adjusted and prorated on
a daily basis between the Lessor and the Lessee, and each party shall pay or
reimburse the other for each party's pro rata share thereof, except that if the
Lessee retains possession of the Property after termination or expiration of
this Lease, no such adjustment and proration shall be made.
ARTICLE V.
5.1 Quiet Enjoyment.
Subject to the rights of the Lessor contained in Section 17.2 and the
other terms of this Lease and so long as no Event of Default shall have
occurred and be continuing, the Lessee shall peaceably and quietly have, hold
and enjoy the Property for the Term, free of any claim or other action by the
Lessor or anyone rightfully claiming by, through or under the Lessor (other
than the Lessee) with respect to any matters arising from and after
(i) the Land Interest Acquisition Date therefor, in the case of the Phase
I Facility, and (ii) the Land Interest Acquisition Date therefor, in the
case of the Phase II Facility.
ARTICLE VI.
6.1 Net Lease. This
Lease shall constitute a net lease. It is the further express intent of
the Lessor and the Lessee that the obligations of the Lessor and the Lessee
hereunder shall be separate and independent covenants and agreements and that
the Basic Rent and Supplemental Rent, and all other charges and sums payable by
the Lessee hereunder, shall commence at the times provided herein and shall
continue to be payable in all events unless the obligations to pay the same
shall be terminated pursuant to an express provision in this Lease. Any
present or future law to the contrary notwithstanding, this Lease shall not
terminate, nor shall the Lessee be entitled to any abatement, suspension,
deferment, reduction, setoff, counterclaim, or defense (other than the defense
of payment) with respect to the Rent, nor shall the obligations of the Lessee
hereunder be affected (except as expressly herein permitted and by performance
of the obligations in connection therewith) by reason of: (i) any defect in the
condition, merchantability, design, construction, quality or fitness for use of
the Property or any portion thereof, or the failure of the Property to comply with
all Requirements of Law and Insurance Requirements, including any inability to
occupy or use the Property or any portion thereof by reason of such
non–compliance; (ii) any damage to, removal, abandonment, salvage, loss,
contamination of or Release from, scrapping or destruction of, or any
requisition or taking of the Property or any portion thereof; (iii) any
restriction, prevention or curtailment of or interference with any use of the
Property or any portion thereof; (iv) any defect in title to or rights to the
Property or any portion thereof or any Lien on such title or rights or on the
Property (other than Lessor Liens); (v) any change, waiver, extension,
indulgence or other action or omission or breach in respect of any obligation
or liability of or by the Lessor, the Agent or any Participant (other than the
breach by the Lessor of its covenant of quiet enjoyment set forth in Section
5.1); (vi) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceedings relating to the
Lessee, the Lessor, the Agent, any Participant or any other Person, or any
action taken with respect to this Lease by any trustee or receiver of the
Lessee, the Lessor, the Agent, any Participant or any other Person, or by any court,
in any such proceeding; (vii) any claim that the Lessee has or might have
against any Person, including without limitation the Lessor, the Existing
Owner, any vendor, manufacturer, contractor of or for the Property, the Agent
or any Participant; (viii) any failure on the part of the Lessor to
perform or comply with any of the terms of this Lease, any other Operative
Document or any other agreement (other than the breach by the Lessor of its
covenant of quiet enjoyment set forth in Section 5.1); (ix) any
invalidity or unenforceability or illegality or disaffirmance of this Lease,
against or by the Lessee or any provision hereof or any of the other Operative
Documents or any provision of any thereof; (x) the impossibility or illegality
of performance by the Lessee, the Lessor or both; (xi) any action by any court,
administrative agency or other Governmental Authority; (xii) any restriction,
prevention or curtailment of or interference with the construction on or any
use of the Property or any portion thereof; or (xiii) any other cause or
circumstances whether similar or dissimilar to the foregoing and whether or not
the Lessee shall have notice or knowledge of any of the foregoing. The
parties intend that the obligations of the Lessee hereunder shall be covenants
and agreements that are separate and independent from any obligations of the
Lessor hereunder or under any other Operative Document and the obligations of
the Lessee shall continue unaffected unless such obligations shall have been
modified or terminated in accordance with an express provision of this Lease.
6.2 No Termination or Abatement.
The Lessee shall remain obligated under this Lease in accordance with its terms
and shall not take any action to terminate (except as provided herein), rescind
or avoid this Lease, notwithstanding any action for bankruptcy, insolvency,
reorganization, liquidation, dissolution, or other proceeding affecting the
Lessor, the Agent, any Participant or the Lessee or any action with respect to
this Lease or any Operative Document which may be taken by any trustee,
receiver or liquidator of the Lessor, the Agent, any Participant or the Lessee
or by any court with respect to the Lessor, the Agent or any Participant.
The Lessee hereby waives, to the extent permitted by Applicable Law, all right
(i) to terminate or surrender this Lease (except as provided herein) or (ii) to
avail itself of any abatement, suspension, deferment, reduction, setoff,
counterclaim or defense (other than the defense of payment) with respect to any
Rent. The Lessee shall remain obligated under this Lease in accordance
with its terms and the Lessee hereby waives, to the extent permitted by
Applicable Law, any and all rights now or hereafter conferred by statute or
otherwise to modify or to avoid strict compliance with its obligations under
this Lease. Notwithstanding any such statute or otherwise, the Lessee
shall be bound by all of the terms and conditions contained in this Lease.
ARTICLE VII.
7.1 Nature of Transaction; Intent
of the Parties.
(a) It is the intent of the
parties hereto that: (i) this Lease constitutes an "operating lease"
pursuant to Statement of Financial Accounting Standards No. 13, as amended and
interpreted, for purposes of the Lessee's financial reporting, and (ii) for
purposes of federal, state, and local income or franchise taxes (and for any
other tax imposed on or measured by income) and documentary, intangibles and
transfer taxes, the transaction contemplated hereby is a financing arrangement
and preserves ownership in the Property in the Lessee. The parties shall
take no action inconsistent with such intention. Nevertheless, the Lessee
acknowledges and agrees that neither the Agent, the Lessor nor any Participant
(other than the Tranche Y Participant) has made any representations or
warranties to the Lessee concerning the tax, accounting or legal
characteristics of the Operative Documents and that the Lessee has obtained and
relied upon such tax, accounting and legal advice concerning the Operative
Documents as it deems appropriate.
(b) Anything to the contrary in the
Operative Documents notwithstanding, the Lessor and the Lessee intend and agree
that with respect to the nature of the transactions evidenced by this Lease in
the context of the exercise of remedies under the Operative Documents,
including, without limitation, in the case of any insolvency or receivership
proceedings or a petition under the United States bankruptcy laws or any other
applicable insolvency laws or statute of the United States of ...... or any
State or Commonwealth thereof or any foreign country affecting the Lessee, the
Lessor, or any Participant or any enforcement or collection actions arising out
of or relating to bankruptcy or insolvency laws, (i) the transactions evidenced
by this Lease shall be deemed to be loans made by the Lessor and the
Participants to the Lessee secured by the Property, (ii) the obligations of the
Lessee under this Lease to pay Basic Rent, Supplemental Rent, Asset Termination
Value or Residual Value Guarantee Amount in connection with a purchase of the
Property pursuant to this Lease shall be treated as payments of interest on
(with respect to Basic Rent), and principal of, respectively, loans from the
Lessor and the Participants to the Lessee, and (iii) this Lease grants a
security interest and mortgage or deed of trust lien, as the case may be, in
the Property to the Lessor and the Lease has been assigned by the Lessor to the
Agent for the benefit of the Participants to secure the Lessee's performance
under and payment of all amounts under this Lease and the other Operative
Documents.
(c) Specifically, without
limiting the generality of subsection (b) of this Section 7.1, the Lessor and
the Lessee further intend and agree that, for the purpose of securing the
Lessee's obligations for the repayment of the above–described loans from the
Lessor and the Participants to the Lessee (the aggregate commitment from the
Participants as of the date hereof is Two Hundred Seventy Million Dollars
($270,000,000) and the maturity date of such loans as of the date hereof is
March 16, 2006,), (i) this Lease shall also be deemed to be a security agreement
and financing statement within the meaning of Article 9 of the Uniform
Commercial Code and a real property mortgage of the Property; (ii) the
conveyance provided for in Article II shall be deemed to be a grant by the
Lessee to the Lessor, assigned by the Lessor to the Agent for the benefit of
the Participants, of a mortgage lien and security interest in all of the
Lessee's right, title and interest in and to the Property, except to the extent
all or a portion of the Property is released from this Lease in accordance with
the Operative Documents, and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, investments, securities or other
property, whether in the form of cash, investments, securities or other
property (it being understood that the Lessee hereby mortgages and warrants and
grants a security interest in the Property to Lessor to secure such loans);
(iii) the possession by the Lessor or any of its agents of any of the
Collateral (as defined below) which constitutes notes and such other items of
property as constitute instruments, money, negotiable documents or chattel
paper shall be deemed to be "possession by the secured party" for
purposes of perfecting the security interest pursuant to Section 9–305 of the
Uniform Commercial Code; and (iv) notifications to Persons holding such
property, and acknowledgments, receipts or confirmations from financial
intermediaries, bankers or agents (as applicable) of the Lessee shall be deemed
to have been given for the purpose of perfecting such security interest under
Applicable Law; provided that the foregoing provisions of this subsection
7.1(c) shall not be deemed or construed so as to constitute the transactions
evidenced under this Lease as loans other than for the purposes described in
subsection 7.1(a)(ii) and/or under the circumstances described in subsection
7.1(b). The Lessor and the Lessee shall, to the extent consistent with
this Lease, take such actions and execute, deliver, file and record such other
documents, financing statements, mortgages and deeds of trust as may be
necessary to ensure that, if this Lease were deemed to create a security
interest in the Property in accordance with this Section, such security
interest would be deemed to be a perfected security interest of first priority
(subject to Permitted Exceptions) under Applicable Law and will be maintained
as such throughout the Term.
(d) If the transactions evidenced by
this Lease and the other Operative Documents can no longer be treated as an
operating lease pursuant to GAAP for accounting purposes (other than by reason
of the failure of the Lessor to maintain the minimum equity required by EITF
Issues 96–21 and 97–1), all provisions in the Operative Documents limiting the
Lessee's obligation to pay the Asset Termination Value (including the
Remarketing Option) on the Expiration Date or otherwise shall no longer
apply. If any such change in accounting treatment shall occur, the
Lessee, the Lessor, the Agent and the Participants shall negotiate in good
faith to enter into such amendments to the Operative Documents as may be
reasonably necessary or desirable to reflect the foregoing.
(e) In the event that, after
the date hereof, the UCC as enacted and in effect in any applicable
jurisdiction shall be revised or amended or amendments thereto shall become
effective, the Lessee, the Lessor, the Agent and the Participants shall
negotiate in good faith to enter into such amendments to the Operative
Documents as may be reasonably necessary or desirable to effect the intended
purposes of this Lease and the other Operative Documents in light of such
revisions or amendments.
(f) Specifically, without
limiting the generality of subsection (b) of Section 7.1, in
order to secure the Lessee's obligation to pay Basic Rent, Supplemental Rent,
Asset Termination Value, the Residual Value Guarantee Amount, the Purchase Option
Price and all other obligations owing by the Lessee under the Operative
Documents (the "Obligations"), the Lessee hereby grants,
remises, releases, aliens, conveys, transfers, mortgages, assigns and warrants
to First ......n Title Insurance Company, as trustee (as "Trustee")
for the benefit of Lessor WITH POWER OF SALE and right of entry and possession,
all of the Lessee's right, title and interest in and to the following
(collectively, the "Collateral"):
(i) all right, title and
interest of the Lessee in and to the Property or any part thereof and the
reversions, remainders, rents, issues and profits thereof;
(ii) all right, title and
interest of the Lessee in and to all Fixtures and Improvements and all
substitutes and replacements of, and all additions and improvements to, the
Improvements and the Fixtures, subsequently acquired by the Lessee or
constructed, assembled or placed by Lessee on any of the Land Interest,
immediately upon such acquisition, release, construction, assembling or
placement, including, without limitation, any and all building materials
whether stored at the Property or offsite, and, in each such case, without any
further mortgage, deed of trust, conveyance, assignment or other act by the
Lessee;
(iii) all right, title and interest
of the Lessee in, to and under all books and records relating to or used in
connection with the operation of the Property or the Fixtures or any part
thereof and the Equipment;
(iv) all right, title and interest of the
Lessee in and to all insurance policies (including title insurance policies)
required to be maintained by the Lessee pursuant to the Operative Documents,
including the right to collect and receive such proceeds; and all awards and
other compensation, including the interest payable thereon and the right to
collect and receive the same, made to the owner of the Property for the taking
by eminent domain, condemnation or otherwise, of all or any part of the
Property or any easement or other right therein;
(v) all right, title and interest of
the Lessee in and to (i) all consents, licenses, building permits, certificates
of occupancy and other governmental approvals relating to construction,
completion, occupancy, use or operation of the Property or any portion thereof,
provided that any such consent, license, permit, certificate or approval
that by its terms or by operation of law would become void, voidable,
terminable or revocable or would result in a breach or default thereunder or
under any applicable law if subjected to the lien granted pursuant to this clause
(v) is expressly excepted and excluded from this clause (v) to the
extent necessary to avoid such result, and (ii) all XYZs and specifications
relating to the Property or any portion thereof, in each case to the extent
assignable;
(vi) all Rent and all other rents,
payments, purchase prices, receipts, revenues, issues and profits payable under
this Lease or pursuant to any other lease with respect to the Property;
(vii) all proceeds, both cash and noncash, of the
foregoing and any items acquired in substitution of, or replacement for, any of
the foregoing; and
(viii) all right, title and interest of the Lessee in
and to all of the Operative Documents, including, without limitation, each
Lease Supplement, regardless of whether the interest of the Lessee therein is
that of lessee, sublessee, sublessor or borrower.
(g) For the purposes of the security
agreement and financing statement provided herein the following information
applies:
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(i) |
Name and Address of Debtor: |
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WWW Inc. |
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(ii) |
Name and Address of Secured Party: |
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Lease XYZ ...... ......, Inc. |
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(iii) |
Description of the types (or items) by property covered by this
Financing Statement
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Those items described as Improvements, Fixtures and other personal
property in Section 7.1(f) |
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(iv) |
Description of real estate to which collateral is attached or upon
which it is located:
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See Exhibit B hereto |
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ARTICLE VIII.
8.1 Condition of the Property.
THE LESSEE ACKNOWLEDGES AND AGREES THAT ALTHOUGH THE LESSOR WILL HOLD FEE TITLE
TO THE PROPERTY, THE LESSEE IS SOLELY RESPONSIBLE FOR THE IMPROVEMENTS AND ANY
ALTERATIONS OR MODIFICATIONS. THE LESSEE FURTHER ACKNOWLEDGES AND AGREES
THAT IT IS LEASING THE PROPERTY "AS IS" WITHOUT REPRESENTATION,
WARRANTY OR COVENANT (EXPRESS OR IMPLIED) BY THE LESSOR, THE AGENT OR ANY
PARTICIPANT AND IN EACH CASE SUBJECT TO (A) THE EXISTING STATE OF TITLE, (B)
THE RIGHTS OF ANY PARTIES IN POSSESSION THEREOF, (C) ANY STATE OF FACTS WHICH
AN ACCURATE SURVEY OR PHYSICAL INSPECTION MIGHT SHOW, AND (D) VIOLATIONS OF
REQUIREMENTS OF LAW WHICH MAY EXIST ON THE DATE HEREOF. NEITHER THE
LESSOR, THE AGENT NOR ANY PARTICIPANT HAS MADE OR SHALL BE DEEMED TO HAVE MADE
ANY REPRESENTATION, WARRANTY OR COVENANT (EXPRESS OR IMPLIED) OR SHALL BE
DEEMED TO HAVE ANY LIABILITY WHATSOEVER AS TO THE TITLE (EXCEPT FOR THE
LESSOR'S COVENANT OF QUIET ENJOYMENT SET FORTH IN SECTION 5.1), VALUE,
HABITABILITY, USE, CONDITION, DESIGN, OPERATION, OR FITNESS FOR USE OF THE
PROPERTY (OR ANY PORTION THEREOF, INCLUDING ANY IMPROVEMENTS EXISTING THEREON),
OR ANY OTHER REPRESENTATION, WARRANTY OR COVENANT WHATSOEVER, EXPRESS OR
IMPLIED, WITH RESPECT TO THE PROPERTY (OR ANY PORTION THEREOF, INCLUDING ANY
IMPROVEMENTS EXISTING THEREON) AND NEITHER THE LESSOR, THE AGENT NOR ANY
PARTICIPANT SHALL BE LIABLE FOR ANY LATENT, HIDDEN, OR PATENT DEFECT THEREIN OR
THE FAILURE OF THE PROPERTY, OR ANY PART THEREOF, TO COMPLY WITH ANY
REQUIREMENT OF LAW.
8.2 Possession and Use of the
Property. The Property shall be used in a manner consistent with
properties of a similar nature in the businesses in which the Lessee is engaged
or as permitted in any sublease or assignment allowed by Section 25.1
hereof and in compliance in all respects with any covenants, conditions and
restrictions of record and any ordinance or law affecting the use and occupancy
of the Property; and provided that such other uses do not increase the
liability, directly or indirectly, of the Lessor or adversely affect the value,
utility or remaining useful life of the Property. At all times during the
applicable Term, the Property shall not be abandoned by the Lessee or a
permitted assignee or sublessee. The Lessee shall pay, or cause to be paid,
all charges and costs required in connection with the use of the Property as
contemplated by this Lease. The Lessee shall not commit or permit any
waste of the Property or any portion thereof.
ARTICLE IX.
9.1 Compliance with Requirements
of Law and Insurance Requirements.
Subject to the terms of Article XIII relating to permitted contests, the
Lessee, at its sole cost and expense, shall (a) comply with all Requirements of
Law and all Insurance Requirements relating to the Property, including the
construction, use, operation, maintenance, repair and restoration thereof and
the remarketing thereof pursuant to Article XXII, whether or not
compliance therewith shall require structural or extraordinary changes in the
Improvements or interfere with the use and enjoyment of the Property, and (b)
procure, maintain and comply with all licenses, permits, orders, approvals,
consents and other authorizations required for the construction, use,
maintenance and operation of the Property and for the use, operation,
maintenance, repair and restoration of the Improvements.
ARTICLE X.
10.1 Maintenance and Repair; Return.
(a) The Lessee, at its sole
cost and expense, shall maintain the Property in good working order, mechanical
condition and repair, subject to reasonable wear and tear, and make all
necessary repairs thereto, of every kind and nature whatsoever, whether
interior or exterior, ordinary or extraordinary, structural or nonstructural or
foreseen or unforeseen, in each case in compliance with all applicable
Requirements of Law and in compliance with all Insurance Requirements and on a
basis consistent with the operation and maintenance of commercial properties
comparable in type and location to the Property and in compliance with prudent
industry practice.
(b) The Lessor shall under no
circumstances be required to build any improvements on the Property, make any repairs,
replacements, alterations or renewals of any nature or description to the
Property, make any expenditure whatsoever in connection with this Lease or
maintain the Property in any way. The Lessor shall not be required to
maintain, repair or rebuild all or any part of the Property, and the Lessee
waives any right to (i) require the Lessor to maintain, repair, or rebuild all
or any part of the Property, or (ii) make repairs at the expense of the Lessor
pursuant to any Requirement of Law, Insurance Requirement, contract, agreement,
or covenant, condition or restriction in effect at any time during the Term.
(c) The Lessee shall, upon the
expiration or earlier termination of this Lease (unless the Property is
conveyed to the Lessee as provided herein), vacate and surrender the Property
to the Lessor in its then-current, "AS IS" condition, subject to the
Lessee's obligations under Sections 9.1, 10.1(a), 11.1, 12.1,
15.1(e), 15.2, 17.2(h), 22.1 and 23.1.
ARTICLE XI.
11.1 Modifications, Substitutions and Replacements.
(a) The Lessee, at its sole
cost and expense, may at any time and from time to time make alterations,
renovations, improvements and additions to the Property or any portion thereof
and substitutions and replacements therefor (collectively, "Modifications");
provided that: (i) no Modification shall impair the value, utility or
remaining useful life of the Property or any part thereof from that which
existed immediately prior to such Modification; (ii) the Modification shall be
done expeditiously and in a good and workmanlike manner; (iii) the Lessee shall
comply with all Requirements of Law and all Insurance Requirements applicable
to the Modification, including the obtaining of all permits and certificates of
occupancy, and the structural integrity of the Property shall not be adversely
affected; (iv) subject to the terms of Article XIII relating to
permitted contests, the Lessee shall pay all costs and expenses and shall
discharge (or cause to be insured or bonded over) within sixty (60) days after
the same shall be filed (or otherwise become effective) any Liens arising with
respect to the Modification; and (v) such Modifications shall comply with Sections
8.2 and 10.1. All Modifications (other than those that both
are not Modifications required to be made pursuant to a Requirement of Law or
an Insurance Requirement ("Required Modification") and are
readily removable without impairing the value, utility or remaining useful life
of the Property) shall remain part of the realty and shall be subject to this
Lease, and title thereto shall immediately vest in the Lessor. So long as
no Event of Default has occurred and is continuing, the Lessee may place upon the
Property any trade fixtures, machinery, equipment or other property belonging
to the Lessee or third parties and may remove the same at any time during the
Term, subject, however, to the terms of Section 10.1(a); provided
that such trade fixtures, machinery, equipment or other property do not impair
the value, utility or remaining useful life of the Property; provided, further,
that the Lessee shall keep and maintain at the Property and shall not remove
from the Property any Equipment financed or otherwise paid for (directly or
indirectly) by the Lessor or any Participant pursuant to the Participation
Agreement.
(b) The Lessee shall deliver to the
Lessor and the Agent and each Participant a brief written narrative description
of the work to be done in connection with any Modification to the Property the
cost of which is anticipated to exceed $1,000,000 in the aggregate.
ARTICLE XII.
12.1 Warranty of Title.
(a) The Lessee agrees that
except as otherwise provided herein and subject to the terms of Article XIII
relating to permitted contests, the Lessee shall not directly or indirectly
create or allow to remain, and shall promptly discharge at its sole cost and
expense, any Lien, defect, attachment, levy, title retention agreement or claim
upon the Property (or the Lessor's interest therein) or any Modifications or
any Lien, attachment, levy or claim with respect to the Rent, the Cash
Collateral or with respect to any amounts held by the Agent or any other Person
pursuant to the Participation Agreement or the other Operative Documents, other
than, with respect to the Property only, Permitted Exceptions and Lessor Liens.
(b) Nothing
contained in this Lease shall be construed as constituting the consent or
request of the Lessor, expressed or implied, to or for the performance by any
contractor, mechanic, laborer, materialman, supplier or vendor of any labor or
services or for the furnishing of any materials for any construction,
alteration, addition, repair or demolition of or to the Property or any part
thereof. NOTICE IS HEREBY GIVEN THAT NEITHER THE LESSOR, ANY PARTICIPANT
NOR THE AGENT IS OR SHALL BE LIABLE FOR ANY LABOR, SERVICES OR MATERIALS
FURNISHED OR TO BE FURNISHED TO THE LESSEE, OR TO ANYONE HOLDING THE PROPERTY
OR ANY PART THEREOF THROUGH OR UNDER THE LESSEE AND THAT NO MECHANIC'S OR OTHER
LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL ATTACH TO OR AFFECT THE
INTEREST OF THE LESSOR IN AND TO THE PROPERTY.
12.2 Grants and Releases of Easements and Other
Agreements. Provided that no Event of Default shall have occurred and
be continuing and subject to the provisions of Articles VIII, IX,
X and XI, the Lessor hereby consents in each instance to the
following actions by the Lessee, in the name and stead of the Lessor, but at
the Lessee's sole cost and expense: (a) the granting of easements, licenses,
rights-of-way and other rights and privileges in the nature of easements
reasonably necessary or desirable for the use, repair, operation or maintenance
of the Property as herein provided; (b) the release of easements, licenses,
rights-of-way and other rights and privileges in the nature of easements which
are for the benefit of the Property; (c) the execution of petitions to have the
Property annexed to any municipal corporation or utility district; and (d) the
execution of amendments to any covenants, restrictions, easements, licenses,
rights-of-way, and other rights and privileges in the nature of easements
affecting the Property; provided, however, in each case the
Lessee shall have delivered to the Lessor a Responsible Officer's Certificate
stating that (i) such grant, release, contract or agreement does not materially
impair the value, utility and remaining useful life of the Property, (ii) such
grant, release, contract or agreement is reasonably necessary for the use,
operation, maintenance, alteration or improvement of the Property, (iii) the
Lessee shall remain obligated under this Lease and under any instrument
executed by the Lessee consenting to the assignment of the Lessor's interest in
this Lease as security for indebtedness, in each such case in accordance with
their terms, as though such grant, release, contract, agreement or transfer had
not been effected, and (iv) the Lessee shall pay and perform any obligations of
the Lessor under such grant, release, contract or agreement. Without
limiting the effectiveness of the foregoing, provided that no Event of Default
shall have occurred and be continuing, the Lessor shall, upon the request of
the Lessee, and at the Lessee's sole cost and expense, execute and deliver, any
instruments necessary or appropriate to confirm any such grant, agreement or release
to any Person permitted under this Section 12.2.
ARTICLE XIII.
13.1 Permitted Contests Other Than in Respect of
Indemnities. Except to the extent otherwise provided for in Section 13
of the Participation Agreement, the Lessee, on its own or on the Lessor's
behalf but at the Lessee's sole cost and expense, may contest, by appropriate
administrative or judicial proceedings conducted in good faith and with due
diligence, the amount, validity or application, in whole or in part, of any Requirement
of Law, or utility charges payable pursuant to Section 4.1 or any Lien,
attachment, levy, encumbrance or encroachment, and the Lessor agrees not to
pay, settle or otherwise compromise any such item, provided that (a) the
commencement and continuation of such proceedings shall suspend the collection
thereof from, and suspend the enforcement thereof against, the Property, the
Cash Collateral, the Lessor, the Agent and the Participants or the Lessee shall
have bonded or otherwise secured such amount in a manner satisfactory to the
Lessor and the Agent; (b) there shall be no risk of the imposition of a Lien as
a result of such contest (other than, as to the Property, Permitted Exceptions)
on the Property or the Cash Collateral, and no part of the Property or the Cash
Collateral, nor any Rent would be in any danger of being sold, forfeited, lost
or deferred as a result of such contest; (c) at no time during the permitted
contest shall there be a risk of the imposition of criminal liability or
material civil liability on the Lessor, the Agent or any Participant for
failure to comply therewith (unless, in the case of civil liability, the Lessee
shall have bonded or otherwise secured such amount in a manner satisfactory to
the Lessor and the Agent); and (d) in the event that, at any time, there shall
be a material risk of extending the application of such item beyond the end of
the Term, then the Lessee shall deliver to the Lessor a Responsible Officer's
Certificate certifying as to the matters set forth in clauses (a), (b)
and (c) of this Section 13.1. The Lessor, at the Lessee's sole
cost and expense, shall cooperate in good faith with the Lessee with respect to
any permitted contests conducted by the Lessee pursuant to this Section 13.1
and shall, at the Lessee's sole cost and expense, execute and deliver to the
Lessee such authorizations and other documents as may reasonably be required in
connection with any such contest and, if reasonably requested by the Lessee,
shall join as a party therein at the Lessee's sole cost and expense.
ARTICLE XIV.
14.1 General Liability and Workers' Compensation
Insurance. The Lessee shall procure and
carry commercial general liability insurance, including contractual liability,
for claims for injuries or death sustained by persons or damage to property
while on the Property and such other general liability coverages as are
ordinarily procured by Persons who own or operate similar properties and
consistent with prudent business practice, which policies shall include
contractual liability endorsements covering the Lessee's indemnification
obligations in Section 13.1 of the Participation Agreement. Such
insurance shall be on terms and in amounts (which shall be acceptable to the
Lessor and in the event of liability insurance shall be maintained at a level
set forth on Schedule 14.2) that are no less favorable than insurance
maintained by the Lessee and its Subsidiaries with respect to similar
properties that it owns and that are in accordance with prudent business
practice and may be provided under blanket policies maintained by or on behalf
of the Lessee and its Subsidiaries. The policy shall be endorsed to name
the Lessor, the Agent and each Participant as additional insureds. The
policy shall also specifically provide that the policy shall be considered
primary insurance which shall apply to any loss or claim before any
contribution by any insurance which the Lessor, the Agent or the Participants
may have in force. The Lessee shall, in the operation of the Property
(including in connection with any Modifications thereof) comply with the
applicable workers' compensation laws and protect the Lessor, the Agent and the
Participants against any liability under such laws.
14.2 Hazard and Other Insurance. The Lessee shall keep, or cause to be kept, the Property insured
against loss or damage by fire, flood and other risks (excluding earthquake,
which insurance may be obtained by the Lessee if it so elects but which shall
not be required hereunder) in an amount not less than the greater of the amount
set forth on Schedule 14.2 and the then current replacement costs of the
buildings and improvements on the Property and on terms that are no less
favorable than insurance covering other similar properties owned or leased by
the Lessee and that are in accordance with prudent business practice. The
Lessee may provide such coverage under blanket policies maintained by or on
behalf of the Lessee; provided, that if the Lessee does not elect to
terminate the Lease pursuant to Article XVI hereof following the
occurrence of an event covered by any such blanket policy, the proceeds of any
such blanket policy shall be applied first, to the exclusion of other
facilities covered by such policy other than the Property, to the repair,
rebuilding and restoration of any damage to the Property. Insurance
coverage required under this Section 14.2 shall be subject to
deductibles reasonably satisfactory to the Lessor. During the
construction of any Modifications the Lessee shall also maintain builders' risk
insurance. Each policy of insurance maintained by the Lessee pursuant to
this Section 14.2 shall provide that all insurance proceeds in respect
of any loss or occurrence shall be paid to and adjusted solely by (and such proceeds
shall be paid to) the Lessee, except from and after the date on which the
insurer receives written notice from the Lessor or the Agent that a Event of
Default exists (and unless and until such insurer receives written notice from
the Lessor or the Agent that all Events of Default have been cured), all losses
shall be adjusted solely by, and all insurance proceeds shall be paid solely
to, the Agent (or the Lessor if the Participation Interests have been fully
paid) for application pursuant to Article XV. The costs and
expenses of all insurance required under this Section 14.2 shall be at
the sole cost and expense of the Lessee.
14.3 Coverage.
(a) The Lessee shall furnish
the Lessor and the Agent with certificates of insurance and certified copies of
the insurance policies on each Land Interest Acquisition Date showing the
insurance then required under Sections 14.1 and 14.2 to be in
effect and naming the Lessor, the Agent and each Participant as additional
insureds and, with respect to the insurance required under Section 14.2
(and with respect to any earthquake insurance covering the Property which
Lessee may elect to purchase and maintain), naming the Agent, for the benefit of
the Participants, as loss payees, and showing the mortgagee endorsement
required by Section 14.3(c). All such insurance shall be at the
cost and expense of the Lessee. Such policies and certificates in respect
thereof shall include a provision for thirty (30) days' advance written notice
by the insurer to the Lessor and the Agent in the event of cancellation of or
any significant reduction in the coverage provided by such insurance.
(b) The Lessee agrees that the insurance
policy or policies required by Sections 14.1 and 14.2 shall
include (i) an appropriate clause pursuant to which such policy shall provide
that it will not be invalidated should the Lessee waive, in writing, prior to a
loss, any or all rights of recovery against any party for losses covered by
such policy, and that the insurance in favor of the Lessor, the Agent and the
Participants, and their respective rights under and interests in said policies
shall not be invalidated or reduced by any act or omission or negligence of the
Lessee or any other Person having any interest in the Property, and (ii) a
so-called "Waiver of Subrogation Clause". The Lessee hereby
waives any and all such rights against the Lessor, the Agent and the Participants
to the extent of payments made under such policies.
(c) All such insurance shall be
written by reputable insurance companies that are financially sound and solvent
and otherwise reasonably appropriate considering the amount and type of
insurance being provided by such companies. Any insurance company
selected by the Lessee which is rated in Best's Key Rating Guide or any
successor thereto (or if there be none, an organization having a similar
national reputation) shall have a general policyholder rating of "A–"
and a financial rating of at least IX in Best's Key Rating Guide or be
otherwise acceptable to the Lessor and the Agent. All insurance policies
required by Section 14.2 shall include a standard form mortgagee
endorsement in favor of the Agent.
(d) The Lessor shall not carry
separate insurance concurrent in kind or form or contributing in the event of
loss with any insurance required under this Article XIV except that the
Lessor may carry separate liability insurance (at its sole cost) so long as (i)
the Lessee's insurance is designated as primary and in no event excess or
contributory to any insurance the Lessor may have in force which would apply to
a loss covered under the Lessee's policy and (ii) each such insurance policy
will not cause the Lessee's insurance required under this Article XIV to
be subject to a coinsurance exception of any kind.
(e) The Lessee shall pay as
they become due all premiums for the insurance required by Section 14.1
and, when required under Section 14.2, for the insurance required under Section
14.2, and shall renew or replace each policy prior to the expiration date
thereof. At the time each of the Lessee's insurance policies is renewed
(but in no event less frequently than once each year), the Lessee shall deliver
to the Lessor and the Agent certificates of insurance with respect to the
insurance policies required by this Article XIV to be maintained by the
Lessee with respect to the Property.
(f) The Lessee hereby waives,
releases and discharges the Lessor, the Agent and each Participant and their
agents and employees from all claims whatsoever arising out of loss, claim,
expense or damage to or destruction covered or coverable by insurance required
under this Article XIV notwithstanding that such loss, claim, expense or
damage may have been caused by the Lessor, the Agent or any Participant or any
of their agents or employees, and the Lessee agrees to look to the insurance
coverage only in the event of such loss.
ARTICLE XV.
15.1 Casualty and Condemnation.
(a) Subject to the provisions
of Article XIV, this Article XV and (in the event the Lessee delivers,
or is obligated to deliver, a Termination Notice) Article XVI, and prior
to the occurrence and continuation of a Event of Default, the Lessee shall be
entitled to receive (and the Lessor shall pay over to the Lessee, if received
by the Lessor, and hereby irrevocably assigns to the Lessee all of the Lessor's
right, title and interest in) any award, compensation or insurance proceeds to
which the Lessee or the Lessor may become entitled by reason of their
respective interests in the Property (i) if all or a portion of the Property is
damaged or destroyed in whole or in part by a Casualty or (ii) if the use,
access, occupancy, easement rights or title to the Property or any part
thereof, is the subject of a Condemnation; provided, however,
subject to Article XIV, if a Event of Default shall have occurred and be
continuing, such award, compensation or insurance proceeds shall be paid
directly to the Agent or, if received by the Lessee, shall be held in trust for
the Agent, and shall be paid over by the Lessee to the Agent (or, if the
Participation Interests have been fully paid, to the Lessor) and held in
accordance with the terms of this paragraph (a). If, contrary to
such provision, any such award, compensation or insurance proceeds are paid to
the Lessor or the Lessee rather than to the Agent, the Lessor and the Lessee,
as the case may be, hereby agree to transfer any such payment to the
Agent. All amounts held by the Lessor or the Agent under the preceding
sentences on account of any award, compensation or insurance proceeds either
paid directly to the Lessor or the Agent or turned over to the Lessor or the
Agent shall either be (i) paid to the Lessee for the repair of damage caused by
such Casualty or Condemnation in accordance with paragraph (e) of this Section
15.1, or (ii) applied to the purchase price of the Property on a
Termination Date resulting from a Casualty or Condemnation in accordance with paragraph
(d) of this Section 15.1 or paragraph (a) of Section 16.2,
with any Excess Proceeds being payable to the Lessee.
(b) In any proceeding or action under
the control of the Lessor or the Agent pursuant to the terms of Section 14.2,
the Lessee may participate and shall pay all expenses of such proceeding and its
participation. At the Lessee's reasonable request, and at the Lessee's
sole cost and expense, the Lessor and the Agent shall participate in any such
proceeding, action, negotiation, prosecution or adjustment under the control of
the Lessee. The Lessor and the Lessee agree that this Lease shall control
the rights of the Lessor and the Lessee in and to any such award, compensation
or insurance payment.
(c) If the Lessor or the Lessee
shall receive notice of a Casualty or of an actual, pending or threatened
Condemnation of the Property or any interest therein, the Lessor or the Lessee,
as the case may be, shall give notice thereof to the other and to the Agent
promptly after the receipt of such notice.
(d) In the event of a Casualty or
receipt of notice by the Lessee or the Lessor of a Condemnation, the Lessee may
deliver to the Lessor and the Agent a Termination Notice with respect to the
Property pursuant to Section 16.1. If the Lessee does not deliver a
Termination Notice within thirty (30) days after such occurrence, then this
Lease shall (subject to the terms and conditions thereof) remain in full force
and effect, and the Lessee shall, at the Lessee's sole cost and expense,
promptly and diligently restore the Property pursuant to paragraph (e)
of this Section 15.1 and otherwise in accordance with this Lease.
If the Lessee delivers a Termination Notice within thirty (30) days after such
occurrence, a Significant Event shall irrevocably be deemed to have occurred
with respect to the Property, and, in such event, this Lease shall terminate
and the Lessee shall purchase the Property on the next Payment Date (but in no
event to exceed sixty (60) days after such occurrence) (a "Termination Date")
pursuant to Article XVI hereof.
(e) If pursuant to this Section
15.1 this Lease shall continue in full force and effect following a
Casualty or Condemnation, the Lessee shall, at its sole cost and expense (and,
without limitation, if any award, compensation or insurance payment is not
sufficient to restore the Property in accordance with this paragraph, the
Lessee shall pay the shortfall), promptly and diligently repair any damage to
the Property caused by such Casualty or Condemnation in conformity with the
requirements of Sections 10.1 and 11.1 using the applicable
as-built XYZs and Specifications for the Property (as modified to give effect
to any subsequent Modifications, any Condemnation affecting the Property and in
compliance with all applicable Requirements of Law and all Insurance
Requirements) so as to restore the Property to at least the same condition,
operation, function and value as existed immediately prior to such Casualty or
Condemnation. In the event of such restoration, title to the Property
shall remain with the Lessor; provided, that (i) title to any such
substituted equipment shall vest in the Lessor and such equipment shall
constitute Equipment thereafter for all purposes of this Lease, and (ii) the
Lessor shall assign all of its right, title and interest to the Lessee in any
such replaced equipment without representation or warranty of any kind other
than that such equipment is free of Lessor Liens and Liens created pursuant to
the Operative Documents. Upon completion of such restoration, the Lessee
shall furnish the Lessor an architect's certificate of substantial completion
and a Responsible Officer's Certificate confirming that such restoration has
been completed pursuant to this Lease.
(f) In no event shall a
Casualty or Condemnation with respect to which this Lease remains in full force
and effect under this Section 15.1 affect the Lessee's obligations to
pay Rent pursuant to Section 3.1 or to perform its obligations and pay
any amounts due on the Expiration Date or pursuant to Articles XIX and XX.
(g) Any Excess Proceeds received by
the Lessor or the Agent in respect of a Casualty or Condemnation shall be
turned over to the Lessee.
15.2 Environmental Matters.
Promptly upon the Lessee's actual knowledge of the presence of Hazardous
Substances in any portion of the Property in concentrations and conditions that
constitute or could reasonably be expected to constitute an Environmental
Violation (excluding any such Environmental Violation that is a Pre-Existing
Environmental Condition), the Lessee shall notify the Lessor in writing of such
condition. In the event of such Environmental Violation, the Lessee shall,
not later than thirty (30) days after the Lessee has actual knowledge of such
Environmental Violation, either, if such Environmental Violation is a
Significant Event, deliver to the Lessor and the Agent a Responsible Officer's
Certificate and a Termination Notice with respect to the Property pursuant to Section
16.1, or, if such Environmental Violation is not a Significant Event, at
the Lessee's sole cost and expense, promptly and diligently commence any
Response Actions necessary to investigate, remove, clean up or remediate such
Environmental Violation in accordance with the terms of Section 9.1.
If the Lessee does not deliver a Termination Notice with respect to the
Property pursuant to Section 16.1, the Lessee shall, upon completion of
Response Actions by the Lessee, cause to be prepared by an environmental
consultant reasonably acceptable to the Lessor a report describing the
Environmental Violation (excluding any such Environmental Violation that is a
Pre-Existing Environmental Condition) and the Response Actions taken by the
Lessee (or its agents or contractors) for such Environmental Violation, and a
statement by the consultant that such Environmental Violation (excluding any
such Environmental Violation that is a Pre-Existing Environmental Condition)
has been remedied in compliance in all material respects with applicable
Environmental Law. Each such Environmental Violation shall be remedied
prior to the Expiration Date. Nothing in this Article XV shall
reduce or limit the Lessee's obligations under Sections 13.1, 13.2 or 13.3 of
the Participation Agreement.
15.3 Notice of Environmental Matters.
Promptly, but in any event within thirty (30) Business Days from the date the
Lessee has actual knowledge thereof, the Lessee shall provide to the Lessor
written notice of any material pending or threatened claim, action or
proceeding involving any Environmental Law or any Release on or in connection
with the Property (other than with respect to any Pre-Existing Environmental
Condition). All such notices shall describe in reasonable detail the
nature of the claim, action or proceeding and the Lessee's proposed response
thereto. In addition, the Lessee shall provide to the Lessor, within
thirty (30) Business Days of receipt, copies of all material written
communications with any Governmental Authority relating to any Environmental
Law in connection with the Property. The Lessee shall also promptly
provide such detailed reports of any such material environmental claims (other
than with respect to any Pre-Existing Environmental Condition) as may
reasonably be requested by the Lessor and the Agent.
ARTICLE XVI.
16.1 Termination by the Lessee upon Certain
Events. If either: (i) the Lessee or the Lessor shall have
received notice of a Condemnation, and the Lessee shall have delivered to the
Lessor a Responsible Officer's Certificate that such Condemnation is a
Significant Condemnation; or (ii) a Casualty occurs, and the Lessee shall have
delivered to the Lessor a Responsible Officer's Certificate that such Casualty
is a Significant Casualty; or (iii) an Environmental Violation occurs or is
discovered and the Lessee shall have delivered to the Lessor a Responsible
Officer's Certificate stating that, in the reasonable, good-faith judgment of
the Lessee, the cost to remediate the same will cause the same to be a
Significant Event, or (iv) if the Lessee shall not have delivered a Termination
Notice with respect to such Environmental Violation described in clause
(iii) but the requirements of Section 16.3 are met with respect to
such Environmental Violation; then, (A) the Lessee shall, simultaneously with
the delivery of the Responsible Officer's Certificate pursuant to the preceding
clause (i), (ii) or (iii) deliver a written notice in the
form described in Section 16.2(a) (a "Termination Notice"),
or (B) if clause (iv) is applicable, the Lessor may deliver a
Termination Notice pursuant to Section 16.3.
16.2 Procedures.
(a) A Termination Notice shall
contain: (i) notice of termination of this Lease with respect to the Property
or the affected portion thereof on a date that is no later than sixty (60) days
after the occurrence of the applicable event described in clause (i), (ii)
or (iii) of Section 16.1 (the "Termination Date"),
such termination to be effective upon the Lessee's payment of the Asset
Termination Value (or portion thereof representing the Property Cost of the
affected portion of the Property); and (ii) a binding and irrevocable agreement
of the Lessee to pay the Asset Termination Value and purchase the Property on
the Termination Date.
(b) On the Termination Date, the
Lessee shall pay to the Lessor the Asset Termination Value (or such portion
thereof, as applicable), plus all other amounts owing in respect of Rent for
the Property (including Supplemental Rent) theretofore accruing, and the Lessor
shall convey the Lessor's interest in the Property or such portion thereof to
the Lessee (or the Lessee's designee) all in accordance with Section 19.1
and, to the extent applicable, Section 19.2, as well as any Net Proceeds
with respect to the Casualty or Condemnation giving rise to the termination of
this Lease with respect to the Property theretofore received by the Lessor.
16.3 Purchase of Property. Upon receipt of any notice pursuant to Section 15.2 or 15.3,
the Lessor or the Required Participants, at the Lessee's expense, shall have
the right to select an independent environmental consultant acceptable to the
Lessee, which acceptance shall not be unreasonably withheld or delayed, to
determine the estimated cost of conducting any clean-up or remediation required
as a result of the Environmental Violation disclosed in such notice. If
such independent environmental consultant determines that the cost of any such
clean-up or remediation would exceed thirty percent (30%) of the original
Property Cost, the Lessor shall, at the direction of the Required Participants,
by written notice require the Lessee to purchase, or arrange for an Affiliate
of Lessee or other third party to purchase, the Property on the Termination
Date by delivering a Termination Notice following the requirements of Section
16.2 hereof.
ARTICLE XVII.
17.1 Events of Default. The
occurrence of any one or more of the following events (whether such event shall
be voluntary or involuntary or come about or be effected by operation of law or
pursuant to or in compliance with any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) shall
constitute an "Event of Default":
(a) the Lessee shall fail to
make payment of (i) any Basic Rent (other than a payment of Basic Rent due on
the Expiration Date or Termination Date) within five (5) Business Days
after the same has become due and payable or (ii) Basic Rent, Purchase Option
Price, Asset Termination Value, Residual Value Guarantee Amount or other
amounts due on the Expiration Date or the Termination Date, including, without
limitation, amounts due pursuant to Sections 16.2, 16.3, 20.2,
20.3 or 22.1, after the same has become due and payable;
(b) the Lessee shall fail to make
payment of any Supplemental Rent (other than Supplemental Rent referred to in clause
(a) of this Section) due and payable within five (5) Business Days after
the same has become due and payable;
(c) the Lessee shall fail to
maintain insurance as required by Article XIV of this Lease;
(d) the Lessee shall fail to observe
or perform any term, covenant or condition of the Lessee under this Lease, the
Participation Agreement or any other Operative Document to which it is a party
(other than those described in Section 17.1(a), (b), (c), (n)
or (o) hereof), or any representation or warranty set forth in this
Lease or in any other Operative Document or in any document entered into in
connection herewith or therewith or in any document, certificate or financial
or other statement delivered in connection herewith or therewith shall be false
or inaccurate in any material way, and, if such failure to perform or
misrepresentation or breach of warranty is other than with respect to a
covenant, agreement, representation or warranty contained in Section 10.1(b)
and Section 10.2 of the Participation Agreement (with respect to which there
shall be no cure period), such failure or misrepresentation or breach of
warranty shall remain uncured for a period of thirty (30) days after the
earlier of (x) the date upon which an executive officer of the Lessee has
actual knowledge thereof and (y) the date upon which the Agent or the Lessor
gives notice to the Lessee thereof;
(e) (i) failure to make any
payment when due (whether by scheduled maturity, upon acceleration or
otherwise) on account of any Indebtedness of the Lessee or any Subsidiary of
the amount of such Indebtedness exceeds $10,000,000 or more, or (ii) default
shall otherwise occur under one or more indentures, agreements or other
instruments under which any Indebtedness of the Lessee or any Subsidiary in an
aggregate principal amount of $10,000,000 or more may be issued or created and
such default shall continue beyond any grace period provided with respect
thereto by such indenture, agreement or other instrument, if the effect of such
default is to cause, or to permit the holder or beneficiary of such Indebtedness
or a trustee therefor to cause, such Indebtedness to become due (by
acceleration, mandatory redemption or otherwise) prior to its stated maturity
(and/or to be secured by cash collateral);
(f) (i) a court having
jurisdiction in the premises shall enter a decree or order for relief in
respect of the Lessee or any of its Subsidiaries in an involuntary case under
the Bankruptcy Code or under any other applicable bankruptcy, insolvency or
similar law now or hereafter in effect, which decree or order is not stayed or
any other similar relief shall be granted under any applicable federal or state
law; or (ii) an involuntary case shall be commenced against the Lessee or any
of its Subsidiaries under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect; or a decree
or order of a court having jurisdiction in the premises for the appointment of
a receiver, liquidator, sequestrator, trustee, custodian or other officer
having similar powers over the Lessee or any of its Subsidiaries or over all or
a substantial part of any such Person's property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee or other custodian of the Lessee or any of its Subsidiaries for all or
a substantial part of any such Person's property; or a warrant of attachment,
execution or similar process shall have been issued against any substantial
part of the property of the Lessee or any of its Subsidiaries, and any such
event described in this clause (ii) shall continue for ninety (90) days
unless dismissed, bonded or discharged;
(g) the Lessee or any of its
Subsidiaries shall (i) commence a voluntary case under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, or shall consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, or shall consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial
part of its property; or the Lessee or any of its Subsidiaries shall make any
assignment for the benefit of creditors; (ii) be unable, or shall fail
generally, or shall admit in writing its inability, to pay its debts as such
debts become due; (iii) be dissolved or liquidated in full or in part; (iv)
become insolvent (as such term may be defined or interpreted under any
applicable statute); or (v) the Board of Directors of the Lessee or any of its
Subsidiaries (or any committee thereof) shall adopt any resolution or otherwise
authorize any action to approve any of the actions referred to herein or in Section
17.1(f);
(h) one or more judgments, orders,
decrees or arbitration awards requiring Lessee or any of its Subsidiaries to
pay an aggregate amount of $10,000,000 or more shall be rendered against Lessee
or any of its Subsidiaries and the same shall not be satisfied, vacated or
stayed within thirty (30) days after the date so rendered;
(i) any Operative
Document or any material term thereof shall cease to be, or be asserted by the
Lessee not to be, a legal, valid and binding obligation of the Lessee
enforceable in accordance with its terms;
(j) any ERISA Event which
constitutes grounds for the termination of any Employee Benefit XYZ by the PBGC
or for the appointment of a trustee by the PBGC to administer any Employee
Benefit XYZ shall occur, or any Employee Benefit XYZ shall be terminated within
the meaning of Title IV of ERISA or a trustee shall be appointed by the PBGC to
administer any Employee Benefit XYZ;
(k) a Change of Control shall
occur;
(l) the Lessee shall have
abandoned or constructively abandoned all or any material portion of the
Property for a period of 30 consecutive days which results in the Property not
being properly maintained in accordance with the terms of this Lease;
(m) the Lessee shall have elected to
or be required to purchase the Property pursuant to Sections 16.2 or 16.3
hereof and such purchase shall not have been consummated on the Termination
Date pursuant to either such Section;
(n) in the event the Lessee is not
purchasing the Property upon the Expiration Date or earlier termination of this
Lease, failure to comply with the return conditions set forth in Sections
19.1(b) and 22.3 hereof; or
(o) any event(s) or condition(s)
which have a Material Adverse Effect shall occur and be continuing or exist.
17.2 Lease Remedies. Upon the
occurrence of any Event of Default and at any time thereafter, the Lessor may,
so long as such Event of Default is continuing, do one or more of the following
as the Lessor in its sole discretion shall determine, without limiting any
other right or remedy the Lessor may have on account of such Event of Default
(including, without limitation, the obligation of the Lessee to purchase the
Property as set forth in Section 20.3):
(a) The Lessor may, by notice
to the Lessee, terminate the Commitments and rescind or terminate this Lease as
to all or any portion of the Property as of the date specified in such notice;
however, (i) no reletting, reentry or taking of possession of the Property (or
any portion thereof) by the Lessor will be construed as an election on the
Lessor's part to terminate this Lease unless a written notice of such intention
is given to the Lessee, (ii) notwithstanding any reletting, reentry or taking
of possession, the Lessor may at any time thereafter elect to terminate this
Lease for a continuing Event of Default, and (iii) no act or thing done by the
Lessor or any of its agents, representatives or employees and no agreement
accepting a surrender of the Property shall be valid unless the same be made in
writing and executed by the Lessor;
(b) The Lessor may (i) demand that
the Lessee, and the Lessee shall upon the written demand of the Lessor, return
the Property promptly to the Lessor in the manner and condition required by,
and otherwise in accordance with all of the provisions of, Articles VIII,
IX and X hereof as if the Property were being returned at the end
of the Term, and the Lessor shall not be liable for the reimbursement of the
Lessee for any costs and expenses incurred by the Lessee in connection
therewith and (ii) without prejudice to any other remedy which the Lessor may
have for possession of the Property, and to the extent and in the manner
permitted by Applicable Law, enter upon the Property and take immediate
possession of (to the exclusion of the Lessee) the Property or any part thereof
and expel or remove the Lessee and any other Person who may be occupying the
Property, by summary proceedings or otherwise, all without liability to the
Lessee for or by reason of such entry or taking of possession, whether for the
restoration of damage to property caused by such taking or otherwise and, in
addition to the Lessor's other damages, the Lessee shall be responsible for all
costs and expenses incurred by the Lessor or the Participants in connection
with any reletting, including, without limitation, brokers' fees and all costs
of any alterations or repairs made by the Lessor;
(c) The Lessor may (i) sell all
or any part of the Property at public or private sale, as the Lessor may
determine, pursuant to such notices and procedures as may be required by
Applicable Law, free and clear of any rights of the Lessee and without any duty
to account to the Lessee with respect to such action or inaction or any
proceeds with respect thereto (except to the extent required by clause (ii)
below if the Lessor shall elect to exercise its rights thereunder) in which
event the Lessee's obligation to pay Basic Rent hereunder for periods
commencing after the date of such sale shall be terminated or proportionately
reduced, as the case may be; and (ii) if the Lessor shall so elect, demand that
the Lessee pay to the Lessor, and the Lessee shall pay to the Lessor, on the
date of such sale, as liquidated damages for loss of a bargain and not as a
penalty (the parties agreeing that the Lessor's actual damages would be
difficult to predict, but the aforementioned liquidated damages represent a
reasonable approximation of such amount) (in lieu of Basic Rent due for periods
commencing on or after the Payment Date coinciding with such date of sale (or,
if the sale date is not a Payment Date, the Payment Date next preceding the
date of such sale)), an amount equal to (A) the excess, if any, of (1) the
Asset Termination Value calculated as of such Payment Date (including all Rent
due and unpaid to and including such Payment Date) less the aggregate amount of
the Cash Collateral, if any, retained by the Lessor, the Agent or the
Participants, over (2) the net proceeds of such sale, if any (that is, after
deducting all costs and expenses incurred by the Lessor, the Agent and the
Participants incident to such conveyance, including, without limitation,
repossession costs, brokerage commissions, prorations, transfer taxes, fees and
expenses for counsel, title insurance fees, survey costs, recording fees, and
any repair or alteration costs); plus (B) interest at the Overdue Rate on the
foregoing amount from such Payment Date until the date of payment; provided,
that the Lessor shall deliver all proceeds from the sale of the Property and
other amounts received hereunder, including any Cash Collateral, to the Agent
for application as provided in Sections 3.14, 3.17 and 3.18 of the
Participation Agreement.
(d) Reserved;
(e) Unless the Property has
been sold in its entirety, the Lessor may, subject to Section 17.2(h),
whether or not the Lessor shall have exercised or shall thereafter at any time
exercise any of its rights under paragraph (b), (c) or (i)
of this Section 17.2 with respect to the Property or portions thereof,
demand, by written notice to the Lessee specifying a date (a "Termination
Date") not earlier than 10 days after the date of such notice, that
the Lessee purchase, on such Termination Date, the Property (or the remaining
portion thereof) in accordance with the provisions of Article XIX and Section
20.3;
(f) The Lessor may exercise any
other right or remedy that may be available to it under the Operative Documents
or otherwise under Applicable Law, or proceed by appropriate court action
(legal or equitable) to enforce the terms hereof or to recover damages for the
breach hereof. Separate suits may be brought to collect any such damages
for any period(s), and such suits shall not in any manner prejudice the
Lessor's right to collect any such damages for any subsequent period(s), or the
Lessor may defer any such suit until after the expiration of the Term, in which
event such suit shall be deemed not to have accrued until the expiration of the
Term;
(g) The Lessor may retain and apply
against the Lessor's damages all sums which the Lessor would, absent such Event
of Default, be required to pay to, or turn over to, the Lessee pursuant to the
terms of this Lease;
(h) Notwithstanding anything
contained in this Lease or any other Operative Document to the contrary, in the
event that the Event of Default resulting in the exercise of remedies by the
Lessor hereunder is solely a Limited Event of Default, then the following
provisions of this Section 17.2(h) shall apply (but without limitation
of the right and remedies set forth in Section 17.2(a)). The
Lessee shall have the option or, if the Lessor terminates this Lease, the
Lessee shall be required to elect to (i) remarket the Property for 180
days after the occurrence of such Limited Event of Default in accordance with Article
XXII hereof (which period shall constitute the Marketing Period), with the
purchase of the Property to be consummated no later than the date that is 180
days following the occurrence of such Limited Event of Default (which date
shall constitute the Expiration Date if such option is exercised or required to
be exercised), or (ii) exercise its Purchase Option under Section 20.1
hereof, with the purchase of the Property by the Lessee to be consummated, and
the other payments required thereunder to be made to the Lessor, on the next
Payment Date following the occurrence of such Limited Event of Default (which
date shall constitute the Expiration Date if such option is exercised).
Notwithstanding the provisions of clause (i) above, if the Lessor elects
to terminate the Lease solely due to the occurrence of a Limited Event of
Default and (x) the Lessor delivers to the Lessee an appraisal of the Property
prepared by an appraiser selected by the Lessor and reasonably satisfactory to
the Agent, the Required Participants and the Lessee setting forth the Fair
Market Sales Value of the of the Property as of the date of the occurrence of
such Limited Event of Default, and (y) the sum of the Fair Market Sales Value
of the Property set forth in such report plus the maximum Residual Value
Guarantee Amount then payable by the Lessee in connection with the exercise of
the Remarketing Option is less than the Asset Termination Value as of such
date, then and in such event the Lessee shall not be entitled to elect to
exercise the Remarketing Option and the Lessor may in lieu thereof require the
Lessee to elect to either (A) return the Property promptly to the Lessor in the
manner and condition required by, and otherwise in accordance with all of the
provisions of, Articles VIII, IX and X hereof as if the
Property were being returned at the end of the Term, or (B) exercise its
Purchase Option under Section 20.1 hereof, with the purchase of the
Property by the Lessee to be consummated, and the other payments required
thereunder to be made to the Lessor, on the next Payment Date following the
occurrence of such Limited Event of Default (which date shall constitute the
Expiration Date if such option is exercised). The Lessee shall notify the
Lessor within ten (10) days after the occurrence of such Limited Event of
Default which option it is exercising. If the Lessee elects to remarket
the Property pursuant to clause (i) above or elects to return the
Property pursuant to clause (A) above, the Lessee shall pay to the Lessor
(i) the maximum Residual Value Guarantee Amount on the date the Lessee
furnishes such notice of exercise of the Remarketing Option or such notice of
its election to return the Property in accordance with clause (A) above
(or, if the Lessor elects, on the date that is ten (10) days after the Lessor
furnishes the Lessee notice that it will require the Lessee to remarket or
purchase the Property or return or purchase the Property, as the case may be),
(ii) Basic Rent when due for the duration of the 180 day Marketing Period, in
the case of an exercise of the Remarketing Option, or all accrued and unpaid
Basic Rent as of the date of the return of the Property in accordance with clause
(A) above, in the case of a return of the Property, and (iii) in the case
of an exercise of the Remarketing Option, the other payments required under Section
22.1 when required thereunder and no later than the Expiration Date.
(i) In addition to the
other rights and remedies set forth herein, the Lessor shall have the right to
continue this Lease in effect and, as permitted by Section 1951.4 of the ......
Civil Code, to enforce, by suit or otherwise, all covenants and conditions
hereof to be performed or complied with by the Lessee and exercise all of the
Lessor's rights and remedies under this Lease, including, without limitation,
the right to recover Basic Rent and Supplemental Rent from the Lessee as it
becomes due under this Lease, even though the Lessee shall have breached this
Lease and abandoned the Property. Acts of maintenance or preservation, or
efforts by the Lessor or on the Lessor's behalf to relet the Property, or the
appointment of a receiver upon the initiative of the Lessor to protect the
Lessor's interest under this Lease shall not constitute a termination of the
Lessee's right to possession of the Property; provided, however,
that the foregoing enumeration shall not be construed as in any way limiting
the actions the Lessor may take without terminating the Lessee's right to possession.
In furtherance of the rights hereby granted to the Lessor, and to the extent
permitted by law, the Lessee hereby appoints the Lessor its agent and
attorney–in–fact, which appointment shall be deemed to be coupled with an
interest and is irrevocable, with power of substitution, to enter the Property
upon a Event of Default hereunder and remove therefrom all persons and property
(with the right to store such property on the Property in a public warehouse or
elsewhere at the cost and risk and for the account of the Lessee) and to alter
the Property in such manner as the Lessor may deem necessary or advisable so as
to put the Property in good order and to make the same rentable and from time
to time and sublet the Property or any part thereof for such term or terms
whether or not extending beyond the then current term of this Lease (but such
sublease may provide for a new and successive lease to commence immediately
upon the termination of this Lease), at such rentals and upon such other terms
as the Lessor in its sole discretion may deem advisable, and with the right to
make alterations and repairs to the Property; and the Lessee agrees to pay to
the Lessor on demand all expenses incurred by the Lessor in such subletting,
and in altering, repairing and putting the Property in good order and
condition, and in reletting the same, including fees of attorneys and
architects, and all other expenses or commissions. The Lessor shall be
the Lessee's agent and representative on the Property in respect of all matters
arising under or in connection with any such sublease made for the Lessee by
the Lessor. Under each such sublease, the Lessee shall retain the right
to enter upon and use the Property, subject to the terms and conditions of such
sublease and the rights of the sublessee thereunder. The Lessee further
agrees to pay to the Lessor, following the date of such subletting, to and
including the date provided in this Lease for the expiration of the Term, the
sums of money which would have been payable by the Lessee as Basic Rent and
Supplemental Rent, deducting only the net amount of rent, if any, which the
Lessor shall actually receive (after deducting from the gross receipts the
expenses, costs and payments of the Lessor which in accordance with the terms of
this Lease would have been borne by the Lessee) in the meantime from and by any
such subletting of the Property, and the Lessee hereby agrees to remain liable
for all sums otherwise payable by the Lessee under this Lease, including, but
not limited to, the expenses of the Lessor aforesaid, as well as for any
deficiency aforesaid. The Lessor shall have the right from time to time
to begin and maintain successive actions or other legal proceedings against the
Lessee for the recovery of such deficiency, expenses or damages or for a sum
equal to any installments of Basic Rent or Supplemental Rent and other sums
payable hereunder, and to recover the same upon the liability of the Lessee
herein provided, which liability it is expressly covenanted shall survive the
commencement or determination of any action to secure possession of the
Property. Nothing herein contained shall be deemed to require the Lessor
to wait to begin such action or other legal proceedings until the date when
this Lease would have expired by limitation had there been no such Event of
Default. Notwithstanding any such subletting without termination,
pursuant to the terms hereof, the Lessor shall retain the right to and may at
any time thereafter elect to terminate this Lease or the Lessee's right to
possession of the Property for any previous breach which remains uncured or for
any subsequent breach by giving the Lessee written notice thereof as herein
provided, and in such event the Lessee shall forfeit any rights or interest
under any such sublease and thereafter the obligations of any such sublessee
shall run directly to the Lessor for its own account. Upon application by
the Lessor, a receiver may be appointed to take possession of the Property,
exercise all rights granted to the Lessor as agent and attorney–in–fact for the
Lessee set forth in this Section 17.2(i) and apply any rentals collected
from the Property as hereinabove provided. No taking of possession of the
Property or other act by the Lessor as the agent and attorney–in–fact for the
Lessee pursuant to the foregoing provisions, nor any subletting by the Lessor
for the Lessee pursuant to the foregoing provisions, nor any such appointment
of a receiver shall constitute or be construed as an election by the Lessor to
terminate this Lease or the Lessee's right to possession of the Property unless
a written notice of such intention be given to the Lessee.
(j) If this Lease is
being terminated on the basis of the occurrence of an Event of Default (excluding
a Limited Event of Default) arising out of the failure to perform an obligation
or covenant listed on Schedule 17.2(j) or the breach of a representation
or warranty listed on Schedule 17.2(j), or the performance of which
covenant or obligation or the truth of which representation or warranty, or
otherwise the existence of such Event of Default (excluding a Limited Event of
Default), is qualified by the words "material," or "Objective
Material Adverse Effect" (but not "Material Adverse Effect") or
"in all material respects" or another similar qualifier set forth on Schedule
17.2(j) hereto, Lessor shall, to the extent required by Schedule 17.2(j)
hereto, apply commercially reasonable standards in determining that such Event
of Default (excluding a Limited Event of Default) occurred.
(k) In the event a Limited
Event of Default occurs prior to the Land Interest Acquisition Date in respect
of the Phase II Facility and the Lessor is exercising its rights and remedies
under Section 17.2(h) with respect thereto, Lessor shall, in addition to
such rights and remedies, be entitled to take such steps as it may deem
necessary or appropriate to, and may require the Lessee to use its best efforts
to, identify a Person willing to accept an assignment of the Property Purchase
Agreement in respect of the Phase II Facility and to consummate the purchase of
the Phase II Facility. In the event such a Person is identified, the
Lessee shall (i) cooperate with the Lessor and such Person as necessary or as
requested in order to transfer to such Person the rights and benefits of the
Lessee and/or the Lessor under the Property Purchase Agreement and the Lockheed
Indemnification Agreements in respect of the Phase II Facility, and (ii) pay for
any modifications requested by such Person to the relevant XYZs and
Specifications and for any fees, costs or expenses required to be paid or
reimbursed to such Person in connection with such Person's agreement to so
acquire the Phase II Facility provided the Lessee's liability with
respect thereto shall not exceed 89.9% of the purchase price in respect of the
Phase II Facility payable pursuant to the Property Purchase Agreement.
17.3 Waiver of Certain Rights. If this
Lease shall be terminated pursuant to Section 17.2, the Lessee waives,
to the fullest extent permitted by law, (a) any notice of re-entry or the
institution of legal proceedings to obtain re-entry or possession; (b) any
right of redemption, re-entry or repossession; (c) the benefit of any laws now
or hereafter in force exempting property from liability for rent or for debt or
limiting the Lessor with respect to the election of remedies; and (d) any other
rights which might otherwise limit or modify any of the Lessor's rights or
remedies under this Article XVII.
17.4 Loan Remedies. If the transaction
evidenced by this Agreement and the other Operative Documents is treated as a
loan, upon the occurrence or existence of any Event of Default and at any time
thereafter unless such Event of Default is waived, the Lessor and the Trustee
may with the consent of the Required Participants, or shall, upon instructions
from the Required Participants, exercise any one or more of the following rights
and remedies in addition to those rights and remedies set forth in Section
17.2:
(a) Acceleration of
Obligations. The Lessor may, by written notice to the Lessee,
terminate this Lease and declare all unpaid Obligations due and payable.
On such termination date (which shall then be the Expiration Date), the Lessee
shall pay the Asset Termination Value (subject to Section 17.2(h)), all
unpaid Basic Rent accrued through such date, all Supplemental Rent due and
payable on or prior to such date and all other amounts payable by the Lessee on
the Expiration Date pursuant to this Lease and the other Operative Documents.
(b) Uniform Commercial Code
Remedies. The Lessor may exercise any or all of the remedies granted
to a secured party under the ...... Uniform Commercial Code.
(c) Judicial Foreclosure.
The Lessor may bring an action in any court of competent jurisdiction to
foreclose the security interest in the Property granted to the Lessor by this
Lease or any of the other Operative Documents; provided that if the
Event of Default resulting in an exercise of such remedy is solely a Limited
Event of Default, the Lessor's right to recover any deficiency amount from the
Lessee following any such foreclosure shall be limited as set forth in Section
17.2(h). Further, Lessor and/or the Trustee may bring an action or
actions in a court of competent jurisdiction to foreclose this instrument as a
mortgage and to obtain specific enforcement of the covenants of the Lessee
hereunder, and the Lessee agrees that such covenants shall be specifically
enforceable by injunction or any other appropriate equitable remedy and that
for the purposes of any suit brought hereunder the Lessee waives the defense of
laches and any applicable statute of limitations.
(d) Power of Sale . The
Lessor may cause some or all of the Property including any Collateral
constituting personal property, including the Cash Collateral ("Personal
Property Collateral"), to be sold or otherwise disposed of in any
combination and in any manner permitted by Applicable Law.
(i)
Sales of Personal Property. The Lessor may dispose of any Personal
Property Collateral separately from the sale of the Collateral constituting
real property ("Real Property Collateral"), in any manner
permitted by Division 9 of the ...... Uniform Commercial Code, including any
public or private sale, or in any manner permitted by any other applicable
Governmental Rule. Any proceeds of any such disposition shall not cure
any Event of Default or reinstate any Obligation for purposes of Section 2924c
of the ...... Civil Code. In connection with any such sale or other disposition,
the Lessee agrees that the following procedures constitute a commercially
reasonable sale:
(A) The Lessor shall mail written notice of
the sale to the Lessee not later than thirty (30) days prior to such sale.
(B) Once per week during the three
(3) weeks immediately preceding such sale, the Lessor will publish notice of
the sale in a local daily newspaper of general circulation.
(C) Upon receipt of any written
request, the Lessor will make the Property available to any bona fide
prospective purchaser for inspection during reasonable business hours.
(D) Notwithstanding, the Lessor shall
be under no obligation to consummate a sale if, in its judgment, none of the
offers received by it equals the fair value of the Property offered for sale.
(E) If the Lessor so requests, the
Lessee shall assemble all of the Personal Property Collateral and make it
available to the Lessor at the site of the Land Interest. Regardless of
any provision of this Agreement or any other Operative Document, the Lessor
shall not be considered to have accepted any property other than cash or
immediately available funds in satisfaction of any Obligation, unless the
Lessor has given express written notice of its election of that remedy in
accordance with ...... Uniform Commercial Code Section 9505.
The foregoing procedures do
not constitute the only procedures that may be commercially reasonable.
(ii) Lessor's
Sales of Real Property or Mixed Collateral. The Lessor may choose to
dispose of some or all of the Property which consists solely of Real Property
Collateral in any manner then permitted by Applicable Law, including without
limitation a nonjudicial trustee's sale pursuant to ...... Civil Code §§2924 et
seq. In its discretion, the Lessor may also or alternatively
choose to dispose of some or all of the Property, in any combination consisting
of both Real Property Collateral and Personal Property Collateral, together in
one sale to be held in accordance with the law and procedures applicable to
real property, as permitted by Section 9501(4) of the ...... Uniform Commercial
Code. The Lessee agrees that such a sale of Personal Property Collateral
together with Real Property Collateral constitutes a commercially reasonable
sale of the Personal Property Collateral. (For purposes of this Power of
Sale, either a sale of Real Property Collateral alone, or a sale of both Real
Property Collateral and Personal Property Collateral together in accordance
with ...... Uniform Commercial Code Section 9501(4), will sometimes be referred
to as a "Lessor's Sale").
(A) Before any Lessor's Sale, the Lessor
shall give such notice of default and election to sell as may then be required
by Applicable Law.
(B) When all time periods then legally
mandated have expired, and after such notice of sale as may then be legally
required has been given, the Lessor shall sell the property being sold at a
public auction to be held at the time and place specified in the notice of
sale.
(C) Neither the Lessor nor the Agent
shall have any obligation to make demand on the Lessee before any Lessor's
Sale.
(D) From time to time in accordance with
then Applicable Law, the Lessor may postpone any Lessor's Sale by public
announcement at the time and place noticed for that sale.
(E) At any Lessor's Sale, the Lessor
shall sell to the highest bidder at public auction for cash in lawful money of
the United States.
(F) The Lessor shall execute and
deliver to the purchaser(s) a deed or deeds conveying the Property being sold
without any covenant or warranty whatsoever, express or implied. The
recitals in any such deed of any matters or facts, including any facts bearing
upon the regularity or validity of any Lessor's Sale, shall be conclusive proof
of their truthfulness. Any such deed shall be conclusive against all
Persons as to the facts recited in it.
(e) Foreclosure Sales.
(i) Single or Multiple.
If the Property consists of more than one lot, parcel or item of property,
Lessor may:
(A) Designate the order in which the lots,
parcels and/or items shall be sold or disposed of or offered for sale or
disposition; and
(B) Elect to dispose of the lots,
parcels and/or items through a single consolidated sale or disposition to be
held or made under the power of sale granted in Section 17.4(d), or in
connection with judicial proceedings, or by virtue of a judgment and decree of
foreclosure and sale; or through two or more such sales or dispositions; or in any
other manner the Lessor may deem to be in its best interests (any such sale or
disposition, a "Foreclosure Sale," any two or more, "Foreclosure
Sales").
If the Lessor chooses to
have more than one Foreclosure Sale, the Lessor at its option may cause the
Foreclosure Sales to be held simultaneously or successively, on the same day,
or on such different days and at such different times and in such order as it
may deem to be in its best interests. No Foreclosure Sale shall terminate
or affect the security interests granted to the Lessor in the Property by this
Lease or any part of the Property which has not been sold, until all of the
Obligations have been paid in full.
(ii) Credit Bids .
At any Foreclosure Sale, any Person, including the Lessor or any Participant,
may bid for and acquire the Property or any part of it to the extent permitted
by Applicable Law. Instead of paying cash for the Property, the Lessor
may settle for the purchase price by crediting the sales price of the Property
against the Obligations in any order and proportions as the Lessor in its sole
discretion may choose.
(f) Additional Rights and
Remedies.
(i) In addition to and
without limitation of the rights and remedies otherwise provided in this Section
17.4, Lessor or its employees, acting by themselves or through a
court-appointed receiver, may enter upon, possess, manage, operate, dispose of
and contract to dispose of the Property or any part thereof; negotiate with
governmental authorities with respect to the Property's environmental
compliance and remedial measures; contract for goods and services, hire agents,
employees and counsel, make repairs, alterations and improvements to the
Property necessary, in Lessor's judgment, to protect or enhance the security
hereof; to incur the risks and obligations ordinarily incurred by owners of
property (without any personal obligation on the part of the receiver); and/or
to take any and all other actions which may be necessary or desirable to comply
with Lessee's obligations hereunder and under the Operative Documents.
All sums realized by the Lessor under this Section 17.4(f)(i), less all
costs and expenses incurred by it under this Section 17.4(f)(i),
including attorneys' fees, and less such sums as the Lessor deems appropriate
as a reserve to meet future expenses under this Section 17.4(f)(i),
shall be applied to any Obligations secured hereby in such order as the Lessor
shall determine. Neither application of said sums to said indebtedness
nor any other action taken by the Lessor under this Section 17.4(f)(i)
shall cure or waive any Event of Default or notice of default hereunder or
nullify the effect of any such notice of default. The Lessor, or any
employee or agent of the Lessor, or a receiver appointed by a court, may take
any action or proceeding hereunder without regard to (i) the adequacy of the
security for the indebtedness secured hereunder, (ii) the existence of a
de......tion that the indebtedness secured hereby has been declared immediately
due and payable, or (iii) the filing of a notice of default;
(ii) Lessor shall have the
power and authority to execute a written notice of such Event of Default and,
at its election, cause the Property to be sold to satisfy the Obligations
secured hereby. The Lessor shall give and record such notice as the law
then requires as a condition precedent to a nonjudicial foreclosure sale.
When the minimum period of time required by law after such notice has elapsed,
the Lessor, without notice to or demand upon Lessee except as otherwise
required by law, shall sell the Property at the time and place of sale fixed by
it in the notice of sale and in such order as it or the Lessor may determine,
at public auction to the highest bidder for cash in lawful money of the United
States, payable at time of sale (the Obligations hereby secured being the
equivalent of cash for purposes of said sale). If the Property consists
of several lots, parcels, or items of property, the Lessor may: (i) designate
the order in which such lots, parcels, or items of property shall be offered
for sale or sold, or (ii) elect to sell such lots, parcels or items through a
single sale, through two or more successive sales, or in any other manner the
Lessor deems in its best interest. The Lessee shall have no right to
direct the order in which the Property is sold. The Lessor may postpone
sale of all or any portion of the Property by public announcement at such time
and place of sale, and from time to time thereafter may postpone such sale by
public announcement at such time fixed by the preceding postponement. The
Lessor shall deliver to the purchaser at such sale a deed or other appropriate
transfer instrument conveying the Property or portion thereof so sold, but
without any covenant or warranty, express or implied. The recitals in
such deed of any matters of facts shall be conclusive proof of the truthfulness
thereof. Any person, including the Lessor or the Lessee may purchase at
such sale.
In connection with any sale or sales hereunder, the Lessor may elect to treat
any of the Property which consists of a right in action or which is property
that can be severed from the real property covered hereby or any improvements
thereon without causing structural damage thereto as if the same were personal
property or a fixture, as the case may be, and dispose of the same in
accordance with applicable law, separate and apart from the sale of real
property. Any sale of any personal property or fixtures hereunder shall
be conducted in any manner permitted by the ...... Uniform Commercial Code.
After deducting all costs, fees and expenses of the Lessor and of this trust,
including all costs of evidence of title and attorneys' fees in connection with
sale, the Lessor shall apply the proceeds of sale to payment of all sums so
expended under the terms hereof not then repaid; the payment of all other sums
then secured hereby; and the remainder, if any, to the person or persons
legally entitled thereto;
(iii) Lessor shall have the power and
authority to resort to and realize upon the Property and any other security now
or hereafter held by the Lessor in such order and manner as the Lessor and the
Trustee may, in their sole discretion, determine; and resort to any or all such
security may be taken concurrently or successively and in one or several
consolidated or independent judicial actions or lawfully taken non-judicial
proceedings, or both.
17.5 Remedies Cumulative. The remedies herein provided shall be cumulative and in addition
to (and not in limitation of) any other remedies available at law, equity or
otherwise, including, without limitation, any mortgage foreclosure remedies.
17.6 The Lessee's Right to Cure.
Notwithstanding any provision contained in the Lease or any other Operative
Document, if a Event of Default has occurred and is continuing, the Lessee shall
have the right to cure such Event of Default by (a) exercising its Purchase
Option at any time prior to the earlier of (i) the termination of the Lessee's
possessory interest in the Property, (ii) the thirty day period following the
occurrence of a Lease Event of Default and (iii) the entering into by the
Lessor of a binding contract to sell the Property, and (b) purchasing the
Property in accordance with Section 20.1 at any time prior to such time
as a foreclosure upon or sale of the Property has been completed.
ARTICLE XVIII.
18.1 The Lessor's Right to Cure the Lessee's
Defaults. The Lessor, without waiving or releasing any obligation
or Event of Default, may (but shall be under no obligation to) remedy any Default
or Event of Default (other than a Limited Default or a Limited Event of
Default) for the account and at the sole cost and expense of the Lessee,
including the failure by the Lessee to maintain the insurance required by Article
XIV (subject to the limitations set forth in Section 24.1), and may,
to the fullest extent permitted by law, and notwithstanding any right of quiet
enjoyment in favor of the Lessee, enter upon the Property for such purpose and
take all such action thereon as may be necessary or appropriate therefor.
No such entry shall be deemed an eviction of the Lessee. All
out-of-pocket costs and expenses so incurred (including fees and expenses of
counsel), together with interest thereon at the Overdue Rate from the date on
which such sums or expenses are paid by the Lessor, shall be paid by the Lessee
to the Lessor on demand (subject to the limitations set forth in Section
24.1), as Supplemental Rent.
ARTICLE XIX.
19.1 Provisions Relating to the Lessee's
Termination of this Lease or Exercise of Purchase Option or Obligation and
Conveyance Upon Remarketing and Conveyance Upon Certain Other Events.
(a) In connection with any
termination of this Lease pursuant to the terms of Section 16.2 or 16.3
(if the Lessee is obligated to purchase the Property), or in connection with
the Lessee's exercise of its Purchase Option or Expiration Date Purchase
Obligation, upon the date on which this Lease is to terminate or upon the
Expiration Date, and upon tender by the Lessee of the amounts set forth in Sections
16.2(b), 20.1, 20.2 or 20.3, as applicable, the Lessor
shall execute and deliver to the Lessee (or to the Lessee's designee) at the
Lessee's cost and expense an assignment or transfer without recourse of the
Lessor's right, title and interest in the Property (which shall include a
release, quitclaim and assignment of all of the Lessor's right, title and
interest in and to any Net Proceeds with respect to the Property or such
portion thereof not previously received by the Lessor), subject to Permitted
Exceptions (other than Lessor Liens and, so long as all amounts required to be
paid upon such termination or exercise have been paid and discharged in full,
free of all Liens created by the Operative Documents) and any encumbrance
caused by the fault, neglect or intention of the Lessee, in recordable form and
otherwise in conformity with local custom and free and clear of any Lessor
Liens. The Improvements and the Equipment shall be conveyed to the Lessee
"AS IS" and in their then present condition of title and physical
condition free of any Lessor Liens and, so long as all amounts required to be
paid upon such termination or exercise have been paid and discharged in full,
free of all Liens created by the Operative Documents.
(b) If the Lessee properly exercises
the Remarketing Option or is required to remarket the Property or return the
Property to the Lessor pursuant to Section 17.2(h), then the Lessee
shall, on the Expiration Date, transfer possession of the Property (or
remaining portion thereof) to the Lessor or the independent purchaser thereof,
as the case may be, by surrendering the same into the possession of the Lessor
or such purchaser, as the case may be, free and clear of all Liens other than
Lessor Liens, in good condition (as modified by Modifications permitted by this
Lease), ordinary wear and tear excepted, in compliance with Applicable Law, and
in "broom-swept clean" condition. The Lessee shall cooperate reasonably
with the Lessor and the independent purchaser of the Property (or remaining
portion thereof) in order to facilitate the purchase by such purchaser of the
Property (or remaining portion thereof) which cooperation shall include the
following, all of which the Lessee shall do on or before the Expiration Date:
providing all books and records regarding the maintenance and ownership of the
Property (or remaining portion thereof) and all know–how, data and technical
information relating thereto, providing a current copy of all of the "as
built" XYZs and Specifications for the Property, granting or assigning (to
the extent assignable) all existing licenses necessary for the operation and
maintenance of the Property and cooperating reasonably in seeking and obtaining
all necessary Governmental Action and complying with the provisions of Section
22.3 hereof. The obligations of the Lessee under this paragraph shall
survive the expiration or termination of this Lease. The reasonable, customary
and documented costs and expenses of the Lessee in complying with this Section
19.1(b) shall at the request of the Lessee be paid or reimbursed from the
gross proceeds of a sale of the Property.
ARTICLE XX.
20.1 Purchase Option.
Without limitation of the Lessee's purchase obligation pursuant to Sections
20.2 or 20.3, unless the Lessee shall have given notice of its
intention to exercise the Remarketing Option and the Lessor shall have entered
into a binding contract to sell the Property, the Lessee shall have the option
(exercisable by giving the Lessor irrevocable written notice (each, a "Purchase
Notice") of the Lessee's election to exercise such option) to
purchase, or to designate a third party to purchase, all of the Property (the
"Purchase Option"), on the date specified in such Purchase
Notice, which date shall be a Payment Date. The purchase price in respect
of the Property (the "Purchase Option Price") shall be equal
to the Asset Termination Value plus in each case all other amounts owing in
respect of Rent (including Supplemental Rent) theretofore accruing (offsetting
against such amount the aggregate amount of the Cash Collateral, if any).
The Lessee shall deliver the Purchase Notice to the Lessor not less than thirty
(30) days prior to the purchase date. If the Lessee exercises its
Purchase Option pursuant to this Section 20.1 (the "Purchase
Option"), the Lessor shall transfer to the Lessee all of the Lessor's
right, title and interest in and to all of the Property, as of the date
specified in the Purchase Notice upon receipt of the Purchase Option Price and
(without duplication) all Rent and all other amounts then due and payable under
this Lease and any other Operative Document, in accordance with Section
19.1(a).
20.2 Expiration Date Purchase Obligation.
Unless (a) the Lessee shall have properly exercised the Purchase Option
pursuant to Section 20.1 and purchased the Property pursuant thereto,
(b) the Lessee shall have properly exercised the Remarketing Option and shall
have fulfilled all of the conditions of clauses (a) through (j)
and (m) of Section 22.1 hereof, or (c) the Lessee shall have
properly exercised the Renewal Option pursuant to Section 21.1 and the terms
and conditions of a Renewal Term shall have been agreed upon pursuant to such
Section, then, subject to the terms, conditions and provisions set forth in
this Section 20.2, and in accordance with the terms of Section
19.1(a), the Lessee shall purchase from the Lessor, and the Lessor shall
assign and convey to the Lessee without recourse, on the Expiration Date of the
Term (as such Term may be renewed pursuant to Section 21.1) all of the
Lessor's right, title and interest in the Property for an amount equal to the
Asset Termination Value (the "Expiration Date Purchase Obligation"),
offsetting against such amount the aggregate amount of the Cash Collateral, if
any. The Lessee may designate, in a notice given to the Lessor not less
than ten (10) Business Days prior to the closing of such purchase (time being
of the essence), the transferee or transferees to whom the conveyance shall be
made (if other than to the Lessee), in which case such conveyance shall
(subject to the terms and conditions set forth herein) be made to such
designee; provided, however, that such designation of a
transferee or transferees shall not cause the Lessee to be released, fully or
partially, from any of its obligations under this Lease, including, without
limitation, the obligation to pay the Lessor an amount equal to the Asset
Termination Value that was not fully and finally paid by such designee on such
Expiration Date.
20.3 Acceleration of Purchase Obligation.
(a) The Lessee shall be
obligated to purchase for an amount equal to the Asset Termination Value the
Lessor's interest in the Property (notwithstanding any prior election to
exercise its Purchase Option pursuant to Section 20.1) (i) automatically
and without notice upon the occurrence and during the continuance of any Event
of Default specified in clause (f) or (g) of Section 17.1,
and (ii) as provided for at Section 17.2(e) immediately upon written
demand of the Lessor upon the occurrence of any other Event of Default (except
as provided in Section 17.2(h).
(b) The Lessee shall be obligated to
purchase for an amount equal to the Asset Termination Value (plus all other
amounts (without duplication) owing in respect of Rent (including Supplemental
Rent) theretofore accruing) (offsetting against such amount the aggregate
amount of the Cash Collateral, if any) immediately upon written demand of the
Lessor the Lessor's interest in the Property at any time during the Term when
the Lessor ceases to have title as contemplated by Section 12.1.
ARTICLE XXI.
21.1 Renewal.
(a) Subject to the conditions
set forth herein, the Lessee shall have the option (the "Renewal Option")
by written request (the "Renewal Request") to the Lessor and
the Agent (which request the Agent shall promptly forward to each Participant)
and each Participant given not later than 180 days prior to the Expiration Date
then in effect, to renew the Term for an additional period as specified in such
Renewal Request, commencing on the date following the Expiration Date then in
effect. No later than the date (the "Renewal Response Date")
which is ninety (90) days after such request has been delivered to each of the
Lessor and the Agent, the Lessor will notify the Lessee in writing (with a copy
to Agent) whether or not it consents to such Renewal Request (which consent may
be granted or denied in its sole discretion and may be conditioned on receipt
of such financial information or other documentation as may reasonably be
specified by the Lessor including without limitation a satisfactory appraisal
of the Property), provided that if the Lessor shall fail to notify the
Lessee on or prior to the Renewal Response Date, it shall be deemed to have
denied such Renewal Request. If the Lessor shall have consented to the
Renewal Request, the Renewal Term contemplated by such request shall become
effective as of the Expiration Date then in effect after the Lessor has
consented to such Renewal Request (each an "Extension Effective Date");
provided that such renewal shall be subject to and conditioned upon the
following:
(A) on both the Extension Effective Date
and the date of the Renewal Request, (i) no Default or Event of Default shall
have occurred and be continuing, and (ii) the Lessor and the Agent shall have
received a Responsible Officer's Certificate of the Lessee as to the matters
set forth in clause (i) above,
(B) the Lessee shall not have
exercised the Remarketing Option, and
(C) the Participants shall have
agreed to extend the Maturity Date contemporaneously therewith pursuant to
Section 3.6 of the Participation Agreement such that the Renewal Term will
expire on the same date as the extended Maturity Date.
(b) As of any date of determination
following the Initial Expiration Date (in the event a Renewal Term is granted hereunder),
the Expiration Date shall be the date set forth in the then most recent
Extension Notice delivered by the Agent pursuant to Section 3.6 of the
Participation Agreement.
ARTICLE XXII.
22.1 Option to Remarket. Subject to the fulfillment of each of the conditions set forth
in this Section 22.1, the Lessee shall have the option (the "Remarketing
Option") to market for the Lessor and complete the sale of all, but
not less than all, of the Lessor's interest in the Property on the Expiration
Date for the Lessor.