THIS INSTRUMENT PREPARED BY
AND AFTER RECORDING RETURN TO:
Xxxxxxxxxxx X. Xxxxxx, Esq.
Xxxxx, Day, Xxxxxx & Xxxxx
3500 One Peachtree Center
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
LEASE AGREEMENT
Dated as of December 9, 1997
Between
FLEET REAL ESTATE, INC.,
as the Lessor,
and
THE VINCAM GROUP, INC.,
as the Lessee
-------------------------------------------------------------------------------
NOTICE TO RECORDER: THIS LEASE AGREEMENT SHALL BE DEEMED (EXCEPT FOR ACCOUNTING
PURPOSES) A MORTGAGE, FIXTURE FINANCING STATEMENT AND SECURITY AGREEMENT BETWEEN
THE LESSEE, THE VINCAM GROUP, INC., AS MORTGAGOR AND DEBTOR, AND THE LESSOR,
FLEET REAL ESTATE, INC., AS MORTGAGEE AND SECURED PARTY SECURING INDEBTEDNESS IN
THE PRINCIPAL AMOUNT OF $360,000.00, AS SET FORTH IN SECTION 26 HEREIN. THE
COLLATERAL SUBJECT TO THE SECURITY INTEREST INCLUDES PERSONAL PROPERTY THAT IS,
OR MAY BECOME, FIXTURES ATTACHED TO THE REAL PROPERTY DESCRIBED IN THIS LEASE
AGREEMENT. THIS LEASE AGREEMENT SHOULD BE FILED AND RECORDED IN THE REAL ESTATE
RECORDS AS A MORTGAGE AND FIXTURE FILING. FLEET REAL ESTATE, INC. SHOULD BE
INDEXED AS THE MORTGAGEE OF THE MORTGAGE AND SECURITY INTEREST. THE VINCAM
GROUP, INC. SHOULD BE INDEXED AS THE MORTGAGOR OF THE MORTGAGE AND SECURITY
INTEREST.
Addresses of Parties:
Lessor: Lessee:
Fleet Real Estate, Inc. The Vincam Group, Inc.
Xxx Xxxxxxx Xxxxxx 0000 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxxx 00000 Xxxxx Xxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxx Attention: Xxxxxxxxx X. Xxxxxx,
General Counsel
THIS LEASE HAS BEEN MANUALLY EXECUTED IN COUNTERPARTS NUMBERED
CONSECUTIVELY FROM 1 TO 2. TO THE EXTENT, IF ANY, THAT THIS LEASE
CONSTITUTES CHATTEL PAPER (AS SUCH TERM IS DEFINED IN THE UNIFORM
COMMERCIAL CODE AS IN EFFECT IN ANY APPLICABLE JURISDICTION), NO
SECURITY INTEREST IN THIS LEASE MAY BE CREATED THROUGH THE TRANSFER OR
POSSESSION OF ANY COUNTERPART OF THIS LEASE OTHER THAN COUNTERPART
NUMBER 1.
This is Counterpart Number _____
TABLE OF CONTENTS
Page
Section 1. Defined Terms...............................................1
Section 2. Lease of Facility...........................................1
Section 3. Payments....................................................3
Section 4. [ RESERVED ]................................................6
Section 5. Credit Agreement; Agency Agreement..........................6
Section 6. Title to Remain in the Lessor...............................7
Section 7. Maintenance of the Facility; Operations.....................7
Section 8. Modifications...............................................9
Section 9. Further Assurances.........................................10
Section 10. Compliance with Governmental Requirements and
Insurance Requirements: Related Contracts..................10
Section 11. Condition and Use of Facility; Quiet Enjoyment.............11
Section 12. Liens......................................................13
Section 13. Permitted Contests.........................................14
Section 14. Insurance, etc.............................................14
Section 15. Termination; Cancellation; Purchase Option.................17
Section 16. Transfer of Title on Removal of Facility; Expenses
of Transfer................................................20
Section 17. Events of Default and Remedies.............................22
Section 18. Change in the Lessee's Name or Structure...................25
Section 19. Inspection; Right to Enter Premises of the Lessee..........26
Section 20. Right to Perform the Lessee's Covenants....................26
Section 21. Participation by Co-Lessees or Sublessees..................26
i
TABLE OF CONTENTS
(continued)
Page
Section 22. Notices....................................................28
Section 23. Amendments and Waivers.....................................28
Section 24. Severability...............................................28
Section 25. Federal Income Tax Considerations..........................28
Section 26. Other Provisions...........................................29
Section 27. Miscellaneous..............................................33
EXHIBITS
Exhibit A Description of Site
SCHEDULES
Schedule 1 Insurance Schedule
ii
LEASE AGREEMENT
This Lease Agreement dated as of December 9, 1997, (as the same may be
amended, modified or supplemented from time to time, this "LEASE") is between
FLEET REAL ESTATE, INC., a Rhode Island corporation (together with its
successors and permitted assigns, the "LESSOR"), and THE VINCAM GROUP, INC., a
Florida corporation (together with its successors and permitted assigns, the
"LESSEE").
RECITALS
WHEREAS, Lessor has acquired certain real property in Dade
County, Florida, described in greater detail on Exhibit A (the "SITE"), and all
appurtenances thereto and has entered into certain agreements described in
greater detail in that certain Credit and Investment Agreement bearing even date
herewith entered into by and among Lessor, Lessee, Fleet National Bank, as Agent
and certain other parties (the "CREDIT AGREEMENT") to construct certain
improvements on the Site in accordance with the Facility Plan in order to create
a corporate headquarters facility together with related enhancements and
improvements in accordance with the Facility Plan; and
WHEREAS, subject to the terms and conditions of this Lease,
the Lessee desires to lease from the Lessor the Site and such enhancements and
improvements beginning on the Lease Commencement Date for the purpose of
occupying and using the Site and such enhancements and improvements as a
corporate headquarters facility in accordance with the terms and conditions set
forth in this Lease.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Lessor and the Lessee agree as follows:
Section 1. DEFINED TERMS. All capitalized terms used in this
Lease, and not otherwise defined herein shall have the meanings assigned such
terms in Schedule 1.02 to the Credit Agreement, which Schedule 1.02 is
incorporated by reference.
Section 2. LEASE OF FACILITY.
(a) During the term of and subject to the terms and conditions
of this Lease, the Lessor hereby leases to the Lessee, and the Lessee hereby
leases from the Lessor, the Facility for the Lease Term to be occupied and used
(i) to cause Completion of the Facility during the portion of the Lease Term
surviving the Construction Term in accordance with the Agency Agreement and (ii)
1
for and only for the Permitted Use with respect to the Basic Term. The entire
Facility shall become subject to this Lease as of the effective date hereof;
provided that the Lessor will deliver possession of the Facility to Lessee for
occupancy and operation in accordance with the Permitted Use in conjunction with
and to the extent permitted by certificates of occupancy issued by the
applicable Governmental Authority.
(b) Unless earlier terminated in accordance with the other
provisions hereof, including without limitation, Sections 15 and 17, this Lease
shall terminate on the Scheduled Lease Termination Date. If, but only if, (i)
the Maturity Date of the Loans and Lessor Investment shall have been extended
pursuant to Section 2.09 of the Credit Agreement to the extended Scheduled Lease
Termination Date proposed by the Lessee as provided herein, and (ii) the Lessee,
on any day that is not less than twelve (12) months and no more than eighteen
(18) months prior to the Scheduled Lease Termination Date shall have requested
in writing to the Lessor and the Agent the extension of the Scheduled Lease
Termination Date for up to three (3) years expiring on or before the three (3)
year anniversary of the original Scheduled Lease Termination Date, then the
Lessor shall consent to such extension in writing and the Scheduled Lease
Termination Date shall be extended to the date requested by the Lessee which
date shall be on or prior to (as requested by the Lessee) the three (3) year
anniversary of the original Scheduled Lease Termination Date. Any such extension
shall be effective upon the execution of documentation evidencing the same
(which the Lessor agrees to execute promptly upon request of the Lessee if the
Lessor's consent to such extension is to be given pursuant hereto), and
containing such additional terms as the Agent, acting in its reasonable
discretion, may require; provided that no such documentation or additional terms
shall impose any additional liability on Lessor.
In the event it is determined at any time that the term of this Lease
will not be extended beyond the original Scheduled Lease Termination Date, or if
a Non-Completion Event occurs, the Lessee shall give to the Lessor and the Agent
written notice as provided below specifying which of the options under Section
15(a)(ii) of this Lease the Lessee intends to exercise upon the applicable Lease
Termination Date:
(x) if the Scheduled Lease Termination Date is not to be
extended because the Agent or any Lender(or assignee thereof) or Lessor
has refused or is deemed to have refused the Lessee's request for
extension, then the Lessee shall give the Lessor notice within thirty
(30) days of the earlier to occur of (A) the date the Lessee receives
written notice of said refusal or (B) the date of such deemed refusal
pursuant to Section 2.10 of the Credit Agreement;
2
(y) if the Scheduled Lease Termination Date is not to be
extended because the Lessee chooses not to request such extension, the
Lessee shall give the Lessor notice on any date that is not less than
twelve (12) months and no more than eighteen (18) months prior to the
then current Scheduled Lease Termination Date; and
(z) if a Non-Completion Event occurs, the Lessee shall give
the Lessor notice within five (5) Business Days of the date of the
Non-Completion Event.
In the event the Lessee fails to give timely written notice to the
Lessor on or before the dates herein provided, the Lessee shall be deemed to
have elected to purchase the Facility on the Lease Termination Date for the
Purchase Price.
Section 3. PAYMENTS.
(a) The Lessee shall pay to the Lessor on the Rent Payment
Date for each Rental Period the amount of Basic Rent due for such Rental Period.
(b) On the earlier to occur of the Lease Termination Date, the
Cancellation Date or the Option Date, Lessee shall pay to Lessor the Final Rent
Payment (or, if a Non-Completion Event has occurred, the Completion Costs
Payment).
(c) In addition to Basic Rent and the Final Rent Payment (or
the Completion Costs Payment, if applicable), the Lessee will also pay to the
Lessor, from time to time, quarterly upon demand by the Lessor or the Agent (or
at such more frequent times as they may deem appropriate in the circumstances),
as additional rent ("SUPPLEMENTAL RENT") the following (but without duplication
of any amounts included in the calculation of Rent):
(i) a fee payable to the Agent in the amount of $500 per month
or portion thereof, payable quarterly in advance on the first day of
each quarter for and during the Construction Period; all out-of-pocket
costs and expenses reasonably incurred by the Lessor or the Agent in
connection with the preparation, negotiation, execution, delivery,
performance and administration of this Lease and the other Transaction
Documents, including, but not limited to, the following: (A) fees and
expenses of the Lessor and the Agent, including, without limitation,
reasonable attorneys' fees and expenses; (B) all other amounts,
including, without limitation, fees, indemnities, expenses,
compensation in respect of increased costs of any kind or description
payable under the Credit Agreement or any other Transaction Document;
(C) all yield maintenance, capital adequacy and other costs
contemplated under Article V of the Credit Agreement, and (D) all
3
out-of-pocket costs and expenses incurred by the Lessor or the Agent
(and, in the case of clause (z) below, any Lender) after the date of
this Lease (including, without limitation, reasonable attorneys' fees
and expenses and other expenses and disbursements reasonably incurred)
associated with (x) negotiating and entering into, or the giving or
withholding of, any future amendments, supplements, waivers or consents
with respect to this Lease; (y) any Loss Event, Casualty Occurrence or
termination of this Lease; and (z) any Default or Event of Default and
the enforcement and preservation of the rights or remedies of the
Lessor under this Lease and the other Transaction Documents; and
(ii) all other amounts that the Lessee agrees herein to pay
other than Basic Rent, the Final Rent Payment (or the Completion Costs
Payment, if applicable) and amounts described in clause (i) above.
(d) This Lease is an absolute net lease, and Rent and all
other sums payable by the Lessee hereunder shall be paid without notice except
as otherwise expressly provided herein, and the Lessee shall not be entitled to
any abatement, reduction, setoff, counterclaim, defense or deduction with
respect to any Rent or other sums payable hereunder. The obligations of the
Lessee to pay Rent and all other sums payable hereunder shall not be affected by
reason of: (i) any damage to, or destruction of, the Facility or any part
thereof by any cause whatsoever (including, without limitation, fire, casualty
or act of God or enemy or any other force majeure event); (ii) any condemnation,
including, without limitation, a temporary condemnation of the Facility or any
portion thereof; (iii) any prohibition, limitation, restriction or prevention of
the Lessee's use, occupancy or enjoyment of the Facility or any part thereof by
any Person (other than by the Lessor in violation of this Lease); (iv) any
matter affecting title to the Facility or any portion thereof; (v) any eviction
of the Lessee from, or loss of possession by the Lessee of, the Facility or any
portion thereof, by reason of title paramount or otherwise (other than by the
Lessor in violation of this Lease); (vi) any default by the Lessor hereunder or
under any other Transaction Document; (vii) the invalidity or unenforceability
of any provision hereof or the impossibility or illegality of performance by the
Lessor or the Lessee or both; (viii) any action of any Governmental Authority;
or (ix) any other Loss Event, Casualty Occurrence or other cause or occurrence
whatsoever, whether similar or dissimilar to the foregoing. The Lessee shall
remain obliged under this Lease in accordance with its terms and shall not take
any action to terminate, rescind or avoid this Lease, except as expressly
provided in Section 15, notwithstanding any bankruptcy, insolvency,
reorganization, liquidation, dissolution or other proceeding affecting the
Lessor or any action with respect to this Lease which may be taken by any
trustee, receiver or liquidator or by any
4
court. The Lessee waives all rights to terminate or surrender this Lease, except
as expressly provided in Section 15, or to any abatement or deferment of Rent or
other sums payable hereunder. The Lessee hereby waives any and all rights now or
hereafter conferred by law or otherwise to modify or to avoid strict compliance
with its obligations under this Lease. All payments made to the Lessor hereunder
as required hereby shall be final and irrevocable, and the Lessee shall not seek
to recover any such payment or any part thereof for any reason whatsoever,
absent manifest error.
(e) Subject to the Lessee's contest rights under Section 13,
the Lessee agrees that it will promptly pay all Impositions imposed upon or
levied or assessed against the Facility or any portion thereof, or against the
Lessor, the Agent or any Lender in connection with the transactions contemplated
by this Lease and the other Transaction Documents, or imposed or levied upon,
assessed against or measured by any Rent, sales or other sums payable hereunder,
or any sums levied in connection with the execution, delivery or recording of
the Transaction Documents, and will furnish to the Lessor upon request copies of
official receipts or other proof evidencing such payment; PROVIDED, HOWEVER,
that the Lessee shall not be obligated to pay (i) any Impositions that are based
upon or measured by the Lessor's, the Agent's or any Lender's overall net
income, or which are in substitution for, or relieve the Lessor, the Agent or
any Lender from, any actual Imposition based upon or measured by the Lessor's,
the Agent's or any Lender's overall net income (excluding, however, Impositions
imposed with respect to the payment, receipt or accrual of any indemnity payment
under this Lease or any other Transaction Document); (ii) Impositions
constituting franchise taxes imposed on any Lender by the jurisdiction under the
laws of which such Lender is organized or qualified or any political subdivision
thereof or by the jurisdiction in which such Lender's lending office is located;
or (iii) any Impositions attributable to the gross negligence or willful
misconduct of the Agent or any Lender. The Lessee further agrees that, subject
to its rights under Section 13, it will, at its expense, do all things required
to be done by the Lessor in connection with the levy, assessment, billing or
payment of any Impositions that it is required to pay pursuant to the preceding
sentence, and is hereby authorized by the Lessor to act for and on behalf of the
Lessor in any and all such respects and to prepare and file, on behalf of the
Lessor, all tax returns and reports required to be filed by the Lessor (other
than federal income tax returns and documents related thereto, subject to
Section 25) concerning the Facility. The Lessee's payment and other obligations
under this Section 3(f) shall survive the termination of this Lease. In the
event that any withholding or deduction from any payment to be made by the
Lessee hereunder is required in respect of any Imposition pursuant to any
Governmental Requirement, then the Lessee will:
5
(1) pay directly to the relevant Governmental Authority
the full amount required to be so withheld or deducted;
(2) promptly forward to the Lessor, if available, an official
receipt or other documentation satisfactory to the Lessor evidencing
such payment to such Governmental Authority; and
(3) pay to the Lessor such additional amount or amounts as is
necessary to ensure that the net amount actually received by the Lessor
will equal the full amount the Lessor would have received had no such
withholding or deduction been required.
(f) All payments by the Lessee pursuant to this Lease shall be
made by the Lessee to the Lessor. All such payments required to be made to the
Lessor shall be made not later than 12:00 noon, prevailing Eastern time, on the
date due, in immediately available funds, to such account with the Agent as the
Lessor shall specify from time to time by notice to the Lessee. Whenever any
payment to be made shall otherwise be due on a day which is not a Business Day,
except as otherwise expressly provided herein or in the Credit Agreement, such
payment shall be made on the next succeeding Business Day and such extension
shall be included in computing Rent, interest, yield and fees, if any, in
connection with such payment.
(g) The Lessee shall pay on demand to the Lessor interest at
the Default Rate on all amounts payable by the Lessee to the Lessor hereunder in
respect of overdue principal of, interest and yield on, and fees in respect of
Loans and Lessor Investment Payments, and all other amounts payable under this
Lease or any of the other Transaction Documents, from the due date thereof until
paid in full.
Section 4. [ RESERVED ].
Section 5. CREDIT AGREEMENT; AGENCY AGREEMENT. The
Lessee and the Lessor are entering into the Credit Agreement with the Agent and
the Lenders pursuant and subject to which the Lessor will fund, and the Lenders
will fund for the account of the Lessor, the Funded Amount as therein provided
up to but not exceeding, for the entire Facility, the sum of the Lessor
Investment Commitment and the Aggregate Loan Commitments. In addition, the
Lessee is entering into the Agency Agreement with the Lessor pursuant to which
the Lessee will act as the Facility Agent for the Lessor in causing the
completion of certain enhancements and improvements to, and the purchase,
manufacture, construction, improvement, renovation, assembly and installation
of, the Facility. Upon funding pursuant to the Credit Agreement, title to all
components of the Facility funded shall be and remain in the Lessor, and,
6
commencing with the Lease Commencement Date, the Facility shall be subject to
the terms and conditions of this Lease. The Facility and all components thereof
shall be purchased, manufactured, constructed, improved, renovated, assembled or
installed, as applicable, in accordance with the Related Contracts entered into
by the Lessee pursuant to the Agency Agreement.
Section 6. TITLE TO REMAIN IN THE LESSOR. The Lessor shall own
100% of the legal and beneficial interest in the Facility. All accessories,
equipment, parts, fixtures and devices affixed or placed on the Facility from
time to time by the Lessee, other than Excluded Equipment, and all
modifications, alterations, renovations or improvements to the Facility made by
the Lessee shall be and become part of the Facility for the purposes of this
Lease and shall be Property of the Lessor subject to the terms of this Lease;
PROVIDED that the Lessor's interest in any portion of the Facility that is
replaced by the Lessee in a manner not violative of this Lease shall be deemed
released from this Lease (and the Collateral) and thereupon become the Property
of the Lessee automatically, without further action by the Lessor, and the
Lessor shall perform all acts and execute all documents that the Lessee
reasonably requests to give effect to the foregoing at the expense of the
Lessee, including the execution and delivery of bills of sale and other
documents of transfer. This Lease shall not give or grant to the Lessee any
right, title or interest in or to the Facility, except the rights expressly
conferred by this Lease. All Excluded Equipment shall at all times remain the
property of Lessee at all times during the term of the Lease. The Lessor
acknowledges and agrees that the Lessee may finance the purchase, lease,
installation and replacement of any Excluded Equipment, subject to the
provisions of Section 8.15 of the Credit Agreement. Upon termination of the
lease, if the Lessee does not purchase the Facility pursuant to Section 15, the
Lessee shall have the right to remove any of the Excluded Equipment from the
Facility, provided that it repairs any damage caused to the Facility in the
process of such removal.
Section 7. MAINTENANCE OF THE FACILITY; OPERATIONS.
(a) The Lessee shall, and it shall require and cause any and
all employees, contractors, subcontractors, agents, representatives, affiliates,
consultants and occupants at the Lessee's own cost and expense to: (i) cause the
Facility to be maintained in all material respects in good operating order,
repair and condition, in accordance with prudent industry practice and any
applicable manufacturer's or supplier's manuals or warranties, subject to normal
wear and tear, and take all action, and make all changes and repairs, structural
and non-structural, foreseen and unforeseen, ordinary and extraordinary, which
are required pursuant to any Governmental Requirement or Insurance Requirement
at any time in effect to assure full compliance therewith in all material
7
respects; and (ii) to all things necessary to prevent the incurrence of any
Environmental Damages or Environmental Liabilities relating to the Facility or
any business conducted in or relating to the Facility or the Site, and cause the
Facility to continue to have at all times, in all material respects, and in
compliance with all applicable Governmental Requirements and Insurance
Requirements, the capacity and functional ability to perform, on a continuing
basis (subject to normal interruption in the ordinary course of business for
maintenance, inspection, service, repair and testing) and in commercial
operation, the functions for which it was designed as specified in the Facility
Plan and to be utilized commercially for the Permitted Use.
(b) The Lessee shall, and it shall require and cause any and
all employees, contractors, subcontractors, agents, representatives, affiliates,
consultants and occupants at the Lessee's own cost and expense to, promptly
replace, or cause to be replaced, the Facility, or parts thereof which may from
time to time be incorporated or installed in or attached to the Facility, and
which may from time to time become worn out, lost, stolen, destroyed, seized,
confiscated, damaged beyond repair, obsolete or permanently rendered unfit for
use for any reason whatsoever. All replacement parts shall be free and clear of
all Liens other than Permitted Liens, and, except for temporary replacement
parts utilized pending installation of permanent replacement parts, shall be of
a type customarily used in the industry at such time for such purpose, shall be
in as good operating condition as, and shall have a utility and useful life at
least equal to, the parts replaced (assuming such replaced parts were in the
condition and repair required to be maintained by the terms hereof) and shall
have a value at least equal to the parts replaced (assuming such replaced parts
were in the condition and repair required to be maintained by the terms hereof).
(c) Notwithstanding the provisions of Section 8 and the
foregoing provisions of this Section 7, the Lessee shall not (except as may be
required by any Governmental Requirement) remove, replace or alter any portion
of the Facility or affix or place any accessory, equipment, part or device on
any portion of the Facility, if such removal, replacement, alteration or
addition would impair the originally intended function or use of the Facility so
as to materially reduce the value of the Facility taken as a whole, or
materially decrease the estimated useful life of the Facility.
(d) The Lessor shall not be required in any way to maintain,
repair or rebuild the Facility or any portion thereof and the Lessee waives any
right it may now or hereafter have to make any repairs at the expense of the
Lessor pursuant to any Governmental Requirement at any time in effect or
otherwise.
8
(e) The Lessee shall, and it shall require and cause any and
all employees, contractors, subcontractors, agents, representatives, affiliates,
consultants and occupants at the Lessee's own cost and expense to: (i) comply
with all applicable Environmental Requirements with regard to the Facility and
all parts thereof; and (ii) use, employ, process, emit, generate, store, handle,
transport, dispose of and/or arrange for the disposal of, any and all Hazardous
Materials in, on or, directly or indirectly, related to or in connection with
the Facility or any part thereof in a manner consistent with prudent industry
practice and in compliance with any applicable Environmental Requirement. The
Lessor and the Lessee hereby acknowledge and agree that the Lessee's obligations
hereunder with respect to Environmental Requirements are intended to bind the
Lessee with respect to matters and conditions involving the Facility or any part
thereof.
Section 8. MODIFICATIONS.
(a) The Lessee shall make no modifications, alterations,
renovations or improvements to the Facility without the prior written consent of
the Lessor, provided however, that subject to the terms of Section 8(b), the
Lessee shall have the right to make modifications, alterations, renovations or
improvements to the Facility so long as such modifications, alterations,
renovations or improvements do not (except as may be required by any
Governmental Requirement) (i) materially reduce the value of the Facility as a
whole; (ii) materially and adversely affect the capacity and performance of the
Facility on a continuing basis in commercial operation of the function for which
the Facility was designed as specified in the Facility Plan; (iii) materially
deviate from the Facility Plan; or (iv) materially and adversely affect the
estimated useful life of the Facility. Within twenty (20) Business Days of the
end of each calendar year, an Authorized Officer of the Lessee shall deliver to
the Lessor and the Agent a schedule certifying to the Agent's satisfaction: (x)
the nature of the repairs, replacements, modifications, alterations, renovations
or improvements to the Facility made during such year having a cost of at least
$250,000 at the time made, and (y) that the Facility continues to have, in all
material respects, the capacity and functional ability to perform on a
continuing basis (subject to normal interruption in the ordinary course of
business for maintenance, inspection, service, repair and testing) and in
commercial operation, the functions for which it was designed as specified in
the Facility Plan or, if not, specifying the reason for any such deficiency.
Within twenty (20) Business Days after the occurrence of any Loss Event or
Casualty Occurrence with respect to the Facility, an Authorized Officer of the
Lessee shall deliver to the Lessor and the Agent a notice describing the
occurrence and nature of any such Loss Event or Casualty Occurrence.
9
(b) If the Lessee determines that any part of the Facility is
no longer necessary for the performance of the Facility on a continuing basis in
commercial operation of the function for which the Facility was designed as
specified in the Facility Plan, then the Lessee (except when such action or
removal may be required by any applicable Governmental Requirement, in which
event, the Lessee shall promptly give the Agent notice of such action or
removal) shall give the Lessor and the Agent at least thirty (30) days' notice
prior to taking any action as the result of such determination and shall not
remove any such portion unless and until the Agent has determined that (i) such
portion is no longer necessary for the performance of the Facility on a
continuing basis in commercial operation of the function for which the Facility
was designed in all material respects as specified in the Facility Plan, (ii)
removal of such portion does not materially reduce the value of the Facility as
a whole, and (iii) removal of such portion does not materially decrease the
estimated useful life of the Facility. This Section 8(b) shall not apply to worn
out or obsolete Property or damaged Property (to the extent such damage does not
constitute a Casualty Occurrence or Loss Event) removed and replaced by the
Lessee in accordance with Section 7(b).
Section 9. FURTHER ASSURANCES. The Lessee, at its expense,
shall execute, acknowledge and deliver from time to time such further
counterparts of this Lease or such affidavits, certificates, certificates of
title, bills of sale, financing and continuation statements, consents and other
instruments as may be required by applicable law or reasonably requested by the
Lessor in order to evidence the Lessor's title to the Facility and the Lessor's
interests in this Lease, and shall, at the Lessee's expense, cause such
documents to be recorded, filed or registered in such places as the Lessor may
request and to be re-recorded, refiled or re-registered in such places as may be
required by applicable law or at such times as may be required by applicable law
in order to maintain and continue in effect the recordation, filing or
registration thereof. The Lessor shall not grant or create any Lien on the
Facility to any Person except Permitted Liens, Liens in favor of the Agent and
the Lenders and Liens pursuant to this Lease, the Security Instruments and the
other Transaction Documents.
Section 10. COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS AND
INSURANCE REQUIREMENTS: RELATED CONTRACTS. The Lessee, at its expense, will
comply with all Governmental Requirements applicable to the Facility or any
portion thereof or the ownership, construction, operation, mortgaging,
occupancy, possession, use, non-use or condition of the Facility or any portion
thereof, all Insurance Requirements, and all instruments, contracts or
agreements affecting title to ownership of the Facility or any portion thereof.
In addition, the Lessee, so long as no Event of Default has occurred and is
continuing, is hereby authorized by the
10
Lessor to, and shall, fully and promptly keep, observe, perform and satisfy on
behalf of the Lessor any and all obligations, conditions, covenants and
restrictions of or on the Lessor or the Lessee under any and all Related
Contracts so that there will be no default thereunder and so that the other
parties thereunder shall be, and remain at all times, obliged to perform their
obligations thereunder, and the Lessee, to the extent within its control, shall
not permit to exist any condition, event or fact that could allow or serve as a
basis or justification for any such Person to avoid such performance.
Section 11. CONDITION AND USE OF FACILITY; QUIET
ENJOYMENT.
(a) The Facility is leased and the Lessee accepts and takes
possession of the Facility as is, where is, and with all faults and in the
condition thereof and subject to the rights of any parties in possession
thereof, the state of the title thereto, the rights of ownership therein and
subject to all Governmental Requirements now in effect or hereafter adopted, in
each case as in existence when the same first becomes subject to this Lease,
without representations and warranties of any kind as to title by the Lessor,
the Agent, any Lender or any Person acting on behalf of any of them. The Lessee
acknowledges and agrees that the Facility has not been selected by the Lessor,
the Agent or any Lender, that none of the Lessor, the Agent or any Lender has
supplied any specifications with respect to the Facility and that none of the
Lessor, the Agent or any Lender (i) is a Vendor of, or merchant or supplier with
respect to, any of the Property comprising the Facility or any Property of such
kind, (ii) has made any recommendation, given any advice or taken any other
action with respect to the choice of any manufacturer, supplier or transporter
of, or any vendor of or other contractor, including, without limitation, with
respect to Property comprising the Facility, (iii) has at any time had physical
possession of any such Property, (iv) has made or is making any warranty,
express or implied, relating to the Facility, including without limitation, with
respect to title, merchantability, fitness for a particular purpose or
otherwise, the design, condition, quality of material or workmanship, conformity
to specifications, freedom from patent or trademark infringement, absence of any
latent or other defects, whether or not discoverable, whether arising pursuant
to the UCC or any other present or future law or otherwise, or compliance with
Applicable Permits or other Governmental Requirements, or (v) shall be liable
for incidental or consequential damages (including liability in tort, strict or
otherwise). In the event of any defect or deficiency of any nature in the
Facility or any Property or other item constituting a portion thereof, whether
patent or latent, none of the Lessor, the Agent, or any Lender shall have any
responsibility or liability with respect thereto. The provisions of this Section
11 have been negotiated and are intended to be a
11
complete exclusion and negation of any and all warranties, express or implied,
by the Lessor, the Agent and the Lenders with respect to the Facility or any
Property or other item constituting a portion thereof, whether arising pursuant
to the UCC or any other law now or hereafter in effect.
(b) The Lessor hereby assigns to the Lessee, until the
occurrence of a Cancellation Event or Termination Event hereunder, the benefits
in respect of any Vendor's warranties or undertakings, express or implied,
relating to the Facility (including any labor, equipment or parts supplied
therewith), and, to the extent assignment of the same is prohibited or precludes
enforcement of any such warranty or undertaking, the Lessor hereby subrogates
the Lessee to its rights in respect thereof. The Lessor hereby authorizes the
Lessee, at the Lessee's expense, to assert any and all claims and to prosecute
any and all suits, actions and proceedings, in its own name or in the name of
the Lessor, in respect of any such warranty or undertaking and, except after the
occurrence of a Cancellation Event or Termination Event hereunder, to retain the
proceeds received, and after the termination of this Lease or after the
occurrence of a Cancellation Event or Termination Event, to pay the same in the
form received (with any necessary endorsement) to the Lessor.
(c) The Lessee may use the Facility for the Permitted Use
provided that the value of the Facility is not diminished by any such use other
than as a result of normal wear and tear in the ordinary course of business.
During the term of this Lease, the Lessor covenants that unless a Cancellation
Event or a Termination Event has occurred and is continuing and except as may
arise under a Permitted Lien or as may otherwise by contemplated under the
Transaction Documents, the Lessor will not, and will not permit any party
claiming by, through or under the Lessor to, interfere with the peaceful and
quiet possession and enjoyment of the Facility by the Lessee; PROVIDED, HOWEVER,
that the Lessor, the Agent, the Lenders and their respective successors,
assigns, representatives and agents may, upon reasonable notice to the Lessee,
enter upon and examine the Facility or any part thereof at reasonable times,
subject to the provisions of Section 19; and PROVIDED FURTHER, HOWEVER, that the
Lessor is not hereby warranting the state or quality of the title to any portion
of the Facility. Any failure by the Lessor to comply with the foregoing
provisions of this Section 11(c) shall not give the Lessee any right to cancel
or terminate this Lease, or to xxxxx, reduce or make reduction from or offset
against any Rent or other sum payable under this Lease or any other Transaction
Document, or to fail to perform or observe any other covenant, agreement or
obligation hereunder or thereunder. The Lessee will not do, or fail to do, or
permit or suffer to exist any act or thing, which action or thing or failure
might impair the value, use or usefulness of the Facility for the
12
Permitted Use in accordance with the design of the Facility, ordinary wear and
tear excepted.
Section 12. LIENS.
(a) The Lessee will not directly or indirectly create, or
permit to be created or to remain, and at the Lessee's expense will discharge
within twenty (20) days of notice of the filing or assertion thereof, by bond,
deposit or otherwise, any Lien upon the Lease or the Facility except (i) any
Lien being contested as permitted by and in accordance with Section 13, or (ii)
Permitted Liens. The Lessor agrees that the Lessee shall have during the term of
this Lease the exclusive right (so long as no Default has occurred and is
continuing) to grant, create or suffer to exist Permitted Liens in the ordinary
course of business and in accordance with prudent industry practices, provided
that the fair market value or use of the Facility or the applicable portion
thereof for the Permitted Use is not materially lessened thereby. The Lessor
agrees to execute such documents and take all other actions as shall be
reasonably necessary, and otherwise to cooperate with the Lessee in connection
with the matters described above, provided that all reasonable out-of-pocket
costs and expenses (including, without limitation, reasonable attorneys' fees
and expenses) incurred by the Lessor in connection therewith shall be borne by
the Lessee, and the Lessor shall not be required to execute any document that
would, in the opinion of the Lessor, materially and adversely affect the value
or use of the Facility or any portion thereof for the Permitted Use or otherwise
materially and adversely affect the transactions contemplated by the Transaction
Documents or the interests of the Lessor, the Agent or the Lenders in the
Facility or under the Transaction Documents or otherwise.
(b) The Lessor will not directly or indirectly sell, transfer
or otherwise dispose of, or create, or permit to be created or to remain, and
will discharge, any Lien of any nature whatsoever on, in or with respect to, its
interest in the Facility arising by or through it or its actions, except
Permitted Liens.
(c) The Lessee will not directly or indirectly sell, transfer,
or otherwise dispose of its interest in the Facility.
(d) The Lessee acknowledges and agrees that this Lease is
subsequent, inferior, junior and subordinate in all respects to the Liens
created pursuant to the Security Instruments. The Lessee will not contest or
otherwise challenge through litigation or by any other means the agreement of
the parties hereto that the right, title and interest of the Agent, on behalf of
the Lenders, as the secured party under the Security Instruments in and to the
Facility is senior and superior to the right, title and interest of the Lessee
under this Lease.
13
Section 13. PERMITTED CONTESTS. Notwithstanding any other
provision of this Lease to the contrary, after prior written notice to the
Lessor and provided there is no material risk of sale, forfeiture or loss of the
Facility or any material part thereof or interest therein, the Lessee may at its
expense contest any Imposition which it is required to pay hereunder, by
appropriate proceedings conducted in good faith and with due diligence, so long
as such proceedings are effective to prevent the collection of such Imposition
from the Lessor, the Agent, or the Lenders or against the Facility or any
portion thereof; PROVIDED, HOWEVER, that the actions of the Lessee, as
authorized by this Section 13, shall be subject to the express written consent
of the Agent and the Lessor if such actions would subject the Agent, the Lessor
or any such Lender or the Facility or any portion thereof to any liability or
loss not indemnified in full by the Lessee hereunder or any sanction, criminal
or otherwise, for failure to pay any such Imposition. The Lessee will pay, and
save the Lessor, the Agent and each such Lender harmless against, all losses,
Judgments and reasonable costs, including attorneys' fees and expenses, in
connection with any such contest and will, promptly after the final
determination of such contest, pay and discharge the amounts which shall be
imposed or determined to be payable therein, together with all penalties, costs
and expenses incurred in connection therewith. The Lessee shall prevent any
foreclosure, judicial sale, taking, loss or forfeiture of the Facility or any
portion thereof, or any interference with or deductions from any Rent or any
other sum required to be paid by the Lessee hereunder by reason of such
nonpayment or nondischarge of an Imposition. The Lessor shall cooperate with the
Lessee in any contest and shall allow the Lessee to conduct such contest (in the
name of the Lessor, if necessary) at the Lessee's sole cost and expense; and the
Lessee shall indemnify and hold the Lessor harmless from and against all
liabilities, costs and expenses in connection with such contest. The Lessee
shall notify the Lessor of each such proceeding within ten (10) days after the
commencement thereof, which notice shall describe such proceeding in reasonable
detail.
Section 14. INSURANCE, ETC. The Lessee will, at its own
expense, purchase and maintain, or cause to be purchased and maintained,
throughout the term of this Lease insurance with respect to its business and the
Facility in accordance with the requirements of Schedule 1.
(a) The Lessee shall bear all risk of loss (including any Loss
Event or Casualty Occurrence), whether by casualty, theft, taking, confiscation
or otherwise, with respect to the Facility or any portion thereof, at all times
during the term of this Lease until possession of the Facility has been accepted
by the Lessor pursuant to Section 17.
14
(b) So long as no Termination Event or Cancellation Event
shall have occurred shall have occurred and be continuing, any payments, whether
constituting insurance proceeds, amounts paid by any Governmental Authority or
otherwise, received by the Lessee or the Lessor upon the occurrence of any loss
with respect to the Facility or portion thereof (other than a Casualty
Occurrence), whether as a result of casualty, theft, taking or other
confiscation, shall be applied in payment for necessary repairs and replacement
to the Facility in accordance with Section 7 or, to the extent the costs of such
repairs and replacement shall have been paid by the Lessee, to reimburse the
Lessee. The Lessee shall be entitled to retain any excess funds remaining after
necessary repairs and replacements have been completed and all costs therefor
paid in full. Upon the occurrence of any Termination Event or Cancellation
Event, the Lessor shall be entitled to receive and retain any such payments for
application to the obligations of the Lessee hereunder.
(c) Upon a Casualty Occurrence, the Lessee shall give prompt
notice thereof to the Lessor and shall within thirty (30) days of the date of
such Casualty Occurrence either (i) offer to purchase the whole of the Facility
for the Purchase Price as provided in Section 15(c) or (ii) provide the Lessor
and the Agent with a replacement plan acceptable to the Lessor and the Agent
setting forth how the Lessee shall replace, or cause to be replaced, at the
Lessee's own cost and expense, within (A) in the case of a Casualty Occurrence
in an aggregate amount less than $100,000, 90 days after the Casualty
Occurrence, (B) in the case of a Casualty Occurrence of $100,000 or more but
less than $250,000, 180 days after the Casualty Occurrence, and (C) in the case
of a Casualty Occurrence of $250,000 or more, 270 days after the Casualty
Occurrence, but in any case no later than the end of the Construction Term (if
the Casualty Loss occurs during the Construction Term) or the Scheduled Lease
Termination Date, as applicable, such portion of the Facility that is the
subject of a Casualty Occurrence in accordance with this Section 14(d) and
Section 7. If the Lessee chooses the option set forth in clause (ii) of the
preceding sentence, within the later to occur of (x) sixty (60) days after the
date of the Casualty Occurrence and (y) satisfaction of all applicable
Governmental Requirements, and obtaining all authorizations of Governmental
Authorities, required therefor (but in no event later than ninety (90) days
after the date of the Casualty Occurrence), the Lessee shall have commenced
repairs or replacements as specified in the replacement plan and shall
thereafter proceed diligently with such repairs and replacements to completion
(or, in the case of (A) above, such repairs and replacements shall have been
completed within such time). After completion of the repairs and replacements,
the Lessee shall demonstrate to the satisfaction of the Lessor and the Agent
that operations, capacity and production from the Facility have been restored to
the standards required for Completion.
15
(d) All replacement Property of the Facility (other than
temporary replacement parts and equipment installed pending installation of
permanent replacement Property) installed pursuant to Section 14(d) shall be
free and clear of all Liens except Permitted Liens, and shall be in as good
operating condition as, and shall have a value and utility at least equal to,
the Property replaced immediately prior to the Casualty Occurrence to which such
Property was subject. For purposes of this Lease (including without limitation
Section 14(d) and Section 7), the Funded Amount and book value of the
replacement Property shall be deemed to equal the Funded Amount and book value
of the part(s) replaced thereby. All Property of the Facility at any time
removed from this Lease pursuant to Section 14(d) and Section 7 shall remain the
property of the Lessor, no matter where located, until such time as insurance
proceeds have been received by the Lessor at least equal to the book value of
such portion of the Facility or such portion shall be replaced by suitable items
that have been incorporated or installed on or attached to the Facility and that
meet the requirements specified above. Immediately upon any permanent
replacement Property becoming incorporated or installed on or attached to the
Facility as provided above, without further act, such permanent replacements
shall become subject to this Lease and be deemed part of the Facility for all
purposes hereof to the same extent as any other parts of the Facility. All
amounts of insurance proceeds for Property losses and all other proceeds
(whether resulting from damage or destruction or from condemnation, confiscation
or seizure) relating to the Facility shall be deposited into the Restoration
Account from any losses exceeding $250,000 per occurrence and held and released,
together with accrued interest thereon, as hereinafter provided. So long as a
Cancellation Event or Termination Event shall not have occurred, and provided
that the Lessor and the Agent shall have received a written application of the
Lessee accompanied by a certificate of an Authorized Officer of the Lessee
showing in reasonable detail the nature of any necessary repair, rebuilding and
restoration, the actual cash expenditures necessary for such repair, rebuilding
and restoration, the expected total expenditures required to complete such work
and evidence that sufficient funds are or will be available to complete such
work on a timely basis (such certificate to be acceptable to the Agent in all
respects), then the amounts available in the Restoration Account, together with
accrued interest thereon, shall be released by the Lessor immediately upon
receipt of such certification or, if applicable, from time to time on the last
Business Day of each month during the period of repair, rebuilding and
restoration in payment therefor against presentation to the Lessor of a
certificate executed by an Authorized Officer of the Lessee to the effect that
expenditures have been made, or costs incurred, by or for the account of the
Lessee or are reasonably anticipated to be made during the immediately following
one month period in a specified amount for the purposes of making repairs,
rebuilding and restoration in the amounts specified, that no
16
Cancellation Event or Termination Event exists and all conditions precedent
herein provided relating to such withdrawal and payment have been satisfied.
Upon the occurrence of any Termination Event or Cancellation Event, the Lessor
shall be entitled to retain all amounts in the Restoration Account for
application to the obligations of the Lessee hereunder.
(e) If any Loss Event or Casualty Occurrence shall occur, the
Lessee shall promptly notify the Lessor and the Agent of such event in writing.
Section 15. TERMINATION; CANCELLATION; PURCHASE
OPTION.
(a) (i) The termination of this Lease (A) in accordance with
Section 2(b) (whether upon the scheduled expiration hereof or by the
refusal to agree to extend the then current Scheduled Lease Termination
Date), or (B) as a result of the declaration by Agent of a
Non-Completion Event, shall be a "TERMINATION EVENT," the effect of
which shall be to cause this Lease to terminate on the applicable Lease
Termination Date.
(ii) If a Termination Event occurs, the Lessee, on
the Lease Termination Date, shall, in accordance with the terms of
Section 2(b), without further notice or demand to the Lessee, either
(A) purchase the Facility from the Lessor for the
Purchase Price; or
(B) so long as no Cancellation Event has occurred:
(1) pay to the Lessor, or at the Lessor's option, to
the Agent for the account of the Lessor, the Final Rent Payment (or
Completion Costs Payment, if a Non-Completion Event has occurred); and
(2) attempt to sell (until such time as the Lessor
shall have terminated, in accordance with the Agency Agreement, the
Lessee's obligation to so attempt to sell the Facility), subject to the
Agent's prior written approval, the Facility, as agent for the Lessor,
without recourse or warranty by the Lessor, for a net cash purchase
price not less than, and remit to the Lessor the net cash sales
proceeds equal to, the Termination Value less any amount paid pursuant
to Section 15(a)(ii)(B)(1). The Lessor and/or the Agent shall also have
the right (but not the obligation) to sell the Facility and/or solicit
bids, each in its sole and absolute discretion.
17
(b) (i) Each of the following events shall be a "CANCELLATION
EVENT", the effect of which shall be to cause this Lease to be
terminated in accordance with the following provisions on the
"CANCELLATION DATE" specified:
(A) the occurrence of (1) an Event of Default (other than an
Event of Default under Section 17(a)(iv) hereof or Section 9.01(h) or
(i) of the Credit Agreement) and the delivery by the Agent to the
Lessee of a notice stating that the Lessor elects to terminate this
Lease by reason of the existence of such Event of Default, in which
case the Cancellation Date will be the fifth (5th) Business Day after
the date of delivery of said notice to the Lessee, or (2) an Event of
Default under Section 17(a)(iv) hereof or Section 9.01(h) or (i) of the
Credit Agreement in which case the Cancellation Date shall occur
immediately upon the occurrence of such Event of Default; or
(B) the occurrence of a Loss Event, in which case the
Cancellation Date shall be the fifth (5th) Business Day after such
event occurs; or
(C) the occurrence of a Casualty Occurrence in respect of the
Facility and the failure of the Lessee to purchase the Facility or to
replace or repair the Facility or such portion thereof in accordance
with, and within the time required by, Section 14(d), including,
without limitation, subsections (i) and (ii) thereof, and the delivery
by the Agent to the Lessee of a notice after the expiration of such
time stating that the Lessor elects to terminate this Lease by reason
of the existence of such Casualty Occurrence, in which case the
Cancellation Date shall be the fifth (5th) Business Day after the date
of delivery of said notice; or
(D) the occurrence of Change of Control and the delivery by
the Agent (acting at the direction of the Majority Lenders) to the
Lessee of a notice stating that the Lessor elects to terminate this
Lease by reason of the occurrence of such Change of Control, in which
case the Cancellation Date will be the fifth (5th) Business Day after
the date of delivery of said notice to the Lessee.
(ii) If a Cancellation Event occurs, the Lessee, on
the Cancellation Date, shall, without further notice or demand to the
Lessee, either (A) purchase the Facility from the Lessor for the
Purchase Price, or (B) pay to Lessor the Termination Value. If
requested by the Lessor, the Lessee shall pay the Purchase Price or the
Termination Value, as the case may be, to the Agent for the account of
the Lessor.
18
(c) The Lessee may, from time to time and at any time, deliver
to the Lessor and the Agent notice of its intent to terminate this Lease, in
which case the Lessee shall purchase the Facility from the Lessor for the
Purchase Price on any Rent Payment Date that is not less than thirty (30) nor
more than sixty (60) days after such notice (the "OPTION DATE"). Upon payment in
full of the Purchase Price, this Lease shall terminate.
(d) This Lease shall cease and terminate on the Lease
Termination Date, Cancellation Date or Option Date, as applicable, except with
respect to (i) obligations and liabilities of the Lessee, actual or contingent,
which arose under this Lease, or by reason of events or circumstances occurring
or existing, on or prior to its termination, and which have not been satisfied
(which obligations shall continue until satisfied and which include, but are not
limited to, obligations for Rent and the Termination Value, the Purchase Price
and amounts owing pursuant to Section 16), (ii) all rights and remedies of the
Lessor under or in respect of this Lease, including without limitation the
provisions of Section 26 hereof, and (iii) obligations of the Lessee which by
the terms of this Lease expressly survive termination. Promptly after either the
Lessee or the Lessor shall learn of the happening of any Termination Event or
Cancellation Event, such party shall give notice thereof to the other party
hereto and to the Agent.
(e) In the event Lessee elects to purchase the Facility upon
the occurrence of a Termination Event (other than the expiration of this Lease
on a Scheduled Lease Termination Date) or a Cancellation Event, Lessee in its
sole discretion in order to ensure the orderly conveyance of the Facility may
postpone the closing date for such conveyance (whether or not extended, the
"Purchase Closing Date") to a reasonable date within sixty (60) days following
the Lease Termination Date or Cancellation Date, as applicable; provided
however, that notwithstanding any such postponement the Lessee shall nonetheless
be required to deposit on or before the Lease Termination Date or Cancellation
Date, as applicable, the Purchase Price (estimated at the time of the deposit)
with the nationally recognized title insurance company which insured Lessor's
leasehold interest in the Facility (or if such title company is unable or
unwilling to serve in such capacity, a replacement nationally recognized title
insurance company designated by Lessor) to be held in escrow pending
consummation of the closing on or before the extended Purchase Closing Date.
Lessor or Agent shall notify Lessee of any such postponement and the proposed
extended Purchase Closing Date in writing on or before the Lease Termination
Date or Cancellation Date, as applicable. Provided that Lessee deposits the
estimated Purchase Price on or before the applicable Lease Termination Date or
Cancellation Date, as appropriate, Lessee shall be deemed to have been granted a
temporary license by Lessor entitling Lessee to retain possession of the
Facility through the Purchase Closing Date
19
provided that Lessee complies with all obligations of Lessee under this Lease as
though this Lease were still in full force and effect (including without
limitation, compliance with permitted use, maintenance and insurance coverage
requirements). In the event of an extension of the Purchase Closing Date as
herein contemplated, the Purchase Price (including the Final Rent Payment
component thereof) will be calculated as of such extended Purchase Closing Date.
This Section 15(e) shall survive the termination of this Lease.
Section 16. TRANSFER OF TITLE ON REMOVAL OF FACILITY;
EXPENSES OF TRANSFER.
(a) Upon any sale or purchase permitted by Section 15, the
Lessor will transfer to the Lessee or the appropriate Third Party all of its
title to and legal and beneficial ownership interest in the Facility (i) free
and clear of any Lien created by, through or under the Lessor other than
Permitted Liens or Liens created at the request of or as a result of the actions
of Lessee or anyone acting by, through or under Lessee, or as a result of the
failure of Lessee to carry out any of its obligations under this Lease or the
other Transaction Documents, and (ii) without recourse, representation or
warranty of any nature whatsoever (except as to the absence of such Liens as
aforesaid).
(b) Whenever the Lessee has the right to purchase or transfer
to itself the Facility pursuant to any provision of this Lease, the Lessee may
cause such purchase to be effected by, or such transfer to be effected to, any
other Person specified by the Lessee, but in no event shall the Lessee be
relieved from any of its obligations hereunder as a result thereof.
(c) Upon any sale or transfer of the Facility pursuant to any
provision of this Lease, the Lessee shall pay the expenses of the Agent and the
Lessor, including, without limitation, reasonable attorneys' fees and expenses,
in connection with such sale or transfer.
(d) If, on the Lease Termination Date or on the Cancellation
Date, as applicable, the Lessee or any of its Affiliates has not elected to
acquire the Facility, the Lessee shall surrender the Facility to the Lessor free
from all Liens except Permitted Liens (other than those described in clause
(ii)(b) of the definition of Permitted Liens), in the same operating condition
(except for ordinary wear and tear) with the remaining original estimated useful
life contemplated by the Facility Plan intact and having the same capacity and
efficiency as the Facility had on the Lease Commencement Date, and in compliance
in all material respects with all Governmental Requirements and Insurance
Requirements, and free of all Environmental Damages and Environmental
Liabilities. To evidence the foregoing and
20
accomplish the surrender of the Facility, the Lessee shall provide the following
items (x) in the event of a Termination Event under Section 15(a)(i)(A) within
nine (9) months prior to the then current Lease Termination Date, with final
confirmation of the same at least thirty (30) days but not more than sixty (60)
days prior thereto and (y) in the event of a Termination Event under Section
15(a)(i)(B), as soon as practicable but in any event at least three (3) Business
Days prior to the Lease Termination Date or Cancellation Date, as applicable:
(i) evidence satisfactory to the Lessor and the Agent that all
Applicable Permits, Related Contracts, patents, trademarks and
copyrights, and all other rights and services reasonably required to
operate the Facility have been, or on or prior to the Lease Termination
Date shall be, transferred to the Lessor (or the Lessor has been, or on
or prior to the Lease Termination Date or Cancellation Date, as
applicable, shall be, given the right to use each such item) and can be
transferred to (or used by) any successor or assignee of the Lessor
without further consent or approval by any Person (subject only to
normal Governmental Requirements);
(ii) conveyancing, assignment, transfer, termination and other
documents that, in the sole discretion of the Lessor, the Agent and the
Lenders, are sufficient to (A) vest in the Lessor good and marketable
title to the Facility, free and clear of all Liens except Permitted
Liens (other than those described in clause (ii)(b) of the definition
of Permitted Liens) and (B) terminate the rights of the Lessee and all
other Persons in and to the Facility;
(iii) evidence satisfactory to the Lessor and the Agent that
the Facility has been operated and maintained in accordance with the
requirements of the Transaction Documents, all Governmental
Requirements, all Applicable Permits and prudent industry practices;
(iv) evidence satisfactory to the Agent that the Facility is
being used solely for the Permitted Use and is operating in accordance
with the requirements set forth in the Facility Plan, meets or exceeds
the original design specifications and is capable of operating and
being used for the Permitted Use as set forth in the Facility Plan, and
has the remaining original estimated useful life contemplated by the
Facility Plan;
(v) evidence satisfactory to the Lessor and the Agent, in
their sole discretion, that (A) no default exists under the Agency
Agreement, (B) all agreements and arrangements to provide the services
and rights contemplated by the Agency Agreement are in place, executed
by the parties thereto, and
21
are valid, enforceable and in full force and effect on or before the
Lease Termination Date or Cancellation Date, as applicable and (C) such
agreements and arrangements adequately provide for the services and
other rights contemplated by the Agency Agreement;
(vi) an updated Environmental Assessment and
(vii) such other documents, instruments, assessments,
investigations, legal opinions, surveys and other items as the Lessor
and/or the Agent may reasonably request to evidence to the satisfaction
of each of the Lessor, the Agent and the Lenders (in each case, in
their sole discretion) that (A) the Lessor has all Property, services,
Permits, assets and rights necessary to own, operate and maintain the
Facility from and after the Lease Termination Date or Cancellation
Date, as applicable, and (B) no Default, Loss Event or Casualty
Occurrence then exists.
To the extent the Facility is not in the condition required by this
Section 16(d), the Lessee will pay to the Lessor such additional
amounts as are reasonably required to place it in compliance. The
Lessee shall also pay all costs and expenses relating to the surrender
and clean-up in connection with the surrender of the Facility as may be
required by Governmental Requirements or Insurance Requirements or
which are otherwise necessary to prevent or remedy any Environmental
Damages or Environmental Liabilities or to consummate the delivery of
possession of the Facility to the Lessor hereunder.
Section 17. EVENTS OF DEFAULT AND REMEDIES.
(a) Each of the following acts or occurrences shall constitute
an "EVENT OF DEFAULT" hereunder:
(i) default in the payment of the Purchase Price on the Option
Date, or in the payment of the Purchase Price or in the Termination
Value on the Cancellation Date or the Purchase Closing Date, as
applicable, or in the payment of the Purchase Price or the Final Rent
Payment on the Lease Termination Date or the Purchase Closing Date, as
applicable; or the default in the payment when due of any Basic Rent
and the continuance of such default for five (5) Business Days
thereafter; or the default in the payment when due of any Supplemental
Rent, the amount of any Indemnified Risk or any other amount due
hereunder or under any other Transaction Document and the continuance
of such default for five (5) Business Days thereafter; or
(ii) any representation or warranty made or deemed made by the
Lessee herein, by Lessee or any Guarantor in any other
22
Transaction Document or otherwise in writing in connection with or
pursuant to this Lease or any other Transaction Document, shall be
false or misleading in any material respect on the date made or deemed
made; or
(iii) an Event of Default under the Credit Agreement;
(iv) The Lessor or any Guarantor shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking
the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its Property, or
shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as
they become due, or shall take any corporate action to authorize any of
the foregoing; or (B) an involuntary case or other proceeding shall be
commenced against the Lessee or any Guarantor seeking liquidation,
reorganization or other relief with respect to it or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of
its Property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of sixty (60) days; or (C)
an order for relief shall be entered against the Lessee or any
Guarantor under the federal bankruptcy laws as now or hereafter in
effect; or
(v) The Lessee shall fail to observe or perform any covenant
or agreement contained in Sections 12, 14 and 26 of this Lease or any
Guarantor shall fail to observe or perform any covenant or agreement
contained in the Guaranty (Lessee); or
(vi) Lessee shall abandon the Facility; provided however that
for purposes of this Section 17(a)(vii), the term "abandon" shall not
include the mere failure of Lessee to occupy the Facility so long as
Lessee continues to perform its obligations hereunder and other
Transaction Documents including without limitation maintenance of the
Facility, maintenance of required insurance, compliance with
Governmental Requirements and Insurance Requirements and payment of all
Rent.
(b) Upon the occurrence and during the continuance of
any Event of Default, the Lessor may do any one or more of the
23
following (without prejudice to the obligations of the Lessee under
Section 15(b)(ii)):
(i) proceed by appropriate judicial proceedings, either at
law, in equity or in bankruptcy, to enforce performance or observance
by the Lessee of the applicable provisions of this Lease, or to recover
damages for the breach of any such provisions, or any other equitable
or legal remedy, all as the Lessor shall deem necessary or advisable;
and/or
(ii) by notice to the Lessee, either (x) terminate this Lease
in accordance with Section 15, whereupon the Lessee's interest and all
rights of the Lessee to the use of the Facility shall forthwith
terminate subject to the Lessee's rights under such Section 15 to
acquire the Facility on the Purchase Closing Date as provided herein,
but the Lessee shall remain liable with respect to its obligations and
liabilities hereunder; or (y) terminate the Lessee's right to
possession of the Facility or any portion thereof; and/or
(iii) exercise any and all other remedies available under
applicable law or at equity.
(c) After the occurrence and during the continuance of a
Cancellation Event or Termination Event, in the event the Lessor elects not to
terminate this Lease and the Lessee has not exercised its option under Section
15(c), this Lease shall continue in effect and the Lessor may enforce all of the
Lessor's rights and remedies under this Lease, including, without limitation,
the right to recover the Basic Rent and Supplemental Rent as it becomes due
under this Lease. For the purposes hereof, the following do not constitute a
cancellation or termination of this Lease: (i) acts of maintenance or
preservation of the Facility or any portion thereof, (ii) efforts by the Lessor
or the Agent to relet the Facility or any portion thereof, including, without
limitation, termination of any sublease of the Facility and removal of any
subtenant from the Facility, (iii) or the appointment of a receiver upon the
initiative of the Lessor to protect the Lessor's interest under this Lease.
(d) If (i) on the Lease Termination Date, the Facility is not
acquired by the Lessee or its designee by payment of the Purchase Price, or (ii)
on the Cancellation Date or Option Date, the Lessee or its designee has
defaulted in its obligation to acquire the Facility and pay the Purchase Price,
or if applicable, the Termination Value, in accordance with Lessee's election
under Section 15(b)(ii), then the Lessor shall have the immediate right of
possession of the Facility and the right to enter onto the Site, and the Lessor
may thenceforth hold, possess and enjoy the Facility free from any rights of the
Lessee and any Person claiming by, through or under the Lessee. The Lessor shall
be under no
24
liability by reason of any such repossession of the Facility or
entry onto the Site.
(e) Should the Lessor elect to repossess the Facility or any
portion thereof upon cancellation or termination of this Lease or otherwise in
the exercise of the Lessor's remedies, the Lessee shall peaceably quit and
surrender the Facility or any such portion thereof to the Lessor and either (i)
deliver possession of the Facility to the Lessor or (ii) allow Lessor or its
agents or assigns to enter onto the Facility and the Site to remove any and all
of the Property comprising the Facility at the expense of the Lessee, and
neither the Lessee nor any Person claiming through or under the Lessee shall
thereafter be entitled to possession or to remain in possession of the Facility
or any portion thereof but shall forthwith peaceably quit and surrender the
Facility to the Lessor.
(f) At any time after the repossession of the Facility or any
portion thereof, whether or not this Lease shall have been canceled or
terminated, the Lessor may (but shall be under no obligation to) relet the
Facility or the applicable portion thereof without notice to the Lessee, for
such term or terms and on such conditions and for such usage as the Lessor in
its sole and absolute discretion may determine. The Lessor may collect and
receive any rents payable by reason of such reletting, and the Lessor shall not
be liable for any failure to relet the Facility or for any failure to collect
any rent due upon any such reletting.
(g) The remedies herein provided in case of an Event of
Default are in addition to, and without prejudice to, Lessee's continuing
obligations under Section 15(b)(ii), and shall not be deemed to be exclusive,
but shall be cumulative and shall be in addition to all other remedies existing
at law, in equity or in bankruptcy. Lessor may exercise any remedy without
waiving its right to exercise any other remedy hereunder or existing at law, in
equity or in bankruptcy.
(h) No waiver by the Lessor hereunder of any Default or Event
of Default shall constitute a waiver of any other or subsequent Default or Event
of Default. To the extent permitted by applicable law, the Lessee waives any
right it may have at any time to require the Lessor to mitigate the Lessor's
damages upon the occurrence of a Default or Event of Default by taking any
action or exercising any remedy that may be available to the Lessor, the
exercise of remedies hereunder being at the discretion of the Lessor.
Section 18. CHANGE IN THE LESSEE'S NAME OR STRUCTURE.
The Lessee will not change its name, identity or corporate structure (including,
without limitation, by any merger, consolidation or sale of substantially all of
its assets) without
25
notifying Lessor of such change in writing at least sixty (60) days prior to the
effective date of such change.
Section 19. INSPECTION; RIGHT TO ENTER PREMISES OF THE LESSEE.
The Lessee shall permit, and cause each of its Subsidiaries to permit, the
Agent, the Lessor, any Lender or their respective authorized representatives may
(but without any obligation to do so) (i) enter upon the Facility or any
premises of the Lessee at reasonable times upon reasonable advance notice in
order to inspect the Facility (subject to compliance with applicable safety
requirements of Lessee and applicable Governmental Requirements) and to examine,
audit and make abstracts from any of their respective books and records and to
discuss the condition, compliance with Governmental Requirements, performance of
the Facility and the respective affairs, finances and accounts of Lessee and its
Subsidiaries with their respective officers, employees and independent
accountants. Lessee agrees to coordinate and assist in such visits and
inspections, in each case at such reasonable times and as often as may
reasonably be desired.
Section 20. RIGHT TO PERFORM THE LESSEE'S COVENANTS. Subject
to Section 13, if the Lessee shall fail to make any payment or perform any act
required to be made or performed by it hereunder, the Agent or the Lessor, upon
notice to or demand upon the Lessee but without waiving or releasing any
obligation or Default or Event of Default, may (but shall be under no obligation
to) at any time thereafter make such payment or perform such act for the account
and at the expense of the Lessee as, at the Lessor's sole discretion, may be
necessary or appropriate therefor and, upon the occurrence and during the
continuance of a Cancellation Event or Termination Event, may enter upon the
Facility for such purpose and take all such action thereon as, at the Lessor's
sole discretion, may be necessary or appropriate therefor. No such entry shall
be deemed an eviction of the Lessee. All sums so paid by the Lessor and all
costs and expenses (including, without limitation, reasonable attorneys' fees
and expenses so incurred) shall be paid by the Lessee to the Lessor on demand as
Supplemental Rent.
Section 21. PARTICIPATION BY CO-LESSEES OR SUBLESSEES.
(a) Except as otherwise permitted in this Section 21, neither
the Lessor nor the Lessee may assign its rights or obligations under this Lease
without the prior consent of all of the Lenders and the Agent. The Lessor has
granted a Lien on this Lease to the Agent for the benefit of the Lenders to
secure the obligation of the Lessor under the Credit Agreement. The Agent,
acting on behalf of the Lenders, shall be entitled to exercise all of the
rights, remedies, powers and privileges herein conferred upon Lessor (including,
without limitation, in any bankruptcy proceeding), to give or withhold all
consents required to be
26
obtained from Lessor hereunder, to give all notices on behalf of the Lessor
including notices regarding Rent, the Final Rent Payment and Supplemental Rent
due hereunder, to receive all payments to be made to the Lessor hereunder and to
approve any sale of the Facility pursuant to Section 15 to a Person other than
the Lessee or any designee of the Lessee or for a price less than the
Termination Value; PROVIDED, HOWEVER, that nothing herein shall be deemed to be
a waiver or relinquishment of the right of the Lessor to receive Supplemental
Rent for its out of pocket costs and expenses as described in Section 3(d)(i) or
to be indemnified for any matter for which Lessor is entitled to indemnification
hereunder.
(b) The Lessor and the Lessee may from time to time, so long
as no Default, Cancellation Event or Termination Event shall have occurred and
be continuing, enter into documentation amending this Lease and, as necessary,
the other Transaction Documents, to evidence the undertaking of a Person (a
"CO-LESSEE") to be responsible for all or certain obligations of the Lessee and
the attendant reduction in the obligations of the Lessee hereunder, subject in
every case to (i) documentation satisfactory to the Agent and the Lenders
amending this Lease and the Transaction Documents and continued perfection and
protection of the Lessor's interest; (ii) such documentation shall expressly
state that such assignment is subject to the terms of this Lease and the Liens
created by the Security Instruments; and (iii) the Lessee remaining primarily
liable for all obligations of the tenant of the Facility under this Lease. Any
assignment made otherwise than as expressly permitted by this Section 21(b)
shall be null and void and of no force and effect.
(c) The Lessee may, from time to time, so long as no Default,
Cancellation Event or Termination Event shall have occurred and be continuing,
enter into a sublease and such other documentation as may be necessary with one
or more Persons (each a "SUBLESSEE"). In any event, any documentation executed
by the Lessee in connection with the subletting of the Facility (i) shall
expressly state that such sublease is subject and subordinate to the terms of
this Lease and the Liens created by the Security Instruments and (ii) shall not
provide for a sublease term ending after the then current Scheduled Lease
Termination Date. The Lessee will furnish promptly to the Lessor and Agent
copies of all subleases and related documentation entered into by the Lessee
from time to time. No sublease permitted by the terms hereof will reduce in any
respect the obligations of the Lessee hereunder, it being the intent of the
Lessee and the Lessor that the Lessee be and remain directly and primarily
liable as a principal for its obligations hereunder. Any sublease made otherwise
than as expressly permitted by this Section 21(c) shall be null and void and of
no force or effect.
27
Section 22. NOTICES. Except as otherwise provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telecopier and other readable communication) and mailed by certified
mail, return receipt requested, telecopied or otherwise transmitted or
delivered, if to the Lessee, at 0000 Xxxxxxx Xxxx, Xxxxx Xxxxxx, Xxxxxxx 00000,
Attention: Xxxxxxxxx X. Xxxxxx, General Counsel, Telecopier: 000- 000-0000; if
to the Lessor, at Xxx Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention:
Xxx Xxxx, Telecopier: 000-000-0000; with copies to the Agent at 00 Xxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxxx Xxxxxxxxxxxxx, Telecopier:
000-000-0000; or, as to each party, at such other address as shall be designated
by such party in a written notice to the other parties. All such notices and
communications shall, if so mailed, telecopied or otherwise transmitted, be
effective when received, if mailed, or when the appropriate answer back or other
evidence of receipt is given, if telecopied or otherwise transmitted,
respectively. A notice received by the Lessor or the Agent by telephone shall be
effective if the Lessor or the Agent believes in good faith that it was given by
an authorized representative of the Lessee and acts pursuant thereto,
notwithstanding the absence of written confirmation or any contradictory
provision thereof.
Section 23. AMENDMENTS AND WAIVERS. The provisions of this
Lease may from time to time be amended, modified or waived only if such
amendment, modification or waiver is in writing and consented to by the Lessee,
the Lessor and the Agent and, if applicable, in accordance with Section 22.
Section 24. SEVERABILITY. Any provision of this Lease which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 25. FEDERAL INCOME TAX CONSIDERATIONS. It is the
understanding of the parties that for income tax purposes this transaction will
be treated as a financing and the Lessee will be treated as the owner of the
Facility; and the Lessee and the Lessor agree not to take any action
inconsistent with such treatment, subject to the following sentence.
Notwithstanding anything in this Section to the contrary, the Lessor and/or the
Agent retain the right to assert that it is the owner of the Facility subject to
this Lease for income tax purposes in the event that there is a determination
(within the meaning of Section 1313 of the Code or with respect to state or
local income tax, a comparable determination under state or local law) that the
Lessee is not to be treated as the owner of the Facility.
28
Section 26. OTHER PROVISIONS. In order to protect the rights
and remedies of the Lessor and the Lessee both during the term of this Lease and
following a Default, a Termination Event or a Cancellation Event, and for the
purposes of Federal, state and local income and AD VALOREM taxes, state and
local sales taxes, documentary stamp and intangibles taxes and other taxes
relating to or assessable as a result of the execution, delivery or recording of
any of the Transaction Documents and for purposes of Title 11 of the United
States Code (or any other applicable Federal, state or local insolvency,
reorganization, moratorium, fraudulent conveyance or similar law now or
hereafter in effect for the relief of debtors), the parties hereto intend that
(a) this Lease be treated as the repayment, provisions of a loan by Lessor to
Lessee in a collective amount of the aggregate unpaid Tranche A Loans, Tranche B
Loans and Lessor Investment Payments and be treated as the security provisions
of a loan by Lessor to Lessee in a collective amount of the aggregate unpaid
Tranche A Loans, Tranche B Loans and Lessor Investment Payments, (b) a portion
of the payments of Rent, Supplemental Rent, the Final Rent Payment (or
Completion Costs Payment, if applicable) and the Termination Value be treated as
payments of principal, interest and other amounts owing with respect to the
Tranche A Loans, the Tranche B Loans and Lessor Investment Payments,
respectively, (c) the Lessee should be treated as entitled to all benefits of
ownership of the Facility or any part thereof, (d) this Lease be treated as a
mortgage, fixture financing statement and security agreement or other similar
instrument (the "MORTGAGE") from Lessee, as mortgagor, to Lessee, as mortgagee,
and as a security agreement from the Lessee, as debtor, to the Lessor, as
secured party, encumbering the Facility and all Property comprising the
Facility, and that the Lessee, as debtor and mortgagor, hereby grants and
mortgages to the Lessor (the "SECURED PARTY"), as secured party and mortgagee, a
first and prior Mortgage and Lien on and security interest in the equipment,
fixtures, and any and all other personal property of any kind or character
comprising the Facility and all proceeds therefrom, in each case being effective
as of the date of this Lease. In such event, the Lessor shall have all of the
rights, powers and remedies of a mortgagee and a secured party available under
applicable law, including, without limitation, judicial foreclosure, as and to
the extent available under applicable law, PROVIDED HOWEVER, that
notwithstanding anything to the contrary set forth herein, the amounts secured
by the real property Liens and security interests of the Mortgage shall be
limited to $360,000.00 plus (y) any other amounts owing to the Lessor or any
other party under the Transaction Documents (including Supplemental Rent), and
for purposes of this Section 26 the balance of the Obligations in excess of
$360,000.00 shall be deemed not secured by real property. The filing of this
Lease (or a memorandum hereof) shall be deemed to constitute the filing of a
mortgage and fixture filing and the filing of any financing statement in
connection with this Lease shall be deemed to constitute the filing of a
financing statement
29
to perfect the mortgage lien and security interests in the Facility as aforesaid
to secure the payment of all amounts due from time to time from the Lessee to
the Lessor under this Lease and the other Transaction Documents (subject to the
limitations set forth in the preceding sentence). If this transaction is treated
as a financing, the obligation arising hereunder shall be with recourse to the
Lessee for all amounts payable by Lessee hereunder and shall not be treated as
recourse only to the Facility. To the fullest extent permitted by applicable
law, the Lessor and the Lessee intend that the Facility (other than the real
property constituting the Site) be and remain at all times personal property
regardless of the manner or extent to which any of the Facility (other than the
real property constituting the Site) may be attached or affixed to any real
property.
This Mortgage secures and shall be security for any and all
future advances made by Secured Party relating to the protection and
preservation of the "Collateral," as defined below. Nothing contained herein
shall be deemed an obligation on the part of the Secured Party to make any
further advances.
In order to preserve the security interest provided for
herein, each of the Lessor and the Lessee agrees to abide by the following
provisions with regard to the Facility (for purposes of this Section,
hereinafter referred to as "COLLATERAL"):
(a) CHANGE IN LOCATION OF COLLATERAL OR THE LESSEE. The
Lessee will notify the Secured Party on or before the date of any change in
location of the Collateral and will, on or before the date of any change in
location of the Collateral, prepare and file new or amended financing statements
as necessary so that the Secured Party shall continue to have a first and prior
perfected Lien (subject only to Permitted Liens) in such Collateral after such
change in location. The Lessee will give the Secured Party thirty (30) days'
prior written notice of any change in the location of the Lessee's chief
executive office or address.
(b) DOCUMENTS; COLLATERAL IN POSSESSION OF THIRD PARTIES. If
certificates of title or other documents evidencing ownership or possession of
the Collateral are issued or outstanding, the Lessee will cause the interest of
the Secured Party to be properly noted thereon and will, forthwith upon receipt,
deliver same to the Secured Party. If any Collateral is at any time in the
possession or control of any warehouseman, bailee, agent or independent
contractor, the Lessee shall notify such Person of the Secured Party's security
interest in such Collateral. Upon the Secured Party's request, the Lessee shall
instruct any such Person to hold all such Collateral for the Secured Party's
account subject to the Lessee's instructions, or, if an Event of Default shall
have occurred and be continuing, subject to the Secured Party's instructions.
30
(c) SALE, DISPOSITION OR ENCUMBRANCE OF COLLATERAL. Except for
Permitted Liens, as permitted by any of the Transaction Documents or with the
Secured Party's prior written consent, the Lessee will not in any way encumber
any of the Collateral (or permit or suffer any of the Collateral to be
encumbered) or sell, assign, lend, rent, lease or otherwise dispose of or
transfer any of the Collateral to or in favor of any Person other than the
Secured Party.
(d) PROCEEDS OF COLLATERAL. Except as permitted by any of the
Transaction Documents, the Lessee will deliver to the Secured Party promptly
upon receipt all proceeds delivered to the Lessee from the sale or disposition
of any Collateral. This Section shall not be construed to permit sales or
dispositions of the Collateral except as may be elsewhere expressly permitted by
this Lease or the other Transaction Documents.
(e) FURTHER ASSURANCES. Upon the request of the Secured Party,
Lessee shall (at Lessee's expense) execute and deliver all such mortgages, deeds
of trust, assignments, certificates, financing statements or other documents and
give further assurances and do all other acts and things as the Secured Party
may reasonably request to perfect the Secured Party's interest in the Collateral
or to protect, enforce or otherwise effect the Secured Party's rights and
remedies hereunder, all in form and substance satisfactory to the Secured Party.
(f) COLLATERAL ATTACHED TO OTHER PROPERTY. In the event that
the Collateral is to be attached or affixed to any real property, the Lessee
hereby agrees that a financing statement which is a fixture filing may be filed
for record in any appropriate real estate records. If the Lessee is not the
record owner of such real property, it will provide the Secured Party with any
additional security documents or financing statements necessary for the
perfection of the Secured Party's Lien in the Collateral, as requested by the
Secured Party.
(g) LEASE. The Lease will not be amended, supplemented or
modified without the written consent of the Secured Party. All payments under
the Lease shall be made only to such account as specified by the Secured Party.
(h) MORTGAGE REMEDIES. If an Event of Default shall have
occurred, Secured Party may institute a proceeding or proceedings, judicial or
by such other statutory procedures available in the state in which the
Collateral is located, for the complete or partial foreclosure of this Mortgage
or the complete or partial sale of the Collateral under any applicable provision
of law. Mortgagee may sell the Collateral, and all estate, right, title,
interest, claim and demand of Mortgagor therein, and all rights of redemption
thereof, at one or more sales, as an entirety
31
or in parcels, with such elements of real and/or personal property, and at such
time and place and upon such terms as it may deem expedient, or as may be
required by applicable law, and in the event of a sale, by foreclosure or
otherwise, of less than all of the Collateral, this Mortgage shall continue as a
lien and security interest on the remaining portion of the Collateral. Subject
to the requirements of applicable law and except as otherwise provided herein,
the following provisions shall apply to any sale or sales of all or any portion
of the Collateral under or by virtue of this subsection(h, whether made by
virtue of judicial proceedings or of a judgment or decree of foreclosure and
sale:
i) Secured Party may conduct any number of sales from time to
time.
ii) Any sale may be postponed or adjourned by public
announcement at the time and place appointed for such sale or for such
postponed or adjourned sale without further notice.
iii) After each sale, Secured Party, or an officer of any court
empowered to do so shall execute and deliver to the purchaser or
purchasers at such sale a good and sufficient instrument or instruments
granting, conveying, assigning and transferring all right, title and
interest of Lessee in and to the property and rights sold and shall
receive the proceeds of said sale or sales and apply the same as
specified in the Note. Secured Party is hereby appointed the true and
lawful attorney-in-fact of Lessee, which appointment is irrevocable and
shall be deemed to be coupled with an interest, in Secured Party's name
and stead, to make all necessary conveyances, assignments, transfers
and deliveries of the property and rights so sold, Lessee hereby
ratifying and confirming all that said attorney or such substitute or
substitutes shall lawfully do by virtue thereof. Nevertheless, Lessee,
if requested by Secured Party, shall ratify and confirm any such sale
or sales by executing and delivering to Secured Party or such purchaser
or purchasers all such instruments as may be advisable, in Secured
Party's judgment, for the purposes as may be designated in such
request.
iv) Any and all statements of fact or other recitals made in
any of the instruments referred to in SUBPARAGRAPH (III) of this
SUBSECTION (H) given by Secured Party shall be taken as conclusive and
binding against all persons as to evidence of the truth of the facts so
stated and recited.
v) Any such sale or sales shall operate to divest all of the
estate, right, title, interest, claim and demand whatsoever, whether at
law or in equity, of Lessee in and to the properties and rights so
sold, and shall be a perpetual bar both at law and in equity against
Lessee and any and all
32
persons claiming or who may claim the same, or any part thereof or any
interest therein, by, through or under Lessee to the fullest extent
permitted by applicable law.
vi) Upon any such sale or sales, Secured Party may bid for and
acquire the Collateral and, in lieu of paying cash therefor, may make
settlement for the purchase price by crediting against the amounts due
under this Lease the amount of the bid made therefor, after deducting
therefrom the expenses of the sale, the cost of any enforcement
proceeding hereunder, and any other sums which Secured Party is
authorized to deduct under the terms hereof and under applicable law,
to the extent necessary to satisfy such bid.
vii) Upon any such sale, it shall not be necessary for Secured
Party or any public officer acting under execution or order of court to
have present or constructively in its possession any of the Collateral.
Secured Party may exercise its rights of enforcement under the Uniform
Commercial Code in effect in the State of Florida.
PROVIDED NEVERTHELESS, that Secured Party shall, at the expense of Lessee, cause
this Mortgage to be released upon (a) Lessee's payment in full of all amounts
secured by this Mortgage as set forth under this Section 26 and (b) Lessee's
paying and performing all other obligations of Lessee set forth in the Operative
Documents in a timely manner.
Section 27. MISCELLANEOUS.
(a) This Lease and the other Transaction Documents embody the
entire agreement and understanding between the Lessee and the Lessor and
supersede all other agreements and understandings between such parties relating
to the subject matter hereof. This written Lease and the other Transaction
Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or subsequent oral
agreements of the parties. There are no unwritten oral agreements between the
parties.
(b) Notwithstanding anything to the contrary contained in this
Lease, the execution of this Lease and any other instrument or document executed
in connection herewith shall not impose upon any director, officer or employee
of the Lessee, the Agent or the Lessor personal liability for the Lessee's, the
Agent's and the Lessor's respective obligations under this Lease or any other
instrument or document executed in connection herewith; provided the foregoing
shall not relieve any such director, officer or employee of personal liability
for his or her fraud or intentional misconduct.
33
(c) Captions and section headings appearing herein are
included solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
(d) This Lease and the rights and obligations of the Parties
hereto relating to the Facility shall be governed by and interpreted in
accordance with the laws of the State of New York, including Section 5-1401 of
the New York General Obligations Law (or any similar successor provision
thereto) but excluding all other conflict-of-laws rules; EXCEPT THAT, to the
extent required by the laws of the State of Florida, the laws of the State of
Florida shall govern (i) the creation and existence of this Lease, (ii) Section
26 of this Lease, and (iii) the enforcement of the rights of Lessor to repossess
the Facility from Lessee after the earlier of the termination of this Lease or
the termination of Lessee's right to possession of the Facility.
(e) Nothing in this Lease, express or implied, shall give to
any Person, other than the parties hereto and the Agent and their respective
successors and permitted assigns, any benefit or any legal or equitable right,
remedy or claim under this Lease including, without limitation, under any
provision of this Lease regarding the priority or application of any amounts
payable hereunder.
(f) This Lease may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument and any
of the parties hereto may execute this Agreement by signing any such
counterpart.
(g) Each of the parties hereto waives, to the fullest extent
permitted by applicable law, any right to a trial by jury in any action or
proceeding to enforce or to defend any rights under this Lease or under any
amendment, instrument, document or agreement delivered or which may in the
future be delivered in connection herewith or therewith or arising from any
relationship existing in connection with this Lease, and agrees that any such
action or proceeding shall be tried before a court and not before a jury.
(h) In the event that any one or more of the provisions
contained in this Lease shall, for any reason, be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of the Lease.
(i) Notwithstanding anything to the contrary contained in this
Lease or any of the Transaction Documents, the amounts which the Lessee is
obliged to pay pursuant to this Lease and the other Transaction Documents, and
the amounts which the Lessor, the Agent and the Lenders are entitled to receive
pursuant to this
34
Lease and the other Transaction Documents, are subject to the limitations set
forth in Section 11.15 of the Credit Agreement.
(j) Time is of the essence in connection with the payment of
Rent and all other amounts payable hereunder and the performance of the Lessee's
other obligations hereunder.
(k) No recourse shall be had against the Lessor or its
successors and assigns and their directors, officers, shareholders, employees or
agents for any claim based on any failure by the Lessor in the performance or
observance of any of the agreements, covenants or provisions contained in this
Lease; and in the event of any such failure, recourse shall be had solely
against the rights and interests of the Lessor in the Facility.
[SIGNATURES CONTAINED ON NEXT PAGE]
35
IN WITNESS WHEREOF, the parties have caused this Lease to be executed
by their respective officers thereunto duly authorized as of the date first
above written.
LESSEE:
THE VINCAM GROUP, INC.
/s/ XXXXXXXX X. XXXXXXXXX
-------------------------------
Witness: Xxxxxxxx X. Xxxxxxxxx
/s/ XXXXX XXXX-XXXXXXXX By:/s/ XXXXXXXXX X. XXXXXX
------------------------------- -------------------------------
Witness: Xxxxx Xxxx-Xxxxxxxx Name: Xxxxxxxxx X. Xxxxxx
Title: Vice President
LESSOR:
FLEET REAL ESTATE, INC.
/s/ XXXXX X. XXXXXXXX
-------------------------------
Witness: Xxxxx X. Xxxxxxxx
By: /s/ X.X. XXXX
/s/ XXXX. X. XXXXXXXXXXX ------------------------------
------------------------------- Name: X.X. Xxxx
Witness: Xxxx X. Xxxxxxxxxxx Title: S.V.P
36
STATE OF GEORGIA ss.
ss.
COUNTY OF XXXXXX xx.
The foregoing instrument was acknowledged before me this 9th day of
December, 1997 by Xxxxxxxxx X. Xxxxxx, as Vice President of The Vincam Group,
Inc., a Florida corporation, on behalf of such corporation, and he is personally
known to me or produced Driver's License as identification.
/s/ XXXXXX X. XXXXX
-------------------------------------
Notary Public for the State of GA
My commission expires: October 20, 2000
Xxxxxx X. Xxxxx
Notary Public
Cherokee County, Georgia
Commission Expires October 20, 2000
37
COMMONWEALTH OF MASSACHUSETTS ss.
ss.
COUNTY OF SUFFOLK ss.
The foregoing instrument was acknowledged before me this 5th day of
December, 1997 by X.X. Xxxx, as Sr. Vice President of Fleet Real Estate, Inc., a
Rhode Island corporation, on behalf of such corporation, and he is personally
known to me or produced ___________________ as identification.
/s/ XXXXXXXX X. XXXXXXX
---------------------------------------------------
Notary Public for the Commonwealth of Massachusetts
My commission expires: June 2, 2000
Xxxxxxxx X. Xxxxxxx
Notary Public
Commission Expires June 2, 2000
38
EXHIBIT A
(Description of Site)
All of FOX CROFT, according to the Plat thereof recorded in Plat Book 115, at
Page 69, of the Public Records of Dade County, Florida.
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SCHEDULE 1
Insurance Requirements
The Lessee will provide, or cause to be provided, insurance in
accordance with the terms of this Schedule, which insurance shall be placed and
maintained with Permitted Insurers.
(a) Insurance Coverages and Limits
At all times subsequent to the Completion Date, the Lessee shall
provide, or cause to be provided, the following property and liability coverages
with respect to the Facility:
(i) all-risk property coverage, with limits of coverage at
least equal to the replacement cost (which limits shall be not less
than $12,000,000 less land value for the Facility), which insurance
coverage may, at the Lessee's option, be included under any "blanket"
policy maintained by the Lessee so long as such "blanket" policy
provides for all-risk property coverage with respect to the Facility
and any other Property covered thereby, with limits of coverage at
least equal to the aggregate replacement cost of the Facility
(provided, however, that such insurance, in either case, shall provide
for replacement cost coverage, provided that the insured property is
replaced, and, provided further, that the insurance shall not have the
effect of causing the Lessee or any of its Affiliates to be deemed a
co-insurer), with respect to the Lessee and any Affiliate of the Lessee
providing services with respect to the Facility, or if the Lessee
elects to effect the coverage required by this Paragraph under a
"blanket" policy, Lessee and its Affiliates insured thereby, such
insurance to include, coverage for (x) floods, windstorms, hurricanes,
tornados, earthquakes, collapse and other perils (including debris
removal and cleanup) and such insurance to cover equipment separated
from the Facility, transit of equipment and consumables to and from the
Facility, labor claims, in each case with respect to the Facility, and
such insurance to include coverage for all other risks and occurrences
customarily included under all-risk policies available with respect to
Property similar in construction, location, occupancy and operation to
the Facility (or the Facility and all other Property insured thereby if
all are covered under a "blanket" policy), and (y) "boiler and
machinery" property damage insurance on a comprehensive basis with
respect to damage to the machinery, plants, equipment or similar
apparatus (including production machinery) included in the Facility (or
the Facility and all other Property insured thereby if all are covered
under a "blanket" policy), from
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risks and in amounts normally insured against under machinery
policies.
(ii)
(1) statutory workers' compensation and occupational
disease insurance in accordance with applicable state and
federal law, and employer's liability insurance with
primary and excess coverage limits of not less than
$1,000,000;
(2) commercial general liability insurance covering
operations of the Lessee, contractual liability coverage,
contingent liability coverage arising out of the operations
of the Facility, cross-liabilities coverage, and other
coverage for hazards customarily insured with respect to
Property similar in construction, location, occupancy and
operation to the Facility, with limits complying with the
underlying requirements of the excess liability policy
described in Paragraph (a)(ii)(3);
(3) excess commercial liability insurance in excess
of the liability policies described in Paragraphs
(a)(ii)(1) and (2) to bring to limits of not less than
$5,000,000 for each occurrence and in the aggregate per
year with respect to the Lessee and its Affiliates.
(iii) The policy or policies providing the coverage required by
paragraphs (a)(i) and (a)(ii)(2) and (a)(ii)(3) may include deductible
amounts for the account of the Lessee or its Affiliates, as the case
may be, not to exceed $1,000,000 in the aggregate for all such
coverages.
(b) Insurance Endorsements - Any insurance carried in accordance
herewith shall, except as hereinafter permitted, provide or be endorsed to
provide that:
(i) the Lessor and the Agent on behalf of the Lenders, as
their interests may appear, shall be included as additional insureds or
named as loss payees but only with respects coverages required by
Paragraphs (a)(i), with the understanding that any obligation imposed
upon the insured (including, without limitation, the liability to pay
premiums) under any policy required by this Schedule shall be the
obligation of the Lessee and its Affiliates and not that of the Lessor,
the Agent or any Lender;
(ii) except with respect to the coverage required by Paragraphs
(a)(i) and (a)(ii), there shall be a cross-liability and severability
of interest endorsement
41
providing that to the extent the policy is written to cover more than
one insured, all terms, conditions, insuring agreements and
endorsements, with the exception of limits of liability and deductibles
shall operate in the same manner as if there were a separate policy
covering each insured;
(iii) the insurer thereunder waives all rights of subrogation to
the extent permitted by applicable law and to the extent available for
a commercially reasonable premium against the Lessor, the Agent or the
Lenders;
(iv) such insurance shall be primary without right of
contribution of any other insurance carried by or on behalf of the
Lessor, the Agent or the Lenders with respect to its or their interests
in the Facility; and
(v) if such insurance is canceled for any reason whatsoever
(including, without limitation, nonpayment of premium) or any material
change is made in the coverage that affects the interests of the
Lessor, the Agent or the Lenders, such cancellation or change shall not
be effective as to the Lessor, the Agent and the Lenders for 10 days
for nonpayment of premiums and otherwise for 45 days, in both cases
after receipt by the Lessor and the Agent (at the address provided
pursuant to Section 22 of the Lease) of written notice sent by
certified mail from such insurer of such cancellation or change.
(c) Adjustment of Property Losses - After the occurrence and during the
continuation of a Cancellation Event or Termination Event, the loss, if any,
under any property insurance covering the Facility required to be carried by
this Schedule shall be adjusted with the insurance companies or otherwise
collected, including, without limitation, the filing of appropriate proceedings,
by the Lessee in consultation with the Lessor and the Agent.
(d) Reinstatement of Limits - The Lessee shall, or shall cause its
insurance broker to, notify promptly the Lessor and the Agent at any time when
the limits of the excess commercial liability insurance required by Paragraph
(a)(ii)(3) shall have been reduced, either by reason of payments of, or the
establishment of reserves for the ultimate payment of, claims which have been
asserted during the term of such insurance, by an aggregate amount in excess of
$250,000. At such time, the Lessee shall, if so requested by the Lessor, use its
best efforts to reinstate such insurance so as to comply with the requisite
limits prescribed herein.
(e) Evidence of Insurance - Upon request, the Lessee will furnish the
Lessor and the Agent reasonable evidence of such insurance relating to the
Facility, as the case may be.
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(f) Additional Insurance by the Agent, the Lenders or the Lessee -
Nothing in this Schedule shall prohibit the Lessor, the Agent, any Lender or the
Lessee, as their respective interests may appear, from maintaining for its own
account, at the expense of the Person purchasing such insurance, additional
insurance on or with respect to the Facility, or any part thereof, with coverage
exceeding that otherwise required under this Schedule, unless such insurance
would conflict with or limit the insurance otherwise required under this
Schedule.
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