Execution Copy
WAIVER AND AMENDMENT
This Waiver and Amendment to Master Lease (as hereinafter
defined) dated as of January 28, 2002 (the "WAIVER AND AMENDMENT") by and among
(i) Perryville III Trust, a trust created under the laws of the state of New
York pursuant to a trust agreement dated as of December 16, 1994 (the
"LANDLORD"), (ii) BNY Midwest Trust Company, as successor trustee to Xxxxxx
Trust and Savings Bank, not in its individual capacity but solely in its
capacity as Owner Trustee of Perryville III Trust (the "OWNER TRUSTEE"), (iii)
Xxxxxx Xxxxxxx Realty Services, Inc., a Delaware corporation ("FWRS"), (iv)
Xxxxxx Xxxxxxx LLC, a Delaware limited liability company (together with FWRS the
"TENANTS" and each a "TENANT"), (v) NatWest Leasing Corporation, a Delaware
corporation (the "OWNER PARTICIPANT"), (vi) National Westminster Bank Plc (the
"AGENT") and (vii) the banks listed on Schedule I to that certain Construction
Loan Agreement dated as of December 16, 1994, among the Landlord, as Borrower,
the lenders party thereto and their permitted successors and assigns (the
"LENDERS") and the Agent.
W I T N E S S E T H:
WHEREAS, the Landlord and the Tenants are parties to that
certain Master Lease dated as of December 16, 1994 (as amended, modified and
supplemented from time to time, the "MASTER LEASE"); and
WHEREAS, the Tenants have requested that the Landlord, the
Owner Participant and the Agent (with the consent of the Required Lenders) waive
and amend certain provisions of the Master Lease.
NOW, THEREFORE, subject to the conditions precedent set forth
herein, the undersigned parties agree as follows:
SECTION 1. DEFINITIONS. (a) Unless otherwise defined herein,
capitalized terms used herein shall have the meaning assigned to them in the
Master Lease.
(b) The following additional terms shall have the
following meanings:
"Special Charge" means, collectively, the
charges listed on Schedule A hereto.
"Waiver Period" means the period commencing
December 31, 2001 and ending on the earliest of (i)
12:00 Noon (New York City time) on February 28, 2002;
(ii) the
date of the termination of the waivers granted
pursuant to that certain Amendment No. 1 and Waiver
relating to the Second Amended and Restated Revolving
Credit Agreement dated as of May 25, 2001 (as amended,
modified and supplemented from time to time, the
"CREDIT AGREEMENT") among Xxxxxx Xxxxxxx LLC, Xxxxxx
Xxxxxxx USA Corporation, Xxxxxx Energy International,
Xxxxxx Xxxxxxx Energy Corporation, the guarantors
signatory thereto, the lenders signatory thereto, Bank
of America, N.A. as administrative agent, First Union
National Bank, as syndication agent, and ABN AMRO Bank
N.V., as documentation agent, arranged by Banc of
America Securities LLC, as lead arranger and book
manager, and ABN AMRO Bank N.V., First Union Capital
Markets, Greenwich Natwest Structured Finance Inc. and
Toronto Dominion Bank, as arrangers; (iii) the
occurrence of any default with respect to any
Indebtedness (as defined in the Credit Agreement) of
any Restricted Entity (as defined below) or the
occurrence of any event or condition which results in
the acceleration of the maturity of any Indebtedness of
any Restricted Entity or enables the holder of such
Indebtedness or any person acting on such holder's
behalf to accelerate the maturity thereof; (iv) the
payment by the Tenants or any of their Subsidiaries of
any principal of Indebtedness of any Restricted Entity
other than payment under the Master Lease; and (v) the
date on which the Waiver Period terminates pursuant to
Section 5.
SECTION 2. WAIVERS. The Tenants have requested that the
undersigned parties waive, and the undersigned parties do hereby waive (subject
to the satisfaction of the conditions set forth in Section 6 and solely to the
extent such failure to comply is due to the Special Charge):
(a) during the Waiver Period, the compliance, and any Event of
Default arising from the failure of the Tenants to comply, with the financial
covenants contained in Paragraph B.1.(a) of Exhibit C to the Master Lease and
Paragraph B.1.(b) of Exhibit C to the Master Lease; and
(b) during the Waiver Period, the compliance, and any Event of
Default arising from the Tenants' failure to comply, with Paragraph B.4 of
Exhibit C to the Master Lease.
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SECTION 3. AMENDMENTS.
(a) Paragraph 20(a)(i) of the Master Lease is amended and
restated in its entirety to read as follows:
"(i) if the Tenant shall fail to pay any Net Rent, other
amounts due hereunder, or an Early Termination Payment, an
Expiration Payment, a Purchase Price, or a Non-Completion Payment
on the date on which such payment is due;"
(b) Paragraph 20(a)(iii) of the Master Lease is amended and
restated in its entirety to read as follows:
"(iii) if the Tenant shall not comply with the provisions
of Paragraph 34 hereof;"
(c) Paragraph 20(a)(viii) of the Master Lease is amended and
restated in its entirety to read as follows:
"(viii) if a Tenant Event (as defined in the Construction
Loan Agreement) has occurred; or"
SECTION 4. AGREEMENTS. In the event that any Tenant or any
Tenant's Subsidiary shall Cash Collateralize (as defined in the Credit
Agreement) any Letter of Credit (as defined in the Credit Agreement) the Tenants
jointly and severally agree to make an additional rental payment upon the
expiration, rollover or replacement of such Letter of Credit in an amount equal
to (i) the amount used to Cash Collateralize such Letter of Credit multiplied by
(ii) a fraction the numerator of which is the aggregate amount of the
outstanding principal amount of the Loans (as defined in the Construction Loan
Agreement) plus the outstanding Owner Participant Investment and the denominator
of which is the amount of the outstanding Loans (as defined in the Credit
Agreement) plus Letters of Credit under the Credit Agreement. Such additional
rental payment shall be applied pursuant to Section 10.6 of the Participation
Agreement. The Tenants shall not have the obligation to make payments of
additional rent pursuant to this Section 4 if the outstandings under the Credit
Agreement exceed $240,000,000.
SECTION 5. COVENANTS. The Tenants jointly and severally hereby
agree that during the Waiver Period:
(a) they shall not and their Subsidiaries shall not incur any
Indebtedness which is, or procure the issuance of any letter of credit the
reimbursement obligation in respect of which would be, guaranteed by or
otherwise considered
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Indebtedness of any of the borrowers or the guarantors under the Credit
Agreement or any of their domestic Subsidiaries (collectively, the "Restricted
Entities"), other than Performance Letters of Credit (as defined in the Credit
Agreement) issued pursuant to the Credit Agreement; provided that Parent may
guarantee performance bonds or performance letters of credit of any Subsidiary
other than a Restricted Entity;
(b) they shall not and no Restricted Entity shall make any
Investment in any Special Purpose Subsidiary;
(c) except as otherwise provided in Section 5(a), they will
not and they will not permit any Subsidiary to, assign, transfer, invest in or
grant a security interest or Lien in or upon any of their assets, cash or other
property to any person, including without limitation, the parties to the Credit
Agreement;
(d) they shall deliver to the Lenders and the Owner
Participant by January 30, 2002, (i) the business plan of Xxxxxx Xxxxxxx LLC (as
well as a commentary on the proposed execution of such business plan), which
shall include financial projections (including income statement, balance sheet,
cash flow and other data), project backlog and other data by business unit on a
quarterly basis for fiscal year 2002 and (ii) actual financial results for the
fiscal year ending December 31, 2001, consisting of the unaudited financial
statements, balance sheet and statement of cash flows; and
(e) they will (i) pay all costs, fees and expenses incurred in
connection with the procurement by counsel to the Agent of an appraisal and
updated title policy with respect to the Property in form and substance
satisfactory to the Agent and (ii) provide the Agent and any appraiser engaged
by the Agent or counsel to the Agent complete access to the Property and all
necessary and appropriate information as may be reasonably requested to complete
the appraisal.
(f) If the Tenants breach any of the covenants specified in
subsections (a) through (e) above, the Waiver Period will automatically and
immediately terminate and such breach shall constitute an Event of Default under
the Master Lease.
(g) If the following event or condition occurs, the Lenders
may terminate the Waiver Period at their option by notice to the Tenants, such
termination to be effective immediately upon the giving of such notice:
(i) The Tenants suffer there to be any reduction in the
amount of financing available to them and/or their Subsidiaries
under, or any default under or in connection with, or any other
event or condition which would permit a reduction in the amount of
financing available under the Receivables Purchase Agreement among
Xxxxxx Xxxxxxx Funding Corporation, Xxxxxx
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Xxxxxxx Capital & Finance Corporation, Market Street Funding
Corporation and PNC Bank, National Association dated as of
September 25, 1998, as amended.
SECTION 6. CONDITIONS TO EFFECTIVENESS. This Waiver and
Amendment shall be subject to the satisfaction of the following conditions
precedent:
(a) Receipt by the Agent of a copy of the Amendment No. 1 and
Waiver relating to the Credit Agreement executed by the requisite lenders
thereunder.
(b) Receipt by the Agent of the payment of all accrued and
unpaid Net Rents, including the payment due January 2002, together with all
other amounts that the Tenants are required to pay the Landlord pursuant to
Paragraph 5 of the Master Lease.
(c) Receipt by each of the Lenders and the Owner Participant
executing this Waiver and Amendment of an amendment and waiver fee of 0.25% of
its outstanding Loan (as defined in the Construction Loan Agreement) and Equity
Investment Amount (as defined in the Participation Agreement), respectively.
(d) Receipt by the Agent of payment by the Tenants of all
current fees and expenses.
(e) Receipt by the Agent of this Waiver and Amendment executed
by the Tenants, the Landlord, the Owner Trustee, the Agent, the Owner
Participant and the Required Lenders.
(f) Receipt by Agent from Bank of America, N.A., as agent
under the Credit Agreement, of a letter pursuant to which Bank of America, N.A.
agrees to provide copies identical to those distributed to the lenders under the
Credit Agreement of the Ernst & Young Report and the Xxxxxxxx Report (the
"Reports") to the Agent, the Lenders and the Owner Participant, subject to the
requirement that with respect to the Reports, the Agent, the Lenders and the
Owner Participant will agree to be bound by the same conditions and restrictions
as the lenders under the Credit Agreement.
SECTION 7. REPRESENTATIONS OF THE TENANTS. The Tenants jointly
and severally represent and warrant that (i) subject in the case of Paragraph
32(h) to matters disclosed in writing to the Lenders and Owner Participant prior
to the effective date of this Waiver and Amendment, the representations and
warranties of the Tenants set forth in Paragraph 32 of the Master Lease are true
and correct in all material respects and (ii) no Event of Default or Potential
Default (as defined in the Construction Loan Agreement) has occurred and is
continuing, in each case after giving effect to this Waiver and Amendment.
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SECTION 8. FEES AND EXPENSES. The Tenants jointly and
severally agree to pay and reimburse the Agent, the Landlord, the Lenders, the
Owner Trustee and the Owner Participant and any of their advisors or consultants
for fees and expenses, including, without limitation, appraisal fees, title
insurance charges and the fees and disbursements of counsel, accountants,
consultants or other advisors, incurred in connection with (i) the Master Lease
and the other Loan Documents and any amendments, modifications or waivers
thereto, including, without limitation, the preparation, execution and delivery
of this Waiver and Amendment and any instrument delivered in connection
herewith, (ii) the enforcement of the Landlord's, the Lenders' and the Owner
Participant's rights under the Master Lease and the other Loan Documents and
(iii) the negotiation and documentation of any potential refinancing or
restructuring (whether or not such refinancing or restructuring is consummated)
of the Tenants. All such fees, costs and expenses shall be payable on demand and
shall be secured by the Property to the extent such Property is secured by the
Fee Mortgage. Fees and expenses of counsel to Agent payable pursuant to this
Section 8 may be offset against the amount received pursuant to Section 6(d).
SECTION 9. FULL FORCE AND EFFECT. Except as specifically
amended and waived hereby, the Loan Documents shall remain in full force and
effect and are hereby ratified and confirmed. The parties acknowledge that the
waivers set forth herein shall be limited precisely as written and shall not
constitute a waiver of compliance with, or an Event of Default or Potential
Default arising under, any other provision of the Loan Documents. It is further
acknowledged and agreed by the Tenants that the Expiration Date has not been
amended by this Waiver and Amendment.
SECTION 10. GOVERNING LAW. THIS WAIVER AND AMENDMENT SHALL BE
GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK.
SECTION 11. COUNTERPARTS. This Waiver and Amendment may be
executed in any number of counterparts, each of which shall, when executed, be
deemed to be an original and all of which taken together shall be deemed to be
one and the same agreement. Delivery of an executed counterpart of a signature
page to this Waiver and Amendment by telecopier shall be effective as delivery
of a manually executed counterpart of this Waiver and Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Waiver
and Amendment to be duly executed by their officers thereunto duly authorized as
of the day and year first above written.
[Remainder of Page Intentionally Left Blank; Signature Pages Follow]
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Signature Page to Waiver and Amendment
PERRYVILLE III TRUST
By: BNY Midwest Trust Company, as
successor trustee to Xxxxxx Trust and
Savings Bank, not in its individual
capacity but solely in its capacity as
Owner Trustee of Perryville III Trust
By: /s/ Xxxxxxx Xxxxx
-------------------------------------
Name: Xxxxxxx Xxxxx
Title: Assistant Vice President
BNY MIDWEST TRUST COMPANY, as successor
trustee to Xxxxxx Trust and Savings
Bank, not in its individual capacity but
solely in its capacity as Owner Trustee
of Perryville III Trust
By: /s/ Xxxxxxx Xxxxx
-------------------------------------
Name: Xxxxxxx Xxxxx
Title: Assistant Vice President
XXXXXX XXXXXXX REALTY SERVICES, INC., a
Delaware corporation
By: /s/ Xxxxxx Xxxxxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
XXXXXX XXXXXXX LLC,
a Delaware limited liability company
By: /s/ Xxxxxx Xxxxxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
AGENT, LENDERS, AND OWNER PARTICIPANT:
NATIONAL WESTMINSTER BANK Plc
By: /s/ Xxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
BANK OF MONTREAL
By:
-------------------------------------
Name:
Title:
THE BANK OF NOVA SCOTIA
By: /s/ Xxxxx X. Xxxxx
-------------------------------------
Name: Xxxxx X. Xxxxx
Title: Managing Director
FIRST UNION NATIONAL BANK,
SUCCESSOR IN INTEREST TO FIRST FIDELITY BANK,
NATIONAL ASSOCIATION
By: /s/ Xxx X. Xxxxxxxx
-------------------------------------
Name: Xxx X. Xxxxxxxx
Title: Senior Vice President
NATWEST LEASING CORPORATION
By: /s/ Xxxxxxx Xxxxxxxxxxx
-------------------------------------
Name:
Title:
Schedule A
4th Quarter Chart 2001
Expected to result in a minimal net cash outlay
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PRE-TAX AFTER-TAX
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CONTRACT RELATED: ($ in millions)
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HRSGs (6 major Contracts) $42.4 27.5
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Xxxxx Refinery Warranty 11.1 7.2
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Receivables (20 Contracts) 24.2 15.7
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Claims Reassessment 37.0 24.1
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RESTRUCTURING:
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Coli Termination 20.0 13.0
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Other Restructuring 21.6 14.0
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Tax Valuation Allowance 155.9
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$257.4
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FAS 142 (Goodwill) for $25.0 million will be applied in lst quarter 2002
