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EXHIBIT 10.4
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PARTICIPATION AGREEMENT
dated as of April 30, 1997
among
APPLIED MATERIALS, INC.,
as Lessee and Construction Agent,
CREDIT SUISSE LEASING 92A, L.P.,
as Lessor and Borrower,
GREENWICH FUNDING CORPORATION,
as CP Lender,
THE PERSONS NAMED ON SCHEDULE I HERETO,
as Eurodollar Lenders,
and
CREDIT SUISSE FIRST BOSTON,
acting through its New York Branch,
as Agent
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TABLE OF CONTENTS
PAGE
ARTICLE 1. DEFINITIONS; INTERPRETATION................................................................. 2
ARTICLE 2. INITIAL CLOSING DATE........................................................................ 3
ARTICLE 3. ACQUISITIONS AND FUNDINGS................................................................... 3
SECTION 3.1. Existing Sites...................................................... 3
SECTION 3.2. Sites............................................................... 3
SECTION 3.3. Construction Costs.................................................. 3
SECTION 3.4. Equipment........................................................... 3
SECTION 3.5. Refinancing of Loans................................................ 4
SECTION 3.6. Lessor Participation................................................ 4
SECTION 3.7. CP Lender Participation............................................. 4
SECTION 3.8. Eurodollar Lenders Participation.................................... 5
SECTION 3.9. Notations on Notes.................................................. 6
SECTION 3.10. Advances; Limitations and Limits; CP
Lender Advance Limitations.......................................... 7
SECTION 3.11. Termination of Commitments.......................................... 9
SECTION 3.12. Obligations of Participants Several................................. 9
SECTION 3.13. Procedures for Advances............................................. 9
SECTION 3.14 Subordinated Mortgage; Subordinated
Security Agreement.................................................. 12
SECTION 3.15 Lessee Option to Increase Original
Estimated Construction Cost......................................... 12
SECTION 3.16. Lessee Directions................................................... 12
ARTICLE 4. YIELD; INTEREST; COMMITMENT FEES............................................................ 13
SECTION 4.1. Yield............................................................... 13
SECTION 4.2. Interest on CP Loans................................................ 14
SECTION 4.3. Interest on Eurodollar Loans........................................ 14
SECTION 4.4. Computations........................................................ 14
SECTION 4.5. Highest Lawful Rate................................................. 15
SECTION 4.6. Capitalized Interest and Capitalized
Yield............................................................... 16
SECTION 4.7. Commitment Fees..................................................... 17
SECTION 4.8. Collateralization................................................... 17
ARTICLE 5. CERTAIN INTENTIONS OF THE PARTIES........................................................... 18
SECTION 5.1. Nature of Transaction............................................... 18
SECTION 5.2. Amounts Due......................................................... 19
ARTICLE 6. CONDITIONS PRECEDENT TO ACQUISITIONS AND
ADVANCES.................................................................................... 20
SECTION 6.1. Conditions to Each Advance.......................................... 20
SECTION 6.2. Conditions to Site Advance.......................................... 22
SECTION 6.3. Conditions to each Equipment Advance................................ 27
SECTION 6.4. Conditions to each Construction Cost
Funding............................................................. 29
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ARTICLE 7. COMPLETION DATE CONDITIONS.................................................................. 30
ARTICLE 8. REPRESENTATIONS AND WARRANTIES.............................................................. 32
SECTION 8.1. Representations and Warranties of Lessee............................ 32
SECTION 8.2. Representations and Warranties of CSL............................... 40
SECTION 8.3. Representations and Warranties of Agent............................. 42
ARTICLE 9. COVENANTS OF LESSEE......................................................................... 43
SECTION 9.1. Further Assurances.................................................. 43
SECTION 9.2. Consolidation, Merger, Sale, etc.................................... 44
SECTION 9.3. Corporate Existence................................................. 44
SECTION 9.4. Liens............................................................... 44
SECTION 9.5. Compliance Certificates............................................. 44
SECTION 9.6. Change of Name or Address........................................... 45
SECTION 9.7. Compliance with Law, Environmental
Matters............................................................. 45
SECTION 9.8. Investigation by Governmental
Authorities......................................................... 45
SECTION 9.9. Financial and Other Information..................................... 46
SECTION 9.10. Securities.......................................................... 48
SECTION 9.11. Interest Rates...................................................... 48
SECTION 9.12. Revolving Credit Facility........................................... 48
ARTICLE 10. OTHER COVENANTS AND AGREEMENTS.............................................................. 49
SECTION 10.1. Cooperation with Lessee............................................. 49
SECTION 10.2. Covenants of Lessor................................................. 49
SECTION 10.3. Lessor Transfers.................................................... 51
SECTION 10.4. Restrictions on and Effect of Transfer.............................. 52
SECTION 10.5. Covenants and Agreements of Lenders................................. 54
SECTION 10.6. Future Lenders...................................................... 56
SECTION 10.7. Agent under Participation Agreement and
Mortgages........................................................... 56
ARTICLE 11. INDEMNIFICATION............................................................................. 56
SECTION 11.1. General Indemnification............................................. 56
SECTION 11.2. General Tax Indemnity............................................... 58
SECTION 11.3. Withholding Tax Exemption........................................... 63
SECTION 11.4. Increased Costs and Reduced Return.................................. 64
SECTION 11.5. Eurodollar Rate Illegal, Unavailable or
Impracticable....................................................... 65
SECTION 11.6. Funding Losses...................................................... 66
SECTION 11.7. Limitations on Amounts Due Under Section
11.4................................................................ 67
SECTION 11.8. Gross-Up............................................................ 67
SECTION 11.9. Indemnity for Excessive Use and Sales
Below Fair Market Value............................................. 68
SECTION 11.10. Environmental Indemnity............................................. 68
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ARTICLE 12. AGENT....................................................................................... 70
SECTION 12.1. Appointment of Agent; Powers and
Authorization to Take Certain Actions............................... 70
SECTION 12.2. Reliance............................................................ 71
SECTION 12.3. Action Upon Instructions Generally.................................. 72
SECTION 12.4. Indemnification..................................................... 73
SECTION 12.5. Independent Credit Investigation.................................... 74
SECTION 12.6. Refusal to Act...................................................... 74
SECTION 12.7. Resignation or Removal of Agent;
Appointment of Successor............................................ 74
SECTION 12.8. Separate Agent...................................................... 75
SECTION 12.9. Termination of Agency............................................... 76
SECTION 12.10. Compensation of Agency.............................................. 76
SECTION 12.11. Limitations......................................................... 76
ARTICLE 13. MISCELLANEOUS............................................................................... 77
SECTION 13.1. Survival of Agreements.............................................. 77
SECTION 13.2. No Broker, etc...................................................... 77
SECTION 13.3. Notices............................................................. 78
SECTION 13.4. Counterparts........................................................ 78
SECTION 13.5. Amendments.......................................................... 78
SECTION 13.6. Headings, etc....................................................... 79
SECTION 13.7. Parties in Interest................................................. 79
SECTION 13.8. GOVERNING LAW....................................................... 79
SECTION 13.9. Payment of Transaction Expenses and
Other Costs......................................................... 80
SECTION 13.10. Severability........................................................ 80
SECTION 13.11. Liabilities of Lenders.............................................. 80
SECTION 13.12. Liabilities of Agent................................................ 81
SECTION 13.13. Lessor Obligations Nonrecourse; Payment
from Certain Lease and Guarantee
Obligations and Certain Proceeds of
Leased Property Only................................................ 81
SECTION 13.14. Consideration for Consents to Waivers
and Amendments...................................................... 81
SECTION 13.15. Payment Directions.................................................. 82
SECTION 13.16. Role of Arranger and its Affiliates................................. 82
SECTION 13.17. Notices to Lessor under Loan Agreement.............................. 82
SECTION 13.18. Submission to Jurisdiction; Waivers................................. 82
SECTION 13.19. No Proceedings..................................................... 83
SECTION 13.20. Final Agreement..................................................... 83
SECTION 13.21. Confidentiality..................................................... 83
SCHEDULES
SCHEDULE I Participants' Commitments
SCHEDULE II Notice Information and Payment Instructions
SCHEDULE III Filings and Recordings
SCHEDULE IV Governmental Actions
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APPENDICES
APPENDIX 1 Definitions and Interpretation
APPENDIX 2 Conditions Precedent to Document Closing Date
EXHIBITS
EXHIBIT A Form of Master Lease
EXHIBIT B Form of Construction Agency Agreement
EXHIBIT C Form of Architect's Certificate
EXHIBIT D Form of Completion Date Certificate
EXHIBIT E Form of Advance Request
EXHIBIT F Form of Note Guarantee
EXHIBIT G Form of Loan Agreement
EXHIBIT H Form of Capital Asset Purchase Agreement
EXHIBIT I Form of Mortgage and Security Agreement
EXHIBIT J Form of Deed of Trust, Security Agreement and
Fixture Filing Statement
EXHIBIT K Form of Hazardous Materials Undertaking and
Unsecured Indemnity
EXHIBIT L Form of Assignment of Lease
EXHIBIT M Form of Consent to Assignment of Lease
EXHIBIT N Form of Assignment of Construction Agency
Agreement
EXHIBIT O Form of Consent to Assignment of Construction
Agency Agreement
EXHIBIT P Form of Security and Pledge Agreement
EXHIBIT Q Form of Custodial Agreement
EXHIBIT R Form of Security Agreement
EXHIBIT S Form of Xxxx of Sale
EXHIBIT T Form of Deed
EXHIBIT U Form of Ground Lease
EXHIBIT V Forms of Opinions of Counsel to Lessee
EXHIBIT W Form of Opinion of Local Counsel Lessee
EXHIBIT X Forms of Lessor Opinions
EXHIBIT Y [Reserved]
EXHIBIT Z Form of Transfer Letter
EXHIBIT AA Form of Private Placement Certificate
EXHIBIT BB Form of Tax Certificate
EXHIBIT CC Form of Subordinated Mortgage
EXHIBIT DD Form of Subordinated Security Agreement
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PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT, dated as of April 30, 1997 (this
"Participation Agreement"), is entered into by and among APPLIED MATERIALS,
INC., a Delaware corporation, as Lessee and as Construction Agent; CREDIT SUISSE
LEASING 92A, L.P., as Lessor and as Borrower; GREENWICH FUNDING CORPORATION, a
Delaware corporation, as CP Lender; the Persons listed on Schedule I hereto
(together with their respective permitted successors, assigns and transferees
each a "Eurodollar Lender" and collectively "Eurodollar Lenders") and CREDIT
SUISSE FIRST BOSTON, acting through its New York Branch, not in its individual
capacity except as expressly stated herein, but solely as Agent for Lenders.
PRELIMINARY STATEMENT
In accordance with the terms of this Participation Agreement, the
Lease, the Construction Agency Agreement, the Loan Agreement, the Capital Asset
Purchase Agreement and the other Operative Documents:
A. At the request of Lessee, on the initial Advance
Date, Lessor contemplates acquiring the Existing Sites and, on
subsequent Advance Dates from time to time during the Commitment
Period, (i) interests in Land (either fee simple or ground leasehold
interests), (ii) interests in Facilities and/or (iii) interests in
Equipment.
B. Should Lessor acquire interests in Land or Land and
Facilities that constitute Construction Sites, using Advances funded
by Participants, Construction Agent on behalf of Lessor contemplates
either constructing Facilities on such Land or renovating or
rebuilding Facilities that exist on such Land.
X. Xxxxxx intends to lease to Lessee and Lessee intends
to lease from Lessor pursuant to the Lease (i) the Developed Sites
and the Existing Sites, (ii) the Construction Sites and, upon
completion of construction, the Facilities constructed thereon, and
(iii) the Equipment.
D. As directed by Lessee, Lessor is willing to provide
3% of the funding for Site acquisitions, Facilities construction
and/or for Equipment acquisitions and will obtain the remaining 97%
of the costs of such acquisitions or construction from limited
recourse financing from (i) Eurodollar Lenders pursuant to the Loan
Agreement and (ii) CP Lender, out of the proceeds from the issuance
of
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commercial paper by CP Lender and the loan of such proceeds to
Lessor, pursuant to the Loan Agreement.
E. The Lenders are willing to provide limited
recourse financing to Lessor for 97% of the acquisition cost
of such Site acquisitions, Facilities construction and
Equipment acquisitions.
F. A Capital Asset Purchase Agreement dated as of the
date hereof is being entered into among CP Lender, Purchasers and
Agent, as liquidity agent and as administrative agent, pursuant to
which Purchasers will extend commitments to purchase ratable shares
of all or a portion, as the case may be, of CP Lender's interest in
the Tranche A CP Notes and the Tranche B CP Notes to enable CP
Lender to make payments in respect of CP Lender's Commercial Paper.
G. To induce Lenders and Agent to make loans under the
Loan Agreement and to enter into this Participation Agreement and
the transactions contemplated hereby, AMAT desires to enter, and it
is a condition to the effectiveness hereof that AMAT enter, into the
Note Guarantee.
H. To secure their respective Investment Amounts and
Loans, Participants will have the benefit of a Lien on the Leased
Property and on substantially all of Lessor's rights against Lessee
under the Lease, and CP Lender will assign to Agent for the benefit
of Purchasers certain of its rights in respect of such Lien.
In consideration of the mutual agreements contained in this
Participation Agreement and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE 1.
DEFINITIONS; INTERPRETATION
Unless the context shall otherwise require, capitalized terms used
and not defined herein shall have the meanings assigned thereto in Appendix 1
hereto for all purposes hereof; and the rules of interpretation set forth in
Appendix 1 hereto shall apply to this Participation Agreement.
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ARTICLE 2.
INITIAL CLOSING DATE
The Document Closing Date shall occur on the earliest date (on or
before May 15, 1997) on which all the conditions precedent thereto set forth in
Appendix 2 hereto shall have been satisfied or waived by the applicable parties
as set forth therein.
ARTICLE 3.
ACQUISITIONS AND FUNDINGS
SECTION 3.1. Existing Sites. Subject to the terms and conditions of
this Participation Agreement, on the initial Advance Date (i) Agent shall make
an advance, the proceeds of which shall be used to fund the Existing Sites
Purchase Price and the Transaction Expenses incurred on or prior to such Advance
Date, (ii) Lessor shall acquire the Existing Sites and (iii) Lessor and Lessee
shall enter into a Site Lease Supplement for each such Site pursuant to which
Lessor shall lease to Lessee the Existing Sites.
SECTION 3.2. Sites. Subject to the terms and conditions of this
Participation Agreement, on each Advance Date that constitutes a Site
Acquisition Date, (i) Agent shall make an advance (such advance or an advance
pursuant to Section 3.1, a "Site Advance"), the proceeds of which shall be used
to fund the Site Acquisition Cost of the Developed Sites or Construction Sites
to be acquired on such Acquisition Date and related Transaction Expenses, (ii)
Lessor shall acquire such Sites and (iii) Lessor and Lessee shall enter into a
Site Lease Supplement for each such Site pursuant to which Lessor shall lease
(or with respect to Land leased to Lessor pursuant to a Ground Lease, sublease)
to Lessee such Developed Sites or Construction Sites.
SECTION 3.3. Construction Costs. Subject to the terms and conditions
of this Participation Agreement, on each Advance Date that constitutes a
Construction Cost Funding Date, Agent shall make an advance (a "Construction
Advance"), the proceeds of which shall be used to reimburse Construction Agent
for the payment of Construction Costs, and to fund Capitalized Interest and
Capitalized Yield relating to any interest and Yield accrued during the Interest
Period immediately preceding such Construction Advance on the aggregate
outstanding principal amount of any Construction Advances made prior to such
Advance Date.
SECTION 3.4. Equipment. Subject to the terms and conditions of this
Participation Agreement, on each Advance Date
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that constitutes an Equipment Acquisition Date, (i) Agent shall make an advance
(an "Equipment Advance"), the proceeds of which shall be used to fund the
Equipment Purchase Price and related Transaction Expenses with respect to the
Units of Equipment in the Equipment Group to be acquired on such Equipment
Acquisition Date, (ii) Lessor shall acquire such Units of Equipment, and (iii)
Lessor and Lessee shall enter into an Equipment Lease Supplement pursuant to
which Lessor shall lease to Lessee each Equipment Group funded by such Advance.
Notwithstanding anything herein to the contrary, to the extent that, in
connection with an acquisition of a Site or the making of a Construction
Advance, Agent is also making an Advance for the acquisition of Equipment or
related Transaction Expenses, the portion of such Advance that relates to the
Equipment Cost of the Equipment so being acquired and the Transaction Expenses
related thereto shall be considered an Equipment Advance separate from the Site
Advance or Construction Advance relating to the Site for the purposes of this
Participation Agreement.
SECTION 3.5. Refinancing of Loans. Subject to the terms and
conditions hereof, on each Advance Date that constitutes a Refinancing Date,
Agent shall make an Advance the proceeds of which will be used to repay all or
portion of outstanding Eurodollar Loans or CP Loans (a "Refinancing Advance").
Notwithstanding anything to the contrary in Section 3.6 below, Lessor shall not
be obligated to Fund any portion of a Refinancing Advance.
SECTION 3.6. Lessor Participation. Subject to the terms and
conditions hereof, Lessor shall Fund (as Lessor's portion of an Advance pursuant
to Sections 3.1 through 3.4 hereof) to Agent for an Advance by Agent to Lessee
or Construction Agent, at the request of either such party from time to time
during the Commitment Period on each Advance Date, an amount (each an
"Investment" or "Investment Amount") in immediately available funds equal to
Lessor's Commitment Percentage of the amount of the Advance being funded on such
Advance Date. Notwithstanding any other provision hereof and in addition to the
limitations set forth in Section 3.10, Lessor shall not be obligated to make
available any Investment if the amount of the proposed Investment exceeds the
Available Lessor Commitment. Subject to the terms and conditions hereof, all or
part of the Investment may be repaid to Lessor and readvanced. Subject to the
terms and conditions hereof, Lessor shall acquire ownership (either fee or
leasehold, as the case may be) of each Site and Unit of Equipment and lease (or
sublease) such Site or Unit of Equipment to Lessee pursuant to the Lease and a
Lease Supplement relating thereto.
SECTION 3.7. CP Lender Participation. (a) Subject to the terms and
conditions hereof and of the Loan Agreement, CP Lender may make CP Loans to
Lessor at the request of Lessee or
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Construction Agent from time to time during the Commitment Period on each
Advance Date in an amount equal to the Eurodollar Lenders' aggregate Commitment
Percentage of the amount of the Advance being funded on such Advance Date. If CP
Lender elects to make a CP Loan hereunder, the proceeds of each such CP Loan
shall be Funded by CP Lender to Agent as CP Lender's portion of an Advance
pursuant to Sections 3.1 through 3.5 hereof. Notwithstanding any other provision
hereof and in addition to the limitations set forth in Section 3.10 hereof, CP
Lender shall not make available to Agent and Agent shall not make an Advance of
any CP Loan if the amount of the proposed CP Loan exceeds the aggregate
Available Eurodollar Lender Commitments. Subject to the terms and conditions
hereof, CP Loans may be repaid in part or in full to CP Lender pursuant to
Section 3.5 and readvanced.
(b) Each CP Loan for a Site acquisition, whether for Existing Sites,
Developed Sites or Construction Sites, payment or reimbursement of Construction
Costs, or to repay any outstanding Eurodollar Loan previously made for such
purposes, shall be recorded by Agent on the grid relating to the two Site Notes,
each such Site Note issued to Agent, on behalf of CP Lender, on the Document
Closing Date and repayable in accordance with the terms of the Loan Agreement
(the Tranche A CP Site Note, to be substantially in the form of Exhibit A-CS of
the Loan Agreement, and representing the aggregate portion of the CP Loans to
which the AMAT Recourse Amount for the Sites will be applied pursuant to Section
5.4 of the Loan Agreement and the Tranche B CP Site Note, to be substantially in
the form of Exhibit B-CS of the Loan Agreement, and representing the remaining
portion of the CP Loans). Each CP Loan for Equipment acquisitions or used to
repay any outstanding Eurodollar Loan previously made for such purpose shall be
recorded by Agent on the grid relating to the two Equipment Notes, each issued
to Agent, on behalf of CP Lender, on the Document Closing Date and repayable in
accordance with the terms of the Loan Agreement (the Tranche A CP Equipment
Note, to be substantially in the form of Exhibit A-CE of the Loan Agreement, and
representing the aggregate portion of the CP Loans to which the AMAT Recourse
Amount for all outstanding Equipment Groups will be applied pursuant to Section
5.4 of the Loan Agreement and the Tranche B CP Equipment Note, to be
substantially in the form of Exhibit B-CE of the Loan Agreement, and
representing the remaining portion of the CP Loans).
SECTION 3.8. Eurodollar Lenders Participation. (a) Subject to the
terms and conditions hereof and of the Loan Agreement, each Eurodollar Lender
severally shall make Eurodollar Loans to Lessor at the request of Lessee or
Construction Agent from time to time during the Commitment Period on each
Advance Date, in an amount in immediately available funds equal to such Lender's
Commitment Percentage of the amount of the Advance being funded on such Advance
Date. The proceeds of each such
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Eurodollar Loan shall be Funded by Eurodollar Lenders to Agent as Eurodollar
Lender's portion of an Advance pursuant to Sections 3.1 through 3.5 hereof.
Notwithstanding any other provision hereof and in addition to the limitations
set forth in Section 3.10, no Eurodollar Lender shall be obligated to make any
Eurodollar Loan if the amount of such Eurodollar Lender's Eurodollar Loan
exceeds such Eurodollar Lender's Available Eurodollar Lender Commitment. Subject
to the terms and conditions hereof, Eurodollar Loans may be repaid in part or in
full to Lenders and readvanced.
(b) Each Eurodollar Loan made by a Eurodollar Lender for a Site
acquisition, whether for Existing Sites, Developed Sites or Construction Sites,
or payment or reimbursement of Construction Costs shall be recorded on the grid
relating to the two Site Notes, each issued to Agent, on behalf of the
Eurodollar Lenders, on the Document Closing Date and repayable in accordance
with the terms of the Loan Agreement (the Tranche A Eurodollar Site Note, to be
substantially in the form of Exhibit A-ES of the Loan Agreement, and the Tranche
B Eurodollar Site Note, to be substantially in the form of Exhibit B-ES of the
Loan Agreement). Each Eurodollar Loan made by a Eurodollar Lender for Equipment
acquisitions shall be recorded on the grid relating to the two Equipment Notes,
each issued to Agent, on behalf of the Eurodollar Lenders, on the Document
Closing Date and repayable in accordance with the terms of the Loan Agreement
(the Tranche A Eurodollar Equipment Note, to be substantially in the form of
Exhibit A-EE of the Loan Agreement, and the Tranche B Eurodollar Equipment Note,
to be substantially in the form of Exhibit B-EE of the Loan Agreement).
SECTION 3.9. Notations on Notes. Agent, on behalf of each Lender, is
hereby authorized to record on the grid attached to the Tranche A CP Site Note,
the Tranche B CP Site Note, the Tranche A Eurodollar Site Note, the Tranche B
Eurodollar Site Note, the Tranche A CP Equipment Note, the Tranche B CP
Equipment Note, the Tranche A Eurodollar Equipment Note, or the Tranche B
Eurodollar Equipment Note, as applicable, held by Agent, on behalf of the
Lenders, the date and amount of each Funding, the amount of all Capitalized
Interest, each payment or repayment of principal, the type of interest rate
applicable thereto from time to time, the length of each Interest Period with
respect thereto (including, in the case of a Eurodollar Loan for which the Base
Rate may, from time to time, be applicable, the period for which such Base Rate
applies) and the interest rate for such Interest Period. Any such recordation
shall constitute prima facie evidence of the accuracy of the information so
recorded; provided, that the failure to make any such recording or errors in
such recordation, or to provide the copies or calculations described below,
shall not affect the obligation of Borrower under such instrument or the
corresponding obligation of Lessee
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to pay Rent. Agent shall also determine with respect to each Note and the
Investment Amount the portion thereof attributable to each Site and Equipment
Group in order to establish the Site Balance of, and the AMAT Recourse Amount
relating to, each such Site and the Equipment Group Balance of, and the AMAT
Recourse Amount relating to, each such Equipment Group, which determination
shall be conclusive and binding on Lessee and the Participants absent manifest
error. Lessee may from time to time request from any Agent, but not more
frequently than once each fiscal quarter of Lessee, copies of the grids
maintained by Agent, on behalf of the Lenders, with respect to the Notes, and if
requested by Lessee and not previously furnished to Lessee by Agent, the Agent's
calculation of any recordation on such grid.
SECTION 3.10. Advances; Limitations and Limits; CP Lender Advance
Limitations.
(a) In addition to any other provision hereof, Agent shall
not be obligated to make an Advance to Lessee or Construction Agent, and no
Lender shall be obligated to Fund any Loan, and Lessor shall not be required to
Fund the portion of its Investment on such Advance Date if the amount of such
Advance would exceed the aggregate Available Commitments or, after giving effect
to such Advance, the aggregate outstanding amount of Loans and Investment
Amounts would exceed the Aggregate Commitment Amount.
(b) The aggregate amount funded by each of the Lenders and
Lessor hereunder outstanding at any time shall not exceed the Aggregate
Commitment Amount. The amount of the initial Site Advance shall be used solely
to pay for the Site Acquisition Cost of the Existing Sites and any Transaction
Expenses incurred through the initial Advance Date. Following the initial
Advance Date, each Site Advance requested by Lessee shall be used solely for
payment of the Aggregate Property Costs for such Site. Each Advance for
Equipment acquisitions must apply to at least one or more entire Equipment
Groups and shall be used solely for payment of the Equipment Purchase Price for
such Equipment and any Transaction Expenses incurred by Lessee in connection
with the purchase of such Equipment. Each Site Advance and Equipment Advance
may, without the consent of all Participants, only be used to acquire Sites or
Units of Equipment located in any State of the United States of America.
(c) The initial Advance Date shall occur on or before May
15, 1997. Each Advance Date shall be a Business Day, and there shall be no more
than one Advance during any calendar month (excluding any Advance made solely to
pay Capitalized Interest and Capitalized Yield pursuant to Section 4.6). Each
Advance shall be in a minimum amount equal to $1,000,000, or an integral
multiple of $100,000 in excess thereof except with respect to any
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Equipment Advance, which may be in a minimum amount equal to $500,000, or an
integral multiple of $100,000 in excess thereof; provided, that so long as an
Advance is for the full amount of the aggregate Available Participant Commitment
and exceeds the minimum threshold of $1,000,000 or $500,000, as the case may be,
such Advance need not be in an integral multiple of $100,000. Notwithstanding
anything herein to the contrary, (i) the aggregate amount of Equipment Advances
shall not exceed $10,000,000, (ii) no more than two Equipment Pools shall exist
at any time, and (iii) the period from the Equipment Pool Period Commencement
Date for such Equipment Pool through the Maturity Date shall equal or exceed
three years. All remittances made by Lessor and Lenders for the Funding of any
Advance shall be made in immediately available federal funds by wire transfer to
Agent for deposit not later than 1:00 p.m., New York time, on the applicable
Advance Date to such account as Lessee or Construction Agent, as applicable,
shall have indicated in the Advance Request. The Funding by Lessor and each
Lender to Agent of its respective portion of an Advance shall constitute
authorization and direction by such party to Agent to make an Advance pursuant
to Article 3.
(d) Notwithstanding anything contained herein or in the Loan
Agreement to the contrary, with respect to each CP Loan and each CP Rate Period
specified in the applicable Advance Request or Continuation Notice related
thereto, CP Lender shall not make or continue a CP Loan with such CP Rate Period
on any Advance Date, Refinancing Date or Continuation Date if, on such date, the
interest rate (stated on a per annum basis) payable on the Commercial Paper to
be issued by CP Lender with such CP Rate Period exceeds the interest rate
(stated on a per annum basis) set forth below opposite the relevant CP Rate
Period:
Interest Rate Requested CP Rate Period
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24% Less than or equal to
45 days
21% Less than or equal to
51 days and more than
45 days
18% Less than or equal to
60 days and more than
51 days
15% Less than or equal to
72 days and more than
60 days
12% Less than or equal to
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90 days and more than
72 days
9% Less than or equal to
120 days and more than
90 days
6% Less than or equal to
180 days and more than
120 days
SECTION 3.11. Termination of Commitments. Notwithstanding anything
in this Participation Agreement to the contrary, the Commitments shall terminate
and Agent shall not be obligated to make any Advance, and no party hereto shall
be obligated to make any Fundings, and no Advance Date may thereafter occur upon
the occurrence of the earlier of (i) 2:00 p.m. New York time on the first (1st)
Business Day immediately preceding the commencement of (a) in the case of
Equipment Advances, the first Remarketing Period elected pursuant to Article
XXII of the Lease, and (b) in the case of Site Advances, the first Site
Remarketing Period elected pursuant to Section 22.1 of the Lease with respect to
a Site or the first Equipment Remarketing Period elected on or after the fifth
anniversary of the Document Closing Date pursuant to Section 22.2 of the Lease
with respect to an Equipment Pool, except, in the case of a Construction Site,
to the extent of future Construction Advances that do not, when aggregated with
all Construction Advances previously Funded for such Site, exceed the Original
Estimated Construction Costs for such Construction Site, (ii) 2:00 p.m. New York
time on the thirtieth (30th) Business Day immediately preceding the Maturity
Date, or (iii) a termination of the Eurodollar Lenders' Commitments pursuant to
Section 6.2 of the Loan Agreement.
SECTION 3.12. Obligations of Participants Several. The obligations
of the Participants hereunder or elsewhere in the Operative Documents shall be
several and not joint; and no Participant shall be liable or responsible for the
acts or defaults of any other party hereunder or under any other Operative
Document.
SECTION 3.13. Procedures for Advances.
(a) Each Advance Date. With respect to the Funding of each
Advance, Lessee shall give Lessor and Agent irrevocable written notice not later
than 1:00 p.m. New York time five (5) Business Days prior to a Site Advance or
an Equipment Advance and three (3) Business Days prior to any Construction
Advance or Refinancing Advance (which in either case does not also constitute a
Site Advance or an Equipment Advance, but any Advance Request may relate to more
than one type of Advance),
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pursuant to an Advance Request substantially in the form of Exhibit E (an
"Advance Request") specifying for each type of Advance requested on such Advance
Date:
(i) the proposed Advance Date;
(ii) the amount of the Advance requested and whether the
Advance is a Site Advance, a Construction Advance (including a
statement of the amount thereof, if any, that constitutes
Capitalized Interest and Capitalized Yield), an
Equipment Advance or Refinancing Advance;
(iii) whether the Loans to Fund such Advance shall be CP
Loans or Eurodollar Loans and the amount of each, and the amount of
such Advance which shall constitute a Refinancing Advance;
(iv) if the Loans to Fund such Advance are Eurodollar
Loans, whether such Eurodollar Loans during the initial Interest
Period commencing on the date of such Advance shall accrue interest
at the Base Rate or the Eurodollar Rate and if the Loans to fund
such Advance are CP Loans, the Interest Period or Interest Periods
applicable to such CP Loans; provided, however, that in no event
shall Lessee select Loans and Interest Periods such that more than
five Payment Dates occur in any calendar month;
(v) with respect to an Equipment Advance, a description
of the Equipment Group and the Units of Equipment included therein
to be acquired on such Advance Date, the Equipment Cost, the
Equipment Purchase Price and location of each such Unit, the
Transaction Expenses to be Funded on such Advance Date and
information satisfactory to Agent in order for Agent to (a) estimate
the Fair Market Value of each Unit of Equipment as of the Original
Equipment Pool Expiration Date, (b) estimate the useful life of each
Unit of Equipment (which Fair Market Value and useful life shall be
satisfactory to Agent and Lessor) and (c) prepare an amortization
schedule for Fixed Rent to attach to the Equipment Lease Supplement
to be delivered pursuant to Section 6.3(c);
(vi) with respect to a Site Advance, whether such
Advance is for the Existing Sites, any other Developed Site or a
Construction Site, a brief description of each Site (including a
legal description) and the Aggregate Property Cost for each such
Site (including the allocation of such amount among the Site
Acquisition Costs (which, for the Existing Sites, is equal to the
Existing Sites Purchase Price), the Original Estimated Construction
Costs, if any, and the applicable Transaction Expenses);
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(vii) with respect to a Construction Advance, whether
Lessor is to acquire fee simple title to or a ground leasehold
interest in the Land;
(viii) with respect to a Site Acquisition Date for a
Construction Site, the anticipated Construction Completion
Date;
(ix) with respect to a Construction Cost Funding Date,
the Remaining Estimated Construction Cost;
(x) if such Advance is to be used to pay any Person or
to reimburse Lessee for Transaction Expenses, a description of the
type and amount of each such Transaction Expense and the allocation
of such Transaction Expenses between Equipment Advances and Site
Advances;
(xi) that Lessee certifies that such Advance complies
with the limitations and conditions set forth at
Section 3.10; and
(xii) wire transfer instructions for the disbursement
of funds.
Lessor and Agent shall promptly forward a copy of such Advance
Request to CP Lender or each Eurodollar Lender, as applicable. All documents and
instruments required to be delivered on the Document Closing Date and the
initial Advance Date pursuant to this Participation Agreement shall be delivered
at the offices of Xxxxx, Xxxxx & Xxxxx, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000, or at such other location as Required Participants, Agent and Lessee
may agree. Any documents and instruments required to be delivered on any Advance
Date following the initial Advance Date shall be delivered to Agent at its
address set forth on Schedule II, or at such other location as Agent may direct
pursuant to Section 13.3. Other than documents and instruments to be recorded or
filed with a Governmental Authority and each Participant's copy of the Operative
Documents required to be delivered on such Advance Date, all documents and
instruments may be delivered by facsimile with overnight delivery on the next
day.
(b) Application and Payments.
(i) Lessee shall apply or cause to be applied all
Advances solely for the purposes permitted herein and pursuant to
the description set forth in the Advance Request for such Advance.
(ii) The parties to this Participation Agreement
hereby agree that any payment required to be made to
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Participants by Lessor pursuant to any Operative Document shall be
made directly to Agent by Lessee for the benefit of Participants, in
lieu of the corresponding payment required to be made by Lessee to
Lessor and Lessor to Participants pursuant to any Operative
Document. Such payment by Lessee to Agent shall be deemed to
constitute (A) the required payment from Lessee to Lessor and (B)
the corresponding payment by Lessor to Participants.
SECTION 3.14. Subordinated Mortgage; Subordinated Security
Agreement. (a) On each Site Acquisition Date, Lessor shall deliver to Lessee a
duly executed Subordinated Mortgage dated such Site Acquisition Date and
relating to the Site acquired on such date (including such modifications as are
necessary to comply with the Applicable Laws and Regulations of the State in
which such Site is located).
(b) On the Document Closing Date, Lessor shall deliver to Lessee a
duly executed Subordinated Security Agreement dated such Document Closing Date.
SECTION 3.15. Lessee Option to Increase Original Estimated
Construction Cost. With respect to any Construction Site, after the related
Acquisition Date, Lessee shall have the option at any time during the related
Site Term to effect an increase in the Original Estimated Construction Cost of
such Construction Site by requesting Agent and Participants to obtain a new
appraisal, at Lessee's expense, of such Site, which appraisal must meet the
requirements of Section 6.2(a), based upon different or revised Plans and
Specifications provided by Lessee and by causing the provision of additional
title insurance coverage and effecting amendments to the related Site Lease
Supplement, the Notes issued to Agent, on behalf of CP Lender in the case of CP
Notes and each Eurodollar Lender in the case of Eurodollar Notes, with respect
to a Funding made or to be made for such Site, and Security Documents to the
extent reasonably requested by Agent and Participants to reflect such increased
Original Estimated Construction Cost. Notwithstanding the foregoing, Lessee may
at its option, in lieu of increasing the Original Estimated Construction Cost as
specified above pay the additional construction costs from its own funds as
specified in Section 4.1 of the Construction Agency Agreement.
SECTION 3.16. Lessee Directions. Lenders, Agent, Lessee and Lessor
hereby agree that, so long as no Loan Event of Default exists, Lessee shall
have, subject to the terms and conditions set forth in the Loan Agreement, the
exclusive right to exercise the rights of "Borrower" under Section 2 of the Loan
Agreement (other than under Section 2.1(f) of the Loan Agreement), including,
without limitation:
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(a) the exclusive right to make Extension Requests
pursuant to Section 2.2(e) of the Loan Agreement;
(b) the exclusive right to give a notice pursuant to
Section 2.3 of the Loan Agreement;
(c) the exclusive right to replace a Non-Consenting
Eurodollar Lender and to exercise all other rights of Borrower
pursuant to Section 2.2(e) of the Loan Agreement; and
(d) the exclusive right to give a Continuation Notice
pursuant to Section 2.5 of the Loan Agreement.
ARTICLE 4.
YIELD; INTEREST; COMMITMENT FEES
SECTION 4.1. Yield. (a) The amount of Investment Amounts outstanding
from time to time shall accrue Yield at the per annum rate equal to the Yield
Rate. Yield shall be due and payable by Lessee as Basic Rent on each applicable
Payment Date and on each applicable Site Expiration Date and the Equipment Pool
Expiration Date. If all or any portion of the Investment Amount, any Yield
payable thereon or any other amount payable hereunder shall not be paid when due
(whether at stated maturity, the acceleration or otherwise), such overdue amount
shall bear interest at a rate per annum which is equal to the Overdue Rate and
shall be payable from time to time on demand as Supplemental Rent. Subject to
the order of priority for distribution of funds set forth at Section 5.3 of the
Loan Agreement, Lessee may prepay at any time, without penalty, any Investment
Amount.
(b) Lessor hereby directs Lessee to pay in accordance with the Lease
to Agent, for the account of Lessor, the portion of Basic Rent representing
Yield and the portion of Supplemental Rent representing other amounts owing to
Lessor under the Lease from time to time. There is no scheduled amortization of
the Investment Amounts prior to the Maturity Date. Notwithstanding the
foregoing, Lessor shall be entitled to repayment of the Investment Amounts from
a portion of payments made by Lessee pursuant to Section 20.1 and Article XXII
of the Lease, and any amounts paid by Lessee pursuant to Article XV of the Lease
or otherwise with respect to a termination of any Leased Property as a result of
a Casualty or Condemnation, which amounts shall be payable to Lessor in the
amounts and subject to the priority in Section 5 of the Loan Agreement. Lessor
shall keep records with respect to the date and amount of each Funding, the
Yield, each payment of principal and the length of each Interest Period with
respect thereto. Such records shall constitute prima facie
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evidence of the accuracy of the information so recorded; provided, that the
failure to make any such recording or errors in such recordation or to provide
the copies of such records as provided below shall not affect the obligation of
Lessee to pay Rent. Lessor shall provide to Lessee, not more than once a month
upon Lessee's request, copies of such records which have not previously been
provided to Lessee.
SECTION 4.2. Interest on CP Loans. (a) Each CP Loan shall accrue
interest computed and payable in accordance with the terms of the Loan
Agreement.
(b) Lessor shall pay (and hereby directs Lessee to pay in
accordance with the Lease) to Agent, for the account of CP Lender the Basic Rent
(determined on the basis of interest on the CP Loans) received from Lessee under
the Lease from time to time.
SECTION 4.3. Interest on Eurodollar Loans. (a) Each Eurodollar Loan
shall accrue interest computed and payable in accordance with the terms of the
Loan Agreement.
(b) Lessor shall pay (and hereby directs Lessee to pay in
accordance with the Lease) to Agent, for the account of the Eurodollar Lenders
the Basic Rent (determined on the basis of interest on the Eurodollar Loans)
received from Lessee under the Lease from time to time.
SECTION 4.4. Computations. For all purposes under the Operative
Documents, all computations of interest, Yield and other accrued amounts
pursuant to the Operative Documents (including, without limitation, amounts
based on the Overdue Rate) shall be made by Agent on the basis of the actual
number of days elapsed and, when such interest and Yield is based on the
Eurodollar Rate or interest is based on the CP Rate, a 360-day year basis,
otherwise, including when such interest and Yield is based on the Base Rate, a
365- (or, if applicable, 366-) day year basis. Agent shall notify Lessee of the
applicable Eurodollar Rate or Base Rate promptly upon the determination thereof,
but in any event not later than three (3) Business Days prior to each Payment
Date. Any change in the interest rate or Yield on an Advance or an Investment
Amount or Loan resulting from a change in the Base Rate shall become effective
as of the opening of business on the day on which such change becomes effective.
Agent shall as soon as practicable notify Lessor, Lessee and Participants of the
effective date and the amount of each such change in interest rate. Agent shall,
at the request of any party, deliver to such party a statement showing the
quotations used by Agent in determining any rate used to calculate interest or
Yield. Agent shall deliver an invoice to Lessee at least two (2) Business Days
before any Payment Date, specifying the Basic Rent due on such Payment Date.
Notwithstanding the foregoing,
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any failure by Agent to deliver any notice or invoice described in this Section
4.4 shall not in any way relieve Lessee of its obligation to make the Basic Rent
payment on such Payment Date.
SECTION 4.5. Highest Lawful Rate. It is the intention of the parties
hereto to conform strictly to applicable usury laws and, anything herein to the
contrary notwithstanding, the obligations of (a) Lessee to Lessor under this
Participation Agreement and the Lease, (b) Lessor to the Lenders under the Loan
Agreement, (c) any party under the Capital Asset Purchase Agreement, (d) Lessor
to the Lenders under the Notes and (e) of either Lessee or Lessor or any other
party under any other Operative Document, shall be subject to the limitation
that payments of interest or of other amounts constituting interest under
applicable law shall not be required to the extent that receipt thereof would be
in excess of the Highest Lawful Rate (as defined below), or otherwise contrary
to provisions of law applicable to the recipient limiting rates of interest
which may be charged or collected by the recipient. Accordingly, if the
transactions or the amount paid or otherwise agreed to be paid for the use,
forbearance or detention of money under this Participation Agreement, the Lease,
the Loan Agreement, the Capital Asset Purchase Agreement, the Notes and any
other Operative Document would exceed the Highest Lawful Rate or otherwise be
usurious under applicable law (including without limitation the federal and
state laws of the United States of America, or of any other jurisdiction whose
laws may be mandatorily applicable) with respect to the recipient of any such
amount, then, in that event, notwithstanding anything to the contrary in this
Participation Agreement, the Lease, the Loan Agreement, the Capital Asset
Purchase Agreement, or any other Operative Document, it is agreed as follows as
to the recipient of any such amount:
(a) the provisions of this Section 4.5 shall govern and
control over any other provision in this Participation Agreement,
the Lease, the Loan Agreement, the Capital Asset Purchase Agreement,
the Notes and any other Operative Document and each provision set
forth therein is hereby so limited;
(b) the aggregate of all consideration which constitutes
interest under applicable law that is contracted for, charged or
received under this Participation Agreement, the Lease, the Loan
Agreement, the Capital Asset Purchase Agreement, the Notes or any
other Operative Document shall under no circumstances exceed the
maximum amount of interest allowed by applicable law (such maximum
lawful interest rate, if any, with respect to such recipient herein
called the "Highest Lawful Rate"), and all amounts owed under this
Participation Agreement, the Lease, the Loan Agreement, the
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Capital Asset Purchase Agreement, the Notes and any other Operative
Document shall be held subject to reduction and (i) the amount of
interest which would otherwise be payable to the recipient hereunder
and under the Lease, the Loan Agreement, the Capital Asset Purchase
Agreement, the Notes and any other Operative Document, shall be
automatically reduced to the amount allowed under applicable law and
(ii) any unearned interest paid in excess of the Highest Lawful Rate
shall be credited to the payor by the recipient (or, if such
consideration shall have been paid in full, refunded to the payor);
(c) all sums paid, or agreed to be paid for the use,
forbearance and detention of the money under this Participation
Agreement, the Lease, the Loan Agreement, the Capital Asset Purchase
Agreement, the Notes or any other Operative Document shall, to the
extent permitted by applicable law be amortized, prorated, allocated
and spread throughout the full term of such indebtedness until
payment in full so that the actual rate of interest is uniform
throughout the full term thereof;
(d) if at any time the interest, together with any other
fees, late charges and other sums payable pursuant to or in
connection with this Participation Agreement, the Lease, the Loan
Agreement, the Capital Asset Purchase Agreement, the Notes and any
other Operative Document executed in connection herewith or
therewith, and deemed interest under applicable law exceeds that
amount which would have accrued at the Highest Lawful Rate, the
amount of interest and any such fees, charges and sums to accrue to
the recipient of such interest, fees, charges and sums pursuant to
the Operative Documents shall be limited, notwithstanding anything
to the contrary in the Operative Documents to that amount which
would have accrued at the Highest Lawful Rate for the recipient, but
any subsequent reductions, as applicable, shall not reduce the
interest to accrue pursuant to the Operative Documents below the
recipient's Highest Lawful Rate until the total amount of interest
payable to the recipient (including all consideration which
constitutes interest) equals the amount of interest which would have
been payable to the recipient (including all consideration which
constitutes interest), plus the amount of fees which would have been
received but for the effect of this Section 4.5.
SECTION 4.6. Capitalized Interest and Capitalized Yield. On each
date which is three Business Days prior to any Payment Date (unless (i) with
respect to a Construction Period Site, such Payment Date occurs after the
Outside Completion Date and the Construction Completion Date has not occurred
prior to such
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Outside Completion Date, in which case Construction Agent shall fund the portion
of Site Rent attributed to the amounts described below from its own funds, or
(ii) Construction Agent at least three Business Days prior to such Payment Date
gives written notice to Lessor and Agent that it is not requesting such Funding
and that Construction Agent intends to fund the portion of Site Rent attributed
to the amounts described below from its own funds), Construction Agent shall be
deemed to have requested a Construction Advance in an amount equal to
Capitalized Interest and Capitalized Yield accrued on the outstanding Investment
Amounts and Loans with an Interest Period ending on such Payment Date allocated
to Construction Advances for Construction Period Sites. The Advance Date with
respect to any such Construction Advance for accrued Capitalized Interest and
Capitalized Yield shall be the relevant Payment Date (subject to the terms and
conditions for a Construction Advance set forth in this Participation Agreement)
and the proceeds of such Construction Advance shall be applied to pay such
accrued Capitalized Interest and Capitalized Yield. On each such Advance Date,
the Investment shall be increased by an amount equal to the Capitalized Yield
Funded on such date with respect to each Construction Period Site, the
outstanding principal on the applicable Site Notes shall be increased by an
amount equal to the Capitalized Interest Funded on such date with respect to
each Construction Period Site, and the Construction Costs of each Construction
Period Site shall be increased by an amount equal to the Capitalized Yield and
Capitalized Interest relating to such Construction Period Site.
SECTION 4.7. Commitment Fees. Lessee shall pay to Agent for the
account of each Eurodollar Lender and Lessor a commitment fee (the "Commitment
Fees") for the period from and including the Document Closing Date to the
Maturity Date, computed, in the case of such Participant, at a rate per annum
equal to the Commitment Fee Rate on the average daily amount of the Available
Participant Commitment of each such Participant (and prorated for any such
period which is less than a calendar quarter), payable quarterly in arrears on
each Commitment Fee Payment Date, commencing on the first such date to occur
after the Document Closing Date. If all or a portion of any Commitment Fee shall
not be paid when due, such overdue amount shall bear interest, payable by Lessee
on demand, at a rate per annum equal to the Overdue Rate from the date of such
nonpayment until such amount is paid in full (as well after as before judgment).
SECTION 4.8. Collateralization. Lessee agrees that it will not
collateralize the outstanding principal amounts of the Tranche A Notes or the
Available Eurodollar Lender Commitment relating to Tranche A Loans until such
time as the Custodial Agreement has been duly executed and delivered by all
parties thereto.
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ARTICLE 5.
CERTAIN INTENTIONS OF THE PARTIES
SECTION 5.1. Nature of Transaction. It is the intention of the
parties that:
(a) the Overall Transaction constitutes an "operating
lease" pursuant to SFAS No. 13 from Lessor to Lessee for purposes of Lessee's
financial reporting;
(b) for federal, state and local income or franchise
tax, bankruptcy (including the substantive law upon which bankruptcy proceedings
are based), real estate and Uniform Commercial Code purposes:
(i) the Overall Transaction constitutes a loan by
Participants to Lessee and preserves beneficial ownership in the
Leased Property in Lessee, and the obligations of Lessee to pay Site
Rent and Equipment Variable Rent shall be treated as payments of
interest, and the payment by Lessee of any amounts in respect of the
Equipment Fixed Rent and the Lease Balance shall be treated as
repayments of principal;
(ii) the Lease grants a security interest and a mortgage
lien, as the case may be, in all of the Sites, the Equipment and the
other Collateral in favor of Lessor; and
(ii) the Mortgage and the Security Agreement create
liens and security interests in the Collateral in favor of Agent for
the benefit of all Participants.
Accordingly, and notwithstanding any provision of this Participation Agreement
to the contrary, the parties hereto agree and declare that: (i) the transactions
contemplated by the Lease and the other Operative Documents are intended to have
a dual, rather than single, form, as evidenced by the statements set forth in
Sections 5.1(a) and (b) above and Article XXVI of the Lease, and (ii) all
references in this Participation Agreement to the "lease" of the Leased Property
which fail to reference such dual form do so as a matter of convenience only and
do not reflect the intent of the parties hereto as to the true characterization
of such arrangements. Notwithstanding the intentions of the parties set forth
above, Lessee acknowledges and agrees that none of Agent, any Participant or
their representatives have made any representations or warranties concerning the
tax, accounting or legal characteristics of the Operative Documents and that
Lessee has obtained and relied upon
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such tax, accounting and legal advice from its own experts concerning the
Operative Documents as it deems appropriate.
(c) Specifically, without limiting the generality of the
foregoing, the parties hereto intend and agree that, for purposes of filing
federal, state and local returns, reports and other statements relating to
income or franchise taxes, or any other taxes imposed upon or measured by
income: (i) the transactions contemplated by the Operative Documents shall be
treated as conditional sales and Lessee shall be entitled to take any deduction,
credit, allowance or other reporting position consistent with such treatment,
and (ii) neither Lessor nor any Participant shall take an initial position on
its federal, state and local returns, reports and other statements relating to
income or franchise taxes that is inconsistent with such treatment.
(d) Prior to the Lease Expiration Date, neither Lessor
nor any Participant shall claim any federal or state tax attributes or benefits
(including depreciation) relating to the Leased Property unless required to do
so by an appropriate taxing authority or after a change in Applicable Laws and
Regulations; provided, however, that if an appropriate taxing authority shall
require Lessor or any Participant to claim any such federal or state tax
attributes or benefits or such Person otherwise intends to claim such attributes
or benefits as otherwise permitted hereunder, such Person shall promptly notify
Lessee thereof and shall permit Lessee to contest such requirement in a manner
similar to the contest rights provided in, and subject to any applicable
limitation to a contest contained in, Section 11.2(b) hereof (it being
understood, however, that any such contest of an item on a net income or
franchise tax return of Lessor or any Participant shall be based upon a tax
opinion of, and shall be conducted and controlled in good faith by, tax counsel
selected by Lessor or the applicable Participant and reasonably approved by
Lessee).
SECTION 5.2. Amounts Due. (a) Anything else herein or elsewhere to
the contrary notwithstanding, it is the intention of Lessee, Participants and
Agent that: (i) the amount and timing of installments of Basic Rent due and
payable from time to time from Lessee under the Lease shall be equal to the
aggregate payments due and payable in respect of principal and interest on the
Loans and Yield on each Payment Date (to the extent such interest and Yield are
not funded by additional Loans and Investment Amounts); (ii) if Lessee elects
the Purchase Option or becomes obligated to purchase any of the Leased
Properties under the Lease, the Loans, Investment Amounts, all interest, Yield
and Commitment Fees thereon and all other obligations of Lessee owing to the
Participants and Agent which are attributable to the applicable Site or
Equipment Group to be purchased, as allocated
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pursuant to the Loan Agreement, shall be paid in full by Lessee in accordance
with Article XX of the Lease; (iii) if Lessee properly elects a Remarketing
Option and remarkets the related Leased Property in accordance with Article XXII
of the Lease, as applicable, Lessee shall only be required to pay to Agent the
Gross Proceeds, subject to the limitation set forth at Section 22.1 of the Lease
with respect to 25% Property, of the sale of such Leased Property, the AMAT
Recourse Amount, all in accordance with Article XXII of the Lease and any
amounts due pursuant to Section 11.9 of this Participation Agreement and Section
22.5 of the Lease (which aggregate amounts under Article XXII of the Lease may
be less than the Lease Balance); and (iv) upon a Lease Event of Default
resulting in an acceleration of Lessee's obligation to purchase the Leased
Properties under the Lease, the amounts then due and payable by Lessee under the
Lease shall include all amounts necessary to pay in full the Lease Balance, plus
all other amounts then payable by Lessee to Participants and Agent under the
Operative Documents.
(b) Anything else herein or in any other Operative Document to the
contrary notwithstanding, it is the intention of AMAT, Participants and Agent
that the amount of the total obligations of AMAT under the Operative Documents,
including the Lease and the Note Guarantee, on any date, shall not exceed the
sum of the aggregate outstanding principal amount of all Loans, plus all
interest accrued thereon, plus the aggregate outstanding Investment Amounts,
plus all accrued Yield thereon, plus all other costs, expenses and indemnities
(including, without limitation, any amounts payable by Borrower pursuant to
Section 6.2(i) of the Loan Agreement) for which Lessee is liable under the
Operative Documents; provided, however, that the foregoing limitation shall not
apply to any damages or amounts otherwise payable by Lessee as a result of
Lessee's breach of its obligation to make payments to Agent rather than Lessor
in accordance with the Assignment of Lease and the Consent to Assignment, unless
Lessee is required by a court order of a Governmental Authority having
jurisdiction to make such payments to Lessor.
ARTICLE 6.
CONDITIONS PRECEDENT TO ACQUISITIONS AND ADVANCES
SECTION 6.1. Conditions to Each Advance. The obligation of each
Participant to perform its obligations on any Advance Date shall be subject to
the fulfillment to the satisfaction of (including, with respect to writings,
such writings being in form and substance reasonably satisfactory to Agent), or
the waiver in writing by, Agent of the conditions precedent set forth in this
Section 6.1 and the other applicable conditions precedent set
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forth in this Article 6 on or prior to such Advance Date (except that the
obligation of any party hereto shall not be subject to such party's own
performance or compliance):
(a) Advance Request. Lessee (or Construction Agent)
shall have delivered an Advance Request conforming with the applicable
requirements of Section 3.10 in respect of the proposed Advance Date.
(b) Performance. Each party to any Operative Document
shall have performed and complied with all conditions and agreements contained
in this Article 6 and, in all material respects, with all other agreements and
conditions contained herein and in any other Operative Document to which it is a
party required to be performed or complied with by it on or prior to such
Advance Date.
(c) Representations and Warranties True; Absence of
Defaults. Each representation and warranty of AMAT (including those made by AMAT
as Lessee and Construction Agent) contained herein or in any other Operative
Document shall be true and correct in all material respects as though made on
and as of such Advance Date, except that any such representation or warranty
which is expressly made only as of a specified date need be true only as of such
date. No Lease Default or Lease Event of Default shall have occurred and be
continuing or will occur immediately after giving effect to such Advance. Each
Funding on an Advance Date shall be deemed to be a representation and warranty
of AMAT to each of the other parties hereto that (i) the matters specified in
clause (b) above are true and correct as of such Advance Date, (ii) after giving
effect to such Advance, none of the limitations or conditions set forth in
Section 3.10 will be violated, (iii) to the extent that such Funding relates to
a Site Advance, Equipment Advance, initial Construction Advance or the first
Construction Advance of any fiscal quarter of Lessee, each of the
representations and warranties of Lessee contained in the Operative Documents is
true and correct as of such Advance Date, except that any such representation or
warranty which is expressly made only as of a specified date is true only as of
such date, and (iv) if such Advance relates to a Site, that as of such Advance
Date, no Significant Casualty or Significant Condemnation has occurred with
respect to the related Site.
(d) Transaction Expenses. Lessee shall have paid in full
on or prior to such Advance Date all Transaction Expenses for which Lessee has
received an invoice no later than five (5) Business Days prior to such Advance
Date to the parties to whom such Transaction Expenses are payable; provided,
that the Arrangement Fee shall be paid on the initial Advance Date. All other
Transaction Expenses shall be paid by Lessee within the time period specified in
Section 13.9(a); provided, further, that
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the Transaction Expenses incurred in connection with the initial Advance if
invoiced within two (2) Business Days prior to the Advance Date shall be paid in
full on the initial Advance Date. Such payments shall be made by wire transfer
of immediately available funds (x) if to Agent, pursuant to the wire transfer
information provided from time to time to Lessee by Agent (initially as set
forth in Schedule II) or (y) if to any other Person, if the necessary wire
transfer information for such payment is provided to Lessee at least one
Business Day prior to such Advance Date.
(e) Proceedings Satisfactory, Etc. All proceedings taken
in connection with such Advance Date and all documents relating thereto shall be
reasonably satisfactory to Agent and its counsel.
(f) Taxes. All taxes, charges, fees and costs, if any,
payable in connection with the execution, delivery, recording and filing of the
Operative Documents and the transactions contemplated to be consummated on such
Advance Date shall have been paid by Lessee, or arrangements for such payment
shall have been made by Lessee to the satisfaction of Agent and Lessor.
(g) Insurance. Insurance complying with the provisions
of Article XIV of the Lease shall be in full force and effect as evidenced by
certificates of insurance, broker's reports or insurance binders delivered on or
prior to the Advance Date to Agent and Lessor in form and substance reasonably
satisfactory to Agent and Lessor.
SECTION 6.2. Conditions to Site Advance. The obligation of each
Participant to perform its obligations on an Advance Date which is a Site
Acquisition Date with respect to a Developed Site (including the initial advance
for the Existing Sites) or a Construction Site shall be subject to the
fulfillment to the satisfaction of (including, with respect to writings, such
writings being in form and substance reasonably satisfactory to the addressee or
beneficiary thereof), or the waiver in writing by, such Participant of the
conditions precedent set forth in this Section 6.2 with respect to each such
Site and the other applicable conditions precedent set forth in Section 6.1 on
or prior to the initial Advance Date (except that the obligation of any party
hereto shall not be subject to such party's own performance or compliance):
(a) Real Estate and Appraisal Matters. Not less than
five (5) Business Days prior to each Site Advance Date, Lessee will deliver to
Lessor and Agent (and with respect to Section 6.2(b) below, sufficient copies
for, and addressed to, each Participant):
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(i) with respect to a Site Advance for a Construction
Site, a copy of the Plans and Specifications; and
(ii) an appraisal in form and substance reasonably
satisfactory to Agent and Lessor which shall establish (by the use
of appraisal methods satisfactory to Participants) (A) the Fair
Market Value of the Site as of the Advance Date, (B) with respect to
each Developed Site and Existing Site, the Fair Market Value of the
Site as of the last day of the Term, without regard to any renewals,
(C) with respect to a Construction Site, the "as built" Fair Market
Value of such Site (assuming the Completion of the Facility on or
before the Outside Completion Date) as of the last day of the Term,
without regard to any renewals, (D) that the Fair Market Value of
the Site as determined in accordance with items (A) and (B) of this
Section 6.2(a)(ii) with respect to a Developed Site, and in
accordance with item (C) of this Section 6.2(a)(ii), with respect to
a Construction Site, will be not be less than 75% of the Aggregate
Property Cost with respect to such Site, (E) with respect to each
Developed Site and Existing Site, the percentage of the Fair Market
Value of such Site attributable to the Land and the percentage of
the Fair Market Value of such Site attributable to the Facility
located thereon, and (F) with respect to a Construction Site, the
percentage of the Fair Market Value of such Site on an "as built"
basis attributable to the Land and the percentage of the Fair Market
Value of such Site on an "as built" basis attributable to the
Facility. The portion of the appraisal described in clause (A) above
shall be prepared in accordance with FIRREA, and the entire
appraisal will be performed by an independent appraisal company
chosen by Agent. The portion of such appraisal described in clauses
(C) and (F) above shall assume that all scheduled portions of the
Facility shall have been completed or renovated in a good and
workmanlike manner in compliance with Applicable Laws and
Regulations and otherwise in accordance with the Lease and the
applicable Plans and Specifications for such Site.
(b) Filings and Recordings. All applicable filings or
recordings enumerated and described in Schedule III hereof, as well as all other
filings and recordings necessary or appropriate, including financing statements,
precautionary financing statements and fixture filings, in the opinion of
counsel to Agent, to perfect the rights, titles and respective interests of
Participants and Agent (including those with respect to any future Advances for
the Site) intended to be created by the Operative Documents shall have been
made, or shall have been arranged to be made promptly thereafter, in the
appropriate places or offices, including any recordings and filings necessary
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to create, perfect, preserve and protect (i) Lessor's interest in the Site, (ii)
the first mortgage lien and deed of trust of record on the Site, subject to
Permitted Exceptions and the rights of Lessee under the Lease and (iii) the
first priority perfected security interest in all fixtures appurtenant to the
Site, subject to Permitted Exceptions, granted to Agent. All recording and
filing fees, charges and taxes with respect to any recordings or filings made
pursuant to this Section 6.2(b) shall have been paid in full by Lessee, or
arrangements for such payment shall have been made by Lessee, to the
satisfaction of Agent.
(c) Opinions of Counsel. With respect to a Site Advance
following the initial Advance, Agent and Participants shall have received, (i)
an opinion of Lessee's in-house counsel substantially in the form of Exhibit V
with respect to the Operative Documents executed and delivered by Lessee on such
Site Advance Date (but excluding the opinion described at paragraph 4 of such
Exhibit), and (ii)(A) if the Site or Sites are located in the State of
California, an opinion of counsel substantially in the form of Exhibit W-1 with
respect to the Operative Documents executed and delivered by Lessee on such Site
Advance Date or (B) if the Site or Sites are not located in the State of
California, an opinion of counsel substantially in the form of Exhibit W-2.
(d) Title and Title Insurance Commitment. Agent shall
have received from the Title Insurance Company its commitment to issue an ALTA
owner's policy of title insurance (1970 Form), acceptable in form and substance
to Agent and Lessor, insuring that Lessor has good and marketable title to the
Site (fee and/or leasehold), subject to the Lease, Permitted Exceptions and such
other exceptions to title as are acceptable to Agent and Lessor, in an amount
equal to the Aggregate Property Costs for such Site together with complete,
legible copies of all encumbrances, maps and surveys of record, and together
with such reinsurance (with direct access to the reinsurers thereunder) or
coinsurance agreements as Agent shall require. Agent, for the benefit of
Participants, shall have received from the Title Insurance Company its
commitment to issue an ALTA form of lender's policy of title insurance (1970
Form), acceptable in form and substance to Agent, insuring the creation under
the Mortgage in favor of Agent of a valid first priority Lien against the
Collateral, subject to Permitted Exceptions and such exceptions to title as are
reasonably acceptable to Agent, in an amount equal to the Site Acquisition
Costs, together with complete, legible copies of all encumbrances and plats of
record, and together with such reinsurance (with direct access to the reinsurers
thereunder) or coinsurance agreements as Agent shall require. Such Title
Policies shall be dated as of the initial Advance Date relating to such Site,
and, to the extent permitted under Applicable Laws
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and Regulations, shall (w) contain affirmative endorsements as to mechanics
liens, doing business, usury, zoning, easements and rights-of-way, Form B-1
comprehensive coverage, encroachments, the nonviolation of covenants and
restrictions, rights of access and survey matters, (x) delete the creditors'
rights exclusion, (y) contain endorsements regarding the effect of
recharacterization, and (z) contain such other endorsements reasonably requested
by Agent. Notwithstanding the above, with respect to any Construction Site
Advance, Lessee shall be required to deliver such Title Policies only on the
earlier of the initial Advance or the entering into a Ground Lease in connection
with such Construction Site, provided, that the foregoing limitations shall not
relieve Lessee's obligation to deliver the date-down endorsement required by
Section 7(d)(ii).
(e) Survey. Lessee shall have delivered, or shall have
caused to be delivered, to Lessor and Agent an ALTA/1992 (Urban) survey of the
Site certified to the Participants and the Agent in a form satisfactory to the
Title Insurance Company in order to issue the Title Policies and showing no
state of facts unsatisfactory to any of the Participants or the Agent.
Notwithstanding the above, with respect to any Construction Site Advance, Lessee
shall be required to deliver such Survey only on the initial Advance in
connection with such Construction Site and upon completion pursuant to Section
7(b).
(f) Environmental Review. Not less than five (5)
Business Days prior to the Advance Date, each Participant and Agent shall have
received the Environmental Audit for the Site, which shall have been delivered
to and approved by Participants and Agent in their sole and absolute discretion,
and each Participant and Agent shall have received an acknowledgement (in form
and substance satisfactory to each of them) from the firm that prepared the
Environmental Audit that each Participant and Agent may rely on the
Environmental Audit. Notwithstanding the above, with respect to any Construction
Site Advance, Lessee shall be required to deliver such Environmental Audit only
on earlier of the initial Advance or entering into a Ground Lease in connection
with such Construction Site.
(g) Transfer Documents. Lessor shall have received from
the owner of such Site (x) a Xxxx of Sale, and (y) a grant deed with respect to
each Site located in the State of California and a general warranty deed for any
Site located outside of the State of California (a "Deed"), in conformity with
Applicable Laws and Regulations and appropriate for recording with the
applicable Governmental Authorities, conveying fee simple title to the Site to
Lessor, subject only to Permitted Exceptions or if the Land with respect to any
Construction Site is owned by Lessee, a Ground Lease.
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(h) Site Lease Supplement. Agent shall receive an
original counterpart of the Site Lease Supplement (with sufficient copies for
each Participant) executed by Lessee and Lessor with respect to the Site (which
Site Lease Supplement for a Construction Site shall specify, among other things,
the Permitted Uses of such Site as designated in the Plans and Specifications
delivered to the Appraiser pursuant to Section 6.2(a)); provided that only Agent
shall retain the copy thereof marked as the sole original counterpart for UCC
purposes.
(i) Mortgage. Lessor shall have delivered to Agent a
Mortgage executed by Lessor with respect to the Site.
(j) Assignment of Lease Supplement. Lessor shall have
delivered to Agent a Supplement to the Assignment of Lease executed by Lessor
with respect to the Site.
(k) Consent of Lessee to Assignment of Lease. Lessee
shall have delivered to Lessor and Agent (with sufficient copies for each
Participant) a consent to the Supplement to the Assignment of Lease executed by
Lessee with respect to the Site.
(l) FIRPTA Affidavit. Lessee shall have caused
the seller of such Developed Site to deliver to Agent and Lessor (i) a FIRPTA
Affidavit in customary form or if such seller is a "foreign person" as defined
in Section 1445 of the Code, evidence that a portion of the sales price to be
paid to such seller has been withheld, if so required, in accordance with the
provisions of the Code and Regulations and (ii) any comparable form and
affidavits required with respect to the purchase and sale of the Site by any
state.
(m) No Significant Casualty or Condemnation. With
respect to a Site Advance or a Construction Advance, no Significant Casualty and
no Significant Condemnation shall have occurred with respect to such Site. No
action shall be pending or, to the knowledge of Lessee, threatened by a
Governmental Authority to initiate a Condemnation of a Site which would
constitute a Significant Condemnation.
(n) Construction Agency Agreement Supplement. With
respect to a Construction Site, Lessee, as Construction Agent, shall have
delivered to Agent (with sufficient copies for each Participant) a Construction
Agency Agreement Supplement executed by Lessee, as Construction Agent, and
Lessor with respect to such Construction Site.
(o) Environmental Indemnity. Lessee shall have delivered
to Agent (with sufficient copies for each Participant) an Unsecured
Environmental Indemnity executed by Lessee.
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(p) Remarketing Option. Lessee shall not have given
written notice to Lessor of Lessee's exercise of any Site Remarketing Option
with respect to a Site pursuant to Section 22.1 of the Lease or, on or after the
fifth anniversary of the Document Closing Date, an Equipment Remarketing Option
with respect to an Equipment Pool pursuant to Section 22.2 of the Lease.
SECTION 6.3. Conditions to each Equipment Advance. The obligation of
each Participant to perform its obligations on each Equipment Acquisition Date
shall be subject to the fulfillment to the satisfaction of (including, with
respect to writings, such writings being in form and substance reasonably
satisfactory to Agent), or the waiver in writing by Agent of the conditions
precedent set forth in this Section 6.3 and the other applicable conditions
precedent set forth in Section 6.1 on or prior to such Equipment Acquisition
Date with respect to each Equipment Group to be Funded on such Advance Date
(except that the obligation of any party hereto shall not be subject to such
party's own performance or compliance):
(a) Filings and Recordings. All applicable filings or
recordings enumerated and described in Schedule III hereof, as well as all other
filings and recordings necessary or advisable, including financing statements,
precautionary financing statements and fixture filings, in the opinion of
counsel to Agent, to perfect the rights, titles and interests of Agent and
Participants intended to be created by the Operative Documents shall have been
made, or shall have been arranged to be made promptly thereafter, in the
appropriate places or offices, including any recordings and filings necessary to
create, perfect, preserve and protect (i) Lessor's interest in the Units of
Equipment in the Equipment Group and (ii) the first priority perfected security
interest of record and Lien granted to Agent in such Units of Equipment, subject
in each case, to Permitted Exceptions and the rights of Lessee under the Lease.
All recording and filing fees and taxes with respect to any recordings or
filings made pursuant to this Section 6.3(a) shall have been paid in full by
Lessee, or arrangements for such payment shall have been made by Lessee, to the
satisfaction of Agent.
(b) Invoices and Bills of Sale. Agent shall have
received (i) the invoices signed by the vendor or manufacturer, as appropriate,
for the Units of Equipment in the Equipment Group and (ii) duly executed Xxxx(s)
of Sale conveying to Lessor such Units of Equipment, with customary warranties
reasonably acceptable to Lessor and Agent.
(c) Equipment Lease Supplement. Lessee shall have
delivered an original counterpart of the Equipment Lease
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Supplement executed by Lessee and Lessor with respect to the Equipment Group to
Lessor and Agent (with sufficient copies for each Participant) setting forth an
amortization schedule for the Equipment Fixed Rent attributable to such Units of
Equipment proposed by Agent, and approved by Lessor and Lessee; provided that
only Agent shall receive the copy thereof marked as the sole original
counterpart for UCC purposes.
(d) Assignment of Lease Supplement. Lessor shall have
delivered to Agent a Supplement to the Assignment of Lease executed by Lessor
with respect to the related Units of Equipment.
(e) Consent of Lessee to Assignment of Lease. Lessee
shall have delivered to Lessor and Agent a consent to the Supplement to the
Assignment of Lease executed by Lessee with respect to the related Units of
Equipment.
(f) Opinions. On the date of the initial Equipment
Advance, Agent and Participants shall have received an opinion of Lessee's
in-house counsel substantially in the form of Exhibit V with respect to the
Operative Documents being executed and delivered by Lessee on such date (but
excluding the opinion described at paragraph 4 of such Exhibit). For each state
in which a Unit of Equipment is located, if no other Unit of Equipment already
subject to the Lease is located in such state, Agent (with sufficient copies for
and addressed to each of the Participants) shall have received an opinion (in
form and content reasonably satisfactory to Participants) from counsel
reasonably satisfactory to each Participant and Agent and qualified with respect
to the laws of such jurisdiction substantially to the effect that (i) as to the
validity and perfection of Agent's lien in such Units of Equipment, (ii) no
other filings or recordings are required to establish and perfect such Lien in
the Units of Equipment, (iii) the descriptions of the Collateral in such filings
and recordings are adequate for the purpose of establishing and perfecting such
Lien, and (iv) that there are no requirements in such state requiring Agent,
Lessor or any other Participant to qualify to do business or pay any fee or tax
other than normal filing and recording fees payable by Lessee.
(g) Searches. Lessor and Agent shall have received a
report satisfactory to Lessor and Agent, as of a date not more than thirty (30)
days prior to the Advance Date, of judgment liens, tax liens and Uniform
Commercial Code filings with respect to Lessee and the Leased Property filed of
record in each applicable jurisdiction.
(h) Waiver. If such Units of Equipment are to be located
on property leased by Lessee, Agent shall have received a waiver from the owner
of such property and any lien holder which
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has a lien thereon, in form and substance reasonably acceptable to Agent and
Lessor, with respect to such Units of Equipment.
(i) Proposed Fair Market Value, Useful Life and
Amortization Schedules. Agent shall have received Lessee's approval of Agent's
(i) estimate of the Fair Market Value as of the applicable Original Equipment
Pool Expiration Date and useful life of each such Unit of Equipment and (ii)
proposed amortization schedule for each such Unit of Equipment, in each case
determined by Agent from the information provided by Lessee pursuant to Section
3.13(a)(v).
(j) Remarketing Option. Lessee shall not have given
written notice to Lessor of Lessee's exercise of a Remarketing Option pursuant
to Article XXII of the Lease.
SECTION 6.4. Conditions to each Construction Cost Funding. The
obligation of each Participant to perform its obligations on a Construction Cost
Funding Date shall be subject to the fulfillment to the satisfaction of
(including, with respect to writings, such writings being in form and substance
reasonably satisfactory to Agent), or the waiver in writing by Agent of the
conditions precedent set forth in this Section 6.4 and in Section 6.1 on or
prior to such Construction Cost Funding Date with respect to each Construction
Site for which a Construction Advance is being made on such Advance Date (except
that the obligation of any party hereto shall not be subject to such party's own
performance or compliance):
(a) Plans and Specifications and Architect's Agreement;
Assignment. Prior to the first Construction Advance under this Section 6.4 for
the Construction Site, Agent and Lessor shall have received, upon request, (i)
the first page of a copy of the Plans and Specifications signed, and all other
pages thereof initialed, by Lessee, as Construction Agent, and Construction
Agent's general contractor (if any) and, if requested by Agent, a copy of
Construction Agent's agreement with the Architect, if any, (ii) a copy of the
general construction contract (if any) and a copy of each Major Construction
Document entered into by Construction Agent or by Construction Agent's general
contractor, as the case may be, and (iii) an assignment, from Lessee in favor of
Lessor, of Lessee's interest, as Construction Agent, in the Plans and
Specifications, the Architect's agreement and the general construction contract
in the form required by the Construction Agency Agreement, and either (A)
attached thereto is the Architect's and general contractor's written consent to
such assignment, in the form required by the Construction Agency Agreement, or
(B) included in such assignment is a certification of Lessee that the applicable
Architect's Agreement includes a provision in substance identical to such
consent.
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(b) Assurance of Completion. If requested by Agent,
Agent and Lessor shall have received from Lessee, as Construction Agent, a
written certification that the Available Commitments for such Facility together
with the other Facilities being constructed or renovated on all other
Construction Sites for which construction has not been completed is sufficient
to complete the construction of such Facilities in accordance with the
respective Plans and Specifications therefor, and that all of such construction
or renovation is capable of being completed prior to the anticipated
Construction Completion Date for each such Construction Site. In the event that
at any time or from time to time the Available Commitments are not sufficient to
fully pay for the Completion of the Facility on any Construction Site, Lessee,
as Construction Agent, covenants that it shall contribute, on an unsecured basis
and without recourse to the Leased Property, to Agent or the Participants for
repayment its own funds to pay costs of such construction or renovation, prior
to making any further request for any Construction Advance to pay for such
construction or renovation until the remaining Available Commitments are
sufficient to fully pay for the completion of such construction or renovation
without further contributions from Lessee.
(c) Construction Progress Information. With respect to
the construction or renovation of a Facility on the Construction Site, Lessee,
as Construction Agent, shall furnish to Agent and Lessor upon request, such
details concerning the construction or renovation of such Facility as Agent or
Lessor may reasonably require, including a detailed breakdown of the applicable
percentages of completion and projected costs of the various phases of
construction or renovation of such Facility, showing the amounts expended to
date for such construction or renovation and the amounts then due and unpaid and
an itemized estimate of the amount necessary to complete construction or
renovation of such Facility in its entirety.
ARTICLE 7.
COMPLETION DATE CONDITIONS
The occurrence of the Construction Completion Date with respect to
any Construction Site shall be subject to the fulfillment to the satisfaction
of, or waiver by, Required Participants of the following conditions precedent:
(a) Construction Completion. The construction or
renovation of the Facility located on such Construction Site shall have been
completed in all material respects in accordance with (i) the Plans and
Specifications (except as any timing of construction or renovation and
completion specified in such Plans
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and Specifications may be modified pursuant to Section 2.8 of the Construction
Agency Agreement) for such Facility and (ii) Applicable Laws and Regulations.
Such Facility shall also be ready for occupancy and operation. All fixtures,
furniture, furnishings, equipment and other property contemplated under such
Plans and Specifications to be incorporated into or installed in such Facility
shall have been incorporated or installed free and clear of all Liens except for
Permitted Liens and Liens in favor of Lessor or Agent.
(b) Architect's Certificate. Lessee shall have furnished
to Lessor and Agent a certificate of the Architect (substantially in the form of
Exhibit C) dated at or about the Construction Completion Date and stating that
(i) the construction or renovation of the Facility located on such Construction
Site has been completed in all material respects in accordance with its Plans
and Specifications (except as any timing of construction or renovation and
completion specified in such Plans and Specifications may be modified pursuant
to Section 2.8 of the Construction Agency Agreement) and such Facility is ready
for use and occupancy and (ii) such Facility, as so completed, complies in all
material respects with all applicable laws and ordinances, and certifying that
attached thereto are true and complete copies of an "as built" or "record" set
of the Plans and Specifications.
(c) Construction Agent's Certification. Construction
Agent shall have furnished to Agent and Lessor with a certification of Lessee
(substantially in the form of Exhibit D) as follows:
(i) The representations and warranties of Lessee
with respect to such Construction Site and Facility set forth in
Section 8.1(i), (l), (m), (n) and (o) are true and correct in all
material respects as of the Construction Completion Date for such
Facility. All amounts owing to third parties for the construction or
renovation of such Facility have been paid in full (other than
contingent obligations for which Lessee has made adequate reserves
or has made other provision for payment in a manner and in amounts
reasonably acceptable to Lessor and Agent);
(ii) No changes or modifications were made to the
related Plans and Specifications after the related Site Acquisition
Date that have had or may have, individually or in the aggregate, a
Material Adverse Effect on the Facility;
(iii) there are no defects to such Facility
including the plumbing, heating, air conditioning and electrical
systems thereof which have had or may have,
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individually or in the aggregate, a Material Adverse Effect
on the Facility; and
(iv) all water, sewer, electric, gas, telephone and
drainage facilities and all other utilities required to adequately
service such Facility for its intended use are available pursuant to
adequate permits (including any that are required under applicable
Environmental Laws) the unavailability of which have had or may
have, individually or in the aggregate, a Material Adverse Effect on
the Facility.
(d) As Built Survey; Title Insurance Endorsements.
Construction Agent shall have furnished to Agent true, correct and complete
copies, certified by the Construction Agent, of the following (to the extent not
previously delivered to Agent):
(i) an "as built" ALTA survey of the Site, certified
to Agent and Lessor, showing the location of the completed Facility,
the location of all points of access to the Site and the location of
all easements affecting the Site and certifying that there are no
encroachments of the Facility onto any easements affecting the Site
or onto any adjoining property (other than Permitted Liens) and that
all applicable setback requirements and other restrictions have been
complied with;
(ii) a date-down endorsement, dated not earlier than
the date of substantial completion of the Facility on such Site, to
the applicable Title Insurance Policy (or, if not available under
the applicable state law, then such other evidence of the lack of
recorded and unrecorded mechanics' liens affecting (or inchoate
rights thereto which could affect) the Site as Agent may reasonably
request; and
(iii) in the event that the applicable Title
Insurance Policy is required to include a zoning endorsement
pursuant to the provisions of Section 6.2(d), ALTA 3.1 Zoning
Endorsement (with express parking coverage).
ARTICLE 8.
REPRESENTATIONS AND WARRANTIES
SECTION 8.1. Representations and Warranties of Lessee. As of the
date hereof, the Document Closing Date and the dates specified in Section
6.1(c), Lessee makes the representations and warranties set forth in this
Section 8.1 to each of the other parties hereto, except that any such
representation or warranty
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which is expressly made only as of a specified date is true only as of such
date.
(a) Due Organization, etc. Lessee is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and Lessee has all requisite corporate power and authority to conduct
its business as presently and presently proposed to be conducted, to own or hold
under lease its properties, to enter into and perform its obligations under each
of the Operative Documents to which it is or is to be a party and each other
agreement, instrument and document to be executed and delivered by it on or
before the Document Closing Date and each Advance Date in connection with or as
contemplated by each such Operative Document to which it is or is to be a party,
and it is duly qualified as a foreign corporation authorized to do business and
is in good standing in California and in every jurisdiction in which its failure
to be so qualified would have a Material Adverse Effect.
(b) Authorization; No Conflict. The execution and
delivery by Lessee of each of the Operative Documents to which it is a party,
and the performance by Lessee of its obligations under such Operative Documents,
have been duly authorized by all necessary corporate action on its part, and do
not and will not: (i) contravene any Applicable Laws and Regulations currently
in effect applicable to or binding on it or the Leased Property; (ii) violate
any provision of its charter or bylaws; (iii) result in a breach of or
constitute a default under any indenture, loan or credit agreement, or any other
agreement or instrument to which Lessee is a party or by which Lessee or its
properties may be bound or affected; (iv) result in, or require, the creation or
imposition of any Lien of any nature upon or with respect to any of the
properties now owned or hereafter acquired by Lessee (other than the security
interests created pursuant to the Operative Documents); or (v) require any
Governmental Action by any Governmental Authority, except, in the case of this
clause (v), (A) for the filings and recordings listed on Schedule III to perfect
the rights of Lessor, Participants and Agent intended to be created by the
Operative Documents, and (B) for those Governmental Actions required with
respect to Lessee or any of its Affiliates listed on Schedule IV, each of which
have been duly effected; and except in the case of each clause above, where the
contravention, violation or failure to be so effected will not, individually or
in the aggregate, have a Material Adverse Effect; and Lessee is not in default
under or in violation of its certificate of incorporation or bylaws.
(c) Enforceability, etc. Each Operative Document to
which Lessee is a party constitutes the legal, valid and binding obligation of
Lessee, enforceable against Lessee in accordance with the terms thereof, except
as such enforceability may be
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limited by applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and by general equitable principles.
(d) Litigation. Except as described under the heading
"Legal Proceedings" in Lessee's Form 10-Q for the period ended January 27, 1997
filed with the SEC, there is no action, proceeding or investigation pending or,
to Lessee's knowledge, threatened which questions the validity of the Operative
Documents to which Lessee is a party or any action taken or to be taken pursuant
to the Operative Documents to which Lessee is a party, and there is no action,
proceeding or investigation pending or, to Lessee's knowledged, threatened
which, if adversely determined, would have a Material Adverse Effect.
(e) Taxes. Lessee has filed or caused to be filed all
United States Federal and all other tax returns that are required to be filed by
Lessee, except where the failure to so file such returns (other than in
connection with federal or state income tax returns) would not have a Material
Adverse Effect, and has paid or caused to be paid all taxes shown to be due and
payable on such returns or on any assessment received by Lessee to the extent
that such taxes have become due and payable except to the extent that taxes due,
but unpaid, are being contested in good faith by Lessee by appropriate action or
proceeding and, to the extent (if any) that such taxes are not due and payable,
has established or caused to be established reserves that are adequate for the
payment thereof in accordance with GAAP.
(f) Rights in Respect of the Leased Property. Lessee is
not a party to any contract or agreement to sell any interest in the Leased
Property or any part thereof other than pursuant to or in accordance with this
Agreement and the Lease.
(g) No Lease Default, Loss, etc. No Lease Default or
Lease Event of Default has occurred and is continuing; there is no action
pending or, to Lessee's knowledge, threatened by a Governmental Authority to
initiate a Significant Condemnation.
(h) Chief Executive Office of Lessee. The principal
place of business and chief executive office, as such terms are used in Section
9-103(3) of the UCC, of Lessee are each located at 0000 Xxxxxx Xxxxxx, Xxxxx
Xxxxx, Xxxxxxxxxx.
(i) Compliance With Law. With respect to each Developed
Site and each Construction Site for which the Construction Completion Date has
occurred, (i) Lessee has complied and is in compliance with all Applicable Laws
and Regulations, except for any violations which would not have, individually or
in the aggregate, a Material Adverse Effect on Lessee or any such Site; and (ii)
each such Site and the use
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thereof by Lessee and its agents, assignees, employees, invitees, lessees,
licensees and tenants complies with all Applicable Laws and Regulations
(including all zoning, subdivision and land use laws and regulations and
Environmental Laws) and insurance requirements, except for any noncompliance
which would not have, individually or in the aggregate, a Material Adverse
Effect. With respect to each Construction Site, the related Plans and
Specifications have been or will be prepared in all material respects in
accordance with Applicable Laws and Regulations (including applicable
Environmental Laws and building, planning, zoning, subdivision and fire codes,
laws, rules and regulations) and such Facility and the other improvements to be
constructed on such Site will not, encroach in any manner onto any adjoining
land (except as permitted by express written easements or as insured by
appropriate title insurance). Except as disclosed in the Environmental Audit
with respect to each Site, there are no underground storage tanks at such Site.
(j) Investment Company Act. Lessee is not an "investment
company" or a company "controlled" by an "investment company", within the
meaning of the Investment Company Act of 1940.
(k) Public Utility Holding Company. Lessee is not
subject to regulation as a "holding company," an "affiliate" of a "holding
company", or a "subsidiary company" of a "holding company", within the meaning
of the Public Utility Holding Company Act of 1935.
(l) Licenses, Registrations and Permits. All material
Governmental Actions required for (x) the use, treatment, storage, transport,
disposal or disposition of any Hazardous Substance on, at, under or from each
Construction Site during the construction of the Facility thereon, (y)
construction of each Facility in accordance with the related Plans and
Specifications and the Construction Agency Agreement and (z) the use and
occupancy of the Sites and for the operation thereof (including a certificate or
certificates of occupancy for such Site or other legally equivalent permission
to occupy such Site) have either been obtained from the appropriate Governmental
Authorities having jurisdiction or from private parties, as the case may be, or
will be obtained from the appropriate Governmental Authorities having
jurisdiction or from private parties, as the case may be, prior to commencing
any such construction or use and operation, as applicable, except for any
Governmental Action, the failure to have obtained, would not, individually or in
the aggregate, have a Material Adverse Effect.
(m) Nature, Condition and Use of Sites. Each Site to be
acquired on a Site Acquisition Date consists of either a Developed Site on which
a Facility exists on the Site Acquisition
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Date or a Construction Site on which a Facility will be constructed pursuant to
the Construction Agency Agreement. The present condition and use of each Site
conforms with all conditions or requirements of all existing permits and
approvals issued with respect to such Site, and the present use of each Site and
Lessee's intended use of each Site under the Lease does not and will not,
violate any Applicable Laws and Regulations, except for failures to conform or
violations which would not, individually or in the aggregate, have a Material
Adverse Effect. No notices, complaints or orders of violation or noncompliance
or liability of any nature whatsoever have been issued or, to Lessee's
knowledge, threatened by any Governmental Authority or, in writing by, any other
Person with respect to any of the Sites or any present or intended future use
thereof, except for such violations and instances of noncompliance as would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on any such Site, and Lessee is not aware of any circumstances
which could give rise to the issuance of any such notices, complaints or orders.
(n) Utility Services. Each Site has available all
material services of public facilities and other utilities necessary for use and
operation of the Facility thereon for its primary intended purposes including
adequate water, gas and electrical supply, storm and sanitary sewerage
facilities, telephone and means of access between such Facility and public
highways for pedestrians and motor vehicles. All utilities serving each Site, or
proposed to serve such Site in accordance with the related Plans and
Specifications, are located in, and vehicular access to the Facility on such
Property is provided by, either public rights-of-way abutting such Site or by
Appurtenant Rights.
(o) Use and Operation of Sites. All material agreements,
easements and other rights, public or private, which are necessary to permit the
lawful use and operation of each Site as Lessee intends to use each such Site
under the Lease and which are necessary to permit the lawful intended use and
operation of all presently intended utilities, driveways, roads and other means
of egress and ingress to and from the same (including certificates of occupancy)
have been obtained and are in full force and effect (or with respect to
Construction Sites will be obtained and be in full force and effect on or prior
to the Completion of the Facility thereon) and Lessee has no actual knowledge of
any pending modification or cancellation of any of the same.
(p) Securities Act. Neither Lessee nor anyone authorized
to act on its behalf has, directly or indirectly, in violation of Section 5 of
the Securities Act or any state securities laws, offered or sold any interest in
the Notes, the
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Leased Property or the Lease, or in any security or lease the offering of which,
for purposes of the Securities Act or any state securities laws, would be deemed
to be part of the same offering as the offering of the aforementioned securities
or leases, or solicited any offer to acquire any of the aforementioned
securities or leases.
(q) Title. Neither Lessee nor any of its Affiliates has
taken or caused to be taken any action which would have an adverse effect on
Lessor's title to the Sites from that indicated in the Title Policies to be
delivered pursuant to Section 6.2(d). Neither Lessee nor any of its Affiliates
has created, consented to, incurred or suffered to exist any Lien upon the
Leased Property, including any of the Sites, other than Permitted Liens.
(r) Federal Reserve Regulations. Neither Lessee nor
Construction Agent, nor any Affiliate thereof will, directly or indirectly, use
any of the proceeds of the sale of the Notes or the Investment or of the
purchase by Lessor of the Sites or the Equipment for the purpose of purchasing
or carrying any "margin security" or "margin stock" within the meaning of
Regulation G, T, U or X of the Board of Governors of the Federal Reserve System,
respectively, or for the purpose of reducing or retiring any indebtedness which
was originally incurred to purchase or carry a margin security or margin stock
or for any other purpose which might cause any of the transactions contemplated
by this Agreement or any other Operative Document to constitute a "purpose
credit" within the meaning of Regulation G, T, U or X of the Board of Governors
of the Federal Reserve System, or for the purpose of purchasing or carrying any
security, and neither Lessee, nor Construction Agent, nor any Affiliate thereof
has taken or will otherwise take or permit any action by Lessee or Construction
Agent, or any of its Affiliates in connection with any of the transactions
contemplated by any of the Operative Documents which would involve a violation
of Regulation G, T, U, or X, or any other regulation of the Board of Governors
of the Federal Reserve System.
(s) ERISA. (i) Neither Lessee, nor any ERISA Affiliate,
presently maintains, participates in, or contributes to, a Plan (A) that has
incurred any material current liability or any "accumulated funding deficiency"
whether or not waived, as defined in Section 412 of the Code or Section 302 of
ERISA, that remains unpaid as of the applicable Advance Date for which Lessee or
any ERISA Affiliate has not reserved sufficient unencumbered assets to pay in
full such liability or deficiency by the payment due date thereof, (B) that has
incurred any material current liabilities with respect to terminations under
Title IV of ERISA or with respect to which as of the applicable Advance Date, a
"reportable event", as defined in Section 4043 of ERISA, has occurred, (C) which
is subject to Title IV of ERISA, but is not a
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Multiemployer Plan whose assets do not at least equal the present value of its
accrued benefits based on the actuarial methods and assumptions included in the
most recent actuarial valuation reports, (D) which is a Multiemployer Plan for
which Lessee or any ERISA Affiliate has received notice that the plan is in
reorganization or insolvent, (E) for which material actions, lawsuits or claims
have been asserted, or (F) for which penalties or taxes have been imposed under
Sections 502(i) and 502(l) of ERISA or Section 4975 of the Code. Neither Lessee
nor any ERISA Affiliate has in the immediate six year period had a complete or
partial withdrawal from any Multiemployer Plan and the liability to which Lessee
or any ERISA Affiliate would become subject under ERISA were there to be a
complete withdrawal from all Multiemployer Plans to which Lessee and its ERISA
Affiliates contribute is not in excess of $500,000. Neither Lessee, nor any
ERISA Affiliate, maintains any "welfare plan" (as defined in Section 3(1) of
ERISA) that obligates Lessee or any ERISA Affiliate to provide health or life
insurance benefits to retired employees of Lessee or any ERISA Affiliate for
which such liability could have a material effect on Lessee's ability to perform
its obligations under any of the Operative Documents.
(ii) The execution and delivery of this Agreement,
including the issuance and sale of the Notes and the consummation of the
transactions contemplated hereby and thereby under the Operative Documents, will
not involve any prohibited transactions, within the meaning of Section 406 of
ERISA or in connection with which a tax could be imposed pursuant to Section
4975 of the Code.
(t) Financial Information.
(i) The consolidated balance sheet of Lessee and its
Consolidated Subsidiaries as of October 27, 1996 and the related
consolidated statements of operations and cash flows for the fiscal
year then ended, reported on by Price Waterhouse LLP, as set forth
(or incorporated by reference) in Lessee's 1996 Form 10-K, a copy of
which has been delivered to each of Participants, fairly present, in
conformity with GAAP, the consolidated financial position of Lessee
and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and cash flows for such fiscal
year.
(ii) The unaudited consolidated balance sheet of Lessee
and its Consolidated Subsidiaries as of January 26, 1997 and the
related unaudited consolidated statements of operations and cash
flows for the portion of Lessee's fiscal year ended at the end of
such quarter, set forth (or incorporated by reference) in Lessee's
most current 10-Q, a copy of which has been delivered to each of
Participants,
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fairly present, in conformity with GAAP, the consolidated financial
position of Lessee and its Consolidated Subsidiaries as of such date
and their consolidated results of operations and cash flows for such
fiscal quarter, subject to normal year-end auditing adjustments.
(iii) Since January 26, 1997, there has been no Material
Adverse Effect.
(u) No Other Filings. On each Site Acquisition Date and
Equipment Acquisition Date, except for the filings and recordings listed in
Schedule III (which filings or recordings shall have been duly made on the
applicable Advance Date, or shall have been arranged to be made promptly
thereafter (including the payment of any fees or taxes relating to any of the
foregoing) in a manner satisfactory to Agent), no other filings or recordings
are necessary to validly and effectively convey to Lessor and Agent such
interests in the Leased Property and the Collateral as contemplated by the
Operative Documents, in each case free and clear of all Liens, other than
Permitted Liens.
(v) Disclosure. The information disclosed or caused to
be provided in writing by Lessee (or any Person authorized or employed by any
such Person as agent or otherwise) to Participants in connection with the
negotiation of the Operative Documents and the transactions contemplated
thereby, when taken as a whole with all other written disclosures to such
parties, do not contain an untrue statement of a material fact or omit to state
a material fact necessary to make the statements herein or therein, in light of
the circumstances under which they were made, misleading.
(w) Appraisal Data. The information provided by Lessee
and its Affiliates to the Appraisers and forming the basis for the conclusions
set forth in each Appraisal, taken as a whole, was true and correct in all
material respects and did not omit any information known and available to Lessee
necessary to make the information provided not materially misleading.
(x) Subjection to Government Regulation. Lessor will not
become, solely by reason of entering into the Operative Documents or
consummation of the transactions contemplated thereby (other than upon exercise
of remedies under the Lease or upon the expiration thereof), subject to ongoing
regulation of its operations by any Governmental Authority having jurisdiction
solely by reason of Lessee's business activities or the specific use of the
Leased Property; provided, however, that Lessee hereby makes no representation
in respect of any regulation applicable to Lessor relating generally to all
owners and lessors of real property (except as set forth in the succeeding
sentence) or
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equipment in the jurisdictions or of the type provided hereunder, the creation
of security interests or lending and financing (including federal and state bank
regulatory provisions). Except as may be required under federal and state bank
regulatory provisions, Lessor, as a result of its ownership of the Sites, will
not be required to obtain or hold any permits or licenses under Applicable Laws
and Regulations.
(y) Solvency. The consummation by Lessee of the
transactions contemplated by the Operative Documents did not and will not render
Lessee insolvent, nor was it made in contemplation of Lessee's insolvency; the
value of the assets and properties of Lessee at fair valuation and at their then
present fair salable value is and, after such transactions, will be greater than
Lessee's total liabilities, including contingent liabilities, as they become
due; the property remaining in the hands of Lessee was not and will not be an
unreasonably small amount of capital.
SECTION 8.2. Representations and Warranties of CSL. Effective as of
the date of execution hereof and as of the initial Advance Date, Credit Suisse
Leasing 92A, L.P., in its individual capacity (in such capacity, "CSL"), with
respect to representations and warranties as to CSL, or as Lessor, with respect
to representations and warranties as to Lessor, represents and warrants to each
of the other parties hereto as follows:
(a) Chief Executive Office. CSL's chief executive
office and principal place of business and the place where the documents,
accounts and records relating to the Overall Transaction are kept is located at
00 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx.
(b) Due Organization, etc. CSL is a limited
partnership duly organized and validly existing in good standing under the laws
of the State of Delaware and is in good standing as a foreign limited
partnership in the State of California and New York and has all corporate power
and authority to execute, deliver and perform its obligations under this
Agreement, the Subordinated Mortgage, the Subordinated Security Agreement, each
other Operative Document to which it is or will be a party as Lessor, and each
other agreement, instrument and document required to be executed and delivered
by each Operative Document, the Subordinated Mortgage and the Subordinated
Security Agreement. The general partner of CSL is Credit Suisse First Boston.
(c) Due Authorization; Enforceability, etc. This
Agreement, the Subordinated Mortgage, the Subordinated Security Agreement and
each other Operative Document to which Lessor is or
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will be a party have been or will be, duly authorized, executed and delivered by
or on behalf of Lessor and are, or upon execution and delivery will be, legal,
valid and binding obligations of Lessor, enforceable against it in accordance
with their respective terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, or similar laws affecting creditors' rights
generally and by general equitable principles.
(d) Non-Contravention. Neither the execution and
delivery by Lessor of the Subordinated Mortgage, the Subordinated Security
Agreement and the Operative Documents to which it is or will be a party, either
in its individual capacity, as Lessor, or both, nor compliance with the terms
and provisions thereof, conflicts with, results in a breach of, constitutes a
default under (with or without the giving of notice or lapse of time or both),
or violates any of the terms, conditions or provisions of: (i) the certificate
of limited partnership or limited partnership agreement of Lessor; (ii) any
bond, debenture, note, mortgage, indenture, agreement, lease or other instrument
to which Lessor, either in its individual capacity, as Agent, or both, is now a
party or by which it or its property, either in its individual capacity, as
Lessor, or both, is bound or affected, where such conflict, breach, default or
violation would be reasonably likely to materially and adversely affect the
ability of Lessor, either in its individual capacity, as Lessor or both, to
perform its obligations under the Subordinated Mortgage, the Subordinated
Security Agreement or any Operative Document to which it is or will be a party,
either in its individual capacity, as Lessor, or both; or (iii) any of the
terms, conditions or provisions of any Applicable Laws and Regulations
applicable to it in its individual capacity, as Lessor, or both, where such
conflict, breach, default or violation would be reasonably likely to materially
and adversely affect the ability of Lessor, either in its individual capacity,
as Lessor or both, to perform its obligations under the Subordinated Mortgage,
the Subordinated Security Agreement or any Operative Document to which it is or
will be a party.
(e) No Approvals, etc. Neither the execution and
delivery by Lessor of the Subordinated Mortgage, the Subordinated Security
Agreement or any of the Operative Documents to which it is a party requires the
consent or approval of, or the giving of notice to or registration with, or the
taking of any other action in respect of, any Governmental Authority or other
body governing its banking practices.
(f) Litigation. There is no action, proceeding or
investigation pending or threatened against Lessor which questions the validity
of the Subordinated Mortgage, the Subordinated Security Agreement or the
Operative Documents, and
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there is no action, proceeding or investigation pending or threatened which is
likely to result, either in any case or in the aggregate, in any material
adverse change in the ability of Lessor to perform its obligations under the
Subordinated Mortgage, the Subordinated Security Agreement or the Operative
Documents to which it is a party.
(g) Lessor Liens. The Leased Property is free and clear
of all Lessor Liens attributable to CSL.
(h) Assignment. Lessor has not assigned or transferred
any of its right, title or interest in or under the Lease except to Agent and
Participants in accordance with this Agreement and the other Operative
Documents.
(i) Defaults. No Loan Event of Default which does not
also constitute a Lease Event of Default and which is attributable solely to a
breach by Lessor of its obligations under the Subordinated Mortgage, the
Subordinated Security Agreement or the Operative Documents has occurred and is
continuing.
SECTION 8.3. Representations and Warranties of Agent. Credit Suisse
First Boston, in its individual capacity (in such capacity, "Bank") or as Agent,
as the case may be, hereby represents and warrants to the Participants as set
forth in this Section 8.3.
(a) Organization and Governmental Authority. Bank is a
bank duly organized and validly existing in good standing under the laws of
Switzerland, operating through its New York Branch and has the corporate power
and authority to enter into and perform its obligations under the Operative
Documents.
(b) Authorization; Binding Effect. The Operative
Documents to which Agent is or will be a party have been or will be, on the date
required to be delivered hereby, duly authorized, executed and delivered by
Agent, and this Participation Agreement is, and such other Operative Documents
are, or, when so executed and delivered by Agent will be, valid, legal and
binding agreements of Agent, enforceable against Agent in accordance with their
respective terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general principles of equity.
(c) Non-Contravention. Neither the execution and
delivery by Agent of the Operative Documents to which it is or will be a party,
either in its individual capacity, or as Agent, or both, nor compliance with and
performance of the terms and provisions thereof, conflicts with, results in a
breach of,
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constitutes a default under (with or without the giving of notice or lapse of
time or both), or violates any of the terms, conditions or provisions of: (i)
the articles of incorporation or bylaws of Bank; (ii) any bond, debenture, note,
mortgage, indenture, agreement, lease or other instrument to which Bank, either
in its individual capacity, or as Bank, or both, is now a party or by which it
or its property, either in its individual capacity, or as Agent, or both, is
bound or affected, where such conflict, breach, default or violation would be
reasonably likely to materially and adversely affect the ability of Agent,
either in its individual capacity, or as Agent, or both, to perform its
obligations under any Operative Document to which it is or will be a party,
either in its individual capacity, or as Agent, or both; or (iii) any of the
terms, conditions or provisions of any law, rule, regulation, order, injunction
or decree of any Governmental Authority applicable to it in its individual
capacity, or as Agent, or both, where such conflict, breach, default or
violation would be reasonably likely to materially and adversely affect the
ability of Agent, either in its individual capacity, or as Agent, or both, to
perform its obligations under any Operative Document to which it is or will be a
party.
(d) Absence of Litigation, etc. There is no litigation
(including derivative actions), arbitration or governmental proceedings pending
or, to the best knowledge of Agent, threatened against it which would be
reasonably likely to adversely affect Agent's ability to perform its obligations
under the Operative Documents to which it is party.
(e) Consents, etc. No Governmental Action from any
Governmental Authority is or will be required in connection with the execution
and delivery by Agent of the Operative Documents to which it is party or the
performance by Agent of its obligations under such Operative Documents.
ARTICLE 9.
COVENANTS OF LESSEE
SECTION 9.1. Further Assurances. Lessee, at its own cost and
expense, will cause to be promptly and duly taken, executed, acknowledged and
delivered all such further acts, documents and assurances as any Lender, Lessor
or Agent reasonably may request from time to time in order to carry out more
effectively the intent and purposes of this Agreement and the other Operative
Documents and the Overall Transaction. Lessee, at its sole cost and expense,
will cause all financing statements (including precautionary financing
statements, continuation statements and amendments), fixture filings and other
documents, to be recorded or filed at such places and times in such manner, and
will take
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all such other actions or cause such actions to be taken, as may be necessary or
as may be reasonably requested by any Participant, Lessor or Agent in order to
establish and perfect, and to maintain, preserve, protect at all times (i) the
title of Lessor to the Leased Property and Lessor's rights under this Agreement
and the other Operative Documents other than the Permitted Liens, (ii) the first
and prior Lien of the Mortgages on the Collateral (other than Permitted Liens)
and (iii) the first priority security interest of Agent on all Leased Property
created pursuant to the Operative Documents other than the Permitted Liens.
SECTION 9.2. Consolidation, Merger, Sale, etc.
(a) Lessee shall not consolidate with any Person, merge
with or into any Person or convey, transfer or lease to any Person all or
substantially all of its assets in any single transaction (or series of related
transactions); provided that Lessee may merge with another Person if immediately
after giving effect to such transaction Lessee is the surviving entity and:
(i) no Lease Default or Lease Event of Default
(including as a result of the breach of Section 9.12 hereof) shall
have occurred or would occur as a result thereof and be continuing;
and
(ii) the title of Lessor to the Leased Property and
Lessor's rights under this Agreement and the other Operative
Documents and the first and prior Lien of Agent in the Collateral
shall not be adversely affected.
SECTION 9.3. Corporate Existence. Lessee shall at all times maintain
its existence as a corporation in good standing under the laws of the State of
Delaware and shall use commercially reasonable efforts to preserve and keep in
full force and effect its franchises material to its business.
SECTION 9.4. Liens. Lessee shall not incur or suffer to exist any
Lien on any of the Sites other than Permitted Liens.
SECTION 9.5. Compliance Certificates.
(a) Lease Defaults. Following the Document Closing Date
and until the termination of the Lease, Lessee shall furnish to Agent (with
sufficient copies for each Participant) a certificate of Lessee signed by a
Responsible Officer of Lessee within five days after Lessee obtains knowledge
that there exists a Lease Default or Lease Event of Default, which such
certificate shall describe such Lease Default or Lease Event of Default in
reasonable detail, with a statement of Lessee's action with respect thereto
taken or proposed to be taken.
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(b) Annual Certificates. Within ninety (90) days after
the close of each fiscal year, Lessee shall deliver to Agent (with sufficient
copies for each Participant) a certificate of Lessee signed by a Responsible
Officer of Lessee to the effect that the signer is familiar with or has reviewed
the relevant terms of this Agreement, the Lease and each other Operative
Document to which Lessee is a party and has made, or caused to be made under his
or her supervision, a review of the transactions contemplated hereby and thereby
and the condition of the Leased Property during the preceding fiscal year, and
to the knowledge of such signer during such fiscal year, no conditions or events
have occurred which constituted a Lease Default or Lease Event of Default, nor
does the signer have knowledge, after due inquiry, of the existence as at the
date of such certificate, of any condition or event which constitutes a Lease
Default, Lease Event of Default or Significant Event or, if any such condition
or event existed or exists, specifying the nature and period of existence
thereof and what action Lessee has taken or is taking or proposes to take with
respect thereto. Notwithstanding the foregoing, Lessee shall not be required to
deliver such certificate if Lessee has previously delivered such a certificate
within ninety (90) days prior to the close of such fiscal year.
SECTION 9.6. Change of Name or Address. Lessee shall provide Agent
fifteen (15) Business Days prior written notice of any change in name, identity
or corporate structure (as such term is used in Section 9-402(7) of the New York
UCC) or the address of its chief executive office and principal place of
business or the office where it keeps its records concerning its accounts and
the Leased Property.
SECTION 9.7. Compliance with Law, Environmental Matters. (a) Lessee
shall comply at all times with all Applicable Laws and Regulations affecting the
Leased Property except (i) where the necessity of compliance therewith is
contested in good faith by proceedings constituting a Permitted Contest or (ii)
where the violation of which, individually or in the aggregate, would not
reasonably be expected to (x) result in a Material Adverse Effect or (y) if such
violation is not remedied, result in any Lien other than a Permitted Lien, and
Lessee and shall maintain at any Site only such quantities of Permitted
Hazardous Substances, if any, as are reasonably necessary for Lessee's
operations at any Site; and (b) Lessee shall not cause or permit the
installation of any underground storage tanks at any Site.
SECTION 9.8. Investigation by Governmental Authorities. Lessee shall
deliver to Agent (with sufficient copies for each Participant), promptly upon
Lessee's receipt, a copy of any notice of the intent by any Governmental
Authority to (x) take an action which would constitute a Condemnation which if
completed would reasonably be expected to reduce the Fair Market Value of
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the Site by more than $1,000,000, or which would otherwise constitute a
Significant Event, (y) investigate any Site for a material violation of any
Applicable Laws and Regulations on or at such Site, including any Environmental
Law, under which liability may be imposed upon Agent or any Participant or under
which liability having a Material Adverse Effect may be imposed on Lessee or (z)
investigate any Site (other than routine fire, life-safety and similar
inspections) for any violation of Applicable Laws and Regulations under which
criminal liability may be imposed upon Agent or any Participant or under which
liability having a Material Adverse Effect may be imposed on Lessee.
SECTION 9.9. Financial and Other Information. Lessee shall deliver
to Agent (with sufficient counterpart originals for each Participant), the
following financial and other information (provided that Lessee shall not be
required to deliver additional copies of such documents to Agent for delivery to
any Participant if Lessee has concurrently or previously delivered copies of
such documents to such Participant within the time periods specified below
pursuant to the Credit Agreement):
(a) Audited Statements. As soon as available and in any
event within ninety (90) days after the end of each fiscal year of Lessee, a
consolidated balance sheet of Lessee and its Consolidated Subsidiaries at the
end of such fiscal year and the related consolidated statements of operations,
cash flows and shareholders' equity for such fiscal year, setting forth in each
case in comparative form the figures at the end of, and for, the prior fiscal
year, all reported on in a manner acceptable to the SEC by independent public
accountants of nationally recognized standing (it being agreed that Lessee may
satisfy the requirements of this Section 9.9(a) with the delivery of its Annual
Report on Form 10-K filed with the SEC);
(b) Quarterly Statements. As soon as available and in
any event within forty-five (45) days after the end of each of the first three
quarters of each fiscal year of Lessee, the consolidated balance sheet of Lessee
and its Consolidated Subsidiaries at the end of such quarter and the related
consolidated statement of operations and cash flows of Lessee and its
Consolidated Subsidiaries for such quarter and the portion of Lessee's fiscal
year ended at the end of such quarter, setting forth in each case in comparative
form the figures at the end of, and for, the corresponding quarter and the
corresponding portion of Lessee's prior fiscal year; it being agreed that (i)
delivery of such financial statements shall be deemed to be a representation by
Lessee that such financial statements fairly present, in conformity with GAAP,
the consolidated financial position of Lessee and its Consolidated Subsidiaries
as of the close of such quarterly fiscal period and their consolidated
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results of operations and cash flows for the portion of the fiscal year ending
with such quarterly fiscal period (subject to normal year-end adjustments) and
(ii) Lessee may satisfy the requirements of this Section 9.9(b) with the
delivery of its Quarterly Report on Form 10-Q filed with the SEC;
(c) Shareholder Mailings. Promptly upon the mailing
thereof to the shareholders of Lessee generally, copies of all financial
statements, reports and proxy statements so mailed;
(d) Supplemental Environmental Information. Promptly
upon receipt thereof, copies of all updates to the baseline study of the
environmental condition of any of Sites as set forth in the Environmental Audits
required to be delivered pursuant to Section 6.2(f);
(e) Ratings Change. Within five (5) Business Days of any
change by S&P or Xxxxx'x in the rating for the unsecured long-term debt of
Lessee, notice of the new rating established by S&P and/or Xxxxx'x.
(f) Other. With reasonable promptness, unless the
disclosure of such data or information is protected by the attorney-client
privilege or attorney work-product privilege pursuant to the laws of the
jurisdiction in which such privilege arises or such disclosure is prohibited by
Applicable Laws and Regulations, and subject to appropriate confidentiality
undertakings with respect thereto, such other data and information (financial or
otherwise) which is either maintained in the ordinary course of Lessee's
business or can be obtained or derived without undue burden to Lessee as to the
business of Lessee or the Leased Property or any portion thereof as from time to
time may be reasonably requested in writing by Agent. Subject to the foregoing
restrictions, Lessee shall permit Agent, Lessor and any other Participant during
normal business hours to visit and inspect under Lessee's guidance and, so long
as no Lease Default or Lease Event of Default shall have occurred and be
continuing, upon not less than three (3) Business Days' prior notice, any of the
properties of Lessee, or its Subsidiaries, to examine (to the extent material to
ascertaining compliance with the terms and provisions hereof or to the extent
reasonably related to the financial condition or material operations of Lessee
or any of its Subsidiaries) all of their books of account, records, reports and
other papers, to make copies and extracts therefrom and (to the extent material
to ascertaining compliance with the terms and provisions hereof or to the extent
reasonably related to the financial condition or material operations of Lessee
or any of its Subsidiaries) to discuss their respective affairs, finances and
accounts with their officers, employees (who are managers or officers), and
independent public accountants (and by this provision Lessee authorizes such
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accountants to discuss with Agent, Lessor or any other Participant the finances
and affairs of Lessee and any of its Subsidiaries, provided, that such Person
shall have given prior written notice to Lessee of its intention to discuss such
finances and affairs with such accountants and have given Lessee the opportunity
to participate in such discussions), all at such reasonable times and as often
as may be reasonably requested.
SECTION 9.10. Securities. Lessee shall not, nor shall it permit
anyone authorized to act on its behalf to, take any action which would subject
the issuance or sale of the Notes, Investment, any portion of the Leased
Property or the Lease, or in any security or lease the offering of which, for
purposes of the Securities Act or any state securities laws, would be deemed to
be part of the same offering as the offering of the aforementioned securities or
leases to the registration requirements of Section 5 of the Securities Act or
any state securities laws.
SECTION 9.11. Interest Rates. With respect to each determination of
an interest rate pursuant to the Loan Agreement and this Participation
Agreement, Lessee agrees to be bound by Sections 2.1 and 2.2 of the Loan
Agreement and Article 4 of this Agreement.
SECTION 9.12. Revolving Credit Facility. Lessee covenants and agrees
that, so long as any portion of the obligations of the Lessee under this
Participation Agreement, the Lease or any other Operative Document shall remain
unpaid or unperformed (other than performance of obligations that survive the
expiration or termination of the Lease and that are inchoate and contingent as
of the expiration or termination of the Lease), Lessee will, and will cause each
of its Subsidiaries to, perform, comply with and be bound by all of its
agreements, covenants and obligations contained in Sections 5.09 through 5.14 of
the Credit Agreement (giving effect to any applicable grace and cure periods),
whether or not any amounts are in fact outstanding under the Credit Agreement,
as such Sections are in effect from time to time prior to the date upon which
the first of the following shall occur (i) the ratings established or deemed
established by either Xxxxx'x or S&P for the senior unsecured long-term debt of
AMAT shall fall below Baa3 or BBB-, respectively, or neither Xxxxx'x or S&P
shall have in effect a rating of such debt or (ii) the debt and obligations
under the Credit Agreement are no longer outstanding and the Credit Agreement is
no longer in full force and effect (such Sections and all other terms of the
Credit Agreement to which reference is made herein, together with all related
definitions and ancillary provisions, being hereby incorporated into this
Participation Agreement by reference as though specifically set forth in
herein). Upon the occurrence of any of clauses (i) or (ii), such Sections shall
be the Sections
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as of the date immediately preceding the date of such occurrence. In determining
compliance with such Sections for purposes of this Participation Agreement at
any time following the termination of the Credit Agreement, any action that
would require consent or approval thereunder shall require the consent or
approval of Required Participants.
ARTICLE 10.
OTHER COVENANTS AND AGREEMENTS
SECTION 10.1. Cooperation with Lessee. Agent, Lessor and each other
Participant shall, to the extent reasonably requested by Lessee (but without
assuming additional liability on account thereof), at Lessee's expense,
cooperate to allow Lessee to (a) perform its covenants contained in Section 9.1,
including at any time and from time to time, upon the reasonable request of
Lessee, to promptly and duly execute and deliver any and all such further
instruments, documents and financing statements (and continuation statements
related thereto) as Lessee may reasonably request in order to perform such
covenants and (b) further Lessee's requirements as lessee of the Leased
Property, including to file any statement with respect to any tax abatements or
other requirements.
SECTION 10.2. Covenants of Lessor.
(a) Discharge of Liens. Lessor covenants that it will
not create or permit to exist at any time, and will, at its own cost and
expense, promptly take such action as may be necessary duly to discharge, or to
cause to be discharged, all Lessor Liens attributable to it and will cause
restitution to be made to the Leased Property in the amount of any diminution of
the value thereof as a result of its failure to comply with its obligations
under this Section 10.2(a). Notwithstanding the foregoing, Lessor shall not be
required to so discharge any such Lessor Lien while the same is being contested
in good faith by appropriate proceedings diligently prosecuted so long as such
proceedings shall not involve any meaningful danger of the impairment of the
Liens granted by Lessor to Agent including the Liens of the Mortgages or of the
sale, forfeiture or loss of, and shall not interfere with the use or disposition
of, any part of the Lease, the Leased Property or title thereto or any interest
therein or the payment of Rent; provided, however, that Lessor shall discharge
any such Lessor Lien attributable to it, whether or not subject to contest as
provided above, upon the purchase of the Leased Property by Lessee pursuant to
the Lease or the sale of the Leased Property in connection with the Remarketing
Option.
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(b) Change of Principal Place of Business. Lessor shall
give prompt notice to Lessee and Agent if Lessor's principal place of business
or chief executive office, or the office where the records concerning the
accounts or contract rights relating to the Leased Property or the Overall
Transaction are kept, shall cease to be located at 00 Xxxxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx or if it shall change its name or identity.
(c) Loan Agreement. As between Lessor and Lessee, Lessor
and each Lender hereby agrees that, so long as the Lease is in effect, Lessor
shall not consent to or permit any amendment of the terms and provisions of the
Loan Agreement, the Mortgages or any Note, whether or not any Lease Event of
Default shall have occurred and be continuing, other than amendments which are
ministerial in nature and that do not have an adverse effect on Lessee, without
the prior written consent of Lessee.
(d) Depreciation. Prior to the Lease Expiration Date, no
Participant shall claim any federal or state tax attributes or benefits
(including depreciation) relating to the Leased Property unless required to do
so by an appropriate taxing authority or after a clearly applicable change in
Applicable Laws and Regulations or as a protective response to a proposed
adjustment by a Governmental Authority; provided, however, that if an
appropriate taxing authority shall require any Participant to claim any such
federal or state tax attributes or benefits, such Participant shall promptly
notify Lessee thereof and shall permit Lessee to contest such requirement in a
manner similar to the contest rights provided in, and subject to any applicable
limitation to a context contained in, Section 11.2(b) hereof.
(e) Organization. Unless otherwise approved by Lessee,
which approval shall not be unreasonably withheld, and provided that no Lease
Default or Lease Event of Default shall have occurred and be continuing, CSL (i)
shall at all times remain a solvent, multi-asset company with assets beyond its
interest in the Leased Property and a limited partnership with Credit Suisse
First Boston as its general partner, provided, however, that CSL may merge,
consolidate or combine with an Affiliate or, as a result of a reorganization,
transfer substantially all of its assets or partnership interests to an
Affiliate if the surviving entity has a comparable net worth to Credit Suisse
First Boston or if Credit Suisse First Boston guarantees such entity's general
obligations except as provided for and subject in all cases to the limitations
on liability set forth at Section 13.13 hereof, and (ii) shall not engage in any
other business substantially different from (A) the business as conducted on the
Document Closing Date (including engaging in the business of leasing personal
and real property as lessor, or acting as agent, broker or advisor in leasing
such property and
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making, acquiring or servicing loans or other investments or extensions of
credit in connection therewith or incidental thereto) or (B) the business as
otherwise permitted in Lessor's certificate of limited partnership or other
organizational documents as in effect on the Document Closing Date.
SECTION 10.3. Lessor Transfers.
(a) Lessor shall not assign, convey or otherwise
transfer all or any portion of its right, title or interest in, to or under the
Leased Property (except pursuant to Article VI of the Lease) or any of the
Operative Documents without the prior written consent of Required Lenders, which
consent may not be unreasonably withheld, except that without the prior written
consent of Required Lenders, Lessor may assign (reserving all rights of Lessor
to indemnification relating to the period prior to such transfer) all (but not
less than all) of its right, title and interest in, to and under the Leased
Property and the Operative Documents to an entity (i) that has a net worth of at
least $150,000,000, (ii) that has Credit Suisse First Boston as its general
partner, or (iii) the obligations of which under the Operative Documents are
guaranteed by Credit Suisse First Boston pursuant to a guaranty reasonably
acceptable in form and substance to Lessee. Any such transfer pursuant to this
Section 10.3 (x) shall be at Lessor's sole cost and expense, (y) shall not
require other changes to the Operative Documents which would alter the
obligations of Lessee under any of the Operative Documents and (z) so long as no
Lease Event of Default shall be continuing, shall be further conditioned upon
Lessor's receipt of Lessee's prior written consent, which consent shall not be
unreasonably withheld. So long as no Lease Event of Default shall be continuing,
Lessor shall provide at least five (5) Business Days' prior written notice of
any such transfer to Lessee.
(b) Upon the occurrence and continuance of a Loan Event
of Default specified in clause (b), (c), (d) or (e) of Section 6.1 of the Loan
Agreement, Agent may (at the direction of the Required Lenders) direct Lessor to
transfer, and Lessor shall promptly transfer, to a Eurodollar Lender or another
entity (provided that in the case of a transfer to another entity each of the
conditions set forth in Section 10.3(a) shall have been satisfied, except that
the notice required by the last sentence of Section 10.3(a) may be given by
Agent to Lessee) (the "Replacement Lessor") that is willing to accept the same,
all of Lessor's right, title, interest, duties and obligations in respect of the
Leased Property, the Investment, the Lease and the other Operative Documents
(without recourse to Lessor and reserving all rights of Lessor to
indemnification relating to the period prior to such transfer) for an amount
payable to Lessor in immediately available funds that is equal to the
outstanding Investment, accrued and unpaid Yield thereon plus all other amounts
then owing to Lessor under the Operative Documents and
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the assumption by such Replacement Lessor of the duties and obligations of
Lessor under the Operative Documents; provided that such Replacement Lessor
assumes the duties and obligations of Lessor under the Operative Documents. As a
condition precedent to the effectiveness of such transfer, Lessor shall have
obtained, at its expense, all necessary approvals from Governmental Authorities
and other Persons for such transfers and shall have effected, at its expense,
all recordings and filings necessary to perfect such transfers. All reasonable
and documented expenses of Agent or Lessee incurred in connection with such
transfer shall be reimbursed by Lessor promptly.
SECTION 10.4. Restrictions on and Effect of Transfer. No Lender
shall assign, convey or otherwise transfer all or any portion of its right,
title or interest in, to or under any Note or any of the other Operative
Documents without the prior written consent of each of Agent (who may condition
its approval upon the satisfaction of any of the conditions of subsections (a)
through (g) below) Lessor, CP Lender and Lessee, except that without the prior
written consent of Agent or Lessee (w) any bank or similar financial or
commercial lending institution may pledge its interest in the ordinary course of
its business (including to any Federal Reserve Bank), provided that no transfer
upon a foreclosure pursuant to such a pledge may occur unless the other
provisions of this Section 10.4 are complied with, (x) any Lender may transfer
all or any portion of its interest to a member of its Consolidated Group upon
compliance with subsections (a), (b) and (g) below, (y) any Lender may transfer
all or any portion of its interest to any other existing Participant upon
compliance with subsections (a), (b), (c), (f) and (g) below, and (z) any Lender
may transfer any or all of such right, title and interest upon compliance with
subsections (a) through (g) below; and provided, further, that the restrictions
set forth in this Section 10.4 shall not apply to a participation, with respect
to which Section 10.5 shall apply:
(a) Required Notice and Effective Date. Any Lender
desiring to effect a transfer of its interest shall give written
notice of each such proposed transfer to Lessee, Agent and each
other Participant at least ten (10) days prior to such proposed
transfer, setting forth the name of such proposed transferee, the
percentage or interest to be retained by such Lender, if any, and
the date on which such transfer is proposed to become effective. All
reasonable out-of-pocket costs incurred by Agent and Lessee in
connection with any such disposition by a Lender under this Section
10.4 shall be borne by such Lender. In the event of a transfer under
this Section 10.4, any expenses incurred by the transferee in
connection with its review of the Operative Documents and its
investigation of the transactions contemplated thereby shall be
borne by such
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transferee or the relevant Lender, as they may determine, but shall
not be considered costs and expenses which Lessee is obligated to
pay or reimburse under Section 11.1 or as Supplemental Rent.
(b) Ratable Transfer; Assumption of Obligations. Each
such transfer shall be to a transferee (or to one or more
transferees in the same Consolidated Group) of a ratable and
constant percentage of such Lender's interests (i) in all its Notes
and (ii) its rights and obligations under the Capital Asset Purchase
Agreement in accordance with Section 7 thereof. Any transferee
pursuant to this Section 10.4 shall have executed and delivered to
Agent a letter in substantially the form of the letter attached
hereto as Exhibit Z, and thereupon the obligations of the
transferring Lender under the Operative Documents shall be
proportionately released and reduced to the extent of such transfer.
Upon any such transfer as above provided, the transferee shall be
deemed to be bound by all obligations (whether or not yet accrued)
under, and to have become a party to, all Operative Documents to
which its transferor was a party, shall be deemed the pertinent
"Lender" for all purposes of the Operative Documents and shall be
deemed to have made that portion of the payments pursuant to this
Participation Agreement previously made or deemed to have been made
by the transferor represented by the interest being conveyed; and
each reference herein and in the other Operative Documents to the
pertinent "Lender" shall thereafter be deemed a reference to the
transferee, to the extent of such transfer, for all purposes. Upon
any such transfer, Agent shall deliver to Lessee amended Schedules I
and II to this Participation Agreement, revised to reflect the
relevant information for such new Lender and the Commitment of such
new Lender (and the revised Commitment of the transferor Lender if
it shall not have transferred its entire interest).
(c) Employee Benefit Plans. No Lender may make any such
assignment, conveyance or transfer to or in connection with any
arrangement or understanding in any way involving any employee
benefit plan (or its related trust), as defined in Section 3(3) of
ERISA, or with the assets of any such plan (or its related trust),
as defined in Section 4975(e)(1) of the Code (other than a
governmental plan, as defined in Section 3(32) of ERISA), with
respect to which Lessee or such Lender or any of their Affiliates is
a party in interest within the meaning of ERISA or a "disqualified
person" within the meaning of the Code.
(d) Financial Condition of Transferee. No transfer by a
Lender shall be effective against the other parties to
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this Participation Agreement unless the transferee (i) (x) has a
credit rating of either BBB- by S&P or Baa3 by Xxxxx'x (or such
transferee's Affiliate has such rating) and (y) is (A) a bank or
other financial institution with a combined capital, surplus and
undivided profits of at least $75,000,000, or (B) any subsidiary of
such a bank, financial institution or corporation, provided that
such bank, financial institution or corporation furnishes a guaranty
with respect to the transferee's obligations as a Lender, or (C) any
other entity, provided the transferee's obligations as a Lender are
guaranteed by the transferor Lender, the form of which guaranty
shall be approved by Agent and, provided no Lease Event of Default
has occurred and is continuing, by Lessee, which approval shall not
be unreasonably withheld or (ii) is otherwise approved by Lessee,
such approval not to be unreasonably withheld.
(e) Amounts. Any transfer of Notes shall be in a
principal amount which is equal to or greater than $5,000,000;
provided that the foregoing limitation shall not apply to a Lender's
transfer of the entire principal amount of such Lender's Notes.
(f) Effect. From and after any transfer of its Notes
(other than a pledge) the transferring Lender shall be released, to
the extent assumed by the transferee, from its liability and
obligations hereunder and under the other Operative Documents to
which such transferor is a party in respect of obligations to be
performed on or after the date of such transfer. Upon any transfer
by a Lender as above provided, any such transferee shall be deemed a
"Lender" for all purposes of such documents and each reference
herein to a Lender shall thereafter be deemed a reference to such
transferee for all purposes, except as the context may otherwise
require. Notwithstanding any transfer as provided in this Section
10.4, the transferor shall be entitled to all benefits accrued and
all rights vested prior to such transfer, including, without
limitation, rights to indemnification under this Participation
Agreement or any other Operative Document.
(g) Transfer Fee. In connection with any transfer by a
Lender pursuant to this Section 10.4, such Lender shall pay a fee of
$3,500 to Agent on or prior to the date of such transfer.
SECTION 10.5. Covenants and Agreements of Lenders.
(a) Participations. Notwithstanding anything in Section
10.4 to the contrary, each Lender covenants and agrees that it will not grant
participations in its Notes to any Person
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(a "Transferee") unless such Person (i) is a bank or other financial institution
and (ii) represents and warrants, in writing, to such Lender for the benefit of
the Lenders, Lessor and Lessee that no part of the funds used by it to acquire
an interest in the Notes constitutes assets of any Plan or its related trust.
Any such Person shall require any transferee of its interest in the Notes to
make the representations and warranties set forth in the preceding sentence, in
writing, to such Person for its benefit and the benefit of the Participants and
Lessee. In the event of any such sale by a Lender of a participating interest to
a Transferee, such Lender's obligations under this Participation Agreement and
under the other Operative Documents shall remain unchanged, such Lender shall
remain solely responsible for the performance thereof, such Lender shall remain
the holder of its Note for all purposes under this Participation Agreement and
under the other Operative Documents, and Lessor, Agent and, except as set forth
in Section 10.4(b), Lessee shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Participation Agreement and under the other Operative Documents. Any such
participation shall be in a ratable and constant percentage of all of such
Participant's Notes.
(b) Transferee Indemnities. Each Transferee shall be
entitled to the benefits of Article VII with respect to its Notes or
participation in the Loans outstanding from time to time; provided, that no
Transferee shall be entitled to receive any greater amount pursuant to such
Article than the transferor Lender would have been entitled to receive in
respect of the amount of the Notes or participation transferred by such
transferor Lender to such Transferee had no such transfer or participation
occurred.
(c) Purchase Events Under the Capital Asset Purchase
Agreement. Each Eurodollar Lender agrees that it will not make the notification
described in clause (v), (vi) or (vii) of the definition of "Purchase Event" set
forth in the Capital Asset Purchase Agreement unless it has first pursued the
related indemnities from Lessee in accordance with Sections 11.4 and 11.5 and
such indemnities are not being or, in such Eurodollar Lender's reasonable
determination, will not be paid by Lessee.
(d) Amendments of the Capital Asset Purchase Agreement.
As between the Lenders and Lessee, each Lender hereby agrees that, so long as
the Lease is in effect and no Lease Event of Default shall have occurred and be
continuing, such Lender shall not consent to or permit any amendment to the
terms and provisions of the Capital Asset Purchase Agreement that would have a
material adverse effect on Lessee or impose additional fees and costs on a party
that would be indemnifiable or
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reimbursed by Lessee, without the prior written consent of Lessee.
SECTION 10.6. Future Lenders. Each Lender, by its acceptance of its
Note or Notes, shall be deemed to be bound by and, upon compliance with the
requirements of Section 10.4, will be entitled to all of the benefits of the
provisions of this Agreement.
SECTION 10.7. Agent under Participation Agreement and Mortgages. For
purposes of this Agreement and the Mortgages, the parties hereto agree that
Agent shall be the agent of Lessor and the Lenders, with Agent's duties and
obligations hereunder and thereunder being subject to the limitations, and Agent
being entitled to the rights set forth in Article 12 hereof.
ARTICLE 11.
INDEMNIFICATION
SECTION 11.1. General Indemnification. Lessee agrees, whether or not
any of the transactions contemplated hereby shall be consummated, to assume
liability for, and to indemnify, protect, defend, save and keep harmless each
Indemnitee from and against any and all Claims that may be imposed on, incurred
by or asserted against such Indemnitee (whether because of action or omission by
such Indemnitee or otherwise), whether or not such Indemnitee shall also be
indemnified as to any such Claim by any other Person and whether or not such
Claim arises or accrues prior to any Advance Date or after the Lease Expiration
Date, in any way relating to or arising out of (a) any of the Operative
Documents or any of the transactions contemplated thereby or any investigation,
litigation or proceeding in connection therewith, and any amendment,
modification or waiver in respect thereof; or (b) the Leased Property or any
part thereof or interest therein; or (c) the acquisition, mortgaging, design,
construction, preparation, installation, inspection, delivery, nondelivery,
acceptance, rejection, purchase, ownership, possession, rental, lease, sublease,
repossession, maintenance, repair, alteration, modification, addition or
substitution, storage, transfer or title, redelivery, use, financing,
refinancing, operation, condition, sale (including, without limitation, any sale
pursuant to Articles XVI, XVII or XXII of the Lease), return or other
disposition of all or any part of any interest in the Leased Property or the
imposition of any Lien (or incurring of any liability to refund or pay over any
amount as a result of any Lien) thereon, including, without limitation: (i)
Claims or penalties arising from any violation of Applicable Laws and
Regulations (including in tort (strict liability or otherwise)), (ii) latent or
other defects, whether or not discoverable,
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(iii) any Claim of BNP or in respect of any agreement with BNP to purchase the
Existing Sites, including any Claim relating to a breach of any such agreement,
and (iv) any Claim for patent, trademark or copyright infringement; (d) the
offer, issuance, sale or delivery of the Notes or Investment; (e) the breach by
Lessee of any representation or warranty made by it or deemed made by it in any
Operative Document; (f) the transactions contemplated hereby or by any other
Operative Document, in respect of the application of Parts 4 and 5 of Subtitle B
of Title I of ERISA and any prohibited transaction described in Section 4975(c)
of the Code or (g) any other agreement entered into or assumed by Lessee in
connection with the Leased Property (including, in each case, matters based on
or arising from the negligence of any Indemnitee, except any indemnification of
Agent for its own negligence in the handling of funds as specifically excluded
below); provided, however, Lessee shall not be required to indemnify under this
Section 11.1 for (1) as to an Indemnitee, any Claim to the extent resulting from
the willful misconduct or gross negligence of such Indemnitee (it being
understood that no Indemnitee shall be deemed to be negligent, grossly negligent
or to have acted wilfully and the parties acknowledge that this indemnity shall
fully apply in connection with any Claim of BNP if Lessor fails to purchase the
Sites upon the failure of any condition thereto set forth in Article 6 of this
Participation Agreement), (2) any Claims in respect of Taxes (such Claims to be
subject to Section 11.2), other than a payment necessary to make payments under
this Section 11.1 on an after-tax basis; provided that the exclusion provided in
this clause (2) does not apply to any taxes or penalties included in Claims
against which the Indemnitee is provided an indemnification under clause (f) of
this Section 11.1, (3) as to an Indemnitee, any Claim resulting from Lessor
Liens which such Indemnitee is responsible for discharging under the Operative
Documents (4) as to an Indemnitee, any Claim to the extent resulting from any
transfer by such Indemnitee in violation of this Agreement or the Operative
Documents (provided, however, that this clause (4) shall not affect the
indemnification rights under this Section 11.1 of any Participant which becomes
a Participant pursuant to a transfer under Section 10.3 or 10.4), (5) as to an
Indemnitee, any Claim against such Indemnitee by another Indemnitee if such
Claim is not related or connected in any way with any action or inaction of
Lessee or any Claim by or against Lessee or for which Lessee is otherwise liable
under the Operative Documents, (6) as to Lessor, any Claim against Lessor to the
extent arising from any breach of a representation or warranty by Lessor set
forth in Section 8.2 of this Agreement or in any other Operative Document or the
Private Placement Letter or from the failure of Lessor to comply in all material
respects with the terms of this Agreement or the other Operative Documents, (7)
as to an Indemnitee, any Claim against such Indemnitee to the extent arising
from a breach of a representation or warranty by such Indemnitee under this
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Agreement or the other Operative Documents or from the failure of such
Indemnitee to comply in all material respects with the material covenants in
this Agreement and the other Operative Documents applicable to such Indemnitee,
(8) as to Lessor, any Claim to the extent resulting from Lessor Liens, (9) as to
an Indemnitee who purchases a Leased Property pursuant to Sections 22.1 or 22.2
of the Lease, any Claim to the extent attributable to acts or events occurring
after the expiration of the Term or the return or remarketing of such Leased
Property so long as Lessor, Agent and Participants are not exercising remedies
against Lessee in respect of the Operative Documents and no Lease Default or
Lease Event of Default has occurred and is continuing, (10) as to Agent, any
Claim against Agent to the extent resulting from its own negligence in handling
of funds, (11) as to any Indemnitee, any Claim against such Indemnitee to the
extent resulting from the wrongful failure of such Indemnitee to distribute to
any other party to this Agreement, as required by the Operative Documents, any
funds received by such Indemnitee or (12) without limiting any provisions of the
Operative Documents requiring Lessee to reimburse or pay the costs of an
Indemnitee, any out-of-pocket or internal costs or expenses of any Indemnitee in
connection with the day-to-day administration of the transactions under the
Operative Documents and which are not included in the definitions of
"Transaction Expenses" or "Supplemental Rent."
SECTION 11.2. General Tax Indemnity.
(a) Tax Indemnity. Lessee shall pay on an after-tax
basis, and on written demand shall indemnify and hold each Indemnitee harmless
from and against, any and all Taxes, howsoever imposed, on or with respect to
any Indemnitee, the Leased Property or any portion thereof, any Operative
Document or Lessee or any sublessee or user of the Leased Property, by the
United States or by any state or local government or other taxing authority in
the United States, or by any taxing authority outside the United States, in
connection with or in any way relating to (i) the acquisition, mortgaging,
design, construction, preparation, installation, inspection, delivery,
nondelivery, acceptance, rejection, purchase, ownership, possession, rental,
lease, sublease, repossession, maintenance, repair, alteration, modification,
addition or substitution, storage, transfer of title, redelivery, use,
financing, refinancing, operation, condition, purchase, repurchase, sale, return
or other application or disposition of all or any part of the Leased Property or
the imposition of any Lien (or incurrence of any liability to refund or pay over
any amount as a result of any Lien) thereon, (ii) Basic Rent or Supplemental
Rent or the receipts or earnings arising from or received with respect to the
Leased Property or any part thereof, or any interest therein or any applications
or dispositions thereof, (iii) any other amount
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paid or payable pursuant to the Notes, Investment or any other Operative
Documents, (iv) the Leased Property or any part thereof or any interest therein,
(v) all or any of the Operative Documents, any other documents contemplated
thereby and any amendments and supplements thereto, and (vi) otherwise with
respect to or in connection with the transactions contemplated by the Operative
Documents or the enforcement thereof; provided, however, that the
indemnification obligation of this Section 11.2 shall not apply to (i) Taxes
which are based upon or measured by the Indemnitee's net income, or which are
expressly in substitution for, or relieve Indemnitee from, any actual Tax based
upon or measured by Indemnitee's net income (except that Lessee shall pay or
reimburse, and indemnify and hold harmless, any Indemnitee which is not
incorporated under the laws of the United States, or a state thereof, and which
has complied with Section 11.3, from any deduction or withholding of any United
States Federal income tax); (ii) Taxes characterized under local law as
franchise, net worth, or shareholder's capital (excluding, however, any
value-added, sales, use, rental license, property or similar Taxes); (iii) Taxes
based upon (A) the voluntary transfer, assignment or disposition by Agent,
Lessor or any Participant of any interest in the Leased Property (other than a
transfer pursuant to the exercise of remedies under the Operative Documents,
transfers pursuant to the exercise of any Remarketing Option or Purchase Option,
a transfer to Lessee or its designee or otherwise pursuant to the Lease), (B)
any involuntary transfer or other disposition in connection with a bankruptcy or
other proceeding for the relief of creditors in which such Indemnitee is the
debtor or (C) any foreclosure sale of an asset of such Indemnitee; (iv) any
Taxes which constitute withholding taxes to the extent imposed with respect to
payments to an Indemnitee that is a transferee to the extent of the excess of
such Taxes over the amount of such Taxes which would have been imposed had there
not been a sale, assignment, transfer or other disposition (whether voluntary or
involuntary) to such transferee; (v) Taxes imposed in respect of any period
after the expiration or earlier termination of the Lease and the payment by
Lessee of all amounts due under the Operative Documents or, if later during the
exercise of remedies while Lease Event of Default is continuing; provided that
the exceptions set forth in this clause (v) shall not apply to Taxes to the
extent such Taxes relate to events or matters arising prior to or simultaneously
with the time of the earliest occurrence of the events covered in this clause
(v), and until Lessee has satisfied and fulfilled its obligations under the
Lease; (vi) Taxes to the extent that such Taxes would not have been imposed on
or with respect to an Indemnitee but for the willful misconduct, gross
negligence or breach of any representation, warranty or covenant of such
Indemnitee or Affiliate thereof; and (vii) any California taxes withheld
pursuant to Section 26131-3 of Title 18 of the California Code of Regulations
(the "California Regulations") as a result of such
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Indemnitee's failing to qualify for any applicable exemption from the
withholding required by Section 11.3 (for this purpose the term "exemption"
shall include, without limitation, (A) having a "permanent place of business" in
California within the meaning of such section; (B) qualifying as a "bank" or
"banking association" within the meaning of such section; and (C) the character
of such payment failing to constitute income from sources within the State of
California within the meaning of Sections 23040 and 26131-1 of the California
Regulations (it being understood, however, that until such time as it receives
an opinion of independent counsel selected by Lessee and reasonably acceptable
to Lessor to the effect that it is required to do so, Lessee will not withhold
any amounts for payment to the California Franchise Tax Board with respect to
Rent payable pursuant to the Operative Documents)).
(b) Contests. Lessee shall pay on or before the time or
times prescribed by law any Taxes (except any Taxes excluded by the proviso to
Section 11.2(a)); provided, however, that Lessee shall be under no obligation to
pay any such Tax so long as the payment of such Tax is not delinquent or is
being contested by a Permitted Contest. If any claim or claims is or are made
against any Indemnitee solely for any Tax which is subject to indemnification as
provided in Section 11.2(a), Indemnitee shall as soon as practicable, but in no
event more than twenty (20) days after receipt of formal written notice of the
Tax or proposed Tax, notify Lessee and if, in the reasonable opinion of Lessee
and (in the case of any Tax which may reasonably be expected to exceed $250,000
in the aggregate) tax counsel acceptable to the Indemnitee, there exists a
reasonable basis to contest such Tax which satisfies the requirements of ABA
Formal Opinion 85-352 (and if the provisos of the definition of "Permitted
Contest" continue to be satisfied and so long as no Lease Event of Default
exists), Lessee at its expense may, to the extent permitted by Applicable Laws
and Regulations, contest such Tax, and subsequently may appeal any adverse
determination, in the appropriate administrative and legal forums; provided,
that in all other circumstances, upon notice from Lessee to such Indemnitee that
there exists a reasonable basis to contest any such Tax which satisfies the
requirements of ABA Formal Opinion 85-352 (as supported by an opinion of tax
counsel to Lessee reasonably acceptable to the Indemnitee), the Indemnitee, at
Lessee's expense, shall contest any such Tax (so long as the provisos of the
definition of "Permitted Contest" continue to be satisfied and so long as no
Lease Event of Default exists). Lessee shall pay all expenses incurred by the
Indemnitee in contesting any such Tax (including, without limitation, all
reasonable attorneys' and accountants' fees, including the allocated costs of
internal counsel), upon demand by the Indemnitee. Lessee shall have the right to
participate in the conduct of any proceedings controlled by the Indemnitee to
the
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extent that such participation by such Person does not interfere with the
Indemnitee's control of such contest and Lessee shall in all events be kept
informed, to the extent practicable, of material developments relative to such
proceedings. The Indemnitee shall have the right to participate in the conduct
of any proceedings controlled by Lessee and the Indemnitee shall in all events
be kept informed, to the extent practicable, of material developments relative
to such proceedings. The Indemnitees agree that a contested claim for which
Lessee would be required to make a reimbursement payment hereunder will not be
settled or compromised without Lessee's prior written consent (which consent
shall neither be unreasonably delayed nor withheld), unless the provisos of the
definition of "Permitted Contest" would not continue to be satisfied. Indemnitee
shall endeavor to settle or compromise any such contested claim in accordance
with written instructions received from Lessees; provided, that (x) Lessee on or
before the date the Indemnitee executes a settlement or compromise pays the
contested Tax to the extent agreed upon or makes an indemnification payment to
the Indemnitee in an amount reasonably acceptable to the Indemnitee; and (y) the
settlement or compromise does not, in the reasonable opinion of the Indemnitee
materially adversely affect the right of such Lessor to receive Rent or the
Lease Balance or any other payment pursuant to the Operative Documents, or
involve a material risk of sale, forfeiture or loss of the Sites or any interest
therein or any matter described in the provisos to the definition of "Permitted
Contest". The failure of an Indemnitee to timely contest a claim against it for
any Tax which is subject to indemnification under Section 11.2(a) and for which
it has an obligation to Lessee to contest under this Section 11.2(b) in the
manner required by Applicable Laws and Regulations or Regulations where Lessee
has timely requested that such Indemnitee contest such claim shall relieve
Lessee of its obligations to such Indemnitee under Section 11.2(a) with respect
to such claim to the extent such failure results in the loss of an effective
contest. If Applicable Laws and Regulations require the payment of a contested
Tax as a condition to, or regardless of, its being contested, and Lessee chooses
to contest such Tax or to direct the Indemnitee to contest such Tax in
accordance with this Section 11.2(b), then Lessee shall provide the Indemnitee
with the funds to pay such Tax, such provision of funds to be deemed a
non-interest bearing loan by Lessee to the Indemnitee to be repaid by any
recovery of such Tax from such contest and any remaining unpaid amount not
recovered to offset Lessee's obligation to indemnify the Indemnitee for such
Tax. Lessee shall indemnify the Indemnitee on a grossed-up basis in accordance
with Section 11.8 for and against any adverse consequences of any such
interest-free loan. In the event that the Indemnitee receives a refund (or like
adjustment) in respect of any Tax for which the Indemnitee has been reimbursed
by Lessee, the Indemnitee shall within ten (10) days remit the
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amount of such refund (or like adjustment) to Lessee, net of all costs and
expenses incurred by such Indemnitee; provided, however, that the Indemnitee
shall not be required to remit any amount pursuant to this sentence in excess of
the amounts previously paid by Lessee to, or on behalf of, such Indemnitee with
respect to such Tax pursuant to this Article 11.
(c) Payments. Any Tax indemnifiable under Section
11.2(a) shall be paid by Lessee directly when due to the applicable taxing
authority if direct payment is practicable and permitted. If direct payment to
the applicable taxing authority is not permitted or is otherwise not made, any
amount payable to an Indemnitee pursuant to Section 11.2(a) shall be paid within
thirty days after receipt of a written demand therefor from such Indemnitee
accompanied by a written statement describing in reasonable detail the amount so
payable, but not before the date that the relevant Taxes are due. Any payments
made pursuant to Section 11.2(a) directly to the Indemnitee entitled thereto or
Lessee, as the case may be, shall be made in immediately available funds at such
bank or to such account as specified by the payee in written directions to the
payor, or, if no such direction shall have been given, by check of the payor
payable to the order of the payee by certified mail, postage prepaid at its
address as set forth in this Participation Agreement. Upon the request of any
Indemnitee with respect to a Tax that Lessee is required to pay, Lessee shall
furnish to such Indemnitee the original or a certified copy of a receipt for
Lessee's payment of such Tax or such other evidence of payment as is reasonably
acceptable to such Indemnitee.
(d) Reports. If any report, return or statement is
required to be filed with respect to any Taxes that are subject to
indemnification under Section 11.2(a), Lessee shall, if Lessee is permitted by
Applicable Laws and Regulations, timely prepare and file such report, return or
statement; provided, however, that if Lessee is not permitted by Applicable Laws
and Regulations to file any such report, return or statement, Lessee will
promptly so notify the appropriate Indemnitee, in which case the Indemnitee, at
Lessee's expense, will file any such report after preparation thereof by Lessee.
(e) Tax Benefit. If, as a result any Taxes
paid or indemnified against by Lessee under this Section 11.2, the aggregate
Taxes paid by Indemnitee for any taxable year and not subject to indemnification
pursuant to this Section 11.2 are less (whether by reason of a deduction,
credit, allocation or apportionment of income or otherwise) than the amount of
such Taxes that otherwise would have been payable by such Indemnitee (a "Tax
Benefit"), then to the extent such Tax Benefit was not taken into account in
determining the amount of indemnification payable by Lessee under Section
11.2(a) hereof and provided no
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Event of Default shall be continuing, such Indemnitee shall pay to Lessee the
lesser of (A)(x) the amount of such Tax Benefit, plus (y) an amount equal to any
Tax Benefit resulting from the payment under clause (x) above and (B) the amount
of the indemnity paid pursuant to this Section 11.2 giving rise to such Tax
Benefit. If it is subsequently determined that the Indemnitee was not entitled
to such Tax Benefit, the portion of such Tax Benefit that is repaid or
recaptured will be treated as Taxes for which the Lessee must indemnify
Indemnitee pursuant to this Section 11.2 without regard to the exclusions other
than the exclusion in clause (vi) of Section 11.2(a).
(f) Independent Examination. Within 15 days after Lessee
receives any computation from Indemnitee, Lessee may request in writing an
independent public accounting firm selected by Indemnitee and reasonably
acceptable to Lessee review and determine on a confidential basis the amount of
any indemnity payment by Lessee to Indemnitee pursuant to this Section 11.2 or
any payment by Indemnitee to Lessee pursuant to Section 11.2(b) or (e) hereof.
Indemnitee shall cooperate with such accounting firm and supply it with all
documentation and records necessary for the accounting firm to conduct such
review and determination (including relevant data from Indemnitee's income tax
returns but not such returns themselves); provided, that such accounting firm
shall agree in writing in a manner satisfactory to Indemnitee to maintain the
confidentiality of such information. The fees and disbursements of such
accounting firm will be paid by Lessee, provided, that such fees and
disbursements shall be paid by Indemnitee if the verification results in an
adjustment in Lessee's favor of five percent (5%) or more of the indemnity
payment or payments computed by Indemnitee.
SECTION 11.3. Withholding Tax Exemption. (a) At least five (5)
Business Days prior to the first date on which any payment is due under any Note
or Investment Amount for the account of any Participant not incorporated under
the laws of the United States or a state thereof, such Participant agrees that
it will have delivered to each of Lessee, Lessor and Agent two duly completed
copies of United States Internal Revenue Service Forms 1001 or 4224, certifying
in either case that such Participant is entitled to receive payments of interest
and/or yield and a return of the principal amount of the Loans and/or Investment
Amount, including Capitalized Interest and Capitalized Yield, as applicable,
under the Operative Documents without deduction or withholding of any United
States Federal income taxes. Each Participant which so delivers a Form 1001 or
4224 further undertakes to deliver to each of Lessee, Lessor and Agent two
additional copies of such form (or a successor form) on or before the date that
such form expires (currently, three successive calendar years for Form 1001 and
one calendar year for Form 4224) or becomes obsolete or after the occurrence of
any event requiring a change in the most recent
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forms so delivered by it, and such amendments thereto or extensions or renewals
thereof as may be reasonably requested by Lessee, Lessor or Agent, in each case
certifying that such Participant is entitled to receive payments under the
Operative Documents without deduction or withholding of any United States
Federal income taxes, unless an event (including any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Participant from duly completing and delivering any such form with
respect to it and such Participant advises Lessee, Lessor and Agent that it is
not capable of receiving payments without any withholding of United States
Federal income tax.
(b) For any period with respect to which a Participant has failed to
provide Lessee with the appropriate form described in Section 11.3(a) (other
than if such failure is due to a change in law subsequent to the date such form
originally was required to be provided or if such form otherwise is not required
under the first sentence of Section 11.3(a), such Participant shall not be
entitled to indemnification under Section 11.2 with respect to Taxes imposed by
the United States because of such failure; provided, however, that should a
Participant become subject to Taxes because of such failure, Lessee shall take
such steps as such Participant shall reasonably request to assist such
Participant to recover such Taxes.
SECTION 11.4. Increased Costs and Reduced Return. (a) If the
adoption of any Applicable Laws and Regulations, or any change in any Applicable
Laws and Regulations, or any change in the interpretation or administration
thereof by any Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any
Participant with any request or directive (whether or not having the force or
law) of any such authority, central bank regulator or other Governmental
Authority or comparable agency shall impose, modify, apply or deem applicable
any reserve (including, without limitation, any such requirement imposed by the
Board of Governors of the Federal Reserve System, special deposit, insurance
assessment or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Participant or shall impose on any
Participant (or its Eurodollar Office) or on the London interbank market any
other condition affecting its Loans or Investment Amounts, its Notes or its
obligation to make Loans or Investment Amounts and the result of any of the
foregoing is to increase the cost to such Participant making or maintaining any
Loan or Investment Amounts, or to reduce the amount of any sum received or
receivable by such Participant under the Operative Documents or under its Notes
with respect thereto, by any amount deemed by such Participant to be material,
then, within sixty (60) days after demand by such
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Participant (with a copy to Agent), Lessee shall pay, subject to Section 11.7,
to such Participant such additional amount or amounts (with interest or Yield on
such Loans, Investment Amounts and additional amounts) as will compensate such
Participant for such increased cost or reduction.
(b) If any Participant shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on capital of such Participant or its parent could have achieved but for such
adoption, change, request or directive (taking into consideration its policies
with respect to capital adequacy) by an amount deemed by such Participant to be
material, then from time to time, within sixty (60) days after demand by such
Participant (with a copy to Agent), Lessee shall pay, subject to Section 11.7,
to such Participant such additional amount or amounts (with interest or Yield on
such Loans, Investment Amounts and additional amounts) as will compensate such
Participant for such reduction.
(c) Each Participant will promptly notify the Lessee and Agent of
any event of which it has knowledge, occurring after the date hereof, which will
entitle such Participant to compensation pursuant to this Section 11.4 and will
designate a different applicable lending office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in the
sole judgment of such Participant, be otherwise disadvantageous to such
Participant. A certificate of any Participant claiming compensation under this
Section 11.4 and setting forth the additional amount or amounts to be paid to it
hereunder shall show in reasonable detail the basis for calculating such amount
or amounts and shall be conclusive in the absence of manifest error. In
determining such amount, such Participant may use any reasonable averaging and
attribution methods.
SECTION 11.5. Eurodollar Rate Illegal, Unavailable or Impracticable.
If, on or after the Document Closing Date, the adoption of any Applicable Laws
and Regulations, or any change in any Applicable Laws and Regulations, or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charted with the interpretation or
administration thereof, or compliance by any Participant (or its Eurodollar
Lending Office) with any request
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or directive (whether or not having the force of law) of any such authority,
central bank or comparable agency shall make it unlawful or impossible for any
Participant (or its Eurodollar lending office) to make, maintain or fund its
Eurodollar Loans or Investment Amounts and such Participant shall so notify
Agent, Agent shall forthwith give notice thereof to the other Participants and
Lessee, whereupon until such Participant notifies Lessee and Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of
such Participant to make Eurodollar Loans and to Fund Investment Amounts shall
be suspended. Before giving any notice to Agent pursuant to this Section 11.5,
such Participant shall designate a different Eurodollar Lending Office if such
designation will avoid the need for giving such notice and will not, in the sole
judgment of such Participant, be otherwise disadvantageous to such Participant.
If such Participant shall determine that it may not lawfully continue to
maintain and fund any of its outstanding Eurodollar Loans or Investment Amounts
to maturity and shall so specify in such notice, then the obligations of such
Participant to make, continue or maintain any such investment shall, upon such
determination, forthwith be suspended until such Participant shall notify Lessee
that such circumstances no longer exist, and all Basic Rent (or interest and
Yield) allocable to such Participant shall automatically be determined on a Base
Rate basis beginning on the next immediately succeeding Payment Date with
respect thereto or sooner, if required by such law, assertion or determination.
SECTION 11.6. Funding Losses. (a) Lessee shall pay to Agent, as
additional Rent, such amounts as may be necessary to reimburse any Participant
for any loss or expense (including, without limitation, any administration
costs) incurred (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such
Participant to make, continue or maintain any portion of its investment in any
Note or Investment on a Eurodollar Rate basis) as a result of (i) the failure of
any Advance Date to occur on or before the date specified therefor in the
Advance Request therefor or (ii) any payment of all or any portion of the Lease
Balance for any reason on a date other than a Payment Date, including, without
limitation, by reason of acceleration. Any Participant shall promptly notify
Agent in writing of the amount of any claim under this Section 11.6, the reason
or reasons therefor and the additional amount required fully to compensate such
Participant for such loss or expense. Such written notice (which shall include
calculations in reasonable detail) shall, in the absence of manifest error, be
conclusive and binding on Lessee.
(b) If the Lessee (i) makes a payment of Basic Rent or (ii)
purchases any Site or Unit of Equipment, in either case,
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resulting in the payment of CP Notes on a date other than the date on which
Commercial Paper matures, at a time when the CP Rate is applicable to the
calculation of Basic Rent with respect thereto, the Lessee shall, on written
demand by CP Lender (with a copy of such demand to Agent), pay to Agent for the
account of CP Lender an amount equal to any loss or expense suffered by CP
Lender during the period from the date of receipt of such payment or purchase to
(but excluding) the maturity date of such Commercial Paper, if the rate of
interest obtainable by CP Lender upon the redeployment of an amount of funds
equal to the amount of such payment or purchase is less than the rate of
interest applicable to such Commercial Paper. A certificate as to such matters
submitted by CP Lender to Lessee shall be, absent manifest error, conclusive and
binding.
SECTION 11.7. Limitations on Amounts Due Under Section 11.4. If any
Participant fails to give Lessee any prompt notice required by Section 11.4(c),
Lessee shall not be required to indemnify and compensate such Participant or
Agent under Section 11.4 for any amounts attributable to the event or factual
circumstance required to be disclosed in such notice and arising during or with
respect to any period ending more than ninety (90) days before notice thereof
has been delivered to Lessee; provided that this Section 11.7 shall in no way
limit the right of any Participant or Agent to demand or receive compensation to
the extent that such compensation relates to any law, rule, regulation,
interpretation, administration, request or directive (or any change therein)
which by its terms has retroactive application if such notice is given within
ninety (90) days after the date of enactment or effectiveness of such
retroactive law, rule, regulation, interpretation, administration, request or
directive (or change therein).
SECTION 11.8. Gross-Up. If an Indemnitee shall not be entitled to a
corresponding and equal deduction with respect to any payment or Tax which
Lessee is required to pay or reimburse under any other provision of this Article
11 (each such payment or reimbursement under this Article 11, an "original
payment") and which original payment constitutes income to such Indemnitee, then
Lessee shall pay to such Indemnitee on demand the amount of such original
payment on a gross-up basis such that, after subtracting all Taxes imposed on
such Indemnitee with respect to such original payment by Lessee (including any
Taxes otherwise excluded by Section 11.2(b) and assuming for this purpose that
such Indemnitee was subject to taxation at the highest Federal marginal rates
applicable to widely held corporations for the year in which such income is
taxable and at an assumed state and local income tax rate of 18.58%), such
payments shall be equal to the original payment to be received or paid (net of
any credits, deductions or other tax benefits then actually recognized that
arise from the payment by such
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Indemnitee of any amount, including taxes, for which the payment to be received
is made).
SECTION 11.9. Indemnity for Excessive Use and Sales Below Fair
Market Value. If following the application of any amounts payable under Article
XXII of the Lease with respect to the remarketing of any Site or Equipment Pool,
the Property Balance for such Site or any Equipment Pool shall not have been
reduced to zero, then Lessee shall promptly pay over to Agent on the applicable
Site Expiration Date or the applicable Equipment Pool Expiration Date, as the
case may be, the remaining Property Balance for such Site or such Equipment Pool
unless Lessee delivers a report from an appraiser selected by Agent and approved
by Lessee, which approval shall not be unreasonably withheld, in form and
substance satisfactory to Required Participants and using approved methods
satisfactory to Required Participants which establishes that the decline in
value of such Site or any Unit of Equipment from (x) in the case of such Site,
the aggregate amount anticipated for such date in the Appraisal delivered on the
applicable Site Acquisition Date or (y) in the case of any Unit of Equipment,
the Equipment Purchase Price related thereto, was not due to any of the
following events, circumstances or conditions, whether or not permitted under
the Lease: (i) the excessive use of the Equipment, (ii) failure to maintain such
Site or Unit of Equipment or any portion thereof in accordance with the Lease or
the other Operative Documents, (iii) any Modifications, alterations,
restorations, repairs or replacements which reduced the value of such Site or
Unit of Equipment (including any change to a Facility resulting from
modifications to the Plans and Specifications for a Site provided to the
appraiser who prepared the Appraisal delivered on the applicable Site
Acquisition Date), (iv) any defect or exception to title of such Site or Unit of
Equipment which is not a Permitted Exception or any adverse environmental
conditions on, under or adjacent to such Site, whether or not such condition
relates to or constitutes a Permitted Hazardous Substance, or (v) any other
cause or condition within the power of Lessee to control or affect other than
ordinary wear and tear.
SECTION 11.10. Environmental Indemnity. Without limitation of the
other provisions of this Article 11 or under the Unsecured Environmental
Indemnities, Lessee agrees to indemnify, hold harmless and defend each
Indemnitee from and against any and all Claims (including without limitation
third party claims for personal injury or real or personal property damage),
losses, damages, liabilities, fines, penalties, charges, administrative and
judicial proceedings (including informal proceedings) and orders, judgments,
remedial action, requirements, enforcement actions of any kind, and all
reasonable and documented costs and expenses incurred in connection therewith
(including but not limited to reasonable and documented attorneys' and/or
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paralegals' fees and expenses), including, but not limited to, all costs
incurred in connection with any investigation or monitoring of site conditions
or any cleanup, remedial, removal or restoration work by any federal, state or
local government agency, arising in whole or in part, out of
(a) the presence on, under or around any of the Sites or
any portion thereof of any Hazardous Substances, or any releases or
discharges of any Hazardous Substances on, under, from, onto or
around any such Site or any portion thereof,
(b) any activity, including, without limitation,
construction, carried on or undertaken on or off any Site or any
portion thereof, and whether by either Lessee or any of its
Affiliates or any predecessor in title or any employees, agents,
sublessees, contractors or subcontractors of Lessee or any
predecessor in title, or any other Persons (including such
Indemnitee), in connection with the handling, treatment, removal,
storage, decontamination, cleanup, transport or disposal of any
Hazardous Substances that at any time are located or present on,
under or around or that at any time migrate, flow, percolate,
diffuse or in any way move onto or under the Sites or any portion
thereof,
(c) loss of or damage to any property or the environment
arising from or in any way related to any Site or Lessee (including,
without limitation, cleanup costs, response costs, remediation and
removal costs, cost of corrective action, costs of financial
assurance, fines and penalties and natural resource damages), or
death or injury to any Person, and all expenses associated with the
protection of wildlife, aquatic species, vegetation, flora and
fauna, and any mitigative action required by or under Environmental
Laws, in each case arising from or in any way related to any Site,
Lessee or the Overall Transaction,
(d) any claim concerning lack of compliance with
Environmental Laws, or any act or omission causing an environmental
condition that requires remediation or would allow any Governmental
Authority to record a Lien against any Site or any portion thereof,
or
(e) any residual contamination on or under any of the
Sites, or affecting any natural resources, and any contamination of
any property or natural resources arising in connection with the
generation, use, handling, storage, transport or disposal of any
such Hazardous Substances, in each case arising from or in any way
related to any Site, Lessee or the Overall Transaction, and
irrespective of whether any of such activities were or will be
undertaken in
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accordance with applicable laws, regulations, codes and
ordinances;
provided, however, that Lessee shall not be required to indemnify any Indemnitee
under this Section 11.10 for any Claim to the extent resulting from the willful
misconduct or gross negligence of such Indemnitee.
ARTICLE 12.
AGENT
SECTION 12.1. Appointment of Agent; Powers and Authorization to Take
Certain Actions.
(a) Each Participant irrevocably appoints and authorizes
Credit Suisse First Boston to act as its agent hereunder, with such powers as
are specifically delegated to Agent by the terms hereof, together with such
other powers as are reasonably incidental thereto. Each Participant authorizes
and directs Agent to, and Agent agrees for the benefit of the Participant, that,
on the Document Closing Date and each Advance Date it will accept the documents
described in Article 6 of this Participation Agreement. Agent accepts the agency
hereby created applicable to it and agrees to receive all payments and proceeds
pursuant to the Operative Documents and disburse such payments or proceeds in
accordance with the Operative Documents. Agent shall have no duties or
responsibilities except those expressly set forth in the Loan Agreement and this
Participation Agreement. Agent shall not be responsible to any Participant (or
to any other Person) (i) for any recitals, statements, representations or
warranties of any party contained in the Loan Agreement, this Participation
Agreement, or in any certificate or other document referred to or provided for
in, or received by any of them under, the Operative Documents, other than the
representations and warranties made by Agent in Section 8.3, or (ii) for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
the Collateral or the title thereto (subject to Agent's obligations under
Section 8.3) or of the Loan Agreement or any other document referred to or
provided for therein or (iii) for any failure by any Lessee, Lessor or any other
third party (other than Agent) to perform any of its obligations under any
Operative Document. Agent may employ agents, trustees or attorneys-in-fact, may
vest any of them with any property, title, right or power deemed necessary for
the purposes of such appointment and shall not be responsible for the negligence
or misconduct of any of them selected by it with reasonable care. Neither Agent
nor any of its directors, officers, employees or agents shall be liable or
responsible for any action taken or omitted to be taken by it or them hereunder,
or in connection
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herewith, except for its or their own gross negligence or willful misconduct or
its failure to handle funds hereunder and under the other Operative Documents
with ordinary care or, if stricter, the same care as Agent uses in handling its
own funds.
(b) Agent shall not have any duty or obligation to
manage, control, use, operate, store, lease, sell, dispose of or otherwise deal
with the Leased Property, any Collateral or the Lease, or to otherwise take or
refrain from taking any action under, or in connection with, this Participation
Agreement or any related document to which Agent is a party, except as expressly
provided by the terms hereof, and no implied duties of any kind shall be read
into any Operative Document against Agent. The permissive right of Agent to take
actions enumerated in this Participation Agreement or any other Operative
Document shall never be construed as a duty, unless Agent is instructed or
directed to exercise, perform or enforce one or more rights by the Required
Participants (provided that Agent has received indemnification reasonably
satisfactory to it). Subject to Section 12.1(c) below, no provision of the
Operative Documents shall require Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its
obligations under the Operative Documents, or in the exercise of any of its
rights or powers thereunder. It is understood and agreed that the duties of
Agent are ministerial in nature.
(c) Except as specifically provided herein, Agent is
acting hereunder solely as agent and, except as specifically provided herein, is
not responsible to any party hereto in its individual capacity, except with
respect to any claim arising from Agent's gross negligence or willful misconduct
or any breach of a representation or covenant made in its individual capacity.
(d) Agent may accept deposits from, lend money to and
otherwise deal with Lessee or any of its Affiliates with the same rights as it
would have if it were not the named Agent hereunder.
SECTION 12.2. Reliance. Agent may rely upon, and shall not be bound
or obligated to make any investigation into the facts or matters stated in, any
certificate, notice or other communication (including any communication by
telephone, telecopy, telex, telegram or cable) reasonably believed by it to be
genuine and correct and to have been made, signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel,
independent accountants and other experts selected by Agent with due care
(including any expert selected by Agent to aid Agent in any calculations
required in connection with its duties under the Operative Documents). Any
provision of this Agreement that requires the approval of Agent to its
satisfaction or sole discretion or otherwise with respect to any matter shall
not require Agent to take any action with respect to such matter
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without the approval or direction of Participants or Required Participants, as
the case may be.
SECTION 12.3. Action Upon Instructions Generally. Subject to
Sections 12.4 and 12.6, upon written instructions of the Required Participants,
Agent shall, on behalf of the Participants, give such notice or direction,
exercise such right, remedy or power hereunder or in respect of the Leased
Property, and give such consent or enter into such amendment to any document to
which it is a party as Agent as may be specified in such instructions. Agent
shall deliver to each Participant a copy of each notice, report and certificate
received by Agent pursuant to the Operative Documents. Agent shall have no
obligation to investigate or determine whether there has been a Lease Event of
Default or a Lease Default. Agent shall not be deemed to have notice or
knowledge of a Lease Event of Default or Lease Default unless a Responsible
Officer of Agent is notified in writing of such Lease Event of Default or Lease
Default; provided that Agent shall be deemed to have been notified in writing of
any failure of Lessee to pay Rent in the amounts and at the times set forth in
Article III of the Lease. If Agent receives notice of a Lease Event of Default,
Agent shall give prompt notice thereof, at Lessee's expense, to each
Participant. Subject to Sections 12.4, 12.6 and 13.5, Agent shall take action or
refrain from taking action with respect to such Lease Event of Default as
directed by the Required Participants or, in the case of a Payment Default, as
directed by any Participant; provided, however, that Agent shall take action or
refrain from taking action with respect to Section 6.1 of the Pledge Agreement
as directed by the Required Lenders; and provided, further, that, unless and
until Agent receives such directions, Agent may refrain from taking any action,
or may act in its discretion, with respect to such Lease Event of Default or
Payment Default. Notwithstanding the foregoing, in exercising the remedies of
Participants and Agent hereunder and the other Operative Documents upon a Lease
Event of Default, Agent shall proceed against the Securities Collateral
concurrently with remedies being conducted with respect to the other Collateral
to the extent that Agent determines, based on advice of counsel, that such
concurrent action does not adversely affect the Participants' rights with
respect to the other Collateral. Prior to the date the Lease Balance shall have
become due and payable by acceleration pursuant to Section 17.2 of the Lease,
the Required Participants may deliver written instructions to Agent to waive,
and Agent shall waive pursuant thereto, any Lease Event of Default and its
consequences; provided that in the absence of written instructions from all
Participants, Agent shall not waive any (i) Payment Default or (ii) covenant or
provision which, under Section 13.5, cannot be modified or amended without the
consent of all Participants. As to any matters not expressly provided for by
this Participation Agreement, Agent shall in all
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cases be fully protected in acting, or in refraining from acting, hereunder in
accordance with instructions signed by the Required Participants and such
instructions of the Required Participants and any action taken or failure to act
pursuant thereto shall be binding on each Participant.
SECTION 12.4. Indemnification. (a) Each Participant shall reimburse
and hold Agent harmless, ratably in accordance with its Commitment at the time
the indemnification is required to be given, (but only to the extent that any
such indemnified amounts have not in fact been paid to Agent by, or on behalf
of, Lessee in accordance with Section 11.1) from any and all claims, losses,
damages, obligations, penalties, liabilities, demands, suits, judgments, or
causes of action, and all legal proceedings, and any reasonable costs or
expenses in connection therewith, including allocated charges, costs and
expenses of internal counsel of Agent and all other reasonable attorneys' fees
and expenses incurred by Agent, in any way relating to or arising in any manner
out of (i) any Operative Document, the enforcement hereof or thereof or the
consummation of the transactions contemplated thereby, or (ii) instructions from
the Required Participants (including, without limitation, the costs and expenses
that Lessee is obligated to and does not pay hereunder, but excluding normal
administrative costs and expenses incident to the performance by Agent of its
agency duties hereunder other than materially increased administrative costs and
expenses incurred as a result of a Lease Event of Default); provided that no
Participant shall be liable for any of the foregoing to the extent they arise
from (a) the gross negligence or willful misconduct of Agent, (b) the inaccuracy
of any representation or warranty or breach of any covenant given by Agent in
Section 8.3 or in the Loan Agreement, (c) in the case of Agent's handling of
funds, the failure to act with the same care as Agent uses in handling its own
funds or (d) any taxes, fees or other charges payable by Agent based on or
measured by any fees, commissions or compensation received by it for acting as
Agent in connection with the transactions contemplated by the Operative
Documents.
(b) Notwithstanding anything to the contrary contained
in this Participation Agreement, CP Lender's obligation (i) to provide indemnity
pursuant to Section 12.4(a) or (ii) to pay any sums due and owing to Lessee
shall be payable by CP Lender solely from excess cash flow from CP Lender's
operations which it is not otherwise required to repay when due under CP Notes
issued by CP Lender. Notwithstanding the foregoing, to the extent a CP Loan is
Funded by CP Lender, CP Administrative Agent shall remain obligated for all
obligations under this Participation Agreement to the Agent, the other
Participants and Lessee. The Agent may continue to deal solely and directly with
CP Administrative Agent.
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SECTION 12.5. Independent Credit Investigation. Each Participant by
entering into this Participation Agreement agrees that it has, independently and
without reliance on Agent or any other Participant and based on such documents
and information as it has deemed appropriate, made its own credit analysis of
Lessee and its own decision to enter into this Participation Agreement and each
of the other Operative Documents to which it is a party and that it will,
independently and without reliance upon Agent or any other Participant and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own analysis and decisions in taking action under this
Participation Agreement and any related documents to which it is a party. Agent
shall not be required to keep itself informed as to the performance or
observance by Lessee of any other document referred to (directly or indirectly)
or provided for herein or to inspect the properties or books of Lessee. Except
for notices or statements which Agent is expressly required to give under this
Participation Agreement and for notices, reports and other documents and
information expressly required to be furnished to Agent alone (and not also to
each Participant, it being understood that Agent shall forward copies of same to
each Participant) hereunder or under any other Operative Document, Agent shall
not have any duty or responsibility to provide any Participant with copies of
notices or with any credit or other information concerning the affairs,
financial condition or business of Lessee (or any of its Affiliates) that may
come into the possession of Agent or any of its Affiliates.
SECTION 12.6. Refusal to Act. Except for notices and actions
expressly required of Agent hereunder and except for the performance of its
covenants in Section 8.3, Agent shall in all cases be fully justified in failing
or refusing to act unless (a) it is indemnified to its reasonable satisfaction
by the Participants, subject to the terms of Section 12.4(b) above, against any
and all liability and reasonable expense which may be incurred by it by reason
of taking or continuing to take any such action (provided that such indemnity
shall not be required to extend to liability or expense arising from any matter
described in clauses (a) through (d) of the proviso of Section 12.4(a), it being
understood that no action taken by Agent in accordance with the instructions of
the Required Participants shall be deemed to constitute any such matter) and (b)
it is reasonably satisfied that such action is not contrary to any Operative
Document or to any Applicable Laws and Regulations.
SECTION 12.7. Resignation or Removal of Agent; Appointment of
Successor. Subject to the appointment and acceptance of a successor Agent as
provided below, Agent may resign at any time by giving notice thereof to each
Lessor and Lessee or may be removed at any time by written notice from Required
Participants. Upon any such resignation or removal, Required Participants at
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the time of the resignation or removal shall have the right to appoint a
successor Agent with, if there exists no Lease Default or Event of Default, the
consent of Lessee, which consent shall not be unreasonably withheld, which shall
be a financial institution having a combined capital, surplus and undivided
profits of not less than $100,000,000. If, within 30 calendar days after the
retiring Agent's giving of notice of resignation or receipt of a written notice
of removal, a successor Agent is not so appointed and does not accept such
appointment, then the retiring or removed Agent may appoint a successor Agent
with, if there exists no Lease Default or Event of Default, the consent of
Lessee, which consent shall not be unreasonably withheld, and transfer to such
successor Agent all rights and obligations of the retiring Agent. Such successor
Agent shall be a financial institution having combined capital, surplus and
undivided profits of not less than $100,000,000. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Agent and the retiring or removed Agent
shall be discharged from duties and obligations as Agent thereafter arising
hereunder and under any related document. If the retiring Agent does not appoint
a successor, any Participant shall be entitled to apply to a court of competent
jurisdiction for such appointment, and such court may thereupon appoint a
successor to act until such time, if any, as a successor shall have been
appointed as above provided.
SECTION 12.8. Separate Agent. From time to time, (x) the Required
Participants may, and if they fail to do so at any time when they are so
required, Agent may, for the purpose of meeting any legal requirements of any
jurisdiction in which the Collateral may be located, and (y) the Agent may, in
the case of either clause (x) or (y) appoint one or more individuals or
corporations either to act as co-agent jointly with Agent or to act as separate
agent of all or any part of the Collateral, and vest in such individuals or
corporations, in such capacity, such title to such Collateral, or any part
thereof, and such rights or duties as Agent may consider necessary or desirable.
Agent shall not be required to qualify to do business in any jurisdiction where
it is not now so qualified. Agent shall execute, acknowledge and deliver all
such instruments as may be required by any such co-agent or separate agent more
fully confirming such title, rights or duties to such co-agent or separate
agent. Upon the acceptance in writing of such appointment by any such co-agent
or separate agent, it, she or he shall be vested with such interest in the
Collateral or any part thereof, and with such rights and duties, not
inconsistent with the provisions of the Operative Documents, as shall be
specified in the instrument of appointment, jointly with Agent (except insofar
as local law makes it necessary for any such co-agent or separate agent to act
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alone), subject to all terms of the Operative Documents. Any co-agent or
separate agent, to the fullest extent permitted by legal requirements of the
relevant jurisdiction, at any time, by an instrument in writing, shall
constitute Agent its attorney-in-fact and agent, with full power and authority
to do all acts and things and to exercise all discretion on its behalf and in
its name. If any co-agent or separate agent shall die, become incapable of
acting, resign or be removed, the interest in the Collateral and all rights and
duties of such co-agent or separate agent shall, so far as permitted by law,
vest in and be exercised by Agent, without the appointment of a successor to
such co-agent or separate agent.
SECTION 12.9. Termination of Agency. The agency created hereby shall
terminate upon the final disposition by Agent of all Collateral at any time
subject hereto and the final distribution by Agent of all monies or other
property or proceeds received pursuant to the Lease in accordance with their
terms; provided, that at such time Lessee shall have complied fully with all the
terms hereof.
SECTION 12.10. Compensation of Agency. Lessee shall pay
Agent its reasonable fees, costs and expenses for the performance
of Agent's obligations hereunder.
SECTION 12.11. Limitations. It is expressly understood and agreed by
and among the parties hereto that, except as otherwise provided herein or in the
other Operative Documents: (a) this Participation Agreement and the other
Operative Documents to which Agent is a party are executed by Agent, not in its
individual capacity (except with respect to the representations and covenants of
Agent in Section 8.3), but solely as Agent under the Operative Documents in the
exercise of the power and authority conferred and vested in it as such Agent;
(b) each and all of the undertakings and agreements herein made on the part of
Agent are each and every one of them made and intended not as personal
undertakings and agreements by Agent, or for the purpose or with the intention
of binding Agent personally, but are made and intended for the purpose of
binding only the Collateral unless expressly provided otherwise; (c) actions to
be taken by Agent pursuant to its obligations under the Operative Documents may,
in certain circumstances, be taken by Agent only upon specific authority of the
Participants; (d) nothing contained in the Operative Documents shall be
construed as creating any liability on Agent, individually or personally, or any
incorporator or any past, present or future subscriber to the capital stock of,
or stockholder, officer or director, employee or agent of, Agent to perform any
covenants either express or implied contained herein, all such liability, if
any, being expressly waived by the other parties hereto and by any Person
claiming by, through or under them; and (e) so far as Agent,
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individually or personally, is concerned, the other parties hereto and any
Person claiming by, through or under them shall look solely to the Collateral
and Lessee for the performance of any obligation under any of the instruments
referred to herein; provided, however, that nothing in this Section 12.11 shall
be construed to limit in scope or substance the general corporate liability of
Agent in respect of its gross negligence or willful misconduct or those
representations, warranties and covenants of Agent in its individual capacity
set forth herein or in any of the other agreements contemplated hereby.
ARTICLE 13.
MISCELLANEOUS
SECTION 13.1. Survival of Agreements. The representations,
warranties, covenants, indemnities and agreements of the parties provided for in
the Operative Documents, and the parties' obligations under any and all thereof,
shall survive the execution and delivery and the termination or expiration of
this Agreement and any of the Operative Documents, including the termination of
the Lease with respect to any Leased Property, the transfer or disposition of
any interest in the Leased Property to or by Lessor as provided herein or in any
other Operative Documents (and shall not be merged into the Deeds, Bills of Sale
or any other conveyance or transfer document), the purchase and sale of the
Notes or Lessor's interest as Lessor or its Investment, payment therefor and any
disposition thereof and shall be and continue in effect notwithstanding any
investigation made by any party hereto or to any of the other Operative
Documents and the fact that any such party may waive compliance with any of the
other terms, provisions or conditions of any of the Operative Documents.
SECTION 13.2. No Broker, etc. Except for Lessee's dealing with
Credit Suisse First Boston and any of its Affiliates and The Staubach Company,
each of the parties hereto represents to the others that it has not retained or
employed any broker, finder or financial advisor to act on its behalf in
connection with the Overall Transaction, nor has it authorized any broker,
finder or financial adviser retained or employed by any other Person so to act,
nor has it incurred any fees or commissions to which any party hereto might be
subjected by virtue of its entering into the transactions contemplated by this
Agreement. Credit Suisse First Boston's sole compensation for acting hereunder
other than as Agent and Participant is the receipt of the amounts, including
reimbursement of expenses, provided for in the Operative Documents and the
Arrangement Fee. Any party who is in breach of this representation shall
indemnify and hold the other parties
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harmless from and against any liability arising out of such
breach of this representation.
SECTION 13.3. Notices. Unless otherwise specified herein, all
notices, requests, demands or other communications to or upon the respective
parties hereto shall be made in writing and shall be deemed to have been given
(i) in the case of notice by letter, the earlier of when delivered to the
addressee by hand or courier if delivered on a Business Day and, if not
delivered on a Business Day, the first Business Day thereafter or on the third
Business Day after depositing the same in the mails, registered or certified
mail, postage prepaid, return receipt requested, addressed as provided on
Schedule II hereto, and (ii) in the case of notice by facsimile or bank wire,
when receipt is confirmed if delivered on a Business Day and, if not delivered
on a Business Day, the first Business Day thereafter, addressed as provided on
Schedule II hereto, or to such other address as any of the parties hereto may
designate by written notice. Copies of all notices given by facsimile or bank
wire shall be contempo raneously sent by overnight courier.
SECTION 13.4. Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same agreement.
SECTION 13.5. Amendments. Neither this Agreement nor any of the
other Operative Documents nor any of the terms hereof or thereof may be
terminated, amended, supplemented, waived or modified orally, but only by an
instrument in writing signed by the party against which the enforcement of the
termination, amendment, supplement, waiver or modification shall be sought;
provided, however, that no such amendment, supplement, waiver or modification
shall amend, supplement, waive or modify any provision of this Participation
Agreement limiting rights of any Person against CP Lender, the extent of the CP
Lender Availability or CP Lender's right to make a CP Loan without the written
consent of CP Administrative Agent; and no such termination, amendment,
supplement, waiver or modification shall be effective unless a signed copy
thereof shall have been delivered to Lessee and Agent. Lessor and Lessee shall
not be permitted to amend, modify or supplement the Lease without the written
consent of Agent and Required Lenders; provided, that without the prior written
consent of each Lender and Agent, Lessor shall not:
(a) modify any of the provisions of this Section 13.5,
change the definition of "Required Lenders" or "Required
Participants", or modify or waive any provision of any Operative
Document requiring action by any of the foregoing,
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or release any collateral (except as otherwise specifically
provided in any Operative Document);
(b) reduce the amount or change the time of payment of
any amount of principal owing or interest owing or payable on any
Note;
(c) modify, amend, waive or supplement any of the
provisions of Articles XV, XVII, XX and XXII of the Lease;
(d) reduce, modify, amend or waive any indemnities in
favor of any Lender or Agent;
(e) reduce the amount or change the time of payment of
Rent or the Lease Balance;
(f) consent to any assignment of the Lease releasing
Lessee from its obligations to pay Rent or the Lease Balance or
changing the absolute and unconditional character of such
obligations; or
(g) permit the creation of any Lien on the Collateral or
any part thereof except as contemplated by the Operative Documents,
or deprive any Lender of the benefit of the security interest and
lien secured by the Collateral.
SECTION 13.6. Headings, etc. The Table of Contents and headings of
the various Articles and Sections of this Agreement are for convenience of
reference only and shall not modify, define, expand or limit any of the terms or
provisions hereof.
SECTION 13.7. Parties in Interest. Except as expressly provided
herein, none of the provisions of this Agreement is intended for the benefit of
any Person except the parties hereto, their successors and permitted assigns.
SECTION 13.8. GOVERNING LAW. THIS AGREEMENT AND EACH OTHER OPERATIVE
DOCUMENT HAS BEEN DELIVERED IN NEW YORK AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT AND EACH OTHER OPERATIVE DOCUMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF NEW YORK,
INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW BUT EXCLUDING
ALL OTHER CHOICE OF LAWS AND CONFLICTS RULES OF SUCH STATE, EXCEPT THAT THE
PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY
INTEREST IN EQUIPMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
SECTION 9- 103(1)(B) OF THE NEW YORK UCC AND THAT THE CREATION, PERFECTION AND
ENFORCEMENT OF THE LIEN ON A SITE SHALL BE GOVERNED BY THE LAWS OF THE
JURISDICTION IN WHICH SUCH SITE IS LOCATED.
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SECTION 13.9. Payment of Transaction Expenses and Other Costs.
(a) Transaction Expenses. Except as provided in
Section 6.1(d), whether or not the transactions contemplated hereby and by the
other Operative Documents are consummated, Lessee shall promptly pay within
thirty (30) days of receiving an invoice therefor the Transaction Expenses
directly or furnish Agent funds sufficient to, and Agent shall make payment of
such portion to the Person or Persons entitled to such payment upon receipt of
such funds from Lessee and presentation to Agent of bills or invoices for the
amount of such payment.
(b) Continuing Expenses. Lessee shall pay the fees
specified in the Fee and Yield Letter to Agent as Supplemental
Rent.
(c) Amendments, Supplements and Appraisal. Without
limitation of the foregoing, Lessee agrees to pay to Agent, Lessor and
Participants all reasonable costs and expenses (including reasonable legal fees
and expenses) incurred by any of them in connection with: (i) the considering,
evaluating, investigating, negotiating and entering into or giving or
withholding of any amendments or supplements or waivers or consents with respect
to any Operative Document; (ii) any Casualty or termination of the Lease or any
other Operative Document; (iii) the negotiation and documentation of any
restructuring or "workout," whether or not consummated, of any Operative
Document; (iv) the enforcement of the rights or remedies under the Operative
Documents; and (v) any transfer by Agent, Lessor or a Participant of any
interest in the Operative Documents during the continuance of an Event of
Default.
SECTION 13.10. Severability. Any provision of this Agreement that 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 13.11. Liabilities of Lenders. No Lender shall have any
obligation to any other Lender or to Lessee or Agent with respect to the
transactions contemplated by the Operative Documents except those obligations of
such Lender expressly set forth in the Operative Documents or except as set
forth in the instruments delivered in connection therewith, and no Lender shall
be liable for performance by any other party hereto of such other party's
obligations under the Operative Documents except as otherwise so set forth.
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SECTION 13.12. Liabilities of Agent. Agent shall have no duty,
liability or obligation to any party to this Agreement with respect to the
transactions contemplated hereby except those duties, liabilities, or
obligations expressly set forth in this Agreement or the Loan Agreement, and any
such duty, liability or obligation of Agent shall be as expressly limited by
this Agreement, the Loan Agreement, or the other Operative Documents as the case
may be.
SECTION 13.13. Lessor Obligations Nonrecourse; Payment from Certain
Lease and Guarantee Obligations and Certain Proceeds of Leased Property Only.
All payments to be made by Lessor in respect of the Loans, the Notes and the
Loan Agreement shall be made only from certain payments received under the Lease
and the Note Guarantee and certain proceeds of the Leased Property and only to
the extent that Lessor or Agent shall have received sufficient payments from
such sources to make payments in respect of the Loans. Each Lender agrees that
it will look solely to such sources of payments to the extent available for
distribution to such Lender as herein provided and that neither Lessor nor Agent
is or shall be personally liable to any Lender for any amount payable hereunder
or under any Note. Nothing in the Loan Agreement, the Notes or any other
Operative Document shall be construed as creating any liability (other than for
willful misconduct or gross negligence) of Lessor in its individual capacity to
pay any sum or to perform any covenant, either express or implied, in the Loan
Agreement, the Notes or any other Operative Documents (all such liability, if
any, being expressly waived by Lenders and Agent) and that each Lender and
Agent, on behalf of itself and its successors and assigns, agrees in the case of
any liability of Lessor hereunder or thereunder (except for such liability
attributable to its willful misconduct or gross negligence) that it will look
solely to those certain payments received under the Lease and the Note Guarantee
and those certain proceeds of the Leased Property, provided, however, that
Lessor in its individual capacity shall in any event be liable with respect to
(i) the removal of Lessor Liens resulting from claims against or acts or
breaches by Lessor in each case in its individual capacity or involving its
gross negligence or willful misconduct or (ii) failure to turn over payments
(other than Excepted Payments) to Agent as required by the terms of the
Operative Documents; and provided further that the foregoing exculpation of
Lessor shall not be deemed to be exculpations of Lessee or any other Person.
SECTION 13.14. Consideration for Consents to Waivers and Amendments.
Lessee hereby agrees that it will not, and that it will not permit any of its
Affiliates to, offer or give any consideration or benefit of any kind whatsoever
to any Participant in connection with, in exchange for, or as an inducement to,
such Participant's consent to any waiver in
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respect of, any modification or amendment of, any supplement to, or any other
consent or approval under, any Operative Document unless such consideration or
benefit is offered ratably to all Participants.
SECTION 13.15. Payment Directions. It is understood and agreed that
during the Term, for administrative convenience and notwithstanding the terms
and provisions of the Lease or any Loan Document, Lessee will pay all amounts
due Lessor under the Lease and this Agreement, on behalf of Lessor, to or at the
direction of Agent (which direction may change from time to time, so long as
such direction does not require Lessee to make any payment due on any date to
more than one Person) for application in accordance with the terms of Article V
of the Loan Agreement.
SECTION 13.16. Role of Arranger and its Affiliates. Each party
hereto acknowledges hereby that it is aware of the fact that Credit Suisse First
Boston has acted as an "arranger" with respect to the transactions contemplated
by the Operative Documents in addition to being a Lender and Agent and that, as
of the Document Closing Date, its Affiliate, Credit Suisse Leasing 92A, L.P. is
Lessor. Each party releases Credit Suisse First Boston and its Affiliates from
any liability as a result of their acting simultaneously and in their combined
role as an "arranger", as Agent, as Lessor and as a Lender. The foregoing
release shall not limit the obligations or rights of Agent under the Operative
Documents, which obligations and rights of Agent shall be governed by Article
12.
SECTION 13.17. Notices to Lessor under Loan Agreement.
Notwithstanding anything to the contrary in the Loan Agreement, the Lenders and
Lessee hereby agree that any notice or demand to be delivered to or made on
Lessor pursuant to Section 7.2 of the Loan Agreement shall, so long as no Lease
Event of Default is continuing, be delivered directly to or made on Lessee, with
a copy to Lessor, and Lessee shall be entitled to any rights inuring to Lessor
in respect thereof.
SECTION 13.18. Submission to Jurisdiction; Waivers.
(a) Each party hereto irrevocably and unconditionally:
(i) submits for itself and its property in any legal
action or proceeding relating to this Agreement or any other
Operative Document, or for recognition and enforcement of any
judgment in respect thereof, to the nonexclusive general
jurisdiction of the Courts of the State of New York, the courts of
the United States of America for the Southern District of New York,
and appellate courts from any thereof;
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(ii) consents that any such action or proceedings may be
brought to such courts, and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(iii) agrees that service of process in any such action
or proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form of
mail), postage prepaid, to such party at its address set forth on
Schedule II or at such other address of which the other parties
hereto shall have been notified pursuant to Section 13.3; and
(iv) agrees that nothing herein shall affect the right
to effect service of process in any other manner permitted by law or
shall limit the right to xxx in any other jurisdiction.
(b) EACH PARTY HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THE OPERATIVE DOCUMENTS AND FOR ANY COUNTERCLAIM THEREIN.
SECTION 13.19. No Proceedings. Each of Lessee, Lessor, the
Eurodollar Lenders and Agent hereby agrees that it shall not institute against,
or join any other Person in instituting against, CP Lender any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding or other
proceedings under any Federal or state bankruptcy or similar law, for one year
and a day after the latest maturing CP Note issued by CP Lender is paid. This
Section 13.19 shall survive termination of this Participation Agreement.
SECTION 13.20. Final Agreement. THIS AGREEMENT, TOGETHER WITH THE
LEASE, THE LOAN DOCUMENTS, THE OTHER OPERATIVE DOCUMENTS AND OTHER DOCUMENTS
EXECUTED IN CONNECTION HEREWITH OR THEREWITH REPRESENT THE ENTIRE FINAL
AGREEMENT BETWEEN THE PARTIES HERETO WITH RESPECT TO THE TRANSACTIONS
CONTEMPLATED HEREIN AND CANNOT BE MODIFIED, SUPPLEMENTED, AMENDED, RESCINDED OR
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES HERETO.
SECTION 13.21. Confidentiality. Each Participant and Agent agrees
severally but not jointly (on behalf of itself and each of its affiliates,
directors, officers, employees and representatives) to use reasonable
precautions to keep confidential, in accordance with safe and sound banking
practices, any non-public information supplied to it by Lessee
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89
pursuant to this Agreement which is identified by Lessee as being confidential
at the time the same is delivered to such Participant or Agent, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or, upon prompt prior written
notice to Lessee (to the extent permitted by law), by judicial process, (ii) to
counsel for any of Participants or Agent, (iii) to bank examiners, auditors or
accountants, (iv) in connection with any litigation to which any one or more of
Participants is a party, provided that Lessee has been given prompt prior
written notice (to the extent permitted by law) of such proposed disclosure or
(v) to any Participant (or prospective Participant) so long as such Assignee or
Participant (or Prospective Assignee or Participant) agrees in writing to be
bound by the terms of this Section 13.21; and provided further that in no event
shall any Participant or Agent be obligated or required to return any materials
furnished by Lessee.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this
Participation Agreement to be duly executed by their respective officers
thereunto duly authorized as of the day and year first above written.
APPLIED MATERIALS, INC., AS LESSEE AND
CONSTRUCTION AGENT
By:/s/ XXXXXX X. XXXXXX
--------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President and
Cheif Financial Officer
By:/s/ XXXXX X. XXXXXX
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President,
Corporate Finance and Treasurer
S-1 PARTICIPATION AGREEMENT
91
CREDIT SUISSE LEASING 92A, L.P., AS
LESSOR AND BORROWER
By: CREDIT SUISSE FIRST BOSTON, acting
through its New York Branch, as
General Partner
By:/s/ XXXX XXXXXXXXXX-XXXXX
----------------------------------
Name: Xxxx Xxxxxxxxxx-Xxxxx
Title: Vice President
By:/s/ XXXX XXXXX
----------------------------------
Name: Xxxx Xxxxx
Title: Associate
S-2 PARTICIPATION AGREEMENT
92
GREENWICH FUNDING CORPORATION,
AS CP LENDER
By: CREDIT SUISSE FIRST BOSTON, acting
through its New York Branch, as
Attorney-in-fact
By:/s/ XXXXXX XXXXX
----------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
By:/s/ XXXXXXX XXXXX
----------------------------------
Name: Xxxxxxx Xxxxx
Title: Associate
S-3 PARTICIPATION AGREEMENT
93
CREDIT SUISSE FIRST BOSTON, ACTING
THROUGH ITS NEW YORK BRANCH, AS AGENT
By:/s/ XXXX XXXXXXXXXX-XXXXX
-----------------------------------
Name: Xxxx Xxxxxxxxxx-Xxxxx
Title: Vice President
By:/s/ XXXX XXXXX
-----------------------------------
Name: Xxxx Xxxxx
Title: Associate
S-4 PARTICIPATION AGREEMENT
94
BANQUE NATIONALE DE PARIS, AS EURODOLLAR
LENDER
By:/s/ XXXXXX X. XXXXXXXX XXXXXXX X. DAY
__________________________________________________
Name: Xxxxxx X. Xxxxxxxx Xxxxxxx X. Day
Title: Vice President Assistant Vice President
S-5 PARTICIPATION AGREEMENT
95
CREDIT SUISSE FIRST BOSTON, AS
EURODOLLAR LENDER
By:/s/ XXXX XXXXXXXXXX-XXXXX
----------------------------------
Name: Xxxx Xxxxxxxxxx-Xxxxx
Title: Vice President
By:/s/ XXXX XXXXX
----------------------------------
Name: Xxxx Xxxxx
Title: Associate
S-6 PARTICIPATION AGREEMENT
96
MELLON BANK, N.A., AS EURODOLLAR LENDER
By:/s/ XXXXX X. XXXXX
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: First Vice President
S-7 PARTICIPATION AGREEMENT
00
XXXXX XXXX XX XXXXXXXXXX, N.A. AS
EURODOLLAR LENDER
By:/s/ XXXXX XXXXXXXX
-----------------------------------
Name: Xxxxx Xxxxxxxx
Title: Vice President
S-8 PARTICIPATION AGREEMENT
98
SCHEDULE I
Participants' Commitments
Commitment
Participant Commitments Percentage
----------- ----------- ----------
Eurodollar Lenders:
Banque Nationale de Tranche A Loan
Paris Commitment: $14,455,670.10 22.2566%
Tranche B Loan
Commitment: $ 2,644,329.90 4.0713%
Mellon Bank, N.A. Tranche A Loan
Commitment: $12,976,288.66 19.9789%
Tranche B Loan
Commitment: $ 2,373,711.34 3.6547%
Union Bank of Tranche A Loan
California, N.A. Commitment: $12,976,288.66 19.9789%
Tranche B Loan
Commitment: $2,373,711.34 3.6547%
Credit Suisse First Tranche A Loan
Boston Commitment: $12,850,752.58 19.7856%
Tranche B Loan
Commitment: $2,350,747.42 3.6193%
Lessor:
Credit Suisse Leasing Investment
92A, L.P. Amount
Commitment: $1,948,500 3.0%
S-9 PARTICIPATION AGREEMENT
99
SCHEDULE II
Notice Information and Funding Offices
AMAT: Applied Materials, Inc.
0000 Xxxxxx Xxxxxx, X/X 0000
Xxxxx Xxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Assistant Treasurer and
Director of Treasury Operations
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Applied Materials, Inc.
0000 Xxxxxx Xxxxxx, X/X 0000
Xxxxx Xxxxx, XX 00000
Attention: Xxxxx Xxxx
Senior Treasury Manager
Cash and Global Markets
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Lessor Credit Suisse Leasing 92A, L.P.
00 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Director
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Agent: Credit Suisse First Boston, acting through its New
York Branch
00 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
100
CP Lender: Greenwich Funding Corporation
00 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Eurodollar
Lenders: Banque Nationale de Paris
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention (Credit): Xxxxxx Xxxxxxxx, Vice
President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention (Operations): Xxxxxx X. Xxxx, Treasurer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Funding Office: Banque Nationale de Paris, San
Xxxxxxxxx Xxxxxx
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Wire Transfer Instructions:
Pay to Federal Reserve Bank of San Francisco
For the Account of Banque Nationale de Paris,
San Xxxxxxxxx Xxxxxx
ABA No. 000000000
Reference: Applied Materials Lease
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101
Mellon Bank, N.A.
Three Mellon Bank Center
23rd Floor, Loan Administration
Xxxxxxxxxx, XX 00000
Attention (Credit Issues): Xxxxx X. Xxxxx
000 Xxxxx Xxxxxx
Xxxxx 000
Xxxx Xxxx, XX 00000
Telephone: (000) 000-0000, Ext. 223
Facsimile: (000) 000-0000
Attention (Administration/Operations):
Xx. Xxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Wire Transfer Instructions:
Mellon Bank, N.A.
ABA No. 000000000
Loan Administration
Further credit to Credit Suisse Leasing 92A,
L.P., Account No. 990873800
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention (Credit Contact/Documentation):
Xxxxx Xxxxxxxx, Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention (Administrative/Operational):
Xxxxxx Xxxxx-Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
3
102
Wire Transfer Instructions:
Union Bank of California, N.A.
San Francisco, CA
ABA No. 0000-0000-0
For credit to Corporate Note Department
Account No. 001-0000000
Reference: Applied Materials, Inc.
Credit Suisse First Boston
00 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Wire Transfer Instructions:
Credit Suisse First Boston
ABA No. 000000000
Reference: Applied Materials, Inc.
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SCHEDULE III
Filings and Recordings
For each Site, the following filings and recordings are required to
perfect the rights of Lessor, Lenders and Agent intended to be created by the
Operative Documents.
A. For each Site, the following Operative Documents must be
recorded among the land records of the county where the
applicable Site is located:
The Deed
The Site Lease Supplement
The Mortgage
For each Existing Site, the following Operative Documents
must be recorded in the Official Records of Santa Xxxxx County,
California:
The Deed
The Site Lease Supplement (California)
The Mortgage
B. All UCC financing statements must be filed with the Secretary of State of the
State where the applicable Site is located and in any other records required by
the UCC in order to perfect the Lessor's, the Lender's and the Agent's rights
intended to be created by the Operative Documents.
For each Existing Site, all UCC financing statements must be filed
with the California Secretary of State.
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SCHEDULE IV
GOVERNMENTAL ACTIONS
No other items except as set forth on Schedule III hereto.
105
APPENDIX 1
TO PARTICIPATION AGREEMENT
DATED AS OF APRIL 30, 1997
Definitions and Interpretation
106
APPENDIX 2
TO
PARTICIPATION AGREEMENT
DATED AS OF APRIL 30, 1997
DOCUMENT CLOSING DATE CONDITIONS PRECEDENT
A. The occurrence of the Document Closing Date is subject to the
following conditions precedent:
(a) Operative Documents. Each of the Operative Documents to be
entered into on the Document Closing Date shall have been duly authorized,
executed and delivered by the parties thereto, and shall be in full force and
effect, including (i) this Participation Agreement, (ii) the Lease and each
Lease Supplement, (iii) the Construction Agency Agreement, (iv) the Deeds for
each Site, (v) the Bills of Sale, (vi) the Lease Supplement for each Site, (vii)
the Note Guarantee, (viii) the Loan Agreement, (ix) the Capital Asset Purchase
Agreement, (x) the Notes, (xi) the Mortgages for each Site, (xii) the Security
Agreement, (xiii) the Assignment of Lease, from Lessor to Agent for the benefit
of the Lenders, and consented to by Lessee pursuant to that certain Lessee's
Consent, dated as of the Document Closing Date (the "Consent to Assignment") by
Lessee, as obligor, in favor of Agent for the benefit of the Lenders, in each
case in the respective forms set forth as Exhibit L and Exhibit M hereto; (xiv)
the Consent to Assignment, (xv) the Assignment of Construction Agency Agreement
dated as of the Document Closing Date from Lessor to Agent for the benefit of
the Lenders, and consented to by Lessee pursuant to that certain Consent, dated
as of the Document Closing Date (the "Consent to Construction Agency Agreement
Assignment"), in each case in the respective forms set forth as Exhibit N and
Exhibit O hereto; (xvii) the Fee and Yield Letter; (xviii) the Pledge Agreement;
and (xix) the Consent to Construction Agency Agreement Assignment. Agent and
Participants shall each have received a fully executed original or copy of each
of the Operative Documents (other than the Notes and the Lease of which Agent
shall receive the originals and Lessor shall receive specimens). The Operative
Documents (or memoranda thereof), any supplements thereto and any financing
statements in connection therewith required under the Uniform Commercial Code
shall have been recorded, registered and filed, if necessary, in such manner as
to enable Lessee's counsel to render its opinion referred to in clause (c)
below.
(b) Taxes. All taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the Operative
Documents shall have been paid or provisions for such payment shall have been
made to the satisfaction of Agent and Participants.
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(c) Opinions of Counsel. (i) Each of Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx
LLP and Xxxxxxxxxxx XxXxxxxxx & XxXxxx, special counsel to Lessee, shall have
issued to Agent and Participants its opinion in the form set forth on Exhibit
V-1 and V-2, respectively; and (ii) the Law Department of Lessee shall have
issued to Agent and Participants his/her opinion in the form set forth on
Exhibit V-3.
(d) Responsible Employee's Certificate of Lessee. Agent shall have
received a Responsible Employee's Certificate, dated as of the Document Closing
Date, of Lessee stating that (i) each and every representation and warranty of
Lessee contained in the Operative Documents to which it is a party is true and
correct in all material respects on and as of the Document Closing Date, except
that any such representation or warranty which is expressly made only as of a
specified date need be true only as of such date; (ii) no Lease Default or Lease
Event of Default under the Lease or, to the best of such Responsible Officer's
knowledge, the Loan Agreement has occurred and is continuing; (iii) each
Operative Document to which Lessee is a party is in full force and effect with
respect to it; and (iv) Lessee has duly performed and complied with all
covenants, agreements and conditions contained in this Appendix 2 and, in all
material respects, with all other agreements and conditions contained in the
Participation Agreement and in any other Operative Document to which Lessee is a
party required to be performed or complied with by it on or prior to the
Document Closing Date.
(e) Lessee's Resolutions and Incumbency Certificate, etc. Agent
shall each have received (i) a certificate of the Secretary or an Assistant
Secretary of Lessee attaching and certifying as to (A) the resolutions of the
Board of Directors duly authorizing the execution, delivery and performance by
Lessee of each Operative Document to which it is or will be a party, (B) its
certificate of incorporation and bylaws, and (C) the incumbency and signature of
persons authorized to execute and deliver on its behalf the Operative Documents
to which it is a party, and (ii) a good standing certificate from the
appropriate officer of each state in which Land Interests are proposed to be
acquired on the Document Closing Date.
(f) Document Closing Date. The Document Closing Date shall occur on
or prior to May 15, 1997.
(g) Officer's Certificate of Lessor. Lessee and Agent shall have
received a certificate of an authorized officer of Lessor, dated as of the
Document Closing Date, stating that (i) each and every representation and
warranty of Lessor contained in the Operative Documents to which it is a party
is true and correct in all material respects on and as of the
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108
Document Closing Date, except that any such representation or warranty which is
expressly made only as of a specified date need be true only as of such date,
(ii) each Operative Document to which Lessor is a party is in full force and
effect with respect to it, and (iii) Lessor has duly performed and complied with
all covenants, agreements and conditions contained herein or in any Operative
Document required to be performed or complied with by it on or prior to the
Document Closing Date.
(h) Lessor's Resolutions and Incumbency Certificate, etc. Lessee and
Agent shall have received (i) a certificate of Lessor attaching and certifying
as to (A) the resolutions duly authorizing the execution, delivery and
performance by Lessor of each Operative Document to which it is or will be a
party, (B) its limited partnership agreement and certificate of limited
partnership, certified as of a recent date by an appropriate officer of Lessor,
and (C) the incumbency and signature of persons authorized to execute and
deliver on its behalf the Operative Documents to which it is a party.
(i) Opinion of Counsel. Each of the General Counsel of Lessor and
Xxxxx, Xxxxx & Xxxxx, special New York counsel, shall have issued to Lessee,
Lenders and Agent their opinion to the effect and in the form set forth on
Exhibit X-1 and Exhibit X-2, respectively.
(j) Private Placement Certificate. Credit Suisse First Boston and
Lessor shall have delivered to Lessee a Private Placement Certificate
substantially in the form of Exhibit AA.
All documents and instruments required to be delivered on the Document Closing
Date shall be delivered at the offices of Xxxxx, Xxxxx & Xxxxx, 0000 Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000-0000 or at such other location as may be determined by
Agent, Lessor and Lessee.
3
