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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
EXHIBIT 10(r)
AMENDED AND RESTATED PURCHASE OPTION AGREEMENT
This Amended and Restated Purchase Option Agreement (the "Agreement"),
dated as of the 16th day of May, 1997, between Nitrogen Leasing Company, Limited
Partnership (the "Owner") and PCS Nitrogen Fertilizer Operations, Inc. (the
"General Partner").
PRELIMINARY STATEMENTS
1. PCS Nitrogen, Inc. (formerly Arcadian Corporation) and the Owner
have entered into a Purchase Option Agreement, dated as of the March 27, 1996
(the "Original Purchase Option Agreement"), whereby PCS Nitrogen, Inc. was
granted certain purchase rights described therein.
2. PCS Nitrogen, Inc. and the General Partner have entered into an
Assignment Agreement, dated as of May 16, 1997, whereby PCS Nitrogen, Inc.
assigned all of its rights and obligations under the Original Purchase Option
Agreement to the General Partner.
3. The parties hereto desire to amend the Original Purchase Option
Agreement to consummate the transactions contemplated by the Amended and
Restated Lease Agreement, dated as of May 16, 1997 between PCS Nitrogen
Fertilizer, L.P. and the Owner (the "Lease"), the Amended and Restated Agreement
for Lease and certain related documents.
4. The Lease contemplates that the General Partner shall be granted
the Purchase Option (as hereinafter defined), pursuant to which the Owner shall
be obligated, under certain circumstances, to sell to the General Partner all
Property and Equipment subject to the Lease (the "Property and Equipment") for a
total purchase price equal to (i) in the case of a purchase during the Initial
Term, the Acquisition Cost of the Property and Equipment on the Exercise Date
(as hereinafter defined) and (ii) in the case of a purchase during the Renewal
Term, the fair market value of the Property and Equipment on the Exercise Date.
5. The parties hereto are amending the Original Purchase Option
Agreement in order to more fully set forth the Purchase Option contemplated by
the Lease and certain
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
related documents. Accordingly, in consideration of the foregoing, the covenants
and conditions hereinafter set forth, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged by each of the
parties hereto, said parties hereby agree that Original Purchase Option
Agreement is hereby amended and restated in its entirety as herein provided:
ARTICLE 1.
PURCHASE OPTION
SECTION (a) Grant and Exercise of Purchase Option. Owner hereby grants
to the General Partner the right to purchase the Ammonia Project on the terms
and pursuant to the conditions set forth herein. Pursuant to the terms of
paragraph (a) of Section 12 of the Lease, the Lessee shall, not earlier than 450
days and not later than one (1) year prior to the end of the Initial Term,
request in writing that the Owner obtain bank commitments acceptable to the
Owner and the Lessee in order to finance the Owner's ownership of the Property
and Equipment under the Lease during a Renewal Term. Upon such request, the
Owner shall advise the Lessee and the General Partner in writing not later than
300 days prior to the end of the Initial Term, indicating whether the Owner has
been able to obtain such binding bank commitments for a Renewal Term. If the
Owner has advised the Lessee and the General Partner that it has been able to
obtain such binding bank commitments, the General Partner shall have the right,
during the Initial Term and during the Renewal Term, if any, upon written notice
(the "Option Notice") to the Owner and the Lessee not later than 270 days prior
to the Lease Termination Date, to purchase the Property and Equipment for the
sale price described in Section 1.02 hereof, on the date which is six (6) months
prior to the Lease Termination Date (the "Exercise Date").
SECTION (b) Purchase Price for Property and Equipment. The purchase
price for the Property and Equipment shall be (i) in the case of a purchase
during the Initial Term, the Acquisition Cost of the Property and Equipment on
the Exercise Date and (ii) in the case of a purchase during the Renewal Term,
the fair market value of the Property and Equipment on the Exercise Date (the
"Sale Price") and shall be payable by the General Partner to the Owner on the
Exercise Date, provided that the Lessee shall have no obligation whatsoever to
pay any portion of said purchase price, it being understood that all parties
hereto shall look only to the General Partner for payment of said purchase
price. In addition to the Sale Price, the General Partner shall pay all transfer
taxes, transfer gains taxes, mortgage recording tax, if any, recording and
filing fees and all other similar taxes, fees, expenses and closing costs
(including reasonable attorneys' fees) in connection with the conveyance of such
Property or Equipment from the Owner to the General Partner.
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
SECTION (c) Transfer of Property and Equipment. Upon payment by the
General Partner of all amounts owing to the Owner pursuant to Section 1.02
hereof, the Owner shall transfer title to the Property and Equipment to the
General Partner by a xxxx of sale, quitclaim deed and such other conveyance
instruments as the General Partner may reasonably require to convey all such
Property and Equipment, which xxxx of sale, quitclaim deed and other conveyance
instruments shall be satisfactory in all respects to the General Partner in its
sole discretion. The transfer of the Owner's interest in the Property and
Equipment shall be on an as-is, non-installment sale basis, without warranty by,
or recourse to, the Owner, except that such title shall be free of any Liens
resulting from the Owner's willful or knowing act or omission. Upon the sale of
the Property and Equipment, as set forth herein, the Owner's interest in the
Property and Equipment shall thereupon vest in the General Partner, free and
clear of any Lien in favor of the Owner or any Assignee.
SECTION (d) Assignment of Contracts. Upon payment by the General
Partner of all amounts owing to the Owner pursuant to Section 1.02 hereof, (i)
the Owner shall convey, and the General Partner shall accept a conveyance of,
the Owner's interest in all contracts, easements, licenses, operating
agreements, and similar agreements relating to the construction, equipping, use
and operation of the Property and Equipment, including without limitation the
Gas Contract, the Operating Agreement and the Ancillary Facility Agreements,
(ii) the General Partner shall execute such agreements and acknowledgements as
shall in the Owner's reasonable judgment be required to reflect such conveyance,
(iii) such conveyance shall be made without warranty by, or recourse to, the
Owner, except that such interest shall be free of any Liens resulting from the
Owner's willful or knowing act or omission, and (iv) the General Partner shall
assume any and all liabilities and obligations of the Owner, of whatever kind or
nature, whether absolute or contingent, direct or indirect, fixed or contingent,
or known or unknown, arising from or based upon any act, omission, event,
condition or circumstance arising from the Property and Equipment.
ARTICLE 2.
FAILURE OF THE GENERAL PARTNER
TO PURCHASE
In the event the General Partner has provided written notice to the
Owner and the Lessee pursuant to Section 1.01 of this Agreement of its intent to
purchase the Property and Equipment on the date which is six (6) months prior to
the end of the Initial Term, and the General Partner fails to effect such
purchase on such date, the General Partner shall have no further right to
purchase any Property or Equipment during the Initial Term. In the event the
General Partner has provided written notice to the Owner and the Lessee pursuant
to Section 1.01 of this Agreement of its intent to purchase the Property and
Equipment on the date which
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
is six (6) months prior to the end of the Renewal Term, and the General Partner
fails to effect such purchase on such date, the General Partner shall have no
further right to purchase the Property or Equipment under this Agreement. If the
General Partner has not provided written notice to the Owner and the Lessee
pursuant to Section 1.01 of this Agreement of its intent to purchase the
Property and Equipment on the date which is six (6) months prior to the end of
the Initial Term or the Renewal Term, as the case may be, the General Partner
shall have no further right to purchase the Property and Equipment during such
Initial Term or Renewal Term, as the case may be.
ARTICLE 3.
REPRESENTATIONS AND WARRANTIES; CERTAIN COVENANTS
SECTION (a) The General Partner hereby represents and warrants to the
Owner that:
(i) the General Partner (i) is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
(ii) has the requisite corporate power and legal right to own and operate its
properties and to carry on its business as presently conducted, and (iii) to the
best of its knowledge after due inquiry, is duly qualified to do business as a
foreign corporation in good standing in each jurisdiction in which its ownership
or leasing of properties or the conduct of its business requires such
qualification, except where the failure to so qualify would not materially
impair the ability of the General Partner to perform its obligations hereunder;
(ii) the General Partner has full power and authority to execute
and deliver this Agreement and any documents referred to herein and to perform
its obligations in accordance herewith and therewith;
(iii) all acts, consents, licenses, orders, authorizations,
approvals, waivers, extensions, and variances of, and notices to or filings
with, any governmental or public body and other proceedings to be taken by or on
the part of the General Partner to authorize the General Partner to perform
hereunder and under any documents referred to herein or contemplated hereby have
been duly and properly taken;
(iv) this Agreement has been duly authorized, executed and
delivered by the General Partner and, assuming the due authorization, execution
and delivery of this Agreement by the Owner, this Agreement constitutes the
legal, valid and binding obligation of the General Partner, enforceable in
accordance with its terms, subject, as to enforceability, to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights generally,
and to
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law); and
(v) the execution, delivery and performance hereof by the General
Partner and any obligations contemplated herein will not result in any violation
of any term of the articles of incorporation or the by-laws of the General
Partner, do not require stockholder approval or the approval or consent of any
trustee or holders of indebtedness of the General Partner except such as have
been obtained prior to the date hereof and will not conflict with or result in a
breach in any material respect of any terms or provisions of, or constitute a
default under, or result in the creation or imposition of any Lien (other than a
Permitted Lien) upon any property or assets of the General Partner under, any
indenture, mortgage or other agreement or instrument to which the General
Partner is a party or by which it or any of its property is bound, or any
existing applicable law, rule, regulation, license, judgment, order or decree of
any government, governmental body or court having jurisdiction over the General
Partner or any of its activities or properties.
SECTION (b) The Owner hereby represents and warrants to the General
Partner that:
(i) the Owner (i) is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of Delaware, (ii) has
the requisite power and legal right to own and operate its properties and to
carry on its business as presently conducted and (iii) to the best of its
knowledge after due inquiry, is duly qualified to do business as a foreign
limited partnership in good standing in each jurisdiction in which its ownership
or leasing of properties or the conduct of its business requires such
qualification, except where the failure to so qualify would not materially
impair the ability of the Owner to perform its obligations hereunder;
(ii) the Owner has full power and authority to execute and deliver
this Agreement and any documents referred to herein and to perform its
obligations in accordance herewith and therewith;
(iii) all acts, consents, licenses, orders, authorizations,
approvals, waivers, extensions and variances of, and notices to or filings with,
any governmental or public body and other proceedings to be taken by or on the
part of the Owner to authorize the Owner to perform hereunder and under any
documents referred to herein or contemplated hereby have been duly and properly
taken;
(iv) this Agreement has been duly authorized, executed and
delivered by the Owner and, assuming the due authorization, execution and
delivery of this Agreement
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
by the General Partner, this Agreement constitutes the legal, valid and binding
obligation of the Owner, enforceable in accordance with its terms, subject, as
to enforceability, to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally, and to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law);
(v) the execution, delivery and performance hereof by the Owner
and any obligations contemplated herein will not result in any violation of any
term of the certificate of limited partnership or the partnership agreement of
the Owner, do not require the approval or consent of any limited partner or
general partner of the Owner, except such as have been obtained prior to the
date hereof, and will not conflict with, or result in a breach in any material
respect of, any terms or provisions of, or constitute a default under, or result
in the creation or imposition of any Lien (other than a Permitted Lien) upon any
property or assets of the Owner under, any indenture, mortgage or other
agreement or instrument to which the Owner is a party or by which it or any of
its property is bound, or any existing applicable law, rule, regulation,
license, judgment, order or decree of any government, governmental body or court
having jurisdiction over the Owner or any of its activities or properties; and
(vi) upon the sale of the Property and Equipment, as contemplated
hereby, the Owner's interest in the Property and Equipment will vest in the
General Partner, free and clear of all Liens (other then Permitted Liens).
ARTICLE 4.
MISCELLANEOUS
SECTION (a) Assignment. No party to this Agreement may assign any of
its rights or delegate any of its obligations hereunder without the prior
written consent of the other party hereto; provided that, (i) the Owner shall be
permitted to assign its right, title and interest in this Agreement to the
Assignee without the prior written consent of the General Partner and (ii) the
General Partner shall be permitted to assign its right, title and interest in
this Agreement to any Affiliate of the General Partner (other than the Lessee)
without the prior written consent of the Owner.
SECTION (b) Indemnification. The General Partner hereby agrees to
indemnify the Owner, any Assignee, any successor or successors, and any
Affiliate of each of them and their respective officers, directors,
incorporators, shareholders, partners (general and limited, including without
limitation the general and limited partners of the Owner), employees, agents and
servants from, and holds each of them harmless against, any and all liabilities,
taxes, losses, obligations, claims, damages, penalties, causes of action, suits,
costs
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
and expenses (including, without limitation, attorneys' and accountants' fees)
to which any of them may become subject, insofar as such liabilities, taxes,
losses, obligations, claims, damages, penalties, causes of action, suits, costs
and expenses arise out of this Agreement, including without limitation the
failure of the General Partner to purchase the Property and Equipment after
notice to the Owner and the Lessee of its intent to purchase the Property and
Equipment on the Exercise Date.
SECTION (c) Amendments and Waivers. Any term, covenant, agreement or
condition of this Agreement may be amended, or compliance therewith may be
waived, only by an instrument or instruments in writing executed by each of the
parties hereto. A waiver on one occasion shall not be construed to be a waiver
with respect to any other occasion.
SECTION (d) Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall be, as to such
jurisdiction, 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 (e) Headings. The headings of sections contained in this
Agreement are inserted for purposes of convenience only and shall not be
construed to affect the meaning or construction of any of the provisions hereof.
SECTION (f) Entire Agreement. This Agreement sets forth the entire
agreement among the parties hereto with respect to the subject matter hereof and
no representations, warranties, promises, guaranties or agreements, oral or
written, express or implied, have been made by any party hereto with respect to
this Agreement or the Property or Equipment, except as provided herein.
SECTION (g) Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York.
SECTION (h) Definitions. Unless otherwise indicated, capitalized terms
used and not otherwise defined herein shall have the respective meanings given
to them in the Lease.
SECTION (i) Counterparts. This Agreement may be executed in several
counterparts, each of which so executed shall be deemed to be an original,
provided that all such counterparts, taken together, shall constitute but one
and the same agreement.
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
SECTION 4.10. Specific Performance. The Owner and the General Partner
acknowledge that the Purchase Option is a unique and valuable right, without
which the parties hereto would lose substantial benefits. The parties hereto
have concluded that, upon breach of this Agreement by any of the parties hereto,
legal remedies would be inadequate and impracticable to enforce, in that, among
other things, it would be difficult to calculate with reasonable certainty the
legal damages payable as a result of such breach; therefore, the obligations of
each of the parties hereto shall be enforceable by means of a suit for specific
performance brought by any one or more of the other parties hereto.
SECTION (a) WAIVER OF JURY TRIAL. THE PARTIES HERETO EXPRESSLY WAIVE
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM RELATED TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THE PARTIES HERETO
ACKNOWLEDGE THAT THE PROVISIONS OF THIS SECTION 4.11 HAVE BEEN BARGAINED FOR AND
THAT THEY HAVE BEEN REPRESENTED BY COUNSEL IN CONNECTION THEREWITH.
SECTION (b) Notices. All notices, requests, demands and other
communications hereunder shall be governed by, and given in accordance with and
at the addresses determined pursuant to, Section 23 of the Lease.
SECTION (c) Term. This Agreement shall terminate upon the earlier of
(a) the expiration or termination of the Lease, or (b) the exercise of the
Purchase Option and the consummation of all transactions contemplated in such
event hereunder; provided, however, that the obligations of the General Partner
contained in Section 4.02 of this Agreement shall survive the expiration or
termination of this Agreement and shall continue in full force and effect.
SECTION (d) Limitation of Liability. (i) The Owner's obligations
hereunder are intended to be the obligations of the limited partnership and of
the corporation which is the general partner thereof only and no recourse for
any obligation of the Owner hereunder, or for any claim based thereon or
otherwise in respect thereof, shall be had against any limited partner of the
Owner or any incorporator, shareholder, officer or director, or affiliate, as
such, past, present or future, of such corporate general partner or limited
partner or of any successor corporation to such corporate general partner or any
corporate limited partner of the Owner, or against any direct or indirect parent
corporation of such corporate general partner or of any limited partner of the
Owner or any other subsidiary or affiliate of any such direct or indirect parent
corporation or any incorporator, shareholder, officer or director, as such,
past, present or future, of any such parent or other subsidiary or affiliate, it
being understood that the Owner and the general partner thereof are a limited
partnership and a
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
corporation, respectively, formed for the purpose of the transactions involved
in and relating to this Agreement on the express understanding aforesaid.
Nothing contained in this Section shall be construed to limit the exercise or
enforcement, in accordance with the terms of this Agreement and any other
documents referred to herein, of rights and remedies against the limited
partnership or the corporate general partner of the Owner or the assets of the
limited partnership or the corporate general partner of the Owner.
(ii) The General Partner's obligations hereunder are intended to
be the corporate obligations of the General Partner only and no recourse for any
obligation of the General Partner hereunder, or for any claim based thereon or
otherwise in respect thereof, shall be had against any incorporator,
shareholder, officer or director, or affiliate, as such, past, present or
future, of the General Partner or of any successor corporation, or against any
direct or indirect parent corporation of the General Partner or any other
subsidiary or affiliate of any such direct or indirect parent corporation or any
incorporator, shareholder, officer or director, as such, past, present or
future, of any such parent or other subsidiary or affiliate. Nothing contained
in this Section shall be construed to limit the exercise or enforcement, in
accordance with the terms of this Agreement and any other documents referred to
herein, of rights and remedies against the General Partner or the assets of the
General Partner.
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THIS AMENDED AND RESTATED AGREEMENT FOR LEASE
IS CONFIDENTIAL AND PROPRIETARY
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
PCS NITROGEN FERTILIZER OPERATIONS,
INC.
By_______________________________________
Name:
Title:
NITROGEN LEASING COMPANY,
LIMITED PARTNERSHIP
By: NITROGEN LEASING CAPITAL,
INC., its General Partner
By_______________________________________
Name:
Title:
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