Exhibit 10.31
CLOSING ITEM NO.: A-4
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COUNTY OF SARATOGA INDUSTRIAL DEVELOPMENT AGENCY
AND
XXXXXXXX ADHESIVES, INC.
INSTALLMENT SALE AGREEMENT
DATED AS OF OCTOBER 1, 1997
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CERTAIN RIGHTS OF THE COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY (THE "ISSUER") UNDER THIS
INSTALLMENT SALE AGREEMENT AND CERTAIN MONEYS DUE AND
TO BECOME DUE TO THE ISSUER HEREUNDER HAVE BEEN
ASSIGNED TO STAR BANK, N.A., AS TRUSTEE (THE
"TRUSTEE"), PURSUANT TO A PLEDGE AND ASSIGNMENT DATED
AS OF OCTOBER 1, 1997, FROM THE ISSUER TO THE
TRUSTEE.
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THIS INSTALLMENT SALE AGREEMENT IS INTENDED TO
CONSTITUTE A SECURITY AGREEMENT UNDER THE UNIFORM
COMMERCIAL CODE OF THE STATE OF NEW YORK.
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TABLE OF CONTENTS
(This Table of Contents is not part of the Installment
Sale Agreement and is for convenience of reference only)
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS.............................................................................3
SECTION 1.2. INTERPRETATION..........................................................................9
ARTICLE II
REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 2.1. REPRESENTATIONS, WARRANTIES AND COVENANTS OF ISSUER....................................11
SECTION 2.2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF COMPANY...................................12
SECTION 2.3. COVENANT WITH TRUSTEE AND BONDHOLDERS AND BANK.........................................13
ARTICLE III
CONVEYANCE AND USE OF PROJECT FACILITY
SECTION 3.1. CONVEYANCE TO ISSUER...................................................................14
SECTION 3.2. USE OF PROJECT FACILITY................................................................14
ARTICLE IV
ACQUISITION, RECONSTRUCTION, CONSTRUCTION AND INSTALLATION OF PROJECT FACILITY; ISSUANCE OF
BONDS; USE OR PROCEEDS
SECTION 4.1. ACQUISITION, CONSTRUCTION AND INSTALLATION OF PROJECT FACILITY.........................15
SECTION 4.2. ISSUANCE OF BONDS......................................................................16
SECTION 4.3. APPLICATION OF PROCEEDS OF BONDS.......................................................16
SECTION 4.4. COMPLETION OF PROJECT FACILITY.........................................................18
SECTION 4.5. COMPLETION BY COMPANY..................................................................18
SECTION 4.6. REMEDIES TO BE PURSUED AGAINST CONTRACTORS, SUBCONTRACTORS, MATERIALMEN AND
THEIR SURETIES.................................................................................18
ARTICLE V
AGREEMENT TO CONVEY PROJECT FACILITY; INSTALLMENT PURCHASE PAYMENTS AND OTHER AMOUNTS PAYABLE
SECTION 5.1. AGREEMENT TO CONVEY PROJECT FACILITY...................................................20
SECTION 5.2. CONVEYANCE; INSTRUMENTS................................................................20
SECTION 5.3. INSTALLMENT PURCHASE PAYMENTS AND OTHER AMOUNTS PAYABLE................................20
SECTION 5.4. NATURE OF OBLIGATIONS OF COMPANY HEREUNDER.............................................21
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SECTION 5.5. PREPAYMENT OF INSTALLMENT PURCHASE PAYMENTS............................................22
SECTION 5.6. RIGHTS AND OBLIGATIONS OF COMPANY UPON DISCHARGE OF LIEN OF MORTGAGE...................22
SECTION 5.7. GRANT OF SECURITY INTEREST.............................................................22
ARTICLE VI
MAINTENANCE, MODIFICATIONS, TAXES AND INSURANCE
SECTION 6.1. MAINTENANCE AND MODIFICATIONS OF PROJECT FACILITY......................................24
SECTION 6.2. TAXES, ASSESSMENTS AND UTILITY CHARGES.................................................24
SECTION 6.3. INSURANCE REQUIRED.....................................................................25
SECTION 6.4. ADDITIONAL PROVISIONS RESPECTING INSURANCE.............................................26
SECTION 6.5. APPLICATION OF NET PROCEEDS OF INSURANCE...............................................27
SECTION 6.6. PAYMENTS IN LIEU OF TAXES..............................................................27
ARTICLE VII
DAMAGE, DESTRUCTION AND CONDEMNATION
SECTION 7.1. DAMAGE OR DESTRUCTION..................................................................29
SECTION 7.2. CONDEMNATION...........................................................................30
SECTION 7.3. ADDITIONS TO PROJECT FACILITY..........................................................32
ARTICLE VIII
SPECIAL COVENANTS
SECTION 8.1. NO WARRANTY OF CONDITION OR SUITABILITY BY ISSUER; ACCEPTANCE "AS IS\..................33
SECTION 8.2. HOLD HARMLESS PROVISIONS...............................................................33
SECTION 8.3. RIGHT OF ACCESS TO PROJECT FACILITY....................................................34
SECTION 8.4. COMPANY NOT TO TERMINATE EXISTENCE OR DISPOSE OF ASSETS; CONDITIONS UNDER
WHICH EXCEPTIONS PERMITTED.....................................................................34
SECTION 8.5. AGREEMENT TO PROVIDE INFORMATION.......................................................34
SECTION 8.6. BOOKS OF RECORD AND ACCOUNT; FINANCIAL STATEMENTS; COMPLIANCE CERTIFICATES.............35
SECTION 8.7. COMPLIANCE WITH ORDERS, ORDINANCES, ETC................................................35
SECTION 8.8. DISCHARGE OF LIENS AND ENCUMBRANCES....................................................35
SECTION 8.9. PERFORMANCE BY ISSUER OR TRUSTEE OF COMPANY'S OBLIGATIONS..............................36
SECTION 8.10. DEPRECIATION DEDUCTIONS AND TAX CREDITS...............................................36
SECTION 8.11. IDENTIFICATION OF EQUIPMENT...........................................................36
SECTION 8.12. INDEMNIFICATION OF TRUSTEE............................................................36
SECTION 8.13. COVENANT AGAINST ARBITRAGE BONDS......................................................37
SECTION 8.14. ENVIRONMENTAL MATTERS.................................................................37
SECTION 8.15. INDEMNIFICATION OF BANK...............................................................38
ARTICLE IX
ASSIGNMENTS; MERGER OF ISSUER
SECTION 9.1. ASSIGNMENT OF INSTALLMENT SALE AGREEMENT...............................................39
SECTION 9.2. PLEDGE AND ASSIGNMENT OF ISSUER'S INTERESTS TO TRUSTEE.................................39
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SECTION 9.3. MERGER OF ISSUER.......................................................................39
SECTION 9.4. SALE OR LEASE OF PROJECT FACILITY......................................................39
ARTICLE X
EVENTS OF DEFAULT AND REMEDIES
SECTION 10.1. EVENTS OF DEFAULT DEFINED.............................................................41
SECTION 10.2. REMEDIES ON DEFAULT...................................................................42
SECTION 10.3. REMEDIES CUMULATIVE...................................................................43
SECTION 10.4. AGREEMENT TO PAY ATTORNEYS' FEES AND EXPENSES.........................................43
SECTION 10.5. NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER............................................43
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. NOTICES...............................................................................44
SECTION 11.2. BINDING EFFECT........................................................................45
SECTION 11.3. SEVERABILITY..........................................................................45
SECTION 11.4. AMENDMENTS, CHANGES AND MODIFICATIONS.................................................46
SECTION 11.5. EXECUTION OF COUNTERPARTS.............................................................46
SECTION 11.6. APPLICABLE LAW........................................................................46
SECTION 11.7. RECORDING AND FILING..................................................................46
SECTION 11.8. SURVIVAL OF OBLIGATIONS...............................................................46
SECTION 11.9. TABLE OF CONTENTS AND SECTION HEADINGS NOT CONTROLLING................................46
SECTION 11.10. NO RECOURSE; SPECIAL OBLIGATION......................................................46
SECTION 11.11. SUBORDINATION TO MORTGAGE AND ASSIGNMENT.............................................47
SECTION 11.12. SUBMISSION TO JURISDICTION...........................................................47
EXHIBIT "A"
REAL PROPERTY DESCRIPTION...........................................................................A-1
EXHIBIT "B"
DESCRIPTION OF EQUIPMENT............................................................................B-1
EXHIBIT "C"
FORM OF DEED TO COMPANY.............................................................................C-1
EXHIBIT "D"
FORM OF XXXX OF SALE TO THE COMPANY.................................................................D-1
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INSTALLMENT SALE AGREEMENT
THIS INSTALLMENT SALE AGREEMENT dated as of OCTOBER 1, 1997, (the
"Installment Sale Agreement") by and between the COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY, a public benefit corporation of the State of New York (the
"State") having its office at 00 XxXxxxxx Xxxxxx, Xxxxxxxx Xxx, Xxx Xxxx 00000
(the "Issuer"), and XXXXXXXX ADHESIVES, INC., a corporation organized and
existing under the laws of the State of Virginia, having an address of 000 Xxxx
Xxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000 (the "Company");
W I T N E S S E T H :
WHEREAS, the Issuer, by resolution adopted on September 16, 1997, (the
"Resolution"), determined to issue its $6,000,000 aggregate principal amount of
Multi-Mode Variable Rate Industrial Development Revenue Bonds (Xxxxxxxx
Adhesives, Inc. Project), Series 1997 A (the "Bonds") for the purpose of
financing a portion of the costs of the Project (as hereinafter defined); and
WHEREAS, said Project (the "Project") shall consist of (A) (1) the
acquisition of a certain parcel of land comprising approximately 16.37 acres
constituting Lot #3 located in the Xxxxxx Industrial Park in the Town of Xxxxxx,
Saratoga County, New York (the "Land"), (2) the construction on the Land of two
(2) buildings approximately 10,000 square feet each in size and one (1)
approximately 800 square foot building for use in the manufacturing of synthetic
organic chemicals and related functions (collectively the "Facility") and (3)
the acquisition and installation therein of certain machinery and equipment (the
"Equipment" and together with the Land and the Facility, the "Project
Facility"), and (B) the financing of a portion of the costs of the foregoing;
and
WHEREAS, contemporaneously with the execution of the Installment Sale
Agreement, the Issuer and Star Bank, N.A., as trustee (the "Trustee"), have
entered into a trust indenture dated as of October 1, 1997, (the "Indenture")
specifying the terms and conditions upon which the Bonds are issued and secured;
and
WHEREAS, as security for the Bonds, the Company will enter into a
letter of credit reimbursement agreement dated as of October 1, 1997 (the
"Reimbursement Agreement") with KeyBank National Association, a national banking
association organized and existing under the laws of the United States (the
"Bank"), pursuant to which the Bank is to issue in favor of the Trustee an
irrevocable transferable direct-pay letter of credit (the "Letter of Credit") in
an amount equal to the aggregate of the principal amount of the Bonds, together
with one hundred ten (110) days' interest thereon at a maximum rate of ten
percent (10%); and
WHEREAS, the Issuer proposes to undertake the Project, appoint the
Company as agent of the Issuer to undertake the acquisition, construction and
installation of the Project Facility and sell the Project Facility to the
Company, and the Company desires to act as agent of the Issuer to undertake the
acquisition, reconstruction, construction and installation of the Project
Facility and purchase the Project Facility from the Issuer, all pursuant to the
terms and conditions hereinafter set forth in the Installment Sale Agreement;
and
WHEREAS, the providing of the Project Facility and the sale of the
Project Facility to the Company pursuant to the Installment Sale Agreement is
for a proper purpose, to wit, to advance the job
opportunities, health, general prosperity and economic welfare of the
inhabitants of the State, pursuant to the provisions of the Act (as hereinafter
defined); and
WHEREAS, all things necessary to constitute the Installment Sale
Agreement a valid and binding agreement by and between the parties hereto in
accordance with the terms hereof have been done and performed, and the creation,
execution and delivery of the Installment Sale Agreement have in all respects
been duly authorized by the Issuer and the Company;
NOW, THEREFORE, FOR AND IN CONSIDERATION OF THE PREMISES AND THE MUTUAL
COVENANTS HEREINAFTER CONTAINED, THE PARTIES HERETO HEREBY FORMALLY COVENANT,
AGREE AND BIND THEMSELVES AS FOLLOWS, TO WIT:
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ARTICLE I
DEFINITIONS
SECTION 1.1. The terms defined in this Section 1.1 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes of
the Installment Sale Agreement and of any agreement supplemental hereto shall
have the respective meaning specified in this Section 1.1
"Act" means Title 1 of Article 18-A of the General Municipal Law of the
State, as amended from time to time, together with Chapter 855 of the Laws of
1971 of the State, as amended from time to time.
"Act of Bankruptcy" means the filing of a petition in bankruptcy (or
the other commencement of a bankruptcy or similar proceeding) by or against the
Company or the Issuer under any applicable bankruptcy, insolvency,
reorganization or similar law, now or hereafter in effect.
"Assignment" means the pledge and assignment dated as of October 1,
1997 from the Issuer to the Trustee pursuant to which the Issuer has assigned to
the Trustee its rights under the Installment Sale Agreement (other than
Unassigned Rights), as said pledge and assignment may be supplemented or amended
from time to time.
"Alternate Credit Facility" shall have the meaning assigned to such
term in the Indenture.
"Authorized Representative" means the Person or Persons at the time
designated to act in behalf of the Issuer or the Company, as the case may be, by
written certificate furnished to the Trustee containing the specimen signature
of each such Person and signed on behalf of (A) the Issuer by its Chairman or
Vice Chairman, or such other person as may be authorized by resolution of the
Issuer, and (B) the Company by Xxxxxx Xxxxxxxx, Xxxxxxx Xxxxxxx or such other
person as may be authorized by the Company.
"Available Moneys" shall have the meaning assigned to such term in the
Indenture.
"Bank" means initially, KeyBank National Association, and its
successors and assigns in its capacity as issuer of the Letter of Credit and in
the event an Alternate Credit Facility is outstanding, the issuer of the
Alternate Credit Facility.
"Bank Documents" means the Letter of Credit, the Reimbursement
Agreement, the Mortgage, the Pledge and Security Agreement, the Collateral
Mortgage, the Security Agreement, the Guaranty, the Term Loan Note, the Building
Loan Agreement and any other document now or hereafter executed by the Issuer or
the Company or the Guarantor in favor of the Bank which affects the rights of
the Bank in or to the Project, in whole or in part, or which secures or
guarantees any sum due under any Bank Document.
"Xxxx of Sale to Issuer" means the xxxx of sale from the Company to the
Issuer conveying the Company's interest in the Equipment to the Issuer.
"Bond Counsel" means Xxxxxx and Xxxx, P.C. of Saratoga Springs, New
York or such other attorney or firm of attorneys located in the State whose
experience in matters relating to the issuance of
3
obligations by states and their political subdivisions is nationally recognized
and who are acceptable to the Issuer and the Trustee in their reasonable
discretion.
"Bond Fund" means the fund so designated and established pursuant to
Section 402 of the Indenture.
"Bond Payment Date" means each Interest Payment Date and each date on
which principal or premium shall be payable on the Bonds according to their
terms and the Indenture, so long as any Bonds shall be Outstanding.
"Bond Registrar" means the Trustee.
"Bond Year" means each one (1) year period ending on the anniversary of
the Closing Date.
"Bondholder" or "Holder" or "Owner" means the registered owner of any
Bond as indicated on the bond register maintained by the Bond Registrar.
"Bonds" means the Issuer's Multi-Mode Variable Rate Industrial
Development Revenue Bonds (Xxxxxxxx Adhesives, Inc. Project), Series 1997 A
issued in the aggregate principal amount of $6,000,000 pursuant to the
Resolution and Article II of the Indenture.
"Building Loan Agreement" means the building loan agreement dated as of
October 1, 1997 by and between the Issuer, the Company and the Bank, as amended
or supplemented from time to time.
"Business Day" means any day of the year on which the Trustee and
banking institutions located in the State are open for the purpose of conducting
business.
"Closing Date" means the date on which authenticated Bonds are
delivered to the purchaser of the Bonds and payment is received therefor by the
Trustee on behalf of the Issuer.
"Code" means the Internal Revenue Code of 1986, as amended, and the
applicable regulations of the United States Treasury Department promulgated
thereunder and under the Internal Revenue Code of 1954, as amended.
"Collateral Mortgage" means the collateral mortgage dated as of October
1, 1997 from the Company in favor of the Bank, as said collateral mortgage may
be amended or supplemented from time to time.
"Company" means Xxxxxxxx Adhesives, Inc., a corporation organized and
existing under the laws of the State of Virginia, having an address of 000 Xxxx
Xxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, and its successors and permitted assigns.
"Completion Date" means the date identified on the completion
certificate delivered by the Company in accordance with Section 4.4 of the
Installment Sale Agreement.
"Condemnation" means the taking of title to, or the use of, Property
under the exercise of the power of eminent domain by any Governmental Authority.
4
"Construction Contract" means the contract for the construction of the
Facility by and between the Company and the Contractor.
"Construction Period" means the period (A) beginning on the Closing
Date and (B) ending on the Completion Date.
"Contractor" means D.B. Western, Inc.
"Cost of the Project" means all those costs and items of expense
enumerated in Section 4.3 of the Installment Sale Agreement.
"Debt Service Payment" means, with respect to any Interest Payment Date
and/or Purchase Date, (A) the interest payable on the Bonds on such Bond Payment
Date, plus (B) the principal, if any, payable on the Bonds on such Bond Payment
Date, plus (C) the premium, if any, payable on the Bonds on such Bond Payment
Date.
"Deed to Issuer" means the deed from the Company to the Issuer with
respect to the Project Facility.
"Equipment" means all materials, machinery, equipment, fixtures or
furnishings intended to be acquired with the proceeds of the Bonds or any
payment made by the Company pursuant to Section 4.5 of the Installment Sale
Agreement, and such substitutions and replacements therefor as may be made from
time to time pursuant to the Installment Sale Agreement, including, without
limitation, all the Property described in Exhibit "B" attached to the
Installment Sale Agreement and the Mortgage.
"Event of Default" means any of those events defined as Events of
Default by the terms of Article X of the Indenture, Article X of the Installment
Sale Agreement or Article VI of the Mortgage.
"Facility" means all those buildings, improvements, structures and
other related facilities (A) affixed to or attached to the Land and (B) financed
with the proceeds of the sale of the Bonds or any payment made by the Company
pursuant to Section 4.5 of the Installment Sale Agreement.
"Financing Documents" means the Bonds, the Indenture, the Installment
Sale Agreement, the Assignment, the Bank Documents, the Tax Regulatory Agreement
and any other document now or hereafter executed by the Issuer or the Company in
favor of the Bondholders or the Trustee or the Bank which affects the rights of
the Bondholders or the Trustee or the Bank in or to the Project Facility, in
whole or in part, or which secures or guarantees any sum due under the Bonds or
any other Financing Document, each as amended from time to time, and all
documents related thereto and executed in connection therewith.
"Governmental Authority" means the United States, the State, any other
state and any political subdivision of any of them, and any agency, department,
commission, board, bureau or instrumentality of any of them.
"Gross Proceeds" means one hundred percent (100%) of the proceeds of
the transaction in question, including, but not limited to, the settlement of
any insurance or Condemnation award.
"Guarantor" means Xxxxxxxx Industries, Inc.
5
"Guaranty" means the payment and performance guaranty dated as of
October 1, 1997 from the Guarantor in favor of the Bank, as said payment and
performance guaranty may be amended or supplemented from time to time.
"Indebtedness" shall have the meaning assigned to such term in Section
2.01 of the Mortgage.
"Indenture" means the trust indenture dated as of September 1, 1997 by
and between the Issuer and the Trustee, as said trust indenture may be
supplemented or amended from time to time.
"Independent Counsel" shall mean an attorney or firm of attorneys duly
admitted to practice law before the highest court of any state and approved by
the Bank and not a full-time employee of the Company or the Issuer.
"Installment Sale Agreement" means the installment sale agreement dated
as of October 1, 1997 by and between the Issuer and the Company, as said
installment sale agreement may be supplemented or amended from time to time.
"Insurance and Condemnation Fund" means the fund so designated and
established pursuant to Section 4.03 of the Indenture.
"Interest Payment Date" means the date on which an installment of
interest on the Bonds is paid as set forth in the Indenture.
"Issuer" means (A) County of Saratoga Industrial Development Agency and
its successors and assigns, and (B) any public benefit corporation or political
subdivision resulting from or surviving any consolidation or merger to which
County of Saratoga Industrial Development Agency or its successors or assigns
may be a party.
"Land" means the approximately 16.37 acre parcel of land constituting
Lot #3 in the Xxxxxx Industrial Park in the Town of Xxxxxx, Saratoga County, New
York, as more particularly described in Exhibit "A" attached to the Installment
Sale Agreement and Exhibit "A" attached to the Mortgage.
"Letter of Credit" means (A) the irrevocable, direct-pay Letter of
Credit issued by the Bank and delivered to the Trustee upon the issuance of the
Bonds and (B) any Alternate Credit Facility.
"Lien" means any interest in Property securing an obligation owed to a
Person, whether such interest is based on the common law, statute or contract,
and including but not limited to a security interest arising from a mortgage,
encumbrance, pledge, conditional sale or trust receipt or a lease, consignment
or bailment for security purposes. The term "Lien" includes reservations,
exceptions, encroachments, projections, easements, rights of way, covenants,
conditions, restrictions, leases and other similar title exceptions and
encumbrances, including but not limited to mechanics', materialmen's,
warehousemen's and carriers' liens and other similar encumbrances affecting real
property. For purposes hereof, a Person shall be deemed to be the owner of any
Property which it has acquired or holds subject to a conditional sale agreement
or other arrangement pursuant to which title to the Property has been retained
by or vested in some other Person for security purposes.
"Local Authority" means any Governmental Authority which exercises
jurisdiction over the Land or the reconstruction, construction or installation
of the Project Facility.
6
"Maturity Date" means with respect to any Bonds, the Stated Maturity.
"Mortgage" means the mortgage and security agreement dated as of
October 1, 1997 from the Issuer and the Company to the Bank, as said mortgage
may be supplemented or amended from time to time.
"Mortgaged Property" shall have the meaning assigned to such term in
Section 2.01 of the Mortgage.
"Net Proceeds" means so much of the Gross Proceeds with respect to
which that term is used as remain after payment of all fees for services,
expenses, costs and taxes (including attorneys' fees) incurred in obtaining such
Gross Proceeds.
"Outstanding" shall have the meaning assigned to such term in the
Indenture.
"Permit" shall mean any permit, license, certificate or authorization
of any kind required by any Governmental Authority in connection with the use,
ownership, occupancy or operation of the Project Facility, including all such
environmental permits required for the transfer, sale or conveyance of any part
of the Project Facility or the storage, treatment, generation, handling,
transportation, processing or disposal of Hazardous Substances.
"Permitted Encumbrances" means (A) utility, access and other easements,
rights of way, restrictions, encroachments and exceptions that benefit or do not
materially impair the utility or the value of the Property affected thereby for
the purposes for which it is intended, (B) mechanics', materialmen's,
warehousemen's, carriers' and other similar Liens to the extent permitted by
Section 8.8(B) of the Installment Sale Agreement, (C) Liens for taxes,
assessments and utility charges (1) to the extent permitted by Section 6.2(B) of
the Installment Sale Agreement, or (2) at the time not delinquent, (D) any Lien
on the Project Facility obtained through any Financing Document, (E) any
exception appearing in the mortgagee title insurance policy issued on the
Closing Date and accepted by the Bank and (F) any Permitted Lien (as defined in
the Reimbursement Agreement).
"Person" means an individual, partnership, corporation, trust,
unincorporated organization or Governmental Authority.
"Plans and Specifications" means the plans and specifications for the
construction and reconstruction of the Facility, prepared and stamped by the
Architect, and all material amendments and modifications thereof made by change
orders; and, if an item for the construction and reconstruction of the Facility
is not specifically detailed in the aforementioned plans and specifications, but
rather is described by way of manufacturer's or supplier's or contractor's shop
drawings, catalog references or similar descriptions, the term also includes
such shop drawings, catalog references and descriptions.
"Pledge and Security Agreement" means (A) the pledge and security
agreement dated as of October 1, 1997 by and between the Company and the Bank,
as the same may be supplemented or amended from time to time, and (B) the pledge
and security agreement by and between the Company and any substitute Bank, as
the same may be supplemented or amended form time to time.
"Project" means (A) the acquisition of the Land, (B) the construction
of the Facility, (C) the installation of the Equipment; and (D) the financing of
a portion of the costs of the foregoing by the issuance of the Bonds.
7
"Project Facility" means, collectively, the Land, the Facility and the
Equipment.
"Project Fund" means the fund so designated and established pursuant to
Section 402 of the Indenture.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Rebate Amount" shall have the meaning assigned to such term in the Tax
Regulatory Agreement.
"Rebate Fund" means the fund so designated and established pursuant to
Section 402 of the Indenture.
"Request for Disbursement" means a request from the Company, as agent
of the Issuer, stating the amount of disbursement sought in substantially the
form of Schedule "D" attached to the Building Loan Agreement.
"Reimbursement Agreement" means the letter of credit reimbursement
agreement dated as of October 1, 1997 between the Company and the Bank, as the
same may be amended from time to time and any agreement of the Company with a
Credit Facility Issuer setting forth the obligations of the Company to such
Credit Facility Issuer arising out of any payments under a Credit Facility.
"Requirement" or "Local Requirement" means any law, ordinance, order,
rule or regulation of a Governmental Authority or a Local Authority,
respectively.
"Resolution" means the resolution of the Issuer adopted on September
16, 1997, authorizing the Issuer to undertake the Project, to issue and sell the
Bonds and to execute and deliver the Financing Documents to which the Issuer is
a party.
"Security Agreement" means the security agreement dated as of October
1, 1997 from the Company to the Bank, as said security agreement may be
supplemented or amended from time to time.
"SEQR" means Article 8 of the Environmental Conservation Law, Chapter
43-B of the Consolidated Laws of New York, as amended and the regulations
adopted pursuant thereto.
"State" means the State of New York.
"Stated Amount" shall have the meaning assigned to such term in the
Letter of Credit.
"Stated Maturity" means, when used with respect to any Bond or any
installment of interest thereon, the date specified in such Bond as the fixed
date on which the principal of such Bond or such installment of interest on such
Bond is due and payable.
"Tax Regulatory Agreement" means the tax regulatory agreement dated the
Closing Date executed by the Company in favor of the Issuer, the Trustee and the
Bank regarding, among other things, the restrictions prescribed by the Code in
order for interest on the Bonds to remain excluded from gross income for federal
income tax purposes.
8
"Term Loan Note" means the term loan note dated the Closing Date in the
principal amount of $1,500,000 from the Company in favor of the Bank.
"Trust Estate" shall have the meaning assigned to such term in the
Indenture.
"Trustee" means Star Bank, N.A., a national banking association
organized and existing under the laws of the United States, having its office at
000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000-0000, or any successor trustee or
co-trustee, acting as trustee under the Indenture.
"Unassigned Rights" means (A) the rights of the Issuer granted pursuant
to Sections 2.2(E), 2.2(F), 2.2(J), 3.2, 4.1(B), 4.1(D), 4.1(E)(2), 4.1(F),
4.1(G), 4.4, 5.2, 5.3(B)(2), 6.1(B)(1), 6.3, 6.4 (as it relates to the insurance
required by Section 6.3), 6.5, 6.6, 7.1, 7.2, 8.1, 8.2, 8.3, 8.4, 8.5, 8.6(C),
8.7, 8.8, 8.9, 8.11, 8.14, 9.1, 9.3, 9.4, 11.1, 11.2, 11.10 and 11.11(B) of the
Installment Sale Agreement, (B) the moneys due and to become due to the Issuer
for its own account or the members, officers, agents (other than the Company)
and employees of the Issuer for their own account pursuant to Sections 2.2(F),
4.1(F), 5.3(B)(2), 5.3(C), 6.4(B), 8.2, 8.14 and 10.4 of the Installment Sale
Agreement, (C) the rights of the Issuer under Section 6.6 of the Installment
Sale Agreement and the moneys due as payments in lieu of taxes under Section 6.6
of the Installment Sale Agreement, and (D) the right to enforce the foregoing
pursuant to Article X of the Installment Sale Agreement. Notwithstanding the
preceding sentence, to the extent the obligations of the Company under the
Sections of the Installment Sale Agreement listed in (A) or (C) above do not
relate to the payment of moneys to the Issuer for its own account or to the
members, officers, agents (other than the Company) and employees of the Issuer
for their own account, such obligations, upon assignment of the Installment Sale
Agreement by the Issuer to the Trustee pursuant to the Assignment and to the
Bank pursuant to the Mortgage, shall be deemed to and shall constitute
obligations of the Company to the Issuer and the Trustee and the Bank, jointly
and severally, and either the Issuer or the Trustee or the Bank may commence an
action to enforce the Company's obligations under the Installment Sale
Agreement.
SECTION 1.2. INTERPRETATION. (A) In the Installment Sale Agreement, unless the
context otherwise requires:
(1) the terms "hereby", "hereof", "herein", "hereunder"
and any similar terms as used in the Installment Sale
Agreement refer to the Installment Sale Agreement, and the
term "heretofore" shall mean before, and the term "hereafter"
shall mean after, the date of the Installment Sale Agreement;
(2) words of masculine gender shall mean and include
correlative words of feminine and neuter genders, and words
importing the singular number shall mean and include the
plural number, and vice versa;
(3) words importing persons shall include firms,
associations, partnerships (including limited partnerships),
trusts, corporations and other legal entities, including
public bodies, as well as natural persons;
(4) any headings preceding the texts of the several
Articles and Sections of the Installment Sale Agreement, and
any table of contents or marginal notes appended to copies
hereof, shall be solely for convenience of reference and shall
neither constitute a part of the Installment Sale Agreement
nor affect its meaning, construction or effect; and
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(5) any certificates, letters or opinions required to be
given pursuant to the Installment Sale Agreement shall mean a
signed document attesting to or acknowledging the
circumstances, representations, opinions of law or other
matters therein stated or set forth or setting forth matters
to be determined pursuant to the Installment Sale Agreement.
(B) If any one or more of the covenants or agreements
provided herein on the part of the Issuer or the Company to be performed shall,
for any reason, be held or shall, in fact, be inoperative, unenforceable or
contrary to law in any particular case, such circumstance shall not render the
provision in question inoperative or unenforceable in any other case or
circumstance. Further, if any one or more of the phrases, sentences, clauses,
paragraphs or sections herein should be contrary to law, then such covenant or
covenants or agreement or agreements shall be deemed separable from the
remaining covenants and agreements hereof and shall in no way affect the
validity of the other provisions of the Installment Sale Agreement.
(C) The Installment Sale Agreement shall be construed in
accordance with the applicable laws of the State.
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ARTICLE II
REPRESENTATIONS, WARRANTIES
AND COVENANTS
SECTION 2.1. REPRESENTATIONS, WARRANTIES AND COVENANTS OF ISSUER. The Issuer
makes the following representations, warranties and covenants as the basis for
the undertakings on its part herein contained:
(A) The Issuer is duly established under the provisions
of the Act and has the power to enter into the Installment Sale Agreement and to
carry out its obligations hereunder. Based upon the representations of the
Company as to the utilization of the Project Facility, the Project Facility will
constitute a "project", as such quoted term is defined in the Act. By proper
official action, the Issuer has been duly authorized to execute, deliver and
perform the Installment Sale Agreement and the other Financing Documents to
which it is a party.
(B) Neither the execution and delivery of the Installment
Sale Agreement, the consummation of the transactions contemplated hereby nor the
fulfillment of or compliance with the provisions of the other Financing
Documents by the Issuer will conflict with or result in a breach by the Issuer
of any of the terms, conditions or provisions of the Act, the by-laws of the
Issuer or any order, judgment, agreement or instrument to which the Issuer is a
party or by which it is bound, or will constitute a default by the Issuer under
any of the foregoing.
(C) The Issuer will cause the Project Facility to be
acquired, reconstructed, constructed and installed and will sell the Project
Facility to the Company pursuant to the Installment Sale Agreement, all for the
purpose of advancing the job opportunities, health, general prosperity and
economic welfare of the people of the State and improving their standard of
living.
(D) Except as provided in Article IX hereof and in
Section 10.2(A)(3) hereof, the Issuer, to the extent of its interest therein,
shall not sell, assign, transfer, encumber or pledge as security the Project
Facility or any part thereof and shall maintain the Project Facility free and
clear of all Liens and encumbrances, except as contemplated or allowed by the
terms of the Installment Sale Agreement and the other Financing Documents.
(E) To assist in financing the Cost of the Project, the
Issuer will issue and sell the Bonds. In no event will the Issuer issue and sell
additional obligations to pay the Cost of the Project if the issuance and sale
of such further obligations would cause interest on the Bonds to be or become
subject to federal income taxation under the Code. The Issuer shall cooperate
with the Company in the filing by the Company, as agent of the Issuer, of such
returns and other information with the Internal Revenue Service as are required
by any applicable law or regulation, provided the Company shall bear all costs
of preparing, gathering and/or filing such returns and other information.
(F) So long as the Bonds shall be outstanding, the Issuer
shall not take any action (or omit to take any action which the Trustee or the
Company, together with Bond Counsel, advise the Issuer in writing to take) which
action (or omission) will in any way cause (1) the proceeds from the sale of the
Bonds to be applied in a manner contrary to that provided in the Financing
Documents or (2) interest on the Bonds to be includable under the Code in the
gross income of the holders thereof.
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SECTION 2.2. The Company makes the following representations, warranties and
covenants as the basis for the undertakings on its part herein contained:
(A) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Virginia, is
authorized to conduct business within the State and has the power and authority
to enter into the Installment Sale Agreement and the other Financing Documents
to which the Company is a party and carry out its obligations hereunder and
thereunder.
(B) Neither the execution and delivery of the Installment
Sale Agreement or the other Financing Documents to which the Company is a party,
the consummation of the transactions contemplated hereby or thereby nor the
fulfillment of or compliance with the provisions of the Installment Sale
Agreement or the other Financing Documents to which it is a party will (1)
conflict with or result in a breach of any of the terms, conditions or
provisions of the Company's Certificate of Incorporation or By-Laws or of any
order, judgment, agreement or instrument to which the Company is a party or by
which it is bound, or constitute a default under any of the foregoing, (2)
result in the creation or imposition of any Lien of any nature upon any Property
of the Company under the terms of any such instrument or agreement, or (3)
require consent under (which has not been heretofore received), conflict with or
violate any existing law, rule, regulation, judgment, order, writ, injunction or
decree of any government, governmental instrumentality or court (domestic or
foreign) having jurisdiction over the Company or any of the Property of the
Company.
(C) The completion of the Project Facility by the Issuer
and the lease and sale thereof by the Issuer to the Company will not result in
the removal of a commercial, manufacturing or industrial plant of the Company or
any other proposed occupant of the Project Facility from one area of the State
to another area of the State or in the abandonment of one or more plants or
facilities of the Company or any other proposed occupant of the Project Facility
located in the State.
(D) The Financing Documents to which the Company is a
party constitute, or upon their execution and delivery in accordance with the
terms thereof will constitute, valid and legally binding obligations of the
Company, enforceable in accordance with their respective terms.
(E) So long as any Bond is Outstanding, the Project
Facility will continue to be a "project", as such quoted term is defined in the
Act, and the Company will not take any action (or omit to take any action
required by the Financing Documents or which the Trustee or the Issuer or the
Bank, together with Bond Counsel, advise the Company in writing should be
taken), or allow any action to be taken, which action (or omission) would in any
way (1) cause the Project Facility not to constitute a "project", as such quoted
term is defined in the Act, (2) cause the proceeds of the Bonds to be applied in
a manner contrary to that provided in the Financing Documents or (3) adversely
affect the exclusion from gross income of the interest on the Bonds for federal
income tax purposes.
(F) The Company shall cause all notices required by law
to be given, and shall comply or cause compliance with all laws, ordinances,
municipal rules and regulations and requirements of all Governmental Authorities
applying to or affecting the conduct of work on the Project Facility and the
Company will defend and save the Issuer and its officers, members, agents and
employees harmless from all fines and penalties due to failure to comply
therewith.
(G) The Company hereby covenants to comply with all
mitigation measures, requirements and conditions, if any, enumerated in the
findings issued by the Town of Xxxxxx under
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SEQR with respect to the Project Facility and in any other approvals issued by
any other Governmental Authority.
(H) The Project Facility and the operation thereof will
comply with all applicable building, zoning, environmental, planning and
subdivision laws, ordinances, rules and regulations of Governmental Authorities
having jurisdiction over the Project Facility.
(I) All proceeds from the sale of the Bonds shall be used
solely to pay the Cost of the Project and the total Cost of the Project is not
expected to be less than $6,000,000.
(J) The Company shall (1) cause any new employment
opportunities created in connection with the Project to be listed with (i) the
Regional Office of the New York State Department of Economic Development serving
Xxxxxx, New York, (ii) the New York State Department of Labor Jobs Service
Division, and (iii) the local service delivery area administrative entity
created pursuant to the United States Job Training Partnership Act (P.L. 97-300)
serving Xxxxxx, New York, (2) the Company shall file with the Issuer on or
before January 1 of each year during which the Bonds are outstanding the status
of its employment plan with respect to the Project, including the number of
employment opportunities created, the number of employment openings listed in
accordance with (i) above and the number of employment positions filled, and (3)
the Company agrees, subject to the terms of an existing collective bargaining
agreement(s), to first consider for such new employment persons eligible under
the United States Job Training Partnership Act.
(K) Except as provided in Section 9.4(B) hereof, all
items comprising the Equipment shall remain in the Facility at all times during
which any Bonds are Outstanding.
(L) Not more than one-third of the total Cost of the
Project shall be used to provide facilities primarily used in making Retail
Sales (as such term is defined in Section 862 of the General Municipal Law of
the State) to customers who personally visit such facilities.
(M) All representations, warranties, statements of
reasonable expectation and covenants of the Company made in the Tax Regulatory
Agreement (including the schedules attached thereto) are hereby declared to be
for the benefit of, among others, the Issuer and are hereby incorporated herein
by reference with the same force and effect as if set forth in full herein and
are hereby represented to be true and correct.
SECTION 2.3. COVENANT WITH TRUSTEE AND BONDHOLDERS AND BANK. The Issuer and the
Company agree that the Installment Sale Agreement is executed in part to induce
the purchase of the Bonds and to induce the Bank to issue the Letter of Credit.
Accordingly, all representations, covenants and agreements on the part of the
Issuer and the Company set forth in the Installment Sale Agreement are hereby
declared to be for the benefit of the Issuer, the Trustee, the holders from time
to time of the Bonds and the Bank.
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ARTICLE III
CONVEYANCE AND USE OF PROJECT FACILITY
SECTION 3.1. CONVEYANCE TO ISSUER. The Company has conveyed or will convey, or
will cause to be conveyed, to the Issuer title to the Project Facility pursuant
to the Deed to Issuer and the Xxxx of Sale to Issuer. The Company represents and
warrants that it has good and marketable title to the Project Facility, free and
clear of all Liens except for Permitted Encumbrances, and agrees that it will
defend, indemnify and hold the Issuer, the Trustee and the Bank harmless from
any expense or liability due to any defect in title thereto.
SECTION 3.2. USE OF PROJECT FACILITY. Subsequent to the Closing Date, the
Company shall be entitled to use the Project Facility in any manner not
otherwise prohibited by the Financing Documents, provided that such use causes
the Project Facility to qualify or continue to qualify as a "project" under the
Act and does not tend, in the reasonable judgment of the Issuer, to bring the
Project Facility into disrepute as a public project; provided, further, however,
that at no time shall any such use be other than as a manufacturing facility
without the written consent of the Issuer and the Bank.
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ARTICLE IV
ACQUISITION, CONSTRUCTION AND INSTALLATION OF
PROJECT FACILITY; ISSUANCE OF BONDS; USE OF PROCEEDS
SECTION 4.1. ACQUISITION, CONSTRUCTION AND INSTALLATION OF PROJECT FACILITY. (A)
The Company shall, on behalf of the Issuer, promptly acquire, construct and
install the Project Facility or cause the Project Facility to be acquired,
constructed, and installed, all in accordance with the Plans and Specifications.
(B) No material change in the Plans and Specifications
shall be made unless the Bank shall have consented thereto in writing and the
Issuer shall have been furnished with an unqualified opinion of Bond Counsel
that the construction of the Facility and installation of the Equipment in
accordance with the revised Plans and Specifications will not adversely affect
the tax-exempt status of the interest payable on the Bonds.
(C) Title to all materials, equipment, machinery and
other items of Property intended to be incorporated into or installed in and to
become part of the Project Facility shall vest in the Issuer immediately upon
deposit on the Land or incorporation into or installation in the Facility,
whichever shall occur first. The Company shall execute, deliver and file all
instruments necessary or appropriate to vest title in the Issuer and shall take
all action necessary or appropriate to protect such title against claims of any
third Persons.
(D) The Issuer shall enter into, and accept the
assignment of, such contracts as the Company may request in order to effectuate
the purposes of this Section 4.1; provided, however, that the liability of the
Issuer thereunder shall be limited to moneys disbursed under the Indenture.
(E) The Issuer hereby appoints the Company as its true
and lawful agent to perform under the following authority in compliance with the
terms, purposes and intent of the Financing Documents, and the Company hereby
accepts such agency: (1) to acquire the land and reconstruct and construct the
Facility and acquire, construct and install the Project Facility, (2) to make,
execute, acknowledge and deliver any contracts, orders, receipts, writings and
instructions with any other Persons, and in general to do all things which may
be requisite or proper, all for the reconstruction, construction and
installation of the Project Facility, with the same powers and with the same
validity as the Issuer could do if acting in its own behalf, provided that the
liability of the Issuer thereunder shall be limited to moneys advanced under the
Indenture, (3) to pay all fees, costs and expenses incurred in the
reconstruction, construction and installation of the Project Facility from funds
made available therefor in accordance with the Installment Sale Agreement and
the Indenture, (4) to request on behalf of the Issuer, and receive for the
purpose of paying the Cost of the Project, disbursements of the proceeds of the
Bonds pursuant to the Indenture, (5) to ask, demand, xxx for, xxxx, recover and
receive all such sums of money, debts, dues and other demands whatsoever which
may be due, owing and payable to the Issuer under the terms of any contract,
order, receipt or writing in connection with the reconstruction, construction
and installation of the Project Facility and to enforce the provisions of any
contract, agreement, obligation, bond or other performance security in
connection with the same, and (6) to appoint sub-agents in connection with any
of the foregoing.
(F) The Company has given or will give or cause to be
given all notices and has complied or will comply or cause compliance with all
laws, ordinances, rules, regulations and
15
requirements of all Governmental Authorities applying to or affecting the
conduct of work on the Project Facility, and the Company will defend, indemnify
and save the Issuer, the Trustee and the Bank and their respective officers,
members, agents, servants and employees harmless from all fines and penalties
due to failure to comply therewith. All permits and licenses necessary for the
prosecution of work on the Project Facility shall be procured promptly by the
Company.
(G) To the extent required by applicable law, the Company
will cause (1) compliance with the requirements of Article 8 of the Labor Law of
the State, and (2) any contractor, subcontractors and other persons involved in
the construction and installation of the Project Facility to comply with Article
8 of the Labor Law of the State.
(H) The Company for itself and on behalf of the Issuer
covenants that the moneys advanced pursuant to the Indenture shall be held as a
trust fund pursuant to Section 13 of the Lien Law of the State to be applied
first for the purpose of paying the Cost of Improvement (as defined in the Lien
Law) with regard to the Project Facility and it will apply the same first to
such payment before using any part thereof for any other purpose.
(I) The Company agrees to file with the Department of
Taxation and Finance of the State in a manner and at the time prescribed
thereby, information relating to the extent of exemption from sales and use tax
claimed with respect to the construction and equipping of the Project Facility
all in compliance with Section 874 of the General Municipal Law of the State.
THE COMPANY ACKNOWLEDGES THAT THE FAILURE TO COMPLY WITH THE PROVISIONS OF SAID
SECTION 874 SHALL RESULT IN A REVOCATION OF THE AUTHORITY GRANTED PURSUANT TO
SUBSECTION (E) OF THIS SECTION 4.1.
SECTION 4.2. ISSUANCE OF BONDS. In order to finance a portion of the Cost of the
Project, together with other costs and incidental expenses in connection
therewith, the Issuer agrees that it will issue, sell and cause to be delivered
to the purchaser thereof the Bonds, as provided in the Indenture. THE ISSUER
MAKES NO REPRESENTATION, EXPRESS OR IMPLIED, THAT THE NET PROCEEDS OF THE BONDS
WILL BE SUFFICIENT TO COMPLETE THE ACQUISITION, CONSTRUCTION AND INSTALLATION OF
THE PROJECT FACILITY.
SECTION 4.3. APPLICATION OF PROCEEDS OF BONDS. The proceeds of the sale of the
Bonds shall be deposited by the Issuer with the Trustee as provided in the
Indenture and, following the Completion Date and upon submission to the Trustee
of a Request for Disbursement certified by an Authorized Representative of the
Company, and otherwise complying with the requirements of the Indenture, the
Reimbursement Agreement and the Building Loan Agreement, shall be applied to pay
the following items of cost and expenses in connection with the acquisition of
the Land, the construction of the Facility, the acquisition and installation of
the Equipment and the financing of the same, and for no other purpose:
(A) the cost of preparing the Plans and Specifications as
they relate to the Facility and the Equipment (including any preliminary study
or planning for the Facility and the Equipment or any necessary further study or
any aspect thereof);
(B) all costs incurred in connection with the acquisition
of the Land, the construction of the Facility and the acquisition and
installation of the Equipment (including architectural, engineering and
supervisory services with respect thereto);
16
(C) all fees, taxes, charges and other expenses for
recording or filing, as the case may be, the Assignment, the Installment Sale
Agreement or a Memorandum thereof, the Indenture, the Mortgage, the Collateral
Mortgage any other agreement contemplated hereby, any financing statements and
any title curative documents that the Issuer or the Trustee or the Bank may deem
desirable in order to perfect or protect the Issuer's, the Trustee's, the Bank's
or the Company's respective interests in the Project Facility, and any security
interests contemplated by the Financing Documents;
(D) all fees and expenses in connection with any actions
or proceedings that the Issuer or the Trustee or the Bank may deem desirable in
order to perfect or protect the Issuer's, the Trustee's, the Bank's or the
Company's respective interests in the Project Facility, except for removing
Permitted Encumbrances;
(E) any expenses of the Company in enforcing any remedy
against any contractor or subcontractor in accordance with Section 4.6 hereof;
(F) the cost of all insurance maintained with respect to
the Project Facility pursuant to Section 6.3 hereof during the Construction
Period and the cost of maintaining a payment and performance bond (or letter of
credit in substitution therefor), if any, with respect to the Construction
Contract;
(G) all interest payable on the Bonds during the
Construction Period;
(H) all interest payable on any interim financing the
Company may have secured with respect to the Project Facility in anticipation of
the issuance of the Bonds;
(I) all legal, accounting, financial advisory, investment
banking, underwriting, rating agency, blue sky, legal investment and any other
fees, discounts, costs and expenses incurred by the Issuer, the Company, the
Trustee or the Bank in connection with the preparation, reproduction,
authorization, issuance, execution, delivery and sale of the Bonds and the other
Financing Documents and all other documents in connection therewith, with the
acquisition of the Land, the construction of the Facility and the acquisition
and installation of the Equipment, and with any other transaction contemplated
by the Bonds, the Indenture and the Installment Sale Agreement;
(J) the administration and acceptance fees, costs and
expenses (including, but not limited to, reasonable attorneys' fees) of the
Issuer, the Trustee and the Bank;
(K) all title insurance, appraisal and surveying costs;
(L) payment of the taxes and assessments for the Project
Facility payable during or allocable to the Construction Period;
(M) the satisfaction of any existing indebtedness
encumbering the Project Facility; and
(N) reimbursement to the Company for any of the above
enumerated costs and expenses paid and incurred by the Company.
SECTION 4.4. COMPLETION OF PROJECT FACILITY. The Company will proceed with due
diligence to complete in a good and workmanlike manner the acquisition of the
Land, the construction of the Facility and the acquisition and installation of
the Equipment and in any event completion of the
17
Project Facility shall occur within three (3) years from the Closing Date.
Completion of the same shall be evidenced by a certificate signed by an
Authorized Representative of the Company delivered to the Issuer, the Trustee
and the Bank stating (A) the date of such completion, (B) that all labor,
services, materials and supplies used therefor and all costs and expenses in
connection therewith have been or will be paid, (C) that the acquisition of the
Land, the construction of the Facility and the acquisition and installation of
the Equipment have been completed with the exception of ordinary punchlist items
and work awaiting seasonal opportunity, (D) that the Company or the Issuer has
good and valid title to all Property constituting a portion of the Project
Facility, and that the Project Facility is subject to the Installment Sale
Agreement and that the Project Facility is subject to the Lien of the Mortgage,
and (E) that the Project Facility is ready for occupancy, use and operation for
its intended purposes. Notwithstanding the foregoing, such certificate may state
(1) that it is given without prejudice to any rights of the Company against
third parties which exist at the date of such certificate or which may
subsequently come into being, (2) that it is given only for the purposes of this
Section 4.4, and (3) that no Person other than the Issuer, the Trustee and the
Bank may benefit therefrom. Such certificate shall be accompanied by (a) a
certificate of occupancy, or a letter from the Local Authority stating no
certificate of occupancy is required, and any and all permissions, licenses or
consents required of Governmental Authorities for the occupancy, operation and
use of the Project Facility for its intended purposes, (b) if requested, an
opinion of counsel to the Company addressed to the Issuer, the Trustee and the
Bank that the Indenture constitutes a valid first Lien on and perfected security
interest in the Trust Revenues subject only to Permitted Encumbrances, and that
the Project Facility will serve the purposes contemplated by the Installment
Sale Agreement and the Indenture and (c) any other items reasonably requested by
the Issuer or the Trustee or the Bank.
SECTION 4.5. COMPLETION BY COMPANY. (A) In the event that the proceeds of the
Bonds are not sufficient to pay in full all costs of acquiring the Land,
constructing the Facility and acquiring and installing the Equipment, the
Company agrees, for the benefit of the Issuer and the Trustee and the Bank, to
complete such acquisition, construction and installation and to pay all such
sums as may be in excess of the moneys available therefor in the Project Fund.
Title to the interest in the Facility constructed and the Equipment acquired or
installed at the Company's expense shall immediately upon such acquisition,
construction or installation vest in the Issuer. The Company shall execute,
deliver and record or file such instruments as the Issuer may request in order
to perfect or protect the Issuer's title to or interest in such portions of the
Facility and the Equipment as are contemplated in this paragraph.
(B) No payment by the Company pursuant to this Section
4.5 shall entitle the Company to any reimbursement for any such expenditure from
the Issuer or the Trustee or to any diminution or abatement of any amounts
payable by the Company under the Installment Sale Agreement.
SECTION 4.6. REMEDIES TO BE PURSUED AGAINST CONTRACTORS, SUBCONTRACTORS,
MATERIALMEN AND THEIR SURETIES. In the event of a default by any contractor,
subcontractor or materialman under any contract made by it in connection with
the construction of the Facility or the acquisition and installation of the
Equipment or in the event of a breach of warranty or other liability with
respect to any materials, workmanship or performance guaranty, the Company may
proceed, either separately or in conjunction with others, to exhaust the
remedies of the Company and the Issuer against the contractor, subcontractor or
materialman so in default and against each surety for the performance of such
contract. The Company may, in its own name or, with the prior written consent of
the Issuer, in the name of the Issuer, prosecute or defend any action or
proceeding or take any other action involving any such contractor,
subcontractor, materialman or surety which the Company deems reasonably
necessary, and in such event the Issuer hereby agrees, at the Company's sole
expense, to cooperate fully with the Company and to take all action necessary to
effect the substitution of the Company for the Issuer in any
18
such action or proceeding. The Company shall immediately advise the Issuer,
Trustee and the Bank of any actions or proceedings taken hereunder. The Net
Proceeds of any recovery secured by the Company as a result of any action
pursued against a contractor, subcontractor, materialman or their sureties
pursuant to this Section 4.6 shall be used to the extent necessary to complete
the Project Facility, the balance then to be deposited in the Insurance and
Condemnation Fund and applied as provided in Section 4.03 of the Indenture.
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ARTICLE V
AGREEMENT TO CONVEY PROJECT FACILITY; INSTALLMENT
PURCHASE PAYMENTS AND OTHER AMOUNTS PAYABLE
SECTION 5.1. AGREEMENT TO CONVEY PROJECT FACILITY. In consideration of the
Company's covenant herein to make installment purchase payments and in
consideration of the other covenants of the Company contained herein, including
the covenant to make additional and other payments required hereby, the Issuer
hereby agrees to sell and convey to the Company, and the Company hereby agrees
to purchase and acquire from the Issuer, the Project Facility, subject only to
Permitted Encumbrances and the Lien of the Mortgage. The obligation of the
Issuer under this Section to convey the Project Facility to the Company shall be
subject to there being no Event of Default existing hereunder, or any other
event which would, but for the passage of time, be an Event of Default.
SECTION 5.2. CONVEYANCE; INSTRUMENTS. (A) the Project Facility shall be conveyed
from the Issuer to the Company on April 1, 2008, or on such earlier date as
hereinafter provided.
(B) The sale and conveyance of the Issuer's right, title
and interest in and to the Land and the Facility shall be effected by the
execution, delivery and recording by the Issuer of the Deed to the Company (a
form of which is attached hereto as Exhibit "C"). The sale and conveyance of the
Issuer's right, title and interest in and to the Equipment shall be effected by
the execution and delivery by the Issuer to the Company of the Xxxx of Sale to
the Company (a form of which is attached hereto as Exhibit "D").
(C) The Company hereby agrees to pay all expenses, filing
and recording fees and taxes, if any, applicable to or arising from the transfer
contemplated by this Section.
SECTION 5.3. INSTALLMENT PURCHASE PAYMENTS AND OTHER AMOUNTS PAYABLE. (A) On or
before each Bond Payment Date, the Company shall pay to the Trustee for deposit
into the Bond Fund an amount which, when added to any amounts then held in the
Bond Fund, shall equal the amount payable as principal of, and premium, if any,
and interest on the Bonds on such Bond Payment Date and all other amounts then
due or past due on the Bonds, including any late charges accruing thereon and
any acceleration or prepayment of principal and accrued interest thereon.
Notwithstanding the foregoing, while the Letter of Credit is in effect, the
Company shall deposit all such amounts directly with the Bank to reimburse the
Bank for draws on the Letter of Credit, and the Bank shall apply such amounts to
the reimbursement obligation of the Company. The obligation of the Company to
make any payment hereunder shall be deemed satisfied and discharged to the
extent of the corresponding payment made by the Bank to the Trustee under the
Letter of Credit, provided further, however, that any payment by the Bank to the
Trustee under the Letter of Credit will not relieve the Company of any of its
obligations under the Reimbursement Agreement.
(B) The Company shall pay as additional installment
purchase payments any premium due on the Bonds and any of the following:
(1) Within thirty (30) days after receipt of a
demand therefor from the Trustee, the Company shall pay to the
Trustee the following amounts:
20
(a) the reasonable fees and expenses of the
Trustee for performing its obligations under the Indenture;
(b) the sum of the expenses of the Trustee
reasonably incurred in performing the obligations of (i) the
Company under the Installment Sale Agreement, or (ii) the
Issuer under the Bonds, the Indenture or the Installment Sale
Agreement; and
(c) the Trustee's reasonable attorneys' fees
incurred in connection with the foregoing and any other moneys
due the Trustee pursuant to the provisions of any of the
Financing Documents.
(2) (a) Within thirty (30) days after receipt of
a demand therefor from the Issuer, the Company shall pay to the Issuer
the sum of the reasonable expenses including attorneys' fees of the
Issuer and the officers, members, agents and employees thereof incurred
by reason of the Issuer's ownership, financing or sale of the Project
Facility or in connection with the carrying out of the Issuer's duties
and obligations under the Installment Sale Agreement or any of the
other Financing Documents, and any other reasonable expense of the
Issuer with respect to the Project Facility, the sale of the Project
Facility to the Company, the Bonds or any of the other Financing
Documents, the payment of which is not otherwise provided for under the
Installment Sale Agreement.
(C) The Company agrees to make the above-mentioned
payments, without any further notice, in lawful money of the United States of
America as, at the time of payment, shall be legal tender for the payment of
public and private debts. In the event the Company shall fail to make any
payment required by this Section 5.3 for a period of more than ten (10) days
from the date such payment is due, the Company shall pay the same, together with
interest thereon, at a rate of two percent (2%) per month or the maximum rate
permitted by law, whichever is less, from the date on which such payment was due
until the date on which such payment is made.
(D) In the event of an application of moneys in the
Project Fund toward prepayment of the principal of the Bonds pursuant to Section
4.02 of the Indenture, there shall be no abatement or reduction in the amounts
payable by the Company under this Section 5.3.
SECTION 5.4. NATURE OF OBLIGATIONS OF COMPANY HEREUNDER. (A) The obligations of
the Company to make the payments required by the Installment Sale Agreement and
to perform and observe any and all of the other covenants and agreements on its
part contained herein shall be general obligations of the Company and shall be
absolute and unconditional irrespective of any defense or any rights of set-off,
recoupment or counterclaim the Company may otherwise have against the Issuer,
the Trustee or the Bank. The Company agrees that it will not suspend,
discontinue or xxxxx any payment required by, or fail to observe any of its
other covenants or agreements contained in, the Installment Sale Agreement, or
terminate the Installment Sale Agreement for any cause whatsoever, including,
without limiting the generality of the foregoing, failure to complete the
acquisition of the Land, the construction of the Facility or the acquisition and
installation of the Equipment, any material defect in the title, design,
operation, merchantability, fitness or condition of the Project Facility or any
part thereof or in the suitability of the Project Facility or any part thereof
for the Company's purposes or needs, failure of consideration for, destruction
of or damage to, Condemnation of title to or the use of all or any part of the
Project Facility, any change in the tax or other laws of the United States of
America or of the State or any political subdivision thereof, or any failure of
the Issuer to perform and observe any agreement, whether expressed or implied,
or any duty, liability or obligation arising out of or in connection with the
Installment Sale Agreement.
21
(B) Nothing contained in this Section 5.4 shall be
construed to release the Issuer from the performance of any of the agreements on
its part contained in the Installment Sale Agreement, and, in the event the
Issuer should fail to perform any such agreement, the Company may institute such
action against the Issuer as the Company may deem necessary to compel
performance (subject to the provisions of Section 11.10 hereof) or recover
damages for non-performance; provided, however, that the Company shall look
solely to the Issuer's estate and interest in the Project Facility for the
satisfaction of any right or remedy of the Company for the collection of a
judgment (or other judicial process) requiring the payment of money by the
Issuer in the event of any liability on the part of the Issuer, and no other
Property or assets of the Issuer shall be subject to levy, execution, attachment
or other enforcement procedure for the satisfaction of the Company's remedies
under or with respect to the Installment Sale Agreement, the relationship of the
Issuer and the Company hereunder or the Company's lease of and title to the
Project Facility, or any other liability of the Issuer to the Company.
SECTION 5.5. PREPAYMENT OF INSTALLMENT PURCHASE PAYMENTS. At any time that any
Bond is subject to prepayment, to the extent and subject to the conditions upon
which prepayment of such Bond is permitted by the terms thereof, the Company
may, at its option, prepay, in whole or in part, the installment purchase
payments payable hereunder by either (A) causing there to be Available Moneys in
an amount equal to the redemption price of the Bonds being redeemed on deposit
with the Trustee thirty-five (35) days prior to the date such moneys are to be
applied to the redemption of Bonds under Section 8.02 of the Indenture, or (B)
delivering to the Trustee notice of its election to cause the redemption of the
Bonds together with a written assurance from the Bank that the Letter of Credit
may be drawn upon to pay the redemption price of the Bonds being redeemed. In no
event shall prepayment be permitted unless the Company shall give to the Trustee
the notice required by Section 8.02 of the Indenture.
SECTION 5.6. RIGHTS AND OBLIGATIONS OF COMPANY UPON DISCHARGE OF LIEN OF
MORTGAGE. (A) Subject to the provisions of Section 5.6(B) hereof, in the event
the Bonds and all sums due under the Reimbursement Agreement and the other
Financing Documents shall have been paid in full, the Issuer shall request the
Bank to do all acts and execute all documents as may be reasonably necessary to
effect the satisfaction and discharge of the Lien of the Mortgage on the Project
Facility.
(B) The conditions that must be satisfied in order to
obtain the discharge and satisfaction of the Lien of the Mortgage on the Project
Facility shall be determined in accordance with the provisions of the Mortgage
and the Indenture. In the event that such conditions are satisfied, the Issuer
shall request the Bank to do all acts and execute all documents as may
reasonably be necessary to effect discharge of the Lien of the Mortgage on the
Project Facility, and, at the request of the Company, shall do all acts and
execute all documents as may reasonably be necessary to discharge the Lien of
the Installment Sale Agreement on the Project Facility to the extent the same
may be discharged.
SECTION 5.7. GRANT OF SECURITY INTEREST. The Company hereby grants the Issuer a
security interest in all of the right, title and interest of the Company in the
Project Facility and in all additions and accessions thereto, all replacements
and substitutions therefor and all proceeds thereof and all books, records and
accounts of the Company pertaining to the Project Facility as security for
payment of the installment purchase payments and all other payments and
obligations of the Company hereunder. The Company hereby irrevocably appoints
the Issuer as its attorney-in-fact to execute and deliver and file any
instruments necessary or convenient to perfect and continue the security
interest granted herein.
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ARTICLE VI
MAINTENANCE, MODIFICATIONS, TAXES AND INSURANCE
SECTION 6.1. MAINTENANCE AND MODIFICATIONS OF PROJECT FACILITY. (A) So long as
any of the Bonds are Outstanding the Company shall (1) keep the Project Facility
in good condition and repair and preserve the same against waste, loss, damage
and depreciation, ordinary wear and tear excepted, (2) make all necessary
repairs and replacements to the Project Facility or any part thereof (whether
ordinary or extraordinary, structural or nonstructural, foreseen or unforeseen),
and (3) operate the Project Facility in a sound, economic manner and in
conformity with all applicable environmental laws and regulations.
(B) After the Construction Period, the Company shall not
make any structural additions, modifications or improvements to the Project
Facility without the prior written consent of the Bank, and in any event shall
not make any such structural additions, modifications or improvements unless:
(1) the Company shall (a) give or cause to be
given all notices and comply or cause compliance with all laws,
ordinances, municipal rules and regulations and requirements of all
Governmental Authorities applying to or affecting the conduct of work
on such addition, modification or improvement to the Project Facility,
or a part thereof, (b) defend and save the Issuer, the Trustee and the
Bank and their respective officers, members, agents and employees
harmless from all fines and penalties due to failure to comply
therewith, (c) promptly procure all permits and licenses necessary for
the prosecution of any work described in this Section 6.1(B), and (d)
make all payments in lieu of taxes required by Section 6.6 hereof;
(2) the addition, modification or improvement to
the Project Facility shall not constitute a default under any of the
Financing Documents; and
(3) the Company shall furnish to the Issuer, the
Trustee and the Bank, at least 30 days prior to commencing such
addition, modification or improvement an opinion, in form and substance
satisfactory to the Issuer, the Trustee and the Bank, of Bond Counsel
that the tax-exempt status of the interest on the Bonds will not be
adversely affected thereby.
SECTION 6.2. TAXES, ASSESSMENTS AND UTILITY CHARGES. (A) The Company shall pay
or cause to be paid, as the same respectively become due, (1) all taxes and
governmental charges of any kind whatsoever which may at any time be lawfully
assessed or levied against or with respect to the Project Facility, (2) all
utility and other charges, including "service charges", incurred or imposed for
the operation, maintenance, use, occupancy, upkeep and improvement of the
Project Facility, and (3) all assessments, rents and other charges of any kind
whatsoever lawfully made by any Governmental Authority for public improvements;
provided that, with respect to special assessments or other governmental charges
that may lawfully be paid in installments over a period of years, the Company
shall be obligated hereunder to pay only such installments as are required to be
paid during all periods that sums payable by the Company hereunder or under any
of the other Financing Documents are due and owing.
(B) Notwithstanding the provisions of subsection (A) of
this Section 6.2 but subject, however, to the provisions of Section
2.02(B)(3)(b) of the PILOT Agreement, the Company may in good faith
23
actively contest any such taxes, assessments and other charges, provided that
the Company shall have paid such taxes.
SECTION 6.3. INSURANCE REQUIRED. At all times that any Bond is Outstanding
and/or the Issuer is the owner of the Project Facility, the Company shall
maintain or, with respect to the insurance required by Subsection (E) of this
Section 6.3, cause the general contractor to maintain, insurance with respect to
the Project Facility against such risks and for such amounts as are customarily
insured against by businesses of like size and type, paying, as the same become
due and payable, all premiums with respect thereto, including, but not
necessarily limited to:
(A) (1) Prior to completion of the Project Facility,
builder's all-risk (or equivalent coverage) insurance upon any work done or
material furnished in connection with the reconstruction and equipping of the
Project Facility with extended coverage for vandalism, malicious mischief,
debris removal and collapse insurance endorsements issued to the Company and the
Issuer as insured, and the Bank as mortgagee and loss payee under a New York
standard mortgagee clause, and written in one hundred percent (100%)
non-reporting completed form with fire and extended coverage in the Stated
Amount, and (2) with respect to the Project Facility, at such time that
builder's risk insurance shall not be available due to the completion of the
Project Facility, insurance protecting the interests of the Company and the
Issuer as insured and the Bank and as mortgagee and loss payee, as its interest
may appear, against loss or damage to the Project Facility by fire, lightning,
vandalism, malicious mischief and other perils normally insured against with a
uniform extended coverage endorsement, such insurance at all times to be in an
amount not less than the greater of the total principal amount of the Bonds
Outstanding or the total cash replacement cost of the Project Facility,
exclusive of footings and foundations as determined at least once every three
(3) years by a recognized appraiser or insurer selected by the Company;
provided, however, that the Company may, with the consent of the Bank (such
consent not to be unreasonably withheld or delayed) insure all or a portion of
the Project Facility under a blanket insurance policy or policies covering not
only the Project Facility or portions thereof but other Property.
(B) To the extent applicable, workers' compensation
insurance, disability benefits insurance and such other forms of insurance which
the Company is required by law to provide, covering loss resulting from injury,
sickness, disability or death of employees of the Company who are located at or
assigned to the Project Facility or who are responsible for the reconstruction
and construction of the Facility or the installation of the Equipment.
(C) Insurance protecting the Company, the Issuer and the
Bank against loss or losses from liabilities imposed by law or assumed in any
written contract (including, without limitation, the contractual liability
assumed by the Company under Sections 8.2, 8.12 and 8.13 of the Installment Sale
Agreement) and arising from personal injury or death or damage to the Property
of others caused by any accident or occurrence, with limits of not less than
$2,000,000 per person per accident or occurrence on account of personal injury,
including death resulting therefrom, and $2,000,000 per accident or occurrence
on account of damage to the Property of others, excluding liability imposed upon
the Company by any applicable workers' compensation law, and a separate umbrella
liability policy with a limit of not less than $5,000,000.
(D) If the Project Facility is located within an area
identified by the Secretary of Housing and Urban Development as having special
flood hazards, insurance against loss by floods in an amount at least equal to
the total principal amount of the Bonds Outstanding or to the maximum limit of
coverage made available, whichever is less.
24
(E) During the Construction Period, the general
contractor and any subcontractor constructing and equipping the Project Facility
shall be required to carry workers' compensation and general comprehensive
liability insurance containing coverages for premises operations, products and
completed operations, explosion, collapse and underground damage hazard,
contractor's protective, owner's protective and coverage for all owned,
non-owned and hired vehicles with non-ownership protection from the general
contractor or subcontractor's employees providing the following minimum limits:
(a) Workers' compensation and employer's
liability - in accordance with applicable
law, covering loss resulting from injury,
sickness, disability and death of employees
located at or assigned to the Facility or
who are responsible for the construction of
the Facility or the installation of the
Equipment.
(b) comprehensive general liability:
(i) Bodily injury liability in an
amount not less than $1,000,000 for each
accident and not less than $5,000,000 for
injuries sustained by two or more persons in
any one accident.
(ii) Property damage liability in an
amount not less than $1,000,000 for each
accident and not less than $5,000,000 in the
aggregate for each year of the policy
period.
(c) Comprehensive automobile liability:
(i) Bodily injury liability in an
amount not less than $1,000,000 for each
accident and not less than $5,000,000 for
injuries sustained by two or more persons in
any one accident.
(F) Business Interruption insurance in an amount
sufficient to cover any loss of income from the Project Facility for a period of
not less than twelve (12) months, to be reviewed and adjusted annually.
(G) Other insurance coverage required by any Governmental
Authority in connection with any Requirement.
(H) THE ISSUER DOES NOT IN ANY WAY REPRESENT OR WARRANT
THAT THE INSURANCE SPECIFIED HEREIN, WHETHER IN SCOPE OR IN LIMITS OF COVERAGE,
IS ADEQUATE OR SUFFICIENT TO PROTECT THE COMPANY'S OR THE TRUSTEE'S RESPECTIVE
BUSINESS OR INTERESTS.
SECTION 6.4. ADDITIONAL PROVISIONS RESPECTING INSURANCE. (A) All insurance
required by Section 6.3 hereof shall be procured and maintained in financially
sound and generally recognized responsible insurance companies selected by the
Company and authorized to write such insurance in the State and satisfactory to
the Issuer and the Bank. The company or companies issuing the policies required
by Sections 6.3(A) and 6.3(F) shall be rated "A" or better by A.M. Best Co.,
Inc. in the most recent edition of Best's Key Rating Guide. Such insurance may
be written with deductible amounts comparable to those on similar policies
carried by other companies engaged in businesses similar in size, character and
other respects to those in which the Company is engaged. All policies evidencing
such insurance shall name the Company and the Issuer as insureds, policies
evidencing insurance as required by Section 6.3(A) shall name the Bank as
mortgagee and loss payee, as its interest may appear, and provide for at least
thirty (30) days' written notice to the Company, the Issuer and the Bank prior
to
25
cancellation, lapse, reduction in policy limits or material change in coverage
thereof and shall contain a standard mortgagee endorsement in favor of the Bank
as mortgagee and loss payee, as its interest may appear. All insurance required
hereunder shall be in form, content and coverage satisfactory to the Issuer and
the Bank. Binders satisfactory in form and substance to the Issuer and the Bank
to evidence all insurance required hereby shall be delivered to the Issuer and
the Bank on or before the Closing Date. The Company shall deliver to the Issuer
and the Bank on or before the first Business Day of each calendar year
thereafter a binder dated not earlier than the immediately preceding November
15th reciting that there is in full force and effect, with a term covering at
least the next succeeding calendar year, insurance in the amounts and of the
types required by Sections 6.3 and 6.4 hereof. At least thirty (30) days prior
to the expiration of any such policy, the Company shall furnish to the Issuer
and the Bank evidence that the policy has been renewed or replaced or is no
longer required by the Installment Sale Agreement.
(B) All premiums with respect to the insurance required
by Section 6.3 hereof shall be paid by the Company; provided, however, that, if
the premiums are not timely paid, the Issuer or the Bank may pay such premiums
and the Company shall pay immediately upon demand all sums so expended by the
Issuer or the Bank together with interest at a rate of one and one half percent
(1.5%) per month or the highest rate permitted by law, whichever is less. All
amounts so paid by the Issuer or the Bank together with interest thereon shall
be deemed secured by the Financing Documents.
(C) (1) The Company shall not take out separate insurance
concurrent in form or contributing in the event of loss with that required to be
maintained under Section 6.3 unless the Issuer and the Bank are included therein
as a named insured with loss payable to the Bank under a standard
non-contributory mortgage endorsement of the above described character. The
Company shall immediately notify the Bank whenever any such separate insurance
is taken out and shall promptly deliver to the Bank and the Issuer the policy or
policies of such insurance.
(2) Each of the policies required pursuant to Section
6.3 hereof shall waive any right of subrogation against any Person insured under
such policy, and shall waive any right of the insurers to any set-off or
counterclaim or any other deduction, whether by attachment or otherwise, in
respect of any liability of any Person insured under such policy.
SECTION 6.5. APPLICATION OF NET PROCEEDS OF INSURANCE. The Net Proceeds of the
insurance carried pursuant to the provisions of Section 6.3 hereof shall be
applied as follows: (A) the Net Proceeds of the insurance required by Section
6.3(A) and 6.3(D) hereof shall be paid to the Bank and applied as provided in
Section 7.1 hereof, (B) the Net Proceeds of the insurance required by Section
6.3(B), 6.3(C), 6.3(E) and 6.3(G) hereof shall be applied toward extinguishment
or satisfaction of the liability with respect to which such insurance proceeds
may be paid and (C) the Net Proceeds of the insurance required by Section 6.3(F)
shall be applied toward Debt Service Payments.
SECTION 6.6. PAYMENTS IN LIEU OF TAXES. (A) It is recognized that, under the
provisions of the Act, the Issuer is required to pay no taxes or assessments
upon any of the property acquired by it or under its jurisdiction, control or
supervision or upon its activities. It is not the intention, however, of the
parties hereto that the Project Facility be treated as exempt from real property
taxation. Accordingly, the parties acknowledge that a Payment In Lieu of Tax
Agreement (the "PILOT Agreement") has been executed with respect to the Project
Facility. Until the expiration date of the PILOT Agreement, the Issuer and the
Company hereby agree that the Company (or any subsequent user of the Project
Facility under this Installment Sale Agreement) shall be required to make or
cause to be made payments in lieu of real estate taxes in the amounts and in the
manner set forth in the PILOT Agreement.
26
(B) In the event that (1) the Project Facility would be
subject to real property taxation if owned by the Company but shall be deemed
exempt from real property taxation due to the involvement of the Issuer
therewith, and (2) the PILOT Agreement shall not have been entered into by the
Issuer and the Company, or, if entered into, the PILOT Agreement shall for any
reason no longer be in effect, the Issuer and the Company hereby agree that the
Company, or any subsequent user of the Project Facility under this Installment
Sale Agreement, shall in such event be required to make or cause to be made
payments in lieu of taxes to the school district or school districts, city,
town, county, village and other political units wherein the Project Facility is
located having taxing powers (such political units are hereinafter collectively
referred to as the "Taxing Entities") in such amounts as would result from taxes
being levied on the Project Facility by the Taxing Entities if the Project
Facility were privately owned by the Company and not deemed owned by or under
the jurisdiction, control or supervision of the Issuer, but with appropriate
reductions similar to the real property tax exemptions and credits, if any,
which would be afforded to the Company if it were the owner of the Project
Facility. It is agreed that the Company, in cooperation with the Issuer, (a)
shall cause the Project Facility to be valued for purposes of determining the
amounts due hereunder as if owned by the Company as aforesaid by the appropriate
officer or officers of any of the Taxing Entities as may from time to time be
charged with responsibility for making such valuations, (b) shall cause to be
appropriately applied to the valuation or valuations so determined the
respective tax rate or rates of the Taxing Entities that would be applicable to
the Project Facility if so privately owned, (c) shall cause the appropriate
officer or officers of the Taxing Entities charged with the duty of levying and
collecting such taxes to submit to the Company, when the respective levies are
made for purposes of such taxes upon Property privately owned as aforesaid,
statements specifying the amounts and due dates of such taxes which the Taxing
Entities would receive if such Property were so privately owned by the Company
and not deemed owned by or under the jurisdiction, control or supervision of the
Issuer, and (d) shall file with the appropriate officer or officers any accounts
or tax returns furnished to the Issuer by the Company for the purpose of such
filing.
(C) The Company shall pay or cause to be paid to the
Taxing Entities when due all such payments in lieu of taxes with respect to the
Project Facility required by Section 6.6(B) of this Installment Sale Agreement
to be paid to the Taxing Entities, subject in each case to the Company's right
to (a) obtain exemptions and credits, if any, which would be afforded to a
private owner of the Project Facility, including any available exemption under
Section 485-b of the New York Real Property Tax Law with respect to the Project
Facility, (b) contest valuations of the Project Facility made for the purpose of
determining such payments therefrom (provided, however, no such contest shall
entitle the Company to defer payments in lieu of taxes by reason of any such
contest), and (c) seek to obtain a refund of any such payments made. In the
event the Company shall fail to make or cause to be made any such payments in
lieu of taxes, the amount or amounts so in default shall continue as an
obligation of the Company until fully paid, and the Company hereby agrees to pay
or cause to be paid the same, together with late charges and interest thereon as
provided for in subsection (5) of Section 874 of the General Municipal Law of
the State (or any successor provision).
27
ARTICLE VII
DAMAGE, DESTRUCTION AND CONDEMNATION
SECTION 7.1. DAMAGE OR DESTRUCTION. (A) If the Project Facility shall be damaged
or destroyed, in whole or in part:
(1) the Issuer shall have no obligation to replace,
repair, rebuild or restore the Project Facility;
(2) there shall be no abatement or reduction in the
amounts payable by the Company under the Installment Sale Agreement
(whether or not the Project Facility is replaced, repaired, rebuilt or
restored);
(3) the Company shall promptly give notice of such damage
or destruction to the Issuer, the Trustee and the Bank; and
(4) except as otherwise provided in subsection (B) of
this Section 7.1,
(a) the Company shall promptly replace, repair,
rebuild or restore the Project Facility to substantially the same
condition and value as an operating entity as existed prior to such
damage or destruction, with such changes, alterations and modifications
as may be desired by the Company and consented to in writing by the
Issuer and the Bank, provided that such changes, alterations or
modifications do not (i) so change the nature of the Project Facility
that it does not constitute a "project", as such quoted term is defined
in the Act, (ii) change the use of the Project Facility as specified in
Section 3.2 hereof without the prior written consent of the Issuer,
which consent shall not be unreasonably withheld or delayed, or (iii)
adversely affect the exclusion of the interest on the Bonds from gross
income for federal income tax purposes; and
(b) pursuant to and in accordance with Section
4.03 of the Indenture, the Trustee shall make available to the Company
(from the Net Proceeds of any insurance settlement) such moneys as may
be necessary to pay the costs of the replacement, repair, rebuilding or
restoration of the Project Facility. In the event such Net Proceeds are
not sufficient to pay in full the costs of such replacement, repair,
rebuilding or restoration, the Company shall nonetheless complete such
work and shall pay from its own moneys that portion of the costs
thereof in excess of such Net Proceeds. Any balance of such Net
Proceeds remaining after payment of all of the costs of such
replacement, repair, rebuilding or restoration shall be applied as
provided in Section 4.03 of the Indenture.
(B) Notwithstanding anything to the contrary contained in
subsection (A) of this Section 7.1, in the event that the damage to the Project
Facility exceeds the sum of all indebtedness then secured by a Lien on the
Project Facility or any part thereof, the Company shall not be obligated to
replace, repair, rebuild or restore the Project Facility and the Net Proceeds of
any insurance settlement shall not be applied as provided in subsection (A) of
this Section 7.1 if the Company shall notify the Issuer and the Bank that, in
the Company's sole judgment, the Company does not deem it practical to so
replace, repair, rebuild or restore the Project Facility and the Bank concurs
with such determination. In such event, or if an Event of Default shall have
occurred and be continuing, the lesser of (1) the total amount of the Net
Proceeds collected under any and all policies of insurance covering the damage
to or destruction of the Project Facility, or (2) the amount necessary to redeem
the Bonds in whole and all interest accrued
28
thereon, together with any other sums payable to the Issuer, the Trustee and the
Bank pursuant to the Financing Documents, shall be transferred by the Trustee
from the Insurance and Condemnation Fund to the Bond Fund to be applied to the
redemption of the Bonds and payment of all such amounts to the Issuer, the
Trustee and the Bank. If the Net Proceeds collected under any and all policies
of insurance are less than the amount necessary to redeem the Bonds in full and
pay any and all amounts payable to the Issuer, the Trustee and the Bank, the
Company shall pay the difference between such amounts and the Net Proceeds of
all insurance settlements so that all of the Bonds then Outstanding shall be
redeemed and any and all amounts payable under the Financing Documents to the
Issuer, the Trustee and the Bank shall be paid in full.
(C) If there are no Bonds Outstanding and all other
amounts due under the Installment Sale Agreement and the other Financing
Documents are paid in full, all such Net Proceeds or the balance thereof shall
be paid to the Company for its purposes.
(D) The Company may not adjust any claims under any
policies of insurance required by Section 6.3(A) through 6.3(D) hereof without
the prior written consent of the Bank, which consent shall not be unreasonably
withheld or delayed.
(E) Notwithstanding anything to the contrary set forth
herein, the Net Proceeds of any insurance settlement shall be transmitted to the
Trustee for deposit into the Insurance and Condemnation Fund.
SECTION 7.2. CONDEMNATION. (A) If title to, or the use of, less than
substantially all of the Project Facility shall be taken by Condemnation:
(1) the Issuer shall have no obligation to
restore the Project Facility;
(2) there shall be no abatement or reduction in
the amounts payable by the Company under the Installment Sale
Agreement (whether or not the Project Facility is restored);
(3) the Company shall promptly give notice of
such Condemnation to the Issuer, the Trustee and the Bank; and
(4) except as otherwise provided in subsection
(B) of this Section 7.2,
(a) the Company shall promptly restore
the Project Facility (excluding any part of the Facility taken
by Condemnation) to substantially the same condition and value
as an operating entity as existed prior to such Condemnation;
and
(b) pursuant to and in accordance with
Section 4.03 of the Indenture, the Trustee shall make
available to the Company (from the Net Proceeds of any
Condemnation award) such moneys as may be necessary to pay the
costs of the restoration of the Project Facility. In the event
such Net Proceeds are not sufficient to pay in full the costs
of such restoration, the Company shall nonetheless complete
such restoration and shall pay from its own moneys that
portion of the costs thereof in excess of such Net Proceeds.
Any balance of such Net Proceeds remaining after payment of
all of the costs of such restoration shall be applied in
accordance with Section 4.03 of the Indenture.
(B) Notwithstanding anything to the contrary contained in
subsection (A) of this Section 7.2, in the event that the Net Proceeds received
in conjunction with the taking of the Project Facility or any part
29
thereof exceeds the sum of all indebtedness then secured by a Lien on the
Project Facility or any part thereof, the Company shall not be obligated to
restore the Project Facility and the Net Proceeds of any Condemnation award
shall not be applied as provided in subsection (A) of this Section 7.2 if the
Company shall notify the Issuer, the Trustee and the Bank that, in the Company's
sole judgment, the Company does not deem it practicable or desirable to replace,
repair, rebuild or restore the Project Facility and the Bank concurs with such
determination. In such event, or if an Event of Default under any of the
Financing Documents shall have occurred and be continuing, the lesser of (1) the
Net Proceeds of any Condemnation award, or (2) the amount necessary to redeem
the Bonds in whole and all interest accrued thereon, together with any other
sums payable to the Issuer, the Trustee and the Bank pursuant to the Financing
Documents, shall be transferred by the Trustee from the Insurance and
Condemnation Fund to the Bond Fund to be applied to the redemption of the Bonds
and the payment of all such amounts due the Issuer, the Trustee and the Bank. If
the Net Proceeds of any Condemnation award are less than the amount necessary to
redeem the Bonds in full and pay any and all amounts payable to the Issuer, the
Trustee and the Bank, the Company shall pay the difference between such amounts
and such Net Proceeds so that all of the Bonds Outstanding shall be redeemed and
any and all amounts payable under the Financing Documents to the Issuer, the
Trustee and the Bank shall be paid in full.
(C) If title to, or use of, all or substantially all of
the Project Facility shall be taken by Condemnation:
(1) neither the Issuer nor the Company shall
have any obligation to restore the Project Facility;
(2) there shall be no abatement or reduction in
the amounts payable by the Company under the Installment Sale
Agreement; and
(3) the Net Proceeds of any Condemnation award
shall be applied as provided in subsection (B) of this Section
7.2.
(D) If there are no Bonds Outstanding and all other
amounts due under the Installment Sale Agreement and the other Financing
Documents have been paid in full, all such Net Proceeds or the balance thereof
shall be paid to the Company for its purposes.
(E) Unless an Event of Default under any of the Financing
Documents shall have occurred and be continuing, the Company shall have sole
control of any Condemnation proceeding with respect to the Project Facility or
any part thereof, except that the prior written consent of the Bank shall be
required for settlement of any such proceeding, which consents shall not be
unreasonably withheld or delayed. The Company shall notify the Issuer, the
Trustee and the Bank of the institution of any Condemnation proceedings within
seven (7) days after receipt of notice of such proceeding and the Company shall,
within seven (7) days after any inquiry from the Issuer, the Trustee and the
Bank, inform the Issuer, the Trustee and the Bank in writing of the status of
such proceeding.
(F) Notwithstanding anything to the contrary set forth
herein, the Net Proceeds of any Condemnation award shall be transmitted to the
Trustee for deposit into the Insurance and Condemnation Fund.
SECTION 7.3. ADDITIONS TO PROJECT FACILITY. All replacements, repairs,
rebuilding or restoration made pursuant to Sections 7.1 or 7.2 hereof, whether
or not requiring the expenditure of the
30
Company's own moneys, shall automatically become part of the Project Facility as
if the same were specifically described herein.
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ARTICLE VIII
SPECIAL COVENANTS
SECTION 8.1. NO WARRANTY OF CONDITION OR SUITABILITY BY ISSUER; ACCEPTANCE "AS
IS". THE ISSUER MAKES NO WARRANTY, EITHER EXPRESS OR IMPLIED, AS TO THE
CONDITION, TITLE, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS OF THE PROJECT
FACILITY OR ANY PART THEREOF OR AS TO THE SUITABILITY OF THE PROJECT FACILITY OR
ANY PART THEREOF FOR THE COMPANY'S PURPOSES OR NEEDS. THE COMPANY SHALL ACCEPT
TITLE TO THE PROJECT FACILITY "AS IS", WITHOUT RECOURSE OF ANY NATURE AGAINST
THE ISSUER FOR ANY CONDITION NOW, HERETOFORE OR HEREAFTER EXISTING. NO
WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE OR MERCHANTABILITY ARE MADE. IN
THE EVENT OF ANY DEFECT OR DEFICIENCY OF ANY NATURE, WHETHER PATENT OR LATENT,
THE ISSUER SHALL HAVE NO RESPONSIBILITY OR LIABILITY WITH RESPECT THERETO.
SECTION 8.2. HOLD XXXXXXX PROVISIONS. (A) The Company hereby releases the Issuer
and its members, officers, agents and employees from, agrees that the Issuer and
its members, officers, agents (other than the Company) and employees shall not
be liable for and agrees to indemnify, defend and hold the Issuer and its
members, officers, agents (other than the Company) and employees harmless from
and against any and all claims, causes of action, judgments, liabilities,
damages, losses, costs and expenses arising as a result of the Issuer's
undertaking the Project, including, but not limited to, (1) liability for loss
or damage to Property or bodily injury to or death of any and all Persons that
may be occasioned, directly or indirectly, by any cause whatsoever pertaining to
the Project Facility or arising by reason of or in connection with the
occupation or the use thereof or the presence of any Person or Property on, in
or about the Project Facility, (2) liability arising from or expense incurred by
the Issuer's financing, acquiring, constructing, reconstructing, equipping,
installing, owning or selling the Project Facility, including, without limiting
the generality of the foregoing, any sales or use taxes which may be payable
with respect to goods supplied or services rendered with respect to the Project
Facility, all liabilities or claims arising as a result of the Issuer's
obligations under the Installment Sale Agreement or any of the other Financing
Documents or the enforcement of or defense of validity of any provision of any
Financing Documents, and all liabilities or claims arising as a result of or in
connection with the offering, issuance, sale or resale of the Bonds, (3) all
claims arising from the exercise by the Company of the authority conferred on it
pursuant to Section 4.1(E) hereof, and (4) all causes of action and attorneys'
fees and other expenses incurred in connection with any suits, actions or
proceedings which may arise as a result of any of the foregoing; provided that
any such claims, causes of action, judgments, liabilities, damages, losses,
costs or expenses of the Issuer are not incurred or do not result from the
intentional wrongdoing of the Issuer or any of its members, officers, agents
(other than the Company) or employees. The foregoing indemnities shall apply
notwithstanding the fault or negligence in part of the Issuer or any of its
officers, members, agents or employees and notwithstanding the breach of any
statutory obligation or any rule of comparative or apportioned liability.
(B) In the event of any claim against the Issuer or its
members, officers, agents (other than the Company) or employees by any employee
of the Company or any contractor of the Company or anyone directly or indirectly
employed by any of them or anyone for whose acts any of them may be liable, the
obligations of the Company hereunder shall not be limited in any way by any
limitation on the amount or type of damages, compensation or benefits payable by
or for the Company or such contractor under workers' compensation laws,
disability benefits laws or other employee benefit laws.
32
(C) To effectuate the provisions of this Section 8.2, the
Company agrees to provide for and insure, in the liability policies required by
Section 6.3(C) of the Installment Sale Agreement, its liabilities assumed
pursuant to this Section 8.2.
(D) Notwithstanding any other provisions of the
Installment Sale Agreement, the obligations of the Company pursuant to this
Section 8.2 shall remain in full force and effect after the termination of the
Installment Sale Agreement until the expiration of the period stated in the
applicable statute of limitations during which a claim, cause of action or
prosecution relating to the matters herein described may be brought and the
payment in full or the satisfaction of such claim, cause of action or
prosecution and the payment of all expenses, charges and costs incurred by the
Issuer, or its officers, members, agents or employees, relating thereto.
SECTION 8.3. RIGHT OF ACCESS TO PROJECT FACILITY. The Company agrees that the
Issuer, the Trustee and the Bank and their duly authorized agents shall have the
right at all reasonable times and upon reasonable prior notice to enter upon and
to examine and inspect the Project Facility.
SECTION 8.4. COMPANY NOT TO TERMINATE EXISTENCE OR DISPOSE OF ASSETS; CONDITIONS
UNDER WHICH EXCEPTIONS PERMITTED. The Company agrees that, so long as the Bonds
are Outstanding, it will maintain its corporate existence, will not dissolve or
otherwise dispose of all or substantially all of its assets, and will not
consolidate with or merge into another corporation, or permit one or more
corporations to consolidate with or merge into it; provided, however, that, if
no Event of Default specified in Section 10.1 hereof shall have occurred and be
continuing, the Company may consolidate with or merge into another domestic
corporation organized and existing under the laws of one of the states of the
United States, or permit one or more such domestic corporations to consolidate
with or merge into it, or sell or otherwise transfer to another Person all or
substantially all of its assets as an entirety and thereafter dissolve, provided
(A) that the Issuer and the Bank give their written consent, which consents
shall not be unreasonably withheld, (B) that the surviving, resulting or
transferee corporation assumes in writing all of the obligations of and
restrictions on the Company under this Installment Sale Agreement and the other
Financing Documents, (C) that the consummation of such transaction will not
adversely affect the exclusions from gross income of the interest on the Bonds
for federal income tax purposes and (D) that as of the date of such transaction,
the Trustee, the Issuer and the Bank shall be furnished with a certificate,
dated the effective date of such transaction, signed by an Authorized
Representative of the Company and of the surviving, resulting or transferee
corporation, as the case may be, or the transferee of its assets to the effect
that immediately after the consummation of the transaction and after giving
effect thereto, no Event of Default exists under the Installment Sale Agreement
and no event exists which, with notice or lapse of time or both, would become
such an Event of Default.
SECTION 8.5. AGREEMENT TO PROVIDE INFORMATION. The Company agrees, whenever
requested by the Issuer or the Trustee or the Bank, to provide and certify or
cause to be provided and certified such information concerning the Company, its
finances and other topics related to the Bonds and/or the Project Facility as
the Issuer (in carrying out its obligations hereunder and under the other
Financing Documents and under the Act) or the Trustee or the Bank from time to
time reasonably considers necessary or appropriate, including, but not limited
to, such information as to enable the Issuer or the Trustee or the Bank to make
any reports required by law or governmental regulation.
SECTION 8.6. BOOKS OF RECORD AND ACCOUNT; FINANCIAL STATEMENTS; COMPLIANCE
CERTIFICATES. (A) The Company agrees to maintain proper accounts, records and
33
books in which full and correct entries shall be made, in accordance with
generally accepted accounting principles, of all business and affairs of the
Company.
(B) As soon as possible after the end of each calendar
year , but in any event within ninety (90) days after such date, the Company
shall furnish to the Issuer, the Trustee and the Bank a certificate of an
Authorized Representative of the Company stating that no Event of Default
hereunder has occurred or is continuing or, if any Event of Default exists,
specifying the nature and period of existence thereof and what action the
Company has taken or proposes to take with respect thereto.
(A) The Company agrees, for the benefit of the Issuer and
the Bank, that it will, during any period in which any Bond is Outstanding,
promptly comply with all statutes, codes, laws, acts, ordinances, orders,
judgments, decrees, injunctions, rules, regulations, permits, licenses,
authorizations, directions and requirements of all Governmental Authorities,
foreseen or unforeseen, ordinary or extraordinary, which now or at any time
hereafter may be applicable to the Company or the Project Facility or any part
thereof, or to any use, manner of use or condition of the Project Facility or
any part thereof (the applicability of such laws, ordinances, rules and
regulations to be determined both as if the Issuer were the owner of the Project
Facility and as if the Company and not the Issuer were the owner of the Project
Facility).
(B) Notwithstanding the provisions of subsection (A) of this Section 8.7,
the Company may in good faith actively contest the validity or the applicability
of any requirement of the nature referred to in such subsection (A), provided
that the Company (1) first shall have notified the Issuer and the Bank in
writing of such contest, (2) is not otherwise in default under any of the
Financing Documents, (3) shall have set aside adequate reserves for any such
requirement, and (4) demonstrates to the reasonable satisfaction of the Issuer
and the Bank that noncompliance with such requirement will not materially
endanger the Lien of the Mortgage as to the Project Facility or subject the
Project Facility or any part thereof to loss or forfeiture. Otherwise, the
Company shall promptly take such action with respect thereto as shall be
reasonably satisfactory to the Issuer and the Bank.
(C) Notwithstanding the provisions of subsection (B) of
this Section 8.7, if the Issuer or any of its members, officers, agents,
servants or employees may be liable for prosecution for failure to comply
therewith, the Company shall promptly take such action with respect thereto as
shall be satisfactory to the Issuer.
SECTION 8.8. DISCHARGE OF LIENS AND ENCUMBRANCES. (A) The Company hereby
covenants that the Mortgage is a valid Lien on the Project Facility subject only
to Permitted Encumbrances, and the Company agrees not to create or suffer to be
created any other Lien, except for Permitted Encumbrances, on the Project
Facility or any part thereof or any funds of the Issuer applicable to the
Project Facility.
(B) Notwithstanding the provisions of subsection (A) of
this Section 8.8, the Company may in good faith actively contest any such Lien,
provided that (1) the Company first shall have notified the Issuer and the Bank
in writing of such contest, (2) the Company is not in default under any of the
Financing Documents, (3) such Lien shall be removed within sixty (60) days of
the date of such notice by the Company or secured by the Company's posting a
bond in form and substance satisfactory to the Issuer and the Bank and (4)
demonstrates to the reasonable satisfaction of the Issuer and the Bank that the
contesting of such Lien and its non-discharge will not materially endanger the
Lien of the Mortgage as to the Project Facility or subject the Project Facility
or any part thereof to loss or forfeiture.
34
SECTION 8.9. PERFORMANCE BY ISSUER OR TRUSTEE OF COMPANY'S OBLIGATIONS. Should
the Company fail to make any payment or to do any act as herein provided, the
Issuer or the Trustee or the Bank may, but need not, without notice to or demand
on the Company and without releasing the Company from any obligation herein,
make or do the same, including, without limitation, appearing in and defending
any action purporting to affect the rights or powers of the Company or the
Issuer, and paying all expenses, including, without limitation, reasonable
attorneys' fees; and the Company shall pay immediately upon demand all sums so
incurred or expended by the Issuer or the Trustee or the Bank under the
authority hereof and all fees, costs and expenses, together with interest
thereon, at the rate of one and one half percent (1.5%) per month or the maximum
permitted by law, whichever is less.
SECTION 8.10. DEPRECIATION DEDUCTIONS AND TAX CREDITS. The parties agree that as
between them the Company shall be entitled to all depreciation deductions and
accelerated cost recovery system deductions with respect to any portion of the
Project Facility pursuant to Sections 167 and 168 of the Code and to any
investment credit pursuant to Section 38 of the Code with respect to any portion
of the Project Facility which constitutes "Section 38 Property" and to all other
state and/or federal income tax deductions and credits which may be available
with respect to the Project Facility.
SECTION 8.11. IDENTIFICATION OF EQUIPMENT. All Equipment which is or may become
part of the Project Facility pursuant to the provisions of the Installment Sale
Agreement shall be properly identified by the Company by such appropriate
records, including computerized records, as may be approved by the Issuer, the
Trustee and the Bank.
SECTION 8.12. INDEMNIFICATION OF TRUSTEE. (A) Notwithstanding any other
provisions of the Financing Documents, the Company agrees to indemnify and hold
the Trustee, and its directors, officers, agents and employees, harmless from
and against any and all claims, causes of action, judgments, liabilities,
damages, losses, costs and expenses, including, but not limited to, reasonable
attorneys' fees, arising out of the execution, delivery or performance of the
Financing Documents, provided that the same are not a result of the negligence
or willful misconduct of the Trustee.
(B) Notwithstanding any other provisions of the
Installment Sale Agreement or the other Financing Documents, the obligations of
the Company pursuant to this Section 8.12 shall remain in full force and effect
after the termination of the Installment Sale Agreement until the expiration of
the period stated in the applicable statute of limitations during which a claim,
cause of action or prosecution relating to the matters herein described may be
brought and the payment in full or the satisfaction of such claim, cause of
action or prosecution and the payment of all reasonable fees, expenses and
charges paid or incurred by the Trustee, or its directors, officers, agents or
employees, relating thereto.
(C) To effectuate the provisions of this Section 8.12,
the Company agrees to provide for and insure, in the liability policies required
by Section 6.3(C) of the Installment Sale Agreement, its liabilities assumed
pursuant to this Section 8.12.
SECTION 8.13. COVENANT AGAINST ARBITRAGE BONDS. Notwithstanding any other
provision of the Installment Sale Agreement, so long as the Bonds shall be
outstanding, neither the Issuer nor the Company shall use, or direct or permit
the use of, the proceeds of the Bonds or any other moneys within their
respective control (including without limitation the proceeds of any insurance
or any Condemnation award with respect to the Project Facility) in any manner
which, if such use had been reasonably expected on the date of issuance of the
Bonds, would have caused the bonds to be "arbitrage bonds" within the meaning
ascribed to such quoted term in Section 148(a) of the Code. The Issuer
authorized
35
the Company, on the Issuer's behalf, to calculate and make the rebate payments
required by Section 148(f) of the Code.
SECTION 8.14. ENVIRONMENTAL MATTERS. (A) The Company shall keep or cause the
Project Facility to be kept free of Hazardous Substances, except for Hazardous
Substances which may be used in connection with the Company's operations, all of
which have been and shall be conducted in accordance with applicable law.
Without limiting the foregoing, the Company shall not cause or permit the
Project Facility to be used to generate, process, store, handle, dispose or
transfer Hazardous Substances, except in compliance with all applicable
environmental laws and Permits, nor shall the Company cause or permit, as a
result of any act or omission on the part of the Company, a Release of Hazardous
Substances onto the Land or any other Property. The Company shall comply with
and ensure compliance by all tenants, if any, with all applicable laws, whenever
and whomever triggered by, and obtain and comply with any and all approvals,
registrations or Permits required thereunder.
(B) The Company shall (1) conduct and complete all
investigations, studies, sampling and testing and all remedial, removal and
other actions necessary to clean up and remove all Hazardous Substances on, from
or affecting the Project Facility (a) in accordance with all applicable
environmental laws, (b) to the satisfaction of the Issuer and the Bank, and (c)
in accordance with the orders and directives of all Governmental Authorities,
and (2) defend, indemnify, and hold harmless the Issuer and the Bank and their
respective employees, agents, officers and directors from and against any
claims, demands, penalties, fines, liabilities, settlements, damages, costs or
expenses of whatever kind or nature, known or unknown, contingent or otherwise,
arising out of or in any way related to (a) the presence, disposal, Release or
threatened Release of any Hazardous Substance on, from or affecting the Project
Facility; (b) any personal injury (including wrongful death) or property damage
arising out of or related to such Hazardous Substance; (c) any lawsuit or
administrative proceeding brought or threatened, settlement reached, or
government order relating to such Hazardous Substance; and (d) any violation of
any law or regulation or demand of any Governmental Authority or any policies or
requirements of the Bank or the Issuer which are based upon or in any way
related to such Hazardous Substances including, without limitation, reasonable
costs and expenses of or relating to attorneys, consultants, investigations and
laboratory fees, and court costs and litigation expenses. In the event the
Mortgage is foreclosed or the Issuer tenders deed in lieu of foreclosure, the
Company shall deliver the Project Facility to the Bank free of any and all
Hazardous Substances so that the condition of the Project Facility shall conform
with all environmental laws and Permits affecting the Project Facility. The
provisions of this Section 8.14 shall be in addition to any and all other
obligations and liabilities the Company may have to the Issuer and the Bank at
common law and under statute, and shall survive the transactions contemplated
herein.
(C) If the Company fails to cause any Release of
Hazardous Substances on, at or from the Project Facility to be contained,
removed, cleaned up or otherwise remediated within one hundred and twenty (120)
days after receiving notice thereof, the Issuer and the Bank shall have the
right (but not the obligation), upon ten (10) days' written notice to the
Company (or without notice in the case of emergency), to take or complete such
action on behalf of the Company. The contractors and subcontractors selected by
the Issuer and the Bank shall have the right to enter the Project Facility with
such Persons, machinery and equipment as shall be necessary, and to undertake
such investigative, containment, removal, clean-up and other remedial actions as
they shall deem necessary and appropriate without thereby incurring any
liability to the Company on account thereof, except for the gross negligence or
willful misconduct of the Issuer and the Bank or the negligence or willful
misconduct of such contractors or subcontractors. The Company agrees to
cooperate with all contractors and subcontractors engaged in such investigative,
containment, removal, clean-up or other remedial actions. The Company shall be
liable to the Issuer and the Bank for all reasonable costs and expenses,
including,
36
without limitation, attorneys' and experts' fees, expenses and disbursements,
paid or incurred on account of such actions undertaken on behalf of the Company,
and shall promptly reimburse the Issuer and the Bank, as the case may be,
therefor on demand. Until paid by the Company, all such costs and expenses,
together with the interest thereon at the rate of one and one half percent
(1.5%) per month (or the highest rate permitted by law, whichever is less) shall
be deemed additional rent under this Installment Sale Agreement.
SECTION 8.15. INDEMNIFICATION OF BANK. (A) Notwithstanding any other provisions
of the Financing Documents, the Company agrees to indemnify and hold the Bank,
and its directors, officers, agents and employees, harmless from and against any
and all claims, causes of action, judgments, liabilities, damages, losses, costs
and expenses, including, but not limited to action, judgments, liabilities,
damages, losses, costs and expenses, including, but not limited to, reasonable
attorneys' fees, arising out of the execution, delivery or performance of the
Financing Documents, provided that the same are not a result of the negligence
or willful misconduct of the Bank.
(B) Notwithstanding any other provisions of this
Installment Sale Agreement or other Financing Documents, the obligations of the
Company pursuant to this Section 8.15 shall remain in full force and effect
after the termination of this Installment Sale Agreement until the expiration of
the period stated in the applicable statute of limitations during which a claim,
cause of action or prosecution relating to the matters herein described may be
brought and the payment in full or the satisfaction of such claim, cause of
action or prosecution and the payment of all reasonable fees, expenses and
charges paid or incurred by the Bank, or its directors, officers, agents or
employees, relating thereto.
(C) To effectuate the provisions of this Section 8.15,
the Company agrees to provide for and insure, in the liability policies required
by Section 6.3(C) of this Installment Sale Agreement, its liabilities assumed by
this Section 8.15.
37
ARTICLE IX
ASSIGNMENTS; MERGER OF ISSUER
SECTION 9.1. ASSIGNMENT OF INSTALLMENT SAFE AGREEMENT. The Installment Sale
Agreement may not be assigned by the Company, in whole or in part, without the
prior written consent of the Issuer, the Trustee and the Bank, which consents
shall not be unreasonably withheld or delayed.
SECTION 9.2. PLEDGE AND ASSIGNMENT OF ISSUER'S INTERESTS TO TRUSTEE. The Issuer
has pledged and assigned, pursuant to the terms of the Assignment and the
Mortgage, certain of its rights and interests under and pursuant to the
Installment Sale Agreement to the Trustee and the Bank as security for the
payment of the principal, premium, if any, and interest on the Bonds. Such
pledge and assignment shall in no way impair or diminish any obligations of the
Issuer under the Installment Sale Agreement. The Company hereby acknowledges
receipt of notice of and consents to such pledge and assignment by the Issuer to
the Trustee and the Bank and specifically agrees to perform for the benefit of
the Trustee and the Bank all of its duties and undertakings hereunder (except
duties undertaken with respect to the Unassigned Rights).
SECTION 9.3. MERGER OF ISSUER. (A) Nothing contained in the Installment Sale
Agreement shall prevent the consolidation of the Issuer with, or merger of the
Issuer into, or assignment by the Issuer of its rights and interests hereunder
to, any other public benefit corporation of the State or political subdivision
thereof which has the legal authority to perform the obligations of the Issuer
hereunder, provided that upon any such consolidation, merger or assignment, the
due and punctual performance and observance of all of the agreements and
conditions of the Installment Sale Agreement, the Bonds and the Indenture to be
kept and performed by the Issuer shall be expressly assumed in writing by the
public benefit corporation or political subdivision resulting from such
consolidation or surviving such merger or to which the Issuer's rights and
interests hereunder or under the Installment Sale Agreement shall be assigned.
(B) As of the date of any such consolidation, merger or
assignment, the Issuer shall give notice thereof in reasonable detail to the
Company, the Trustee and the Bank. The Issuer shall promptly furnish to the
Trustee, the Company and the Bank such additional information with respect to
any such consolidation, merger or assignment as the Trustee, the Company and the
Bank reasonably may request.
SECTION 9.4. SALE OR LEASE OF PROJECT FACILITY. (A) The Company may not sell,
sublease, transfer, convey or otherwise dispose of the Project Facility or any
part thereof and without the prior written consent of the Issuer and the Bank.
(B) Notwithstanding anything to the contrary in the
Installment Sale Agreement, in any instance after the Completion Date where the
Company reasonably determines that any item of Equipment has become inadequate,
obsolete, worn out, unsuitable, undesirable or unnecessary, the Company may
remove such item of Equipment and may sell, trade in, exchange or otherwise
dispose of the same, as a whole or in part, provided, however that no such
Equipment having a value in excess of $100,000 shall be removed, sold, traded
in, exchanged or otherwise disposed of without the consent of the Bank which
consent shall not unreasonably be withheld provided that such removal will not
materially impair the value of the Project Facility as collateral. At the
request of the Company, the Issuer shall execute and deliver, and shall request
the Bank to execute and deliver, to the Company all instruments necessary or
appropriate to enable the Company to sell or otherwise dispose of any such item
of Equipment free from
38
the Liens of the Financing Documents. The Company shall pay all costs and
expenses (including reasonable counsel fees) incurred in transferring title to
and releasing from the Liens of the Financing Documents any item of Equipment
removed pursuant to this Section 9.4.
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ARTICLE X
EVENTS OF DEFAULT AND REMEDIES
SECTION 10.1. EVENTS OF DEFAULT DEFINED. (A) The following shall be "Events of
Default" under the Installment Sale Agreement, and the terms "Event of Default"
or "Default" shall mean, whenever they are used in the Installment Sale
Agreement, any one or more of the following events:
(1) A default by the Company in the due and punctual
payment of the amounts specified to be paid pursuant to Section 5.3(A)
hereof.
(2) A default in the performance or observance of any
other of the covenants, conditions or agreements on the part of the
Company in the Installment Sale Agreement and the continuance thereof
for a period of thirty (30) days after written notice is given by the
Issuer or the Trustee or the Bank to the Company, or, if such covenant,
condition or agreement is capable of cure but cannot be cured within
such thirty (30) day period, the failure of the Company to commence to
cure within such thirty (30) day period and thereafter diligently
proceed with all action required to complete said cure within ninety
(90) days of such written notice unless such time to cure is otherwise
extended by the Issuer and the Trustee and the Bank in writing.
(3) The occurrence of an "Event of Default" under any of
the other Financing Documents.
(4) Any representation or warranty made by the Company
herein or in any other Financing Document proves to have been false in
any material manner at the time it was made.
(5) The Company shall generally not pay its debts as such
debts become due or admits its inability to pay its debts as they
become due.
(6) The Company shall conceal, remove or permit to be
concealed or removed any part of its Property, with intent to hinder,
delay or defraud its creditors, or any one of them, or shall make or
suffer a transfer of any of its Property which is fraudulent under any
bankruptcy, fraudulent conveyance or similar law; or shall make any
transfer of its Property to or for the benefit of a creditor at a time
when other creditors similarly situated have not been paid; or shall
suffer or permit, while insolvent, any creditor to obtain a Lien upon
any of its Property through legal proceedings or distraint which is not
vacated within sixty (60) days from the date thereof.
(7) (a) The filing by the Company (as debtor) of a
voluntary petition under Title 11 of the United States Code or any
other federal or state bankruptcy statute; (b) the failure by the
Company within sixty (60) days to lift any execution, garnishment or
attachment of such consequence as will impair the Company's ability to
carry out its obligations hereunder; (c) the commencement of a case
under Title 11 of the United States Code against the Company as the
debtor or commencement under any other federal or state bankruptcy
statute of a case, action or proceeding against the Company and
continuation of such case, action or proceeding without dismissal for a
period of sixty (60) days; (d) the entry of an order for relief by a
court of competent jurisdiction under Title 11 of the United States
Code or any other federal or state bankruptcy statute with respect to
the debts of the Company; or (e) in connection with any insolvency or
bankruptcy case, action or proceeding, appointment by final order,
judgment or decree of a court of competent jurisdiction of a receiver
or trustee of the whole or
40
a substantial portion of the Property of the Company, unless such
order, judgment or decree is vacated, dismissed or dissolved within
sixty (60) days of such appointment.
(8) Final judgment or judgments for the payment of money
in excess of an aggregate of $100,000 shall be rendered against the
Company and the Company shall not discharge the same or cause it to be
bonded or discharged within sixty (60) days from the entry thereof, or
shall not appeal therefrom or from the order, decree or process upon
which or pursuant to which said judgment was granted, based or entered
and secure a stay of execution pending such appeal.
(9) The imposition of a Lien on the Project Facility
other than a Lien being contested as provided in Section 8.8(B) of the
Installment Sale Agreement or a Permitted Encumbrance.
(10) Subject to the provisions of Section 9.4(B) hereof,
the removal of the Equipment or any portion thereof outside the Town of
Xxxxxx, New York without the prior written consent of the Issuer.
(11) The occurrence of an "Event of Default" under the
PILOT Agreement.
(B) Notwithstanding the provisions of Section 10.1(A)
hereof, if by reason of force majeure (as hereinafter defined) either party
hereto shall be unable, in whole or in part, to carry out its obligations under
the Installment Sale Agreement and if such party shall give notice and full
particulars of such force majeure in writing to the other party and to the
Trustee within a reasonable time after the occurrence of the event or causes
relied upon, the obligations under the Installment Sale Agreement of the party
giving such notice, so far as they are affected by such force majeure, shall be
suspended during the continuance of the inability, which shall include a
reasonable time for the removal of the effect thereof. The suspension of such
obligations for such period pursuant to this subsection (B) shall not be deemed
an Event of Default under this Section 10.1 or under any of the other Financing
Documents. Notwithstanding anything to the contrary in this subsection (B), an
event of force majeure shall not excuse, delay or in any way diminish the
obligations of the Company to make the payments required by Sections 4.5, 5.3,
6.6, 8.4 and 8.14 hereof, to obtain and continue in full force and effect the
insurance required by Article VI hereof, to provide the indemnity required by
Section 8.2, 8.4 and 8.14 hereof and to comply with the provisions of Sections
2.2(E), 4.5, 6.6, 8.2, 8.4, 8.5, 8.7(C), 8.12, 8.13 and 8.14 hereof. The term
"force majeure" as used herein shall include, without limitation, acts of God,
strikes, lockouts or other industrial disturbances, acts of public, enemies,
orders of any kind of any Governmental Authority or any civil or military
authority, insurrections, riots, epidemics, landslides, earthquakes, fire,
hurricanes, storms, floods, washouts, droughts, arrests, restraint of government
and people, civil disturbances, explosions, breakage or accident to machinery,
transmission pipes or canals, entire failure of utilities or any other cause or
event not reasonably within the control of the party claiming such inability. It
is agreed that the settlement of strikes, lockouts and other industrial
disturbances shall be entirely within the discretion of the party having
difficulty and the party having difficulty shall not be required to settle any
strike, lockout or other industrial disturbances by acceding to the demands of
the opposing party or parties.
SECTION 10.2. REMEDIES ON DEFAULT. (A) Whenever any Event of Default shall have
occurred, the Issuer may, to the extent permitted by law, take any one or more
of the following remedial steps:
(1) declare, by written notice to the Company, to be
immediately due and payable, whereupon the same shall become
immediately due and payable, (a) all unpaid rental payments
41
payable pursuant to Section 5.3(A) hereof, and (b) all other payments
due under the Installment Sale Agreement or any of the other Financing
Documents;
(2) take any other action at law or in equity which may
appear necessary or desirable to collect any amounts then due or
thereafter to become due hereunder and to enforce the obligations,
agreements or covenants of the Company under the Installment Sale
Agreement; and
(3) in the event of a default by the Company in the
payment of any amounts due and owing under the PILOT Agreement and upon
forty-five (45) days' prior written notice to the Company and the Bank,
terminate the PILOT Agreement and reconvey the Project Facility to the
Company subject to the Lien of the Financing Documents. The Company
hereby consents to said reconveyance and appoints the Issuer its
attorney-in-fact, which appointment is coupled with an interest and is
irrevocable, to execute any and all instruments and documents in its
name as may be necessary, in the sole discretion of the Issuer, to
effectuate such transfer.
(B) Any sums paid to the Issuer as a consequence of any
action taken pursuant to this Section 10.2 (excepting sums payable to the Issuer
as a consequence of action taken to enforce the Unassigned Rights) shall be paid
to the Trustee and applied in accordance with the provisions of Section 10.11 of
the Indenture.
(C) No action taken pursuant to this Section 10.2
(including repossession of the Project Facility) shall relieve the Company from
its obligations to make all payments required by the Installment Sale Agreement
and the other Financing Documents.
SECTION 10.3. REMEDIES CUMULATIVE. No remedy herein conferred upon or reserved
to the Issuer is intended to be exclusive of any other available remedy, but
each and every such remedy shall be cumulative and in addition to every other
remedy given under the Installment Sale Agreement or now or hereafter existing
at law or in equity. No delay or omission to exercise any right or power
accruing upon any default shall impair any such right or power or shall be
construed to be a waiver thereof, but any such right and power may be exercised
from time to time and as often as may be deemed expedient. In order to entitle
the Issuer to exercise any remedy reserved to it in this Article X, it shall not
be necessary to give any notice, other than such notice as may be herein
expressly required.
SECTION 10.4. AGREEMENT TO PAY ATTORNEYS' FEES AND EXPENSES. In the event the
Company should default under any of the provisions of the Installment Sale
Agreement, and the Issuer or the Trustee or the Bank should employ attorneys or
incur other expenses for the collection of amounts payable hereunder or the
enforcement of performance or observance of any obligations or agreements on the
part of the Company herein contained, the Company shall, on demand therefor, pay
to the Issuer or the Trustee or the Bank, as the case may be, the reasonable
fees of such attorneys and such other expenses so incurred, whether an action is
commenced or not.
SECTION 10.5. NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER. In the event any
agreement contained herein should be breached by either party and thereafter
such breach be waived by the other party, such waiver shall be limited to the
particular breach so waived and shall not be deemed to waive any other breach
hereunder.
42
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. NOTICES. All notices, certificates and other communications
hereunder shall be in writing and shall be sufficiently given and shall be
deemed given when (A) sent to the applicable address stated below by registered
or certified mail, return receipt requested, postage prepaid, or by such other
means (including, without limitation, personal and overnight delivery) as shall
provide the sender with documentary evidence of such delivery, or (B) delivery
is refused by the addressee, as evidenced by the affidavit of the Person who
attempted to effect such delivery. The addresses to which notices, certificates
and other communications hereunder shall be delivered are as follows:
If to the Company:
Xxxxxxxx Adhesives, Inc.
0000 Xxxxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Executive Vice President
With a Copy to:
Xxxxxxxx Xxxxxx Xxxxxxxxx & Xxxxxxx, P.C.
0000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Dallas, Jr., Esq.
If to the Issuer:
County of Saratoga Industrial Development Agency
Saratoga County Municipal Center
00 XxXxxxxx Xxxxxx
Xxxxxxxx Xxx, Xxx Xxxx 00000
Attention: Administrator
With a Copy to:
Xxxxxxx X. Xxxxxx, Esq.
Snyder, Kiley, Xxxxxx & Xxxxxxx, LLP
000 Xxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxx Xxxxxxx, Xxx Xxxx 00000
43
If to the Trustee:
Star Bank, N.A.
000 Xxxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Trust Financial Services Group
If to the Bank:
KeyBank National Association
00 Xxxxx Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000-0000
Attention: Corporate Banking Division
With a Copy to:
KeyBank National Association
00 Xxxxx Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: International Division, Letter of Credit Department
and
Crane Xxxxxx Xxxxxx & Parente
00 Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
The Issuer, the Company, the Trustee and the Bank may, by notice given
hereunder, designate any further or different addresses to which subsequent
notices, certificates and other communications shall be sent.
SECTION 11.2. BINDING EFFECT. The Installment Sale Agreement shall inure to the
benefit of the Issuer, the Company, the Trustee, the Bank and the holders of the
Bonds and shall be binding upon the Issuer, the Company and, as permitted by the
Installment Sale Agreement, their respective heirs, successors and assigns.
SECTION 11.3. SEVERABILITY. If any one or more of the covenants or agreements
provided herein on the part of the Issuer or the Company to be performed shall,
for any reason, be held or shall, in fact, be inoperative, unenforceable or
contrary to law in any particular case, such circumstance shall not render the
provision in question inoperative or unenforceable in any other case or
circumstance. Further, if any one or more of the phrases, sentences, clauses,
paragraphs or sections herein shall be contrary to law, then such covenant or
covenants or agreement or agreements shall be deemed separable from the
remaining covenants and agreements hereof and shall in no way affect the
validity of the other provisions of the Installment Sale Agreement.
44
SECTION 11.4. AMENDMENTS, CHANGES AND MODIFICATIONS. The Installment Sale
Agreement may not be amended, changed, modified, altered or terminated, except
by an instrument in writing signed by the parties hereto, with the written
consent of the Trustee and the Bank.
SECTION 11.5. EXECUTION OF COUNTERPARTS. The Installment Sale Agreement may be
executed in several counterparts, each of which shall be an original and all of
which shall constitute but one and the same instrument.
SECTION 11.6. APPLICABLE LAW. The Installment Sale Agreement shall be governed
exclusively by the applicable laws of the State.
SECTION 11.7. RECORDING AND FILING. (A) The Assignment, the Installment Sale
Agreement, the Mortgage and financing statements perfecting the security
interests created and/or assigned thereby shall be recorded or filed, as the
case may be, by the Issuer in the office of the County Clerk of Saratoga County,
New York, or in such other office as may at the time be provided by law as the
proper place for the recordation or filing thereof, and said statements as well
as continuation statements may be filed without the signature of the Issuer and
the Company. The Trustee shall be entitled to receive, no less frequently than
each five (5) year anniversary of the date of the issuance of the Bonds, an
opinion of Counsel (as defined in the Indenture), addressed to the Trustee,
stating that all such necessary recordings and filings have been completed.
(B) The Issuer and the Company shall execute and deliver
all instruments and shall furnish all information which the Trustee or the Bank
may deem necessary or appropriate to protect any Lien created or contemplated by
the Installment Sale Agreement, the Indenture and the Mortgage.
SECTION 11.8. SURVIVAL OF OBLIGATIONS. (A) The obligations of the Company to
make the payments required by Section 5.3(B) hereof and to provide the indemnity
required by Sections 8.2, 8.4, 8.12, 8.13 and 8.14 hereof shall survive the
termination of the Installment Sale Agreement and the full payment of the Bonds,
and all such payments after such termination shall be made upon demand of the
party to whom such payment is due.
(B) The obligations of the Company with respect to the
Unassigned Rights shall survive the termination of the Installment Sale
Agreement until the expiration of the period stated in the applicable statute of
limitations during which a claim, cause of action or prosecution relating to the
Unassigned Rights may be brought and the payment in full or the satisfaction of
such claim, cause of action or prosecution and the payment of all expenses and
charges incurred by the Issuer, or its officers, members, agents or employees,
relating thereto.
SECTION 11.9. TABLE OF CONTENTS AND SECTION HEADINGS NOT CONTROLLING. The Table
of Contents and the headings of the several sections in the Installment Sale
Agreement have been prepared for convenience of reference only and shall not
control, affect the meaning of or be taken as an interpretation of any provision
of the Installment Sale Agreement.
SECTION 11.10. NO RECOURSE; SPECIAL OBLIGATION. The obligations and agreements
of the Issuer contained herein and in the other Financing Documents and any
other instruments or documents executed in connection therewith or herewith, and
any other instrument or document supplemental thereto or hereto, shall be deemed
the obligations and agreements of the Issuer, and not of any member, officer,
agent (other than the Company) or employee of the Issuer in his individual
capacity, and the members, officers, agents (other than the Company) and
employees of the Issuer shall not be liable
45
personally hereon or thereon or be subject to any personal liability or
accountability based upon or in respect hereof or thereof or of any transaction
contemplated hereby or thereby. The obligations and agreements of the Issuer
contained herein and therein shall not constitute or give rise to an obligation
of the State or of Saratoga County, New York, and neither the State nor Saratoga
County, New York shall be liable hereon or thereon, and, further, such
obligations and agreements shall not constitute or give rise to a general
obligation of the Issuer, but rather shall constitute limited, special
obligations of the Issuer payable solely from the revenues of the Issuer derived
and to be derived from the sale or other disposition of the Project Facility
(except for revenues derived by the Issuer with respect to the Unassigned
Rights). No order or decree of specific performance with respect to any of the
obligations of the Issuer hereunder shall be sought or enforced against the
Issuer unless (A) the party seeking such order or decree shall first have
requested the Issuer in writing to take the action sought in such order or
decree of specific performance, and ten (10) days shall have elapsed from the
date of receipt of such request, and the Issuer shall have refused to comply
with such request (or, if compliance therewith would reasonably be expected to
take longer than ten [10] days, shall have failed to institute and diligently
pursue action to cause compliance with such request) or failed to respond within
such notice period, (B) if the Issuer refuses to comply with such request and
the Issuer's refusal to comply is based on its reasonable expectation that it
will incur fees and expenses, the party seeking such order or decree shall have
placed in an account with the Issuer an amount or undertaking sufficient to
cover such reasonable fees and expenses, and (C) if the Issuer refuses to comply
with such request and the Issuer's refusal to comply is based on its reasonable
expectation that it or any of its members, officers, agents (other than the
Company) or employees shall be subject to potential liability, the party seeking
such order or decree shall (1) agree to indemnify and hold harmless the Issuer
and its members, officers, agents (other than the Company) and employees against
any liability incurred as a result of its compliance with such demand, and (2)
if requested by the Issuer, furnish to the Issuer satisfactory security to
protect the Issuer and its members, officers, agents and employees against all
liability expected to be incurred as a result of compliance with such request.
SECTION 11.11. SUBORDINATION OT MORTGAGE AND ASSIGNMENT. (A) Except as set forth
below, the Installment Sale Agreement and all rights of the Company and the
Issuer hereunder are and shall be subordinate to the Liens of the Mortgage and
the Assignment. The subordination of the Installment Sale Agreement to the
Mortgage and the Assignment shall be automatic, without the execution of any
further subordination agreement by the Company or the Issuer. Nonetheless, if
the Trustee and/or the Bank requires a further written subordination agreement,
the Company and the Issuer agree to execute, acknowledge and deliver the same.
(B) Notwithstanding anything to the contrary contained
herein or in any other Financing Document, the Installment Sale Agreement shall
constitute a first priority lien on the Project Facility in favor of the Issuer
to the extent of and as security for the payment by the Company of all amounts
due and owing to the Issuer under Section 6.6 hereof, including the payment of
all amounts due and owing under the PILOT Agreement such that the rights of the
Trustee and the Bank under the Mortgage, the Assignment and the other Financing
Documents shall be expressly subordinated thereto, notwithstanding the relative
order of recordation of such documents.
SECTION 11.12. SUBMISSION TO JURISDICTION. The Company hereby irrevocably and
unconditionally agrees that any suit, action or proceeding arising out of or
relating to this Installment Sale Agreement shall be brought in the state courts
of the State of New York or federal district court for the Northern District of
New York and waives any right to object to jurisdiction within either of the
foregoing forums by the Issuer. Nothing contained herein shall prevent the
Issuer from bringing any suit, action or proceeding or exercising any rights
against any security and against the Company personally,
46
and against any property of the Company, within any other jurisdiction and the
initiation of such suit, action or proceeding or taking of such action in any
such other jurisdiction shall in no event constitute a waiver of the agreements
contained herein with respect to the laws of the State of New York governing the
rights and obligations of the parties hereto or the agreement of the Company to
submit to personal jurisdiction within the State of New York.
47
IN WITNESS WHEREOF, the Issuer and the Company have caused the Installment
Sale Agreement to be executed in their respective names by their respective
Authorized Representatives, all as of the day and year first above written.
COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx, Chairman
XXXXXXXX ADHESIVES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxx
---------------------------------
Title: Executive Vice President
---------------------------------
STATE OF NEW YORK )
) SS.:
COUNTY OF SARATOGA )
On the 7th day of October, 1997, before me personally came XXXXX X.
XXXXXX, to me known, who being by me duly sworn, did depose and say that he
resides in Northumberland, New York, that he is the CHAIRMAN of the COUNTY OF
SARATOGA INDUSTRIAL DEVELOPMENT AGENCY, the public benefit corporation of the
State of New York described in and which executed the foregoing instrument, and
that he signed his name thereto by authority of said public benefit corporation.
/s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Notary Public
Xxxxxxx X. Xxxxxx
Notary Public, State of New York
Washington County #01PR4921971
Commission Expires Feb. 28, 0000
XXXXX XX XXX XXXX )
) SS.:
COUNTY OF SARATOGA )
On this 7th day of October, 1997, before me personally came Xxxxxxx X.
Xxxxxxx, to me known, who being by me duly sworn, did depose and sat that he
resides in Waverly Virginia, that he is the Exec. VP of XXXXXXXX ADHESIVES,
INC., the corporation described in and which executed the foregoing instrument,
and that he signed his name thereto by order of the Board of Directors of said
corporation.
/s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Notary Public
Xxxxxxx X. Xxxxxx
Notary Public, State of New York
Washington County #01PR4921971
Commission Expires Feb. 28, 1998
EXHIBIT "A"
REAL PROPERTY DESCRIPTION
THAT TRACT OR PARCEL OF LAND, situate in the Town of Xxxxxx, County of
Saratoga and State of New York more fully described as Lot Number 3 as shown on
subdivision maps of Xxxxxx Industrial Park prepared by The Saratoga Associates
and filed in the Saratoga County Clerk's Office on March 18, 1992 in drawer
#M-348 A-Z and AA-DD; and as modified by revised subdivision maps of Xxxxxx
Industrial Park prepared by The Saratoga Associates and filed in the Saratoga
County Clerk's Office on February 16, 1994 in drawer #M-398, A-S and being
further bounded and described as follows:
BEGINNING at a point marked with a capped iron rod found at the point
of intersection of the easterly line of Xxxxxx Road with the common division
line of Xxx Xx. 0 xx xxx xxxxx xxx Xxx Xx. 0 to the south as shown on said map;
thence from said point of beginning along said common division line the
following five (5) courses and distances:
1) North 90 deg. 00 min. 00 sec. East, 347.86 feet to a point marked with
a capped iron rod found;
2) South 00 deg. 00 min. 00 sec. West, 32.63 feet to a point marked with a
capped iron rod found;
3) North 90 deg. 00 min. 00 sec. East, 191.52 feet to a point marked with
a capped iron rod found;
4) North 00 deg. 00 min. 00 sec. East, 32.63 feet to a point marked with a
capped iron rod found;
5) North 90 deg. 00 min. 00 sec. East, 680.17 feet to the point of
intersection of the westerly line of Lot No. 5 with the common division line of
Xxx Xx. 0 xx xxx xxxxx xxx Xxx Xx. 0 to the south as shown on said map; thence
along said westerly line, South 16 deg. 10 min. 56 sec. West, 102.04 feet to a
point in the northwesterly line of lands of The State of New York as shown on
said map, said point also being at the 145 foot elevation; thence along said
northwesterly and the westerly line of lands of The State of New York as it
winds and turns along the 145 foot elevation in a southerly direction 712 +/-
feet to the point of intersection of said westerly line of lands of The State of
New York with the common division line of Xxx Xx. 0 xx xxx xxxxx xxx Xxx Xx. 0
to the south as shown on said map, the last course having a tie-line of South 33
deg. 02 min. 30 sec. West, 699.47 feet; thence along said common division line,
South 90 deg. 00 min. 00 sec. West, 865.65 feet to a point marked with a capped
iron rod found at the point of intersection of the easterly line of Xxxxxx Road
with the common division line of Xxx Xx. 0 xx xxx xxxxx xxx Xxx Xx. 0 to the
south as shown on said map; thence along said easterly line in a northerly
direction the following four (4) courses and distances:
1) North 00 deg. 00 min. 00 sec. West, 116.35 feet to a point of
curvature;
2) Along a curve to the right an arc length of 464.05 feet to a point of
tangency, said curve having a radius of 2,773.32 feet and a delta angle
of 09 deg. 35 min. 13 sec.;
3) North 09 deg. 35 min. 13 sec. East, 50.00 feet to a point of curvature;
4) Along a curve to the left an arc length of 57.49 feet to the point or
place of beginning, said curve having a radius of 2,294.42 feet and a delta
angle of 01 deg. 26 min. 08 sec., said parcel containing 16.37 +/- acres of land
and being Lot No. 3 as shown on said map.
EXHIBIT "B"
DESCRIPTION OF EQUIPMENT
All articles of personal property and all appurtenances acquired with
the proceeds of the Bonds or any payment made by the Company pursuant to Section
4.5 of the Installment Sale Agreement and now or hereafter attached to,
contained in or used in connection with the Facility or placed on any part
hereof, though not attached thereto, including, but not limited to, all
equipment, machinery, pipes, screens, fixtures, heating, lighting, plumbing,
ventilation, air conditioning, compacting and elevator plants, drapes, blinds
and accessories, sprinkler systems and other fire prevention and extinguishing
apparatus and materials; and together with any and all products of any of the
above, all substitutions, replacements, additions or accessions therefor, and
any and all cash proceeds or non-cash proceeds realized from the sale, transfer
or conversion of any of the above. The references to "proceeds" shall not be
deemed to be an authorization by the Bank of the disposition of any of the
foregoing.
B-1
EXHIBIT "C"
FORM OF DEED TO COMPANY
THIS INDENTURE made __________________, ____, between COUNTY OF
SARATOGA INDUSTRIAL DEVELOPMENT AGENCY, a public benefit corporation organized
under the laws of the State of New York, with offices at 00 XxXxxxxx Xxxxxx,
Xxxxxxxx Xxx, Xxx Xxxx 00000, party of the first part, and
XXXXXXXX ADHESIVES, INC., a Virginia corporation having an address of
0000 Xxxxxxx Xxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxxx 00000, party of the second part
WITNESSETH that the party of the first part, in consideration of One
and 00/100 dollars ($1.00), lawful money of the United States, and other good
and valuable consideration paid by the party of the second part, the heirs or
successors and assigns of the party of the second part forever, all
[Insert description of Land from Deed to Issuer]
TOGETHER with the appurtenances and all the estate and rights of the
party of the first part in and to said premises,
TO HAVE AND TO HOLD the premises herein granted unto the party of the
second part, the heirs or successors and assigns of the party of the second part
forever.
The word "party" shall be construed as if it read "parties" whenever
the sense of this Indenture so requires.
IN WITNESS WHEREOF, the party of the first part has duly executed this
deed the day and year first above written.
COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY
BY:_________________________________
C-1
EXHIBIT "D"
FORM OF XXXX OF SALE TO THE COMPANY
County of Saratoga Industrial Development Agency, a public benefit
corporation of the State of New York (the "State") having its office at the
Saratoga County Municipal Center, 00 XxXxxxxx Xxxxxx, Xxxxxxxx Xxx, Xxx Xxxx
00000 (the "Grantor"), for the consideration of One Dollar ($1.00), cash in hand
paid, and other good and valuable consideration received by the Grantor from
Xxxxxxxx Adhesives, Inc. a corporation organized and existing under the laws of
the State of Virginia having its office at 0000 Xxxxxxx Xxxxxx Xxxxxxx, Xxxxxxx,
Xxxxxxxx 00000 (the "Grantee"), the receipt of which is hereby acknowledged by
the Grantor, hereby sells, transfers and delivers unto the Grantee, and its
successors and assigns, all those materials, machinery, equipment, fixtures or
furnishings which are described in Exhibit "A" attached hereto and by this
reference made a part hereof, now owned or hereafter acquired by the Grantor
with proceeds of the sale of the Bonds (as defined in the installment sale
agreement dated as of October 1, 1997, [the "Installment Sale Agreement"] by and
between the Grantor and the Grantee) or any payment made by the Grantee pursuant
to Section 4.5 of the Installment Sale Agreement, and such additions thereto and
substitutions therefor as may be made from time to time.
TO HAVE AND TO HOLD the same unto the Grantee, and its successors and
assigns, forever.
THE GRANTOR MAKES NO WARRANTY, EITHER EXPRESS OR IMPLIED, AS TO THE
CONDITION, TITLE, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS OF ANY OF THE
EQUIPMENT DESCRIBED ABOVE. THE GRANTEE ACCEPTS TITLE TO SUCH EQUIPMENT "AS IS",
WITHOUT RECOURSE AGAINST THE GRANTOR FOR ANY CONDITION NOW OR HEREAFTER
EXISTING. IN THE EVENT OF A DEFICIENCY OR DEFAULT OF ANY NATURE, WHETHER PATENT
OR LATENT, THE GRANTOR SHALL HAVE NO RESPONSIBILITY OR LIABILITY WHATSOEVER WITH
RESPECT THERETO.
IN WITNESS WHEREOF, the Grantor has caused this xxxx of sale to be
executed in its name by its duly authorized officer on the date indicated
beneath the signature of such officer and dated as of the _____ day of
__________, ____.
COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY
By:______________________________
Chairman
D-1
