CONFIDENTIAL AND PROPRIETARY
LEASE AGREEMENT
Dated as of August 11, 1994
BETWEEN
Shawnee Funding, Limited Partnership
as Lessor
AND
Seaboard Corporation
as Lessee
THIS LEASE HAS BEEN ASSIGNED AS SECURITY
FOR INDEBTEDNESS OF THE LESSOR. SEE SECTION 21.
This Lease has been manually executed in 8 counterparts, numbered
consecutively from 1 trough 8 of which this is No. 3. To the
extent, if any, that this Lease constitutes chattel paper (as
such term is defined in the Uniform Commercial Code as in effect
in any applicable jurisdiction) no security interest in this
Lease may be created or perfected through the transfer or
possession of any counterpart other than the original executed
counterpart which shall be the counterpart identified as
counterpart No. 1.
CONFIDENTIAL
LEASE AGREEMENT
Lease Agreement, dated as of August 11, 1994 (as the same
may be amended, restated, modified or supplemented from time to
time, "this Lease"), between Shawnee Funding, Limited
Partnership, a Delaware limited partnership, Lessor (the
"Lessor"), and Seaboard Corporation, a Delaware corporation,
Lessee (the "Lessee").
SECTION 1. DEFINED TERMS.
Unless the context otherwise requires, each term defined in
this Section 1 shall, when used in this Lease, have the meaning
indicated:
"Accrued Default Obligations" has the meaning set forth in
Section 19 hereof.
"Acquisition Cost" means, (i) in the case of a Parcel of
Property acquired and built pursuant to the Agreement for Lease,
an amount equal to the costs incurred by the Lessor in connection
with the acquisition, construction and financing of such Parcel
pursuant to the Agreement for Lease; (ii) with respect to any
Unit of Equipment, an amount equal to the sum of (a) the vendor's
invoice price therefor; including any progress payments, costs of
labor, delivery or installation, sales, use, excise or similar
taxes and any other charges included in such invoice, after
deduction for any refundable fleet or other discounts or credits
actually used by the Lessor, (b) similar amounts paid or payable
with respect to such Unit to parties other than the vendor of
such Unit, (c) similar costs incurred with respect to such Unit
by the Lessee and approved and reimbursed by the Lessor, and (d)
legal, printing, reproduction, closing and other normally
capitalizable administrative fees and expenses paid by the Lessee
and approved and reimbursed by the Lessor; and (iii) with respect
to any Parcel of Property not acquired and built pursuant to the
Agreement for Lease, an amount equal to the sum of any amounts
included in (ii)(d) above which are applicable to such Parcel
plus (a) the vendor's contract price therefor or the appraised
value thereof, (b) vendee's closing costs, including, without
limitation, title insurance premiums, survey and survey
inspection charges, recording and filing fees, title closer fees,
vendee's attorneys' fees and brokerage commissions, (c) other
costs related to the acquisition, including, without limitation,
appraisal, architectural, engineering, soil analysis,
environmental analysis and market analysis fees, and (d) any
amounts paid by vendee on behalf of vendor in addition to, and
not as a credit against the contract price, including, without
limitation, payments made in satisfaction of prior liens, and
payment of any transfer, transfer gains or similar taxes imposed
in respect of the conveyance of such Property.
"Additional Rent" has the meaning set forth in paragraph (d)
of Section 7 hereof.
"Adjusted Acquisition Cost" means, at any time, with respect
to any Parcel of Property or Unit of Equipment, its Acquisition
Cost less the aggregate amount of all Monthly Rent Components
paid as portions of Basic Rent for such Parcel of Property or
Unit of Equipment as of the time of determination.
"Affiliate" of any Person means any other Person
controlling, controlled by or under direct or indirect common
control with such Person. For the purposes of this definition,
"control," when used with respect to any specified Person, means
the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling"
and "controlled" have meanings correlative to the foregoing.
"AFL Unit Leasing Record" means an instrument, substantially
in the form of Exhibit C hereto, evidencing the lease or sublease
under this Lease of a Parcel of Property, including, without
limitation, a Pork Production Facility and related Pork
Production Facility Equipment and a Poultry Production Facility
and related Poultry Production Facility Equipment, acquired and
built pursuant to the Agreement for Lease. The terms "lease" or
"leased" when used in this Lease shall be deemed to mean
"sublease" or "subleased" when referenced to the Property
subleased pursuant to the AFL Unit Leasing Record.
"Agreement for Lease" means the Agreement for Lease, dated
as of the date hereof, between the Lessor, as owner, and the
Lessee, as agent, providing for the acquisition of a fee or
leasehold interest in real property and the construction of
improvements on certain parcels of real property, and, in the
case of Pork Production Facilities, the acquisition of Pork
Production Facility Equipment and in the case of Poultry
Production Facilities, the acquisition of Poultry Production
Facility Equipment, as the same may be amended, restated,
modified or supplemented from time to time.
"Aircraft" means the aircraft, if any, which are more
particularly described in Exhibit B hereto, together with the
Engines and any and all appliances, parts, instruments,
appurtenances, accessories, furnishings and other equipment of
whatever nature, from time to time incorporated or installed in
or attached to such aircraft.
"Appraisal Procedure" means the following procedure whereby
an independent appraiser shall be appointed by the Lessor and the
Lessee, with the consent of the Assignee, to determine the amount
of wear and tear in excess of that attributable to normal use of
any Property or Equipment to which the provisions of Section
12(b)(iii), Section 12(c)(iii) or Section 12(d)(iii) apply. If
no such appraiser is appointed by the Lessor and the Lessee
within ten (10) days of the written request of either the Lessor
or the Lessee that an appraiser be appointed, the Lessor and the
Lessee shall each appoint an independent appraiser within fifteen
(15) days thereafter, and the two appraisers so appointed shall
appoint a third independent appraiser. Each appraiser appointed
pursuant to the foregoing procedure shall, within ten (10) days
after appointment of the last appraiser, independently determine
the amount of wear and tear in excess of that attributable to
normal use. If the Lessor or the Lessee shall fail to appoint an
independent appraiser within the above-mentioned fifteen (15) day
period, the appraiser appointed by the other party shall
determine such amount. If a single appraiser is appointed, such
appraiser's determination shall be final. If three appraisers
are appointed, the amounts determined by the three appraisers
shall be averaged, the amount which differs the most from such
average shall be excluded, the remaining two amounts shall be
averaged and such average shall be final. The expenses of all
appraisers shall be paid by the Lessee.
"Assignee" means each Person to which any part of the
Lessor's interest under this Lease or in any Parcel of Property
or Unit of Equipment shall at the time have been assigned,
conditionally or otherwise, by the Lessor in accordance with
Section 21 of this Lease. For purposes of paragraph (d), (h) and
(k) of Section 2, paragraph (f) of Section 5, clauses (i), (iv),
and (v) of paragraph (f) of Section 10, Section 11, the last
sentence of paragraph (b) of Section 21, clauses (ii) and (iii)
of paragraph (a) of Section 28 and Section 33 hereof, the term
"Assignee" shall include each lender to the Lessor or each other
Person which is a party to a Credit Agreement.
"Assignment" means each assignment agreement referred to in
Section 21 hereof, between the Lessor and a third party, pursuant
to which the Lessor assigns certain of its rights under this
Lease to such third party, as the same may be amended, restated,
modified or supplemented from time to time.
"Basic Rent" means, with respect to any Parcel of Property
or Unit of Equipment:
(a) for each calendar month during the Lease Term of such
Parcel or Unit, the sum of the Monthly Rent Component for such
Parcel or Unit plus an amount (the "Variable Component of Basic
Rent") computed by multiplying the following:
(i) the Adjusted Acquisition Cost of such Parcel or
Unit before payment of Basic Rent for such month,
by
(ii) a fraction having a numerator equal to the number
of days in such month and a denominator of 365, or
in a leap year, 366, by
(iii) the decimal equivalent of a percentage (which
percentage will be based upon the Lessee's debt
rating as follows: (1) if the Lessee's debt rating
is Level 1, the percentage shall be (A) during the
Initial Term (i) 0.806% with respect to the
aggregate Adjusted Acquisition Cost of Property
and 0.815% with respect to the aggregate Adjusted
Acquisition Cost of Equipment, at any time subject
to this Lease, up to and including $35 million of
such Property and Equipment; (ii) 0.706% with
respect to the aggregate Adjusted Acquisition Cost
of Property and 0.715% with respect to the
aggregate Adjusted Acquisition Cost of Equipment,
at any time subject to this Lease between
$35 million and $70 million of such Property and
Equipment; and (iii) 0.606% with respect to the
aggregate Adjusted Acquisition Cost of Property
and 0.615% with respect to the aggregate Adjusted
Acquisition Cost of Equipment, at any time subject
to this Lease above $70 million of such Property
and Equipment; and (B) during the Extended Term
(i) 0.80% with respect to the aggregate Adjusted
Acquisition Cost of Property and Equipment at any
time subject to this Lease, up to and including
$35 million of such Property and Equipment;
(ii) 0.70% with respect to the aggregate Adjusted
Acquisition Cost of Property and Equipment at any
time subject to this Lease between $35 million and
$70 million of such Property and Equipment; and
(iii) 0.60% with respect to the aggregate Adjusted
Acquisition Cost of Property and Equipment at any
time subject to this Lease above $70 million of
such Property and Equipment; (2) if the Lessee's
debt rating is Level 2, the percentage shall be
(A) during the Initial Term (i) 0.908% with
respect to the aggregate Adjusted Acquisition Cost
of Property and 0.920% with respect to the
aggregate Adjusted Acquisition Cost of Equipment,
at any time subject to this Lease, up to and
including $35 million of such Property and
Equipment; (ii) 0.808% with respect to the
aggregate Adjusted Acquisition Cost of Property
and 0.820% with respect to the aggregate Adjusted
Acquisition Cost of Equipment, at any time subject
to this Lease between $35 million and $70 million
of such Property and Equipment; and (iii) 0.708%
with respect to the aggregate Adjusted Acquisition
Cost of Property and 0.720% with respect to the
aggregate Adjusted Acquisition Cost of Equipment,
at any time subject to this Lease above
$70 million of such Property and Equipment; and
(B) during the Extended Term (i) 0.90% with
respect to the aggregate Adjusted Acquisition Cost
of Property and Equipment at any time subject to
this Lease, up to and including $35 million of
such Property and Equipment; (ii) 0.80% with
respect to the aggregate Adjusted Acquisition Cost
of Property and Equipment at any time subject to
this Lease between $35 million and $70 million of
such Property and Equipment; and (iii) 0.70% with
respect to the aggregate Adjusted Acquisition Cost
of Property and Equipment at any time subject to
this Lease above $70 million of such Property and
Equipment; (3) if the Lessee's debt rating is
Level 3, the percentage shall be (A) during the
Initial Term (i) 1.111% with respect to the
aggregate Adjusted Acquisition Cost of Property
and 1.129% with respect to the aggregate Adjusted
Acquisition Cost of Equipment, at any time subject
to this Lease, up to and including $35 million of
such Property and Equipment; (ii) 1.011% with
respect to the aggregate Adjusted Acquisition Cost
of Property and 1.029% with respect to the
aggregate Adjusted Acquisition Cost of Equipment,
at any time subject to this Lease between
$35 million and $70 million of such Property and
Equipment; and (iii) 0.912% with respect to the
aggregate Adjusted Acquisition Cost of Property
and 0.929% with respect to the aggregate Adjusted
Acquisition Cost of Equipment, at any time subject
to this Lease above $70 million of such Property
and Equipment; and (B) during the Extended Term
(i) 1.10% with respect to the aggregate Adjusted
Acquisition Cost of Property and Equipment at any
time subject to this Lease, up to and including
$35 million of such Property and Equipment;
(ii) 1.00% with respect to the aggregate Adjusted
Acquisition Cost of Property and Equipment at any
time subject to this Lease between $35 million and
$70 million of such Property and Equipment; and
(iii) 0.90% with respect to the aggregate Adjusted
Acquisition Cost of Property and Equipment at any
time subject to this Lease above $70 million of
such Property and Equipment; and (4) if the
Lessee's debt rating is Level 4, the percentage
shall be (A) during the Initial Term (i) 1.517%
with respect to the aggregate Adjusted Acquisition
Cost of Property and 1.549% with respect to the
aggregate Acquisition Cost of Equipment, at any
time subject to this Lease, up to and including
$35 million of such Property and Equipment;
(ii) 1.418% with respect to the aggregate Adjusted
Acquisition Cost of Property and 1.449% with
respect to the aggregate Adjusted Acquisition Cost
of Equipment, at any time subject to this Lease
between $35 million and $70 million of such
Property and Equipment; and (iii) 1.318% with
respect to the aggregate Adjusted Acquisition Cost
of Property and 1.349% with respect to the
aggregate Adjusted Acquisition Cost of Equipment,
at any time subject to this Lease above
$70 million of such Property and Equipment; and
(B) during the Extended Term (i) 1.50% with
respect to the aggregate Adjusted Acquisition Cost
of Property and Equipment at any time subject to
this Lease, up to and including $35 million of
such Property and Equipment; (ii) 1.40% with
respect to the aggregate Adjusted Acquisition Cost
of Property and Equipment at any time subject to
this Lease between $35 million and $70 million of
such Property and Equipment; and (iii) 1.30% with
respect to the aggregate Adjusted Acquisition Cost
of Property and Equipment at any time subject to
this Lease above $70 million of such Property and
Equipment, plus (A) the weighted average bond
yield equivalent percentage cost per annum
(including as part of such cost any fees payable
under or pursuant to any Credit Agreement and any
dealer discount or placement agency commission
payable by the Lessor in respect of its Commercial
Paper) on all Commercial Paper of the Lessor
issued to finance or refinance the acquisition and
ownership of Property and Equipment outstanding at
any time during the period from and including the
16th day of the preceding calendar month to and
including the 15th day of the calendar month for
which Basic Rent is being computed (the
"Computation Period"), or (B) if no such
Commercial Paper of the Lessor is outstanding
during the Computation Period, the Lessor's
weighted average percentage cost per annum
(including as part of such cost any fees payable
under or pursuant to any Credit Agreement and
whether or not interest is accruing at a default
rate) of other borrowings outstanding at any time
during the Computation Period for which Basic Rent
is being computed to finance or refinance the
acquisition and ownership of Property or Equipment
or (C) if both Commercial Paper and other
borrowings are outstanding at any time during the
Computation Period for which Basic Rent is being
computed, a weighted average blended rate based on
the calculations referred to in clauses (A) and
(B).
(b) for any partial first calendar month during the Lease
Term of such Parcel or Unit, an amount computed by multiplying
the following:
(i) the Acquisition Cost of such Parcel or Unit, by
(ii) a fraction having a numerator equal to the number
of days such Parcel or Unit is under lease during
such partial first month and a denominator of 365,
or in a leap year, 366, by
(iii) the decimal referred to in paragraph (a)(iii)
above; provided, that if the Effective Date for
such Parcel or Unit falls on or after the Lease
Rate Date during such partial first calendar month
such decimal shall be the decimal determined as of
the next succeeding Lease Rate Date; and
(c) for each calendar month during the Renewal Term, if
any, of such Parcel or Unit, an amount equal to the fair market
value rental thereof, determined as provided in paragraph (c) of
Section 13 hereof.
"Basic Rent Payment Date" means the 20th day of any calendar
month during the Lease Term or Renewal Term of any Property or
Equipment or, if such day is not a Business Day, the next
succeeding Business Day.
"Business Day" means any day other than a Saturday, a Sunday
or a day on which banking institutions in the City of New York
are authorized by law to close.
"Cash Proceeds" has the meaning set forth in paragraph (a)
of Section 12 hereof.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commercial Paper" means all promissory notes of the Lessor
issued pursuant to a Credit Agreement maturing not more than
ninety (90) days from the date of issuance thereof.
"Computation Period" has the meaning set forth in subclause
(a)(iii)(A) of the definition of Basic Rent in Section I hereof.
"Consent" means each consent of the Lessee to an Assignment,
pursuant to which the Lessee consents to the terms of such
Assignment insofar as they relate to this Lease, as the same may
be amended, restated, modified or supplemented from time to time.
"Credit Agreement" means each credit or loan agreement which
has been entered into between the Lessor and a lender or lenders
related to the financing of Property or Equipment, as the same
may be amended, restated, modified or supplemented from time to
time.
"Duff & Xxxxxx" has the meaning set forth in the definition
of "Level 1" in this Section 1.
"Effective Date" means, with respect to any Parcel of
Property or Unit of Equipment, the date on which such Parcel or
Unit becomes subject to this Lease, as evidenced by execution by
the Lessor of an AFL Unit Leasing Record or a Unit Leasing Record
with respect to such Parcel, as the case may be, or a Unit
Leasing Record with respect to such Unit.
"Engine" means (a) each of the engines installed in the
Aircraft on the Aircraft's Effective Date and (b) any aircraft
engine leased hereunder, together in either case with any and all
appliances, parts, instruments, appurtenances, accessories and
other equipment of whatever nature from time to time incorporated
or installed in or attached to an Engine.
"Equipment" means personal property of any type, including,
without limitation, any Aircraft and Engines, leased or to be
leased hereunder and, when leased, evidenced by Unit Leasing
Records, and all related appliances, appurtenances, accessions,
furnishings, Materials and parts leased or to be leased by the
Lessor to the Lessee as provided herein and including all
replacements and subsequent replacements of such related
appliances, appurtenances, accessions, furnishings, materials and
parts. "Unit", when referring to the personal property leased
under this Lease, means a particular item of Equipment, as the
context may require.
"Event of Default" has the meaning set forth in Section 18
hereof.
"Extended Term" has the meaning set forth in paragraph (b)
of Section 6 hereof.
"Governmental Action" has the meaning set forth in paragraph
(d) of Section 2 hereof.
"Ground Lease" has the meaning set forth in Section 29
hereof.
"Implied Senior Debt Rating" means with respect to any debt
ratings, if in existence, of the Lessee's subordinated debt from
S&P, Moody's or Duff & Xxxxxx, as the case may be, two rating
levels higher than such subordinated debt rating.
"Indemnified Person" has the meaning set forth in Section 11
hereof.
"Initial Term" has the meaning set forth in paragraph (a) of
Section 6 hereof.
"Insurance Requirements" means all terms of any insurance
policy covering or applicable to any Property or Equipment, all
requirements of the issuer of any such policy, all statutory
requirements and all orders, rules, regulations and other
requirements of any governmental body related to insurance
applicable to any Property or Equipment.
"Lease Rate Date" has the meaning set forth in paragraph (b)
of Section 7 hereof.
"Lease Term" means, with respect to any Parcel of Property
or Unit of Equipment, the Initial Term plus the Extended Term
thereof.
"Legal Requirements" means all laws, judgments, decrees,
ordinances and regulations and any other governmental rules,
orders and determinations and all requirements having the force
of law, now or hereinafter enacted, made or issued, whether or
not presently contemplated, and all agreements, covenants,
conditions and restrictions, applicable to each Parcel or Unit
and/or the construction, ownership, operation or use thereof,
including, without limitation, compliance with all requirements
of labor laws and environmental statutes, compliance with which
is required at any time from the date hereof through the Lease
Term and any Renewal Term, whether or not such compliance shall
require structural, unforeseen or extraordinary changes to any
Property or Equipment or the operation, occupancy or use thereof.
"Lessee" has the meaning set forth in the first paragraph of
this Lease.
"Lessor" means Shawnee Funding, Limited Partnership or any
successor or successors to all of its rights and obligations as
the Lessor hereunder and, for purposes of Section 11 hereof,
shall include any partnership (general or limited), corporation,
trust, individual or other entity which computes its liability
for income or other taxes on a consolidated basis with Shawnee
Funding, Limited Partnership or the income of which for purposes
of such taxes is, or may be, determined or affected directly or
indirectly by the income of the Lessor or its successor or
successors.
"Level 1" means when the Lessee's senior debt rating or, if
the Lessee has no senior debt rating, when the Lessee's Implied
Senior Debt Rating is AA+ to A- by Standard & Poor's Corporation
or any successor corporation thereto ("S&P"), or if the Lessee
has no senior debt rating or Implied Senior Debt Rating from S&P,
Aa1 to A3 by Xxxxx'x Investors Service, Inc. or any successor
corporation thereto ("Moody's"), or if the Lessee has no senior
debt rating or Implied Senior Debt Rating from either S&P or
Moody's, AA+ to A- by Duff & Xxxxxx Ratings Corporation or any
successor corporation thereto ("Duff & Xxxxxx"), or if the
Lessee's senior debt or subordinated debt is not rated by any of
S&P, Moody's or Duff & Xxxxxx, when the Lessee's private debt is
rated NAIC 1 by the National Association of Insurance
Commissioners ("NAIC"), provided, however, that if the Lessee's
private debt rating has not been reviewed and affirmed by the
NAIC within the previous 15 month period, then when the Xxxxxxx
Xxxxx Fixed Income Research Rating is 7.0 or higher.
"Level 2" means when the Lessee's senior debt rating or, if
the Lessee has no senior debt rating, when the Lessee's Implied
Senior Debt Rating is not Level 1 and when the Lessee's senior
debt rating, or if the Lessee has no senior debt rating, when the
Lessee's Implied Senior Debt Rating is BBB+ to BBB- by S&P, or if
the Lessee has no senior debt rating or Implied Senior Debt
Rating from S&P, Baal to Baa3 by Moody's, or if the Lessee has no
senior debt rating or Implied Senior Debt Rating from either
Moody's or S&P, BBB+ to BBB- by Duff & Xxxxxx, or if the Lessee's
senior debt or subordinated debt is not rated by any of S&P,
Moody's or Duff & Xxxxxx, when the Lessee's private debt is rated
NAIC 2 by the NAIC, provided, however, that if the Lessee's
private debt rating has not been reviewed and affirmed by the
NAIC within the previous 15 month period, then when the Xxxxxxx
Xxxxx Fixed Income Research Rating is 6.0 or higher but less than
7.0.
"Level 3" means when the Lessee's senior debt rating or, if
the Lessee has no senior debt rating, when the Lessee's Implied
Senior Debt Rating is not Level 1 or Level 2, and when the
Lessee's senior debt rating, or if the Lessee has no senior debt
rating, when the Lessee's Implied Senior Debt Rating is BB+ to BB-
by S&P, or if the Lessee has no senior debt rating or Implied
Senior Debt Rating from S&P, Ba1 to Ba3 by Moody's, or if the
Lessee has no senior debt rating or Implied Senior Debt Rating
from either S&P or Moody's, BB+ to BB- by Duff & Xxxxxx, or if
the Lessee's senior debt or subordinated debt is not rated by any
of S&P, Moody's or Duff & Xxxxxx, when the Lessee's private debt
is rated NAIC 3 by the NAIC provided, however, that if the
Lessee's private debt rating has not been reviewed and affirmed
by the NAIC within the previous 15 month period, then when the
Xxxxxxx Xxxxx Fixed Income Research Rating is 5.0 or higher, but
less than 6.0.
"Level 4" means when the Lessee's senior debt rating or if
the Lessee has no senior debt rating, when the Lessee's Implied
Senior Debt Rating is not Xxxxx 0, Xxxxx 0 or Level 3 and when
the Lessee's senior debt rating, or if the Lessee has no senior
debt rating, when the Lessee's Implied Senior Debt Rating is B+
or below by S&P, or if the Lessee has no senior debt rating or
Implied Senior Debt Rating from S&P, B1 or below by Moody's or if
the Lessee has no senior debt rating or Implied Senior Debt
Rating from either S&P or Moody's, B+ or below by Duff & Xxxxxx,
or if the Lessee's senior debt or subordinated debt is not rated
by any of S&P, Moody's or Duff & Xxxxxx, when the Lessee's
private debt is rated NAIC 4 by the NAIC, provided, however, that
if the Lessee's private debt rating has not been reviewed and
affirmed by the NAIC within the previous 15 month period, then
when the Xxxxxxx Xxxxx Fixed Income Research Rating is below 5.0.
"Lien" means any security interest, mortgage, pledge,
hypothecation, assignment, encumbrance, lien (statutory or
other), or other security agreement of any kind or nature
whatsoever (including, without limitation, any conditional sale
or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing,
and the filing of any financing statement under the Uniform
Commercial Code or comparable law of any jurisdiction in respect
of any of the foregoing).
"Xxxxxxx" means Xxxxxxx Xxxxx Money Markets Inc., a Delaware
corporation.
"Xxxxxxx Leasing" means ML Leasing Equipment Corp., a
Delaware corporation.
"Xxxxxxx Xxxxx" means Xxxxxxx Xxxxx & Co., Inc., a Delaware
corporation.
"Monthly Rent Component" means, (i) with respect to each
Parcel of Property (other than a Parcel acquired and built
pursuant to the Agreement for Lease) or Unit of Equipment, for
each calendar month during the Lease Term of such Parcel or Unit,
the amount determined in accordance with Schedule B, if any, to
the Unit Leasing Record relating to such Parcel or Unit, (ii)
with respect to a Parcel of Property or Unit of Equipment
acquired and/or built pursuant to the Agreement for Lease, the
amount determined in accordance with Schedule B, if any, to the
AFL Unit Leasing Record relating to such Parcel of Property or
Unit of Equipment, or (iii) if no amount for such Parcel or Unit
shall be provided in Schedule B to such Unit Leasing Record or
AFL Unit Leasing Record, the Acquisition Cost of such Parcel of
Property or Unit of Equipment divided by the number of calendar
months in the Lease Term with respect to such Parcel or Unit.
Schedule B to the Unit Leasing Record, if any, or AFL Unit
Leasing Record, if any, shall be completed as to the Acquisition
Cost of the Parcel or Unit and the amortization schedule for such
Parcel or Unit, which schedule shall reflect mortgage
amortization over the Lease Term of the Acquisition Cost, as
agreed upon by the Lessee and the Lessor, provided that with
respect to Parcels of Property, the Lessee shall not be required
to amortize the Acquisition Cost of the underlying land.
"Moody's" has the meaning set forth in the definition of
"Level 1" in this Section 1.
"Mortgageable Ground Lease" means a Ground Lease for a
Parcel of Property to be subleased to the Lessee which is
delivered to the Lessor for execution by the Lessor, or assigned
to the Lessor by an assignment in form and substance satisfactory
to the Lessor, and having such terms and characteristics as may
be required by the Lessor and any Assignee, which terms and
characteristics shall include, without limitation, the following:
(a) free assignability to (i) any lender as security for a
borrowed money obligation of the Lessor and, upon foreclosure of
such security, freely assignable by such lender to any third
party, and (ii) any purchaser in connection with a sale of such
Parcel of Property pursuant to the provisions of this Lease or
the Agreement for Lease (the Lessor and any Assignee being
released from liability upon such assignment); (b) a term
(including renewals) of at least one (1) year in excess of the
Lease Tenn of the Parcel of Property to which such Ground Lease
relates; (c) no provisions for percentage or variable rent; (d)
permit any lawful use; (e) no provision for a security deposit;
(f) a requirement that any Assignee or any lender will receive
copies of all notices of default delivered under or pursuant to
such Ground Lease; (g) a provision that any Assignee or any
lender shall have the right to cure any defaults thereunder
(whether monetary or nonmonetary in nature), and in the event of
such cure, to receive a new ground lease on the same terms as the
original Ground Lease; (h) a no recourse section in accordance
with the language set forth in Section 31 hereof; (i) a
prohibition of any mortgages or other Liens on the underlying
fee, except Permitted Liens; and (j) no provision requiring the
Lessor to indemnify any Person. A Mortgageable Ground Lease
shall be delivered with such estoppel certificates, recognition
and attornment agreements, or confirmation of customary mortgagee
protection as are reasonably acceptable to the Lessor and any
Assignee.
"NAIC" has the meaning set forth in the definition of "Level
1" in this Section 1.
"Permitted Contest" has the meaning set forth in paragraph
(a) of Section 28 hereof.
"Permitted Liens" means the following Liens and other
matters affecting the title of any Parcel of Property or Unit of
Equipment: (a) Liens securing the payment of taxes, assessments
and other governmental charges or levies which are either not
delinquent or, if delinquent, are being contested by the Lessee
in good faith as a Permitted Contest; (b) zoning and planning
restrictions, subdivision and platting restrictions, easements,
rights-of-way, licenses, reservations, covenants, conditions,
waivers, restrictions on the use of any Parcel of Property, minor
encroachments or minor irregularities of title none of which
materially impairs the intended use or value of such Parcel of
Property by the Lessee; (c) reservations of mineral interests;
(d) the Lien created pursuant to a Credit Agreement; (e) leases
and licenses in effect with respect to any Parcel of Property
which are permitted by this Lease or which are delivered to and
accepted by the Lessor and any Assignee prior to such Parcel's
Effective Date; and (f) such other or additional matters as may
be approved in writing by the Lessor and any Assignee.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Potential Default" means any event which, but for the lapse
of time, or giving of notice, or both, would constitute an Event
of Default.
"Pork Production Facility" means any Property designed for
use to xxxxxx, nurse or finish hogs, and related improvements on
the same Parcel of Property.
"Pork Production Facility Equipment" means the Units of
Equipment, if any, used and (if such Equipment has been acquired
by the Lessor but not yet delivered by the vendor) to be used, at
a particular Pork Production Facility, including without
limitation certain vehicles to be used to deliver feeder pigs and
xxxxxxxxx hogs to, and to spread effluent at, a particular Pork
Production Facility.
"Poultry Production Facility" means any Property designed
for use to breed, hatch, and grow poultry, and related
improvements on the same Parcel of Property.
"Poultry Production Facility Equipment" means the Units of
Equipment, if any, used and (if such Equipment has been acquired
by the Lessor but not yet delivered by the vendor) to be used, at
a particular Poultry Production Facility, including without
limitation certain vehicles to be used to deliver the chicken
livestock to a particular Poultry Production Facility.
"Property" means any and all parcels of land together with
all buildings and other improvements (including, without
limitation, the attachments, appliances, equipment, machinery and
other affixed property which, in each case, would constitute
"fixtures" under Section 9-313(1)(a) of the Uniform Commercial
Code) now or hereafter located on such parcels of land, leased or
to be leased hereunder and when leased, evidenced by Unit Leasing
Records or AFL Unit Leasing Records, and the respective
easements, rights and appurtenances relating to such parcels of
land, buildings and improvements. "Parcel" or "Parcel of
Property" means a specific parcel or parcels of Property.
"Reconciliation Amount" has the meaning set forth in
paragraph (f) of Section 7 hereof.
"Renewal Term" has the meaning set forth in paragraph (b) of
Section 13 hereof.
"Responsible Officer" shall mean the President, Vice
President, Secretary or Treasurer of the Lessee, or any other
officer or similar official of the Lessee responsible for the
administration of the obligations of the Lessee with respect to
this Lease.
"S&P" has the meaning set forth in the definition of "Level
1" in this Section 1.
"Taking" has the meaning set forth in paragraph (a) of
Section 16 hereof.
"Unit Leasing Record" means an instrument, substantially in
the form of Exhibit D hereto, evidencing, except in the case of
any Parcel or Parcels of Property acquired and built pursuant to
the Agreement for Lease, the lease of any Parcel or Parcels of
Property or Unit or Units of Equipment under this Lease.
"Variable Component of Basic Rent" has the meaning set forth
in the definition of Basic Rent in Section 1 hereof.
SECTION 2. REPRESENTATIONS, WARRANTIES AND
AGREEMENTS OF LESSEE.
The Lessee represents, warrants and covenants to the
Lessor:
(a) Corporate Matters. The Lessee (i) has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the State of Delaware, (ii) has full
power, authority and legal right to own and operate its
properties and to conduct its business as presently conducted and
to execute, deliver and perform its obligations under this Lease
and any Consent, and (iii) is duly qualified to do business as a
foreign corporation in good standing in each jurisdiction in
which its ownership or leasing of properties or the conduct of
its business requires such qualification.
(b) Binding Agreement. This Lease has been duly
authorized, executed and delivered by the Lessee and, assuming
the due authorization, execution and delivery of this Lease by
the Lessor, this Lease is a legal, valid and binding obligation
of the Lessee, enforceable according to its terms, subject, as to
enforceability, to applicable bankruptcy, insolvency and similar
laws affecting creditors' rights generally and to general
principles of equity.
(c) Compliance with Other Instruments. The execution,
delivery and performance by the Lessee of this Lease and any
Consent will not result in any violation of any term of the
articles of incorporation or the by-laws of the Lessee, do not
require stockholder approval or the approval or consent of any
trustee or holders of indebtedness of the Lessee except such as
have been obtained prior to the date hereof and will not conflict
with or result in a breach of any terms or provisions of, or
constitute a default under, or result in the creation or
imposition of any Lien (other than a Permitted Lien) upon any
property or assets of the Lessee under, any indenture, mortgage
or other agreement or instrument to which the Lessee is a party
or by which it or any of its property is bound, or any existing
applicable law, rule, regulation, license, judgment, order or
decree of any government, governmental body or court having
jurisdiction over the Lessee or any of its activities or
properties, except for any possible violations of any existing
applicable law, rule, regulation, license, judgment, order or
decree of any government, governmental body or court having
jurisdiction over the Lessee or any of its activities or
properties, which violation could not reasonably be expected to
impair the validity and enforceability of this Lease or
materially impair the rights of or benefits available to the
Lessor under this Lease or the ability of the Lessee to perform
its obligations under this Lease.
(d) Governmental Consents. There are no consents, permits,
licenses, orders, authorizations, approvals, waivers, extensions
or variances of, or notices to or registrations or filings with
(each a "Governmental Action"), any governmental or public body
or authority which are or will be required in connection with the
valid execution, delivery and performance of this Lease, or any
Governmental Action (i) which is or will be required in
connection with any participation by the Lessor in the
transaction contemplated by any xxxx of sale, deed, assignment,
assumption, ownership agreement, operating agreement, or other
agreement relating to any Property or Equipment or (ii) which is
or will be required to be obtained by the Lessor, the Lessee,
Xxxxxxx, Xxxxxxx Leasing, any Assignee or any Affiliate of the
foregoing, during the term of this Lease, with respect to any
Property or Equipment except such Governmental Actions, (A) (i)
as have been duly obtained, given or accomplished, with true
copies thereof delivered to the Lessor, (ii) as may be required
by applicable law not now in effect and (iii) as may be necessary
in connection with any alterations of any Property permitted
hereunder, which Governmental Actions will be obtained prior to
the time required or (B) which, individually or in the aggregate,
if not obtained or effected, (x) will not place either the Lessor
or any Assignee in any danger of civil liability for which the
Lessor or any Assignee is not adequately indemnified (the
Lessee's obligations under Section 11 of this Lease shall be
deemed to be adequate indemnification if no Event of Default
exists and if such civil liability is reasonably likely to be
less than $1,000,000 in the aggregate) or subject the Lessor or
any Assignee to any criminal liability as a result of a failure
to comply therewith, (y) will not result in a material diminution
in the value of any Property or Equipment, and (z) will not
materially impair the ability of the Lessee to perform its
obligations hereunder.
(e) Financial Statements. The Lessee has furnished to the
Lessor copies of its Annual Report on Form 10-K for the year
ended December 31, 1993, and its Quarterly Reports on Form 10-Q
for the quarter ended March 26, 1994. The financial statements
contained in such documents fairly present the financial
position, results of operations and statements of cash flows of
the Lessee as of the dates and for the periods indicated therein
and have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis as described
therein.
(f) Changes. Since March 26, 1994, there has been no
material adverse change in the financial condition or business of
the Lessee nor any change which would materially impair the
ability of the Lessee to perform its obligations under this
Lease.
(g) Litigation. There is no action, suit, proceeding or
investigation at law or in equity by or before any court,
governmental body, agency, commission or other tribunal now
pending or, to the Lessee's knowledge, threatened against or
affecting the Lessee or any property or rights of the Lessee
which questions the enforceability of this Lease, which affects
any Parcel of Property or Unit of Equipment, which may have a
material adverse impact on the financial condition or business of
the Lessee or which, if adversely determined, would materially
impair the ability of the Lessee to perform its obligations
hereunder.
(h) Delivery of Information. The Lessee shall deliver to
the Lessor from time to time, (i) promptly, and in any event not
more than 120 days after the end of each fiscal year of the
Lessee, copies of its Annual Reports on Form 10-K and promptly,
and in any event not more than 60 days after the end of each
fiscal quarter of the Lessee, its Quarterly Reports on Form 10-Q,
and promptly any other reports it files with the Securities and
Exchange Commission, (ii) promptly upon request, such other
information with respect to the Lessee's operations, business,
properties, assets, financial condition or litigation as the
Lessor or any Assignee shall reasonably request, (iii) promptly
after a Responsible Officer of the Lessee obtains knowledge of
any Event of Default or Potential Default hereunder, a
certificate of a Responsible Officer of the Lessee specifying the
nature and period of existence of such Event of Default or
Potential Default, and what action, if any, the Lessee has taken,
is taking, or proposes to take with respect thereto and (iv)
promptly after a Responsible Officer of the Lessee obtains
knowledge of any material adverse change in the financial
condition or business of the Lessee or of any litigation of the
type described in paragraph (g) of this Section 2, a certificate
of a Responsible Officer of the Lessee describing such change or
litigation as the case may be, and what action, if any, the
Lessee has taken, is taking, or proposes to take with respect
thereto.
(i) Aircraft. To the best of the Lessee's knowledge,
neither the execution and delivery by the Lessee of a Unit
Leasing Record relating to Aircraft nor any of the transactions
relative to Aircraft contemplated by this Lease, require the
consent or approval of the Federal Aviation Administration,
except for notice pursuant to Federal Aviation Administration
Regulation 91.23 (14 C.F.R. 91.23).
(j) Accuracy of Appraisal. The information contained in
any appraisal report furnished by the Lessee to the Lessor with
respect to any Parcel of Property or Unit of Equipment is
accurate and complete in all material respects.
(k) Compliance with Legal Requirements and Insurance
Requirements. The operation, use and physical condition of the
Property and Equipment are in full compliance with all Legal
Requirements and Insurance Requirements, except any Legal
Requirements, the non-compliance with which, individually or in
the aggregate, (i) will not place either the Lessor or any
Assignee in any danger of civil liability for which the Lessor or
any Assignee is not adequately indemnified (the Lessee's
obligations under Section 11 of this Lease shall be deemed to be
adequate indemnification if no Event of Default exists and if
such civil liability is reasonably likely to be less than
$1,000,000 in the aggregate) or subject the Lessor or any
Assignee to any criminal liability as a result of failure to
comply therewith, (ii) will not result in a material diminution
in the value of any Property or Equipment and (iii) is consistent
with prudent business practices.
(l) Liens. No Property or Equipment is subject to any
Lien, except Permitted Liens.
(m) Agreement for Lease. The Property acquired and built
pursuant to the Agreement for Lease was acquired and built in
accordance with the terms of the Agreement for Lease. The
representations and warranties of the Lessee, as agent, in the
Agreement for Lease are true and correct in all material
respects.
(n) ERISA. The Lessee has not established and does not
maintain or contribute to any employee benefit plan that is
covered by Title IV of the Employee Retirement Income Security
Act of 1974, as amended, from time to time.
SECTION 3. LEASE OF PROPERTY OR EQUIPMENT.
(a) Subject to the terms and conditions hereof, the Lessor
shall lease to the Lessee, and the Lessee may lease from the
Lessor pursuant to this Lease, any Property or Equipment, when
and as the Lessee has need of such Property or Equipment;
provided, that:
(i) such Property or Equipment is available for
purchase;
(ii) except with respect to any Parcel of Property
acquired and built pursuant to the Agreement for
Lease, the Lessor has approved the purchase order
or acquisition with respect to such Equipment or
the acquisition with respect to such Property
(which approval shall be in the sole discretion of
the Lessor);
(iii) at the time any such Property or Equipment is
to be ordered or leased hereunder there exists no
Event of Default or Potential Default;
(iv) with respect to any Property acquired and built
pursuant to the Agreement for Lease, Substantial
Completion (as defined in the Agreement for Lease)
shall have occurred; and
(v) the sum of (A) the Acquisition Cost of such
Property or Equipment and (B) the aggregate
Adjusted Acquisition Cost of all other Property or
Equipment leased hereunder would not, at the time
any such Property or Equipment is to be leased
hereunder, exceed such amount as the Lessor and
the Lessee may from time to time agree.
(b) The lease hereunder of each Parcel of Property and
related Units of Equipment acquired and built pursuant to the
Agreement for Lease shall be evidenced by an AFL Unit Leasing
Record. Subject to the terms of paragraph (a) of Section 3
hereof, upon Substantial Completion (as defined in the Agreement
for Lease) of a Parcel or Parcels of Property acquired and built
pursuant to the Agreement for Lease, the Lessee shall prepare an
AFL Unit Leasing Record. The AFL Unit Leasing Record shall give
a full description of the Property (and the Equipment included
therein), the Acquisition Cost thereof, the Initial Term,
Extended Term and Renewal Term of the Property and Equipment
included therein, the Monthly Rent Component with respect to such
Property, and such other details as the Lessor and the Lessee may
from time to time agree. Each AFL Unit Leasing Record that
relates to Pork Production Facilities or Poultry Production
Facilities shall identify specifically the Pork Production
Facility Equipment or the Poultry Production Facility Equipment,
as the case may be, to be used at such Pork Production Facility
or such Poultry Production Facility, as the case may be. Within
five (5) Business Days of the Lessor's receipt of the Certificate
of Substantial Completion relating to a Parcel or Parcels of
Property to be leased hereunder, satisfaction of the other
requirements of the Agreement for Lease and receipt of a
completed and executed AFL Unit Leasing Record, the Lessor shall
execute the AFL Unit Leasing Record and deliver it to the Lessee.
The AFL Unit Leasing Record shall have an Effective Date of the
date of execution by the Lessor of the AFL Unit Leasing Record.
Execution and delivery by the Lessee of an AFL Unit Leasing
Record shall constitute (i) acknowledgment by the Lessee that the
Property and Equipment, if any, specified in such AFL Unit
Leasing Record has been delivered to the Lessee in good condition
and has been accepted for lease hereunder by the Lessee as of the
Effective Date of such AFL Unit Leasing Record, (ii)
acknowledgment by the Lessee that the Property and Equipment, if
any, specified in such AFL Unit Leasing Record is subject to all
of the covenants, terms and conditions of this Lease, and (iii)
certification by the Lessee that the representations and
warranties contained in Section 2 of this Lease are true and
correct on and as of the Effective Date of such AFL Unit Leasing
Record as though made on and as of such date and that there
exists on such date no Event of Default or Potential Default.
(c) The lease of each Parcel of Property, other than a
Parcel of Property acquired and built pursuant to the Agreement
for Lease, or Unit of Equipment to the Lessee under this Lease
shall be evidenced by a Unit Leasing Record. The Lessee shall
prepare and execute a Unit Leasing Record with respect to each
Parcel of Property or Unit of Equipment (which Unit Leasing
Record may relate to more than one Unit of Equipment) and deliver
it promptly to the Lessor. Contemporaneously with the payment
required by paragraph (b) of Section 5 hereof, the Lessor shall
execute the acceptance of such Unit Leasing Record and promptly
return one copy of such Unit Leasing Record to the Lessee.
(d) The Lessee shall prepare each Unit Leasing Record
pursuant to the procedures provided by the Lessor. Each Unit
Leasing Record shall give a full description of the Parcel or
Parcels of Property or Unit or Units of Equipment covered
thereby, the Acquisition Cost of each such Parcel or Unit, the
Initial Term, Extended Term and Renewal Term for each such Parcel
or Unit, the Monthly Rent Component with respect to each such
Parcel or Unit, its location and such other details as the Lessor
and the Lessee may from time to time agree. Any Unit Leasing
Record relating to Equipment which is Pork Production Facility
Equipment or Poultry Production Facility shall identify the Pork
Production Facility or the Poultry Production Facility, as the
case may be, at which such Pork Production Facility Equipment or
such Poultry Production Facility Equipment, as the case may be,
is to be used.
(e) Execution by the Lessee of a Unit Leasing Record shall
constitute (i) acknowledgment by the Lessee that the Property or
Equipment specified in such Unit Leasing Record has been
delivered to the Lessee in good condition and has been accepted
for lease hereunder by the Lessee as of the Effective Date, (ii)
acknowledgment by the Lessee that the Property or Equipment
specified in such Unit Leasing Record is subject to all of the
covenants, terms and conditions of this Lease, and (iii)
certification by the Lessee that the representations and
warranties contained in Section 2 of this Lease are true and
correct on and as of the Effective Date as though made on and as
of the Effective Date and that there exists on the Effective Date
no Event of Default or Potential Default.
(f) In connection with any Parcel of Property acquired and
built pursuant to the Agreement for Lease, within three (3)
months of the Effective Date of such Parcel, the Lessee may
deliver to the Lessor a Certificate of Increased Cost (as defined
in the Agreement for Lease) pursuant to the Agreement for Lease
setting forth the actual amount expended by the Lessee for items
included in the Unit Budget (as defined in the Agreement for
Lease) with respect to such Parcel while it was subject to the
Agreement for Lease. If, based upon such Certificate of
Increased Cost, a Completion Advance (as defined in the Agreement
for Lease) is to be made, the Lessor shall execute within five
(5) days of receipt of such Certificate of Increased Cost from
the Lessee a revised AFL Unit Leasing Record to amend the
Adjusted Acquisition Cost for such Parcel to reflect the increase
in the Acquisition Cost.
SECTION 4. OPERATING LEASE.
The Lessor and the Lessee hereby declare that it is their
mutual intent that for accounting and regulatory purposes this
Lease be treated as an operating lease and not an instrument or
evidence of indebtedness, and that the relationship between the
Lessor and the Lessee under this Lease shall be that of lessor
and lessee only. Title to and ownership of any Property or
Equipment shall at all times remain in the Lessor and at no time
become vested in the Lessee except in accordance with an express
provision of this Lease. The Lessee does not hereby acquire any
right, equity, title or interest in or to any Property or
Equipment except pursuant to the terms hereof.
SECTION 5. DELIVERY.
(a) The Lessee shall acquire or order and accept Property,
other than Property acquired and built pursuant to the Agreement
for Lease, or Equipment pursuant to the procedures provided by
the Lessor. The Lessor shall not be liable to the Lessee for any
failure to obtain, or delay in obtaining, any Property or
Equipment or any delay in the delivery of title to the Lessor or
possession of the Property or Equipment to the Lessee.
(b) Upon acceptance for lease of a Parcel of Property,
other than Property acquired and built pursuant to the Agreement
for Lease, or Unit of Equipment by the Lessee and the Lessor and
receipt by the Lessor of (i) the vendor's invoice or invoices for
such Unit of Equipment and a contract of sale and deed with
respect to each Parcel of Property, (ii) invoices or other
evidence satisfactory to the Lessor for any amounts included in
the Acquisition Cost of such Parcel or Unit payable to parties
other than the vendor, (iii) invoices or other evidence
satisfactory to the Lessor (including an appraisal with respect
to a Parcel of Property or Unit of Equipment) for any amounts
included in the Acquisition Cost of such Parcel or Unit that have
been paid to the vendor or other parties by the Lessee and for
any costs included in the Acquisition Cost of such Parcel or Unit
incurred by the Lessee, (iv) with respect to each Parcel of
Property, an ALTA form title insurance commitment from a title
insurance company satisfactory to the Lessor, subject to no title
exceptions other than those approved by the Lessor, (v) a Unit
Leasing Record with respect to such Parcel or Unit prepared and
duly executed by the Lessee, (vi) in the case of the Aircraft,
(1) a letter, certificate or other evidence satisfactory to the
Lessor as to the due compliance with the insurance provisions of
Section 10 of this Lease, (2) an opinion of counsel to the Lessee
with respect to matters, if any, requested by the Lessor, (3) an
AC Form 8050-2 Xxxx of Sale (or such other form of xxxx of sale
as may be approved by the Federal Aviation Administration on the
Effective Date for the Aircraft) covering the Aircraft, executed
by the owner of the Aircraft in favor of the Lessor, (4) evidence
satisfactory to the Lessor that application for registration of
the Aircraft in the name of the Lessor has been duly made with
the Federal Aviation Administration and (5) evidence satisfactory
to the Lessor that the Aircraft has been certificated by the
Federal Aviation Administration with an appropriate airworthiness
certificate and such certificate is in full force and effect and
(vii) such other documentation as the Lessor may reasonably
require, the Lessor shall (A) pay to such vendor the amount of
the vendor's invoice or invoices and/or contract of sale for such
Parcel or Unit except to the extent previously paid by the
Lessee, (B) pay to such other parties such amounts payable,
except to the extent previously paid by the Lessee and (C)
reimburse or pay to the Lessee for such amounts paid to the
vendor or other parties by the Lessee, for such costs incurred by
the Lessee and, if agreed between the Lessor and the Lessee, for
the appraised value of the Property or Equipment; provided,
however, that in no event shall the sum of all payments made
pursuant to clauses (A), (B) and (C) above exceed the Acquisition
Cost of such Property or Equipment.
(c) The requirements for acceptance for lease hereunder of
the Property acquired and built pursuant to the Agreement for
Lease shall be the requirements set forth in the Agreement for
Lease.
(d) The Lessee shall ensure that the installation or
erection of any Equipment is in accordance with the
specifications and requirements of the vendor thereof.
(e) The obligations of the Lessee to pay all amounts
payable pursuant to this Lease (including specifically and
without limitation amounts payable under Sections 7 and 11
hereof) shall be absolute and unconditional under any and all
circumstances of any character, and such amounts shall be paid
without notice, demand, defense, setoff, deduction or
counterclaim and without abatement, suspension, deferment,
diminution or reduction of any kind whatsoever, except as herein
expressly otherwise provided. The obligation of the Lessee to
lease and pay Basic Rent for any and all Property or Equipment
accepted for use pursuant to this Lease is without any warranty
or representation, express or implied, as to any matter
whatsoever on the part of the Lessor or any Assignee or any
Affiliate of either, or anyone acting on behalf of any of them.
THE LESSEE HAS SELECTED AND SHALL SELECT ALL PROPERTY OR
EQUIPMENT ACQUIRED OR ORDERED ON THE BASIS OF ITS OWN JUDGMENT.
NEITHER THE LESSOR NOR ANY ASSIGNEE NOR ANY AFFILIATE OF EITHER,
NOR ANYONE ACTING ON BEHALF OF ANY OF THEM MAKES ANY
REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER, EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, AS TO THE SAFETY, TITLE,
CONDITION, QUALITY, QUANTITY, FITNESS FOR USE, MERCHANTABILITY,
CONFORMITY TO SPECIFICATION, OR ANY OTHER CHARACTERISTIC, OF ANY
PROPERTY OR EQUIPMENT, OR AS TO WHETHER ANY PROPERTY OR EQUIPMENT
OR THE OWNERSHIP, USE, OCCUPANCY OR POSSESSION THEREOF COMPLIES
WITH ANY LAWS, RULES, REGULATIONS OR REQUIREMENTS OF ANY KIND.
AS BETWEEN THE LESSEE AND THE LESSOR, ANY ASSIGNEE OR ANY
INDEMNIFIED PERSON, THE LESSEE ASSUMES ALL RISKS AND WAIVES ANY
AND ALL DEFENSES, SET-OFFS, DEDUCTIONS, COUNTERCLAIMS (OR OTHER
RIGHTS), EXISTING OR FUTURE, AS TO THE LESSEE'S OBLIGATION TO PAY
BASIC RENT AND ALL OTHER AMOUNTS PAYABLE HEREUNDER, INCLUDING,
WITHOUT LIMITATION, ANY RELATING TO:
(A) THE SAFETY, TITLE, CONDITION, QUALITY, QUANTITY,
FITNESS FOR USE, MERCHANTABILITY, CONFORMITY TO SPECIFICATION, OR
ANY OTHER QUALITY OR CHARACTERISTIC OF ANY PROPERTY OR EQUIPMENT,
LATENT OR NOT;
(B) ANY SET-OFF, COUNTERCLAIM, RECOUPMENT, ABATEMENT,
DEFENSE OR OTHER RIGHT WHICH THE LESSEE MAY HAVE AGAINST THE
LESSOR, ANY ASSIGNEE OR ANY INDEMNIFIED PERSON FOR ANY REASON
WHATSOEVER ARISING OUT OF THIS OR ANY OTHER TRANSACTION OR
MATTER;
(C) ANY DEFECT IN TITLE OR OWNERSHIP OF PROPERTY OR
EQUIPMENT OR ANY TITLE ENCUMBRANCE NOW OR HEREAFTER EXISTING WITH
RESPECT TO THE PROPERTY OR EQUIPMENT;
(D) ANY FAILURE OR DELAY IN DELIVERY OR ANY LOSS, THEFT OR
DESTRUCTION OF, OR DAMAGE TO, ANY PROPERTY OR EQUIPMENT, IN WHOLE
OR IN PART, OR CESSATION OF THE USE OR POSSESSION OF ANY PROPERTY
OR EQUIPMENT BY THE LESSEE FOR ANY REASON WHATSOEVER AND OF
WHATEVER DURATION, OR ANY CONDEMNATION, CONFISCATION,
REQUISITION, SEIZURE, PURCHASE, TAKING OR FORFEITURE OF ANY
PROPERTY OR EQUIPMENT, IN WHOLE OR IN PART;
(E) ANY INABILITY OR ILLEGALITY WITH RESPECT TO THE USE,
OWNERSHIP, OCCUPANCY OR POSSESSION OF THE PROPERTY OR EQUIPMENT
BY THE LESSEE;
(F) ANY INSOLVENCY, BANKRUPTCY, REORGANIZATION OR SIMILAR
PROCEEDING BY OR AGAINST THE LESSEE OR THE LESSOR OR ANY
ASSIGNEE;
(G) ANY FAILURE TO OBTAIN, OR EXPIRATION, SUSPENSION OR
OTHER TERMINATION OF, OR INTERRUPTION TO, ANY REQUIRED LICENSES,
PERMITS, CONSENTS, AUTHORIZATIONS, APPROVALS OR OTHER LEGAL
REQUIREMENTS;
(H) THE INVALIDITY OR UNENFORCEABILITY OF THIS LEASE OR ANY
OTHER INFIRMITY HEREIN OR ANY LACK OF POWER OR AUTHORITY OF THE
LESSOR OR THE LESSEE TO ENTER INTO THIS CONTRACT;
(I) THE INVALIDITY OR UNENFORCEABILITY OF ANY XXXX OF SALE
OF ANY PROPERTY OR EQUIPMENT EXECUTED IN CONNECTION WITH THIS
LEASE OR ANY OTHER INFIRMITY THEREIN OR LACK OF POWER OR
AUTHORITY OF ANY PARTY THERETO TO ENTER INTO SUCH XXXX OF SALE;
OR
(J) ANY OTHER CIRCUMSTANCES OR HAPPENING WHATSOEVER,
WHETHER OR NOT SIMILAR TO ANY OF THE FOREGOING.
THE LESSEE HEREBY WAIVES, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHTS WHICH IT MAY NOW HAVE OR WHICH
AT ANY TIME HEREAFTER MAY BE CONFERRED UPON IT, BY STATUTE OR
OTHERWISE, TO TERMINATE, CANCEL, QUIT, RESCIND OR SURRENDER THIS
LEASE EXCEPT IN ACCORDANCE WITH THE EXPRESS TERMS HEREOF. Each
payment of Basic Rent, Additional Rent and any other amount due
hereunder made by the Lessee shall be final, and the Lessee,
without waiving any other remedies it may have, will not seek or
have any right to recover all or any part of such payment from
the Lessor or any Assignee for any reason whatsoever. The making
of payments under this Lease by the Lessee (including without
limitation payments pursuant to Section 11 hereof) shall not be
deemed to be a waiver of any claim or claims that the Lessee may
assert against the Lessor or any other Person. The Lessor agrees
to repay the Lessee amounts paid to the Lessor to the extent such
payments were in error and are not required by any of the terms
and provisions of this Lease.
(f) Notwithstanding any other provision contained in this
Lease, it is specifically understood and agreed that neither the
Lessor nor any Assignee nor any Affiliate of either, nor anyone
acting on behalf of any of them makes any warranties or
representations, or has any responsibility or duty, nor, except
as set forth in Section 22 of this Lease, has the Lessor or any
Assignee or any Affiliate of either, or anyone acting on behalf
of any of them made any covenants or undertakings, as to the
accounting treatment to be accorded the Lessee or as to the U.S.
Federal or any state income or any other tax consequences, if
any, to the Lessee as a result of or by virtue of the
transactions contemplated by this Lease.
(g) In the event the title insurance policy insuring the
Lessor's interest in any Parcel of Property would not, in the
absence of special insurance by the Lessee, become effective
until the date of recordation of the deed, then the Lessee shall
furnish such indemnity to the title insurance company as it shall
require in order to insure the Lessor's interest in such Parcel
of Property, effective as of the Effective Date.
SECTION 6. INITIAL TERM; EXTENDED TERM.
(a) The "Initial Term" with respect to any Parcel of
Property or Unit of Equipment leased hereunder shall commence on
the Effective Date set forth in the Unit Leasing Record or the
AFL Unit Leasing Record for such Parcel of Property or Unit of
Equipment and shall continue for any partial first calendar month
plus the number of calendar months set forth opposite such Parcel
of Property or type of Equipment under the heading "Initial Term"
in Exhibit A hereto, unless terminated earlier pursuant to
Section 12, 13, 14, 15, 16, 19 or 20 hereof. Notwithstanding the
preceding sentence, if any Ground Lease is terminated prior to
the expiration of the then current term of such Ground Lease,
then, as provided in paragraph (d) of Section 29 hereof, the
lease of any Parcel of Property subject to such Ground Lease
shall terminate on the date of termination of such Ground Lease
and all of the other terms and provisions of paragraph (d) of
Section 29 hereof shall apply to such termination.
(b) The "Extended Term" with respect to any Parcel of
Property or Unit of Equipment shall commence on the first day of
the calendar month following the last day of the Initial Term of
such Parcel or Unit and shall continue for the number of calendar
months set forth opposite such Parcel of Property or type of
Equipment under the heading "Extended Term" in Exhibit A hereto
and specified in the Unit Leasing Record or the AFL Unit Leasing
Record for such Parcel of Property or Unit of Equipment, unless
terminated earlier pursuant to Section 12, 13, 14, 15, 16, 19 or
20 hereof; provided that, in the case of Pork Production Facility
Equipment and Poultry Production Facility Equipment, in certain
circumstances set forth in Exhibit A hereto, the Extended Term
with respect to such Pork Production Facility Equipment or such
Poultry Production Facility Equipment, as the case may be, shall
commence on the Effective Date set forth in the Unit Leasing
Record relating to such Unit of Pork Production Facility
Equipment or such Unit of Poultry Production Facility Equipment,
as the case may be. Notwithstanding the preceding sentence, if
any Ground Lease is terminated prior to the expiration of the
then current term of such Ground Lease, then, as provided in
paragraph (d) of Section 29 hereof, the lease of any Parcel of
Property subject to such Ground Lease shall terminate on the date
of termination of such Ground Lease and all of the other terms
and provisions of paragraph (d) of Section 29 hereof shall apply
to such termination.
(c) With respect to each Unit of Equipment or Parcel of
Property, it is understood and agreed that the Initial Term of
each Parcel of Property or Unit of Equipment shall in no event
exceed 75% of its economic useful life.
(d) Notwithstanding anything contained in this Section 6,
the provisions of Sections 10 and 11 hereof and paragraph (a) of
Section 15 hereof shall apply with respect to any Property or
Equipment from the time such Property or Equipment is ordered by
the Lessee, with the approval of the Lessor, pursuant to
procedures supplied by the Lessor.
SECTION 7. RENT AND OTHER PAYMENTS.
(a) The Lessee hereby agrees to pay the Lessor (i) on each
Basic Rent Payment Date, Basic Rent for the calendar month (or
part thereof) in which such Basic Rent Payment Date falls, with
respect to each Parcel of Property or Unit of Equipment leased
during any part of such calendar month hereunder for which the
Effective Date is before the Lease Rate Date for such calendar
month, and (ii) on the Basic Rent Payment Date in the next
succeeding calendar month, Basic Rent for any partial first
calendar month, with respect to each Parcel of Property or Unit
of Equipment for which the Effective Date is on or after the
Lease Rate Date for such calendar month.
(b) The Lessor shall furnish to the Lessee on the 16th day
of each calendar month the percentage referred to in paragraph
(a)(iii) of the definition of "Basic Rent" in Section 1 hereof
for such calendar month, or, if such day is not a Business Day,
on the next succeeding Business Day (the "Lease Rate Date").
Prior to each Basic Rent Payment Date the Lessor shall furnish
the Lessee with a summary of the calculations of Basic Rent
payable on such Basic Rent Payment Date.
(c) The Lessee hereby agrees to pay on demand all amounts
(other than Basic Rent) payable hereunder including, without
limitation, all amounts payable to any Indemnified Person
pursuant to Section 11 hereof.
(d) Without prejudice to the full exercise by the Lessor of
its rights under Sections 18 and 19 hereof, the Lessee shall pay
to the Lessor from time to time, on demand, as additional rent
("Additional Rent") (i) amounts required to reimburse the Lessor
for its obligations, costs and expenses (not previously included
in Basic Rent) incurred in acquiring, financing (including equity
financing) and leasing the Property or Equipment (including,
without limitation, all obligations of the Lessor under or in
respect of any interest rate swap, cap, collar or other financial
hedging arrangement and any amounts payable by the Lessor under
any such arrangement to reduce the notional amount thereof by the
amount of any prepayment of any borrowing to which such interest
rate swap, cap, collar or other financial hedging arrangement
relates), and (ii) to the extent legally enforceable, an amount
computed by multiplying (A) all sums not paid by the Lessee to
the Lessor as provided in this Lease on or before the date such
payments are due, by (B) the decimal equivalent of the percentage
referred to in paragraph (a)(iii) of the definition of "Basic
Rent" as most recently furnished by the Lessor, and by (C) a
fraction having a numerator equal to the number of days in the
period from but excluding such due date to and including the date
of payment thereof and a denominator of 365, or in a leap year,
366. The Lessee shall also pay to the Lessor on demand an amount
equal to any expenses incurred by the Lessor in collecting such
unpaid sums.
(e) Basic Rent and Additional Rent and any other amount
payable by the Lessee to the Lessor shall be paid such that
immediately available funds in the full amount due are available
on the date due, to the account of the Lessor at such bank, or to
such account of such other Person at such bank, or otherwise as
the Lessor may from time to time designate.
(f) During the Lease Term of any Parcel of Property or Unit
of Equipment, the Lessor shall calculate, on each Lease Rate Date
(except the first Lease Rate Date hereunder), the difference, if
any, between (i) the Variable Component of Basic Rent paid by the
Lessee for the previous calendar month and (ii) an amount equal
to what the Variable Component of Basic Rent would have been for
such calendar month had the Variable Component of Basic Rent been
calculated using the weighted average bond yield equivalent
percentage cost per annum on all Commercial Paper of the Lessor
outstanding at any time or the weighted average percentage cost
per annum of other borrowings outstanding at any time or a
blended rate if both Commercial Paper and other borrowings are
outstanding at any time (as specified in clauses (A), (B) and
(C), respectively, in subparagraph (a)(iii) of the definition of
Basic Rent) during the previous calendar month (rather than
during the applicable Computation Period); provided, that with
respect to the Variable Component of Basic Rent for the last
month of the Lease Term, such calculation shall occur on the last
day of the Lease Term. On or about August 16, 1995 (or such
other date that the Lessor so chooses), and thereafter on or
about August 16 of each year, and on the last day of the Lease
Term, the Lessor shall furnish to the Lessee a calculation of the
aggregate difference between the amounts determined under clause
(i) above and the correlating amounts determined under clause
(ii) above (the "Reconciliation Amount") for each calendar month
since the date of this Lease or each calendar month since the
last time the Reconciliation Amount was calculated, whichever is
later. The Lessor and the Lessee agree that if the
Reconciliation Amount is a positive number, then such amount
shall be credited against the amount of Basic Rent that the
Lessee is required to pay on the next Basic Rent Payment Date (or
Basic Rent Payment Dates, if such amount shall exceed the amount
of Basic Rent payable in the next succeeding month), and if the
Reconciliation Amount is a negative number, then such amount
shall be payable by the Lessee on the next Basic Rent Payment
Date in addition to the amount of Basic Rent due and payable on
such Basic Rent Payment Date, except that with respect to the
Reconciliation Amount computed on the last day of the Lease Term,
such amount shall be paid by the Lessor to the Lessee (in the
case of a positive number) or by the Lessee to the Lessor (in the
case of a negative number) on the last day of the Lease Term.
Any notices required by this paragraph (f) which are furnished to
the Lessee by the Lessor shall be conclusive, absent manifest
error, as to the contents thereof.
SECTION 8. RESTRICTED USE; COMPLIANCE WITH LAWS.
(a) So long as no Event of Default shall have occurred and
be continuing, the Lessee may use the Property or Equipment in
the regular course of its business for any lawful purpose. The
Lessee will not do or permit any act or thing which might impair,
other than in the normal use thereof, the value or usefulness of
any Property or Equipment.
(b) The Lessee shall promptly and duly execute, deliver,
file and record, at the Lessee's expense, all such documents,
statements, filings and registrations, and take such further
action, as the Lessor shall from time to time reasonably request
in order to establish, perfect and maintain the Lessor's title to
and interest in the Property or Equipment and any Assignee's
interest in this Lease or any Property or Equipment as against
the Lessee or any third party in any applicable jurisdiction.
The Lessee may, after notice in writing to the Lessor and at the
Lessee's own cost and expense, change the place of principal
location of any Equipment; provided, that prior notice shall not
be required in the case of Equipment used for transportation
(such as, without limitation, automobiles and trucks), but in
such event the Lessee shall notify the Lessor in writing of the
change of the principal location of such transportation Equipment
not later than thirty (30) days after such change is made; and
provided further, that (A) all Pork Production Facility Equipment
will be principally located at a Pork Production Facility and all
Poultry Production Facility Equipment will be principally located
at a Poultry Production Facility and (B) the Lessee will not
change the principal location of any Pork Production Facility
Equipment or any Poultry Production Facility Equipment until
notice of such change in location has been provided to the
Lessor. Notwithstanding the foregoing, no change of location
shall be undertaken unless and until all Legal Requirements shall
have been met. At the request of the Lessor, the Lessee shall
promptly advise the Lessor in writing where all Equipment leased
hereunder as of such date is principally located.
(c) The Lessee shall use every reasonable precaution to
prevent loss or damage to Property or Equipment and to prevent
injury to third persons or property of third persons. The Lessee
shall cooperate fully with the Lessor and all insurance companies
providing insurance pursuant to Section 10 hereof in the
investigation and defense of any claims or suits arising from the
ownership, operation or use of any Equipment or ownership, use,
or occupancy of the Property; provided, that nothing contained in
this paragraph (c) shall be construed as imposing on the Lessor
any duty to investigate or defend any such claims or suits. The
Lessee shall comply and shall cause all Persons using or
operating Equipment or using or occupying Property to comply with
all Insurance Requirements and Legal Requirements applicable to
such Property or Equipment and to the acquiring, titling,
registering, leasing, insuring, using, occupying, operating and
disposing of Property or Equipment, and the licensing of
operators thereof.
(d) Upon reasonable prior notice and compliance with such
procedures as the Lessee may reasonably request to ensure
security, the Lessor or any Assignee or any authorized
representative of either may during reasonable business hours
from time to time inspect Property or Equipment and deeds,
registration certificates, certificates of title and related
documents covering Property or Equipment wherever the same may be
located, but neither the Lessor nor any Assignee shall have any
duty to make any such inspection.
(e) The Lessee shall not, without the prior written consent
of the Lessor, permit, or suffer to exist, any Lien, including
mechanics' liens, other than Permitted Liens or those Liens
placed thereon by, or arising from, the Lessor's own actions or
which are subject to a Permitted Contest, nor may it assign any
right or interest herein or in any Property or Equipment. The
Lessee shall not, without the prior written consent of the
Lessor, sublease or otherwise relinquish possession of any
Property or Equipment, except that (i) the Lessee may relinquish
possession of Property or Equipment to any contractor for use in
performing work for the Lessee on such Property or Equipment;
provided, that such relinquishment of possession shall in no way
affect the obligations of the Lessee or the rights of the Lessor
hereunder and with respect to the Property or Equipment and (ii)
the Lessee may sublease any Parcel of Property or Unit of
Equipment; provided, that (A) the terms of the instrument of
sublease and, unless the sublease shall be to an Affiliate of the
Lessee which is a wholly owned subsidiary of the Lessee, the
identity of the sublessee shall be subject to the prior written
approval of the Lessor and any Assignee, which approval shall not
be unreasonably withheld or delayed, (B) each such sublease shall
expressly be made subject and subordinate to the provisions
hereof and shall, at the sole option of the Lessor, by its terms
be subject to termination upon the termination for any reason of
this Lease, (C) no such sublease shall modify or limit any right
or power of the Lessor hereunder or affect or reduce any
obligation of the Lessee hereunder, and all such obligations
shall continue in full force and effect as obligations of a
principal and not of a guarantor or surety, as though no such
subletting had been made, and (D) any such sublease made
otherwise than as expressly permitted by this paragraph (e) shall
be void and of no force and effect. As additional security to
the Lessor for the performance of the Lessee's obligations under
this Lease, the Lessee hereby assigns to the Lessor all of its
right, title and interest in and to all subleases permitted
hereby and agrees to cause any sublessee to enter into attornment
agreements with the Lessor as the Lessor shall request. The
Lessor shall have the present and continuing right to collect and
enjoy all rents and other sums of money payable under any such
sublease, and the Lessee hereby irrevocably assigns such rents
and other sums to the Lessor for the benefit and protection of
the Lessor; provided, that unless an Event of Default shall have
occurred and be continuing hereunder, the Lessee shall be
entitled to collect and enjoy such rents and other sums. The
Lessee shall, within thirty (30) days after the execution of any
such sublease, deliver a conformed copy thereof to the Lessor.
Nothing contained in this Lease shall be construed as
constituting the consent or request of the Lessor, express or
implied, to or for the performance by any contractor, laborer,
materialman or vendor of any labor or services or for the
furnishing of any materials for any construction, alteration,
addition, repair or demolition of or to any Property or Equipment
or any part thereof. Notice is hereby given that the Lessor will
not be liable for any labor, services or materials furnished or
to be furnished to the Lessee, or to anyone holding any Property
or Equipment or any part thereof through or under the Lessee, and
that no mechanics' or other liens for any such labor, services or
materials shall attach to or affect the interest of the Lessor in
and to the Property or Equipment.
(f) The Lessee shall register and title all automotive
Equipment in the name of the Lessor except that, where required
or permitted by law or regulation, Equipment may, with the
written approval of the Lessor be registered (but not titled) in
the name of the Lessee. If requested by the Lessor, the Lessee
shall cause one of its officers to hold in his custody and
control all registration certificates and certificates of title
covering automotive Equipment, as custodian for the Lessor. The
Lessee agrees to cause such officer to furnish to the Lessor,
upon reasonable request, a certificate to the effect that all
registration certificates and certificates of title pursuant to
any Legal Requirement have been obtained and are being held on
behalf of the Lessor.
(g) On or prior to the pertinent Effective Date, the Lessee
shall affix or cause to be affixed to each Unit of Equipment,
except for motor vehicles in states with documents of title, in
the place designated by the Lessor (or, if no such place shall
have been designated, in a prominent place), labels, plates or
other markings stating that such Unit of Equipment is owned by
the Lessor. The Lessee shall not without the prior permission of
the Lessor change or remove (or permit to be changed or removed
or otherwise permit a decrease in the visibility of) any insignia
or lettering which is on any Equipment at the time of delivery
thereof or which is thereafter placed thereon indicating the
Lessor's ownership thereof.
(h) If any Lien or charge of any kind or any judgment,
decree or order of any court or other governmental authority
(including, without limitation, any state or local tax lien
affecting the Property or Equipment), whether or not valid, shall
be asserted or entered which might interfere with the due and
timely payment of any sum payable or the exercise of any of the
rights or the performance of any of the duties or
responsibilities under this Lease, the Lessee shall, upon
obtaining knowledge thereof or upon receipt of notice to that
effect from the Lessor, promptly take such action as may be
necessary to prevent or terminate such interference.
(i) The Lessee, at its own cost and expense, shall
forthwith upon the Effective Date with respect to any Aircraft,
cause the Aircraft to be duly registered and at all times
thereafter to remain duly registered in the name of the Lessor,
as owner, except as may be otherwise required by the Federal
Aviation Act of 1958, as amended.
SECTION 9. MAINTENANCE, IMPROVEMENT AND REPAIR OF
PROPERTY OR EQUIPMENT.
(a) Upon request of the Lessee, the Lessor will, so long as
no Event of Default shall have occurred and be continuing, assign
or otherwise make available to the Lessee any and all rights the
Lessor may have under any vendor's or manufacturer's warranties
or undertakings with respect to any Property or Equipment.
(b) The Lessee shall pay all costs, expenses, fees and
charges incurred in connection with the ownership, use or
occupancy of any Parcel of Property or ownership, use and
operation of any Unit of Equipment. Except as otherwise provided
in Section 15 hereof, the Lessee shall at all times, at its own
expense, and subject to reasonable wear and tear, keep Property
or Equipment in good operating order, repair, condition and
appearance. The foregoing undertaking to maintain Property or
Equipment in good repair shall apply regardless of the cause
necessitating repair and regardless of whether the Lessee has
possession of the Property or Equipment, and as between the
Lessor and the Lessee all risks of damage to Property or
Equipment are assumed by the Lessee. With respect to any Parcel
of Property, the undertaking to maintain in good repair shall
include, without limitation, all interior and exterior repairs,
whether structural or nonstructural, foreseen or unforeseen,
ordinary or extraordinary and all common area maintenance
including, without limitation, removal of dirt, snow, ice,
rubbish and other obstructions and maintenance of sidewalks and
landscaping. The Lessee hereby agrees to indemnify and hold the
Lessor harmless from and against all costs, expenses, claims,
losses, damages, fines or penalties, including reasonable counsel
fees, arising out of or due to the Lessee's failure to fulfill
its obligations under this paragraph (b).
(c) With respect to any Parcel of Property, the Lessee
shall pay: (i) all taxes, assessments, levies, fees, water and
sewer rents and charges, and all other governmental charges,
general and special, ordinary and extraordinary, foreseen and
unforeseen, which are, at any time, imposed or levied upon or
assessed against (A) the Parcel, (B) any Basic Rent, any
Additional Rent or other sum payable hereunder or (C) this Lease,
the leasehold estate hereby created, or which arises in respect
of the ownership, operation, occupancy, possession or use of the
Parcel; (ii) all gross receipts or similar taxes (i.e., taxes
based upon gross income which fail to take into account all
customary deductions (e.g., ordinary operating expenses and
interest) relating to the Parcel) imposed or levied upon,
assessed against or measured by any Basic Rent, or any Additional
Rent or other sum payable hereunder; (iii) all sales, value
added, use and similar taxes at any time levied, assessed or
payable on account of the acquisition, leasing or use of the
Parcel; and (iv) all charges of utilities and communications
services serving the Parcel. The Lessee shall not be required to
pay any franchise, estate, inheritance, transfer, income or
similar tax of the Lessor (other than any tax referred to in
clause (ii) above) unless such tax is imposed, levied or assessed
in substitution for any other tax, assessment, charge or levy
which the Lessee is required to pay pursuant to this paragraph
(c); provided, however, that if at any time the method of
taxation shall be such that there shall be levied, assessed or
imposed on the Lessor a capital levy or other tax directly on the
rents received therefrom, or upon the value of any Parcel or any
present or any future improvement or improvements on any Parcel,
then all such taxes, assessments, levies or charges or the part
thereof so measured or based, shall be payable by the Lessee, but
only to the extent that such taxes would be payable if the
Property affected were the only property of the Lessor, and the
Lessee shall pay and discharge the same as herein provided. The
Lessee will furnish to the Lessor, promptly after demand
therefor, proof of payment of all items referred to above which
are payable by the Lessee. If any such assessments may legally
be paid in installments, the Lessee may pay such assessment in
installments.
(d) The Lessee shall not make any material alterations to
any Equipment without the prior written consent of the Lessor,
which consent shall not be unreasonably withheld or delayed. Any
improvements or additions to any Equipment shall become and
remain the property of the Lessor, except that any addition to
Equipment made by the Lessee shall remain the property of the
Lessee if it can be removed from such Equipment without impairing
the functioning of such Equipment or its resale value, excluding
such addition. Any improvements or additions which do not remain
property of the Lessee shall be evidenced by a revised Unit
Leasing Record.
(e) So long as no Event of Default shall have occurred and
be continuing, the Lessee may, at its expense, make additions to
and alterations to any Parcel of Property; provided, that upon
completion of such additions or alterations (i) neither the fair
market value of the Parcel of Property shall be lessened thereby
nor the condition of such Parcel of Property impaired, below the
value, utility or condition thereof immediately prior to such
action (assuming such Parcel of Property was then of a condition
and repair required to be maintained pursuant to paragraph (b) of
Section 9 hereof), (ii) such additions or alterations shall not
result in a change of use of such Parcel of Property, (iii) such
work shall be completed in a good and workmanlike manner and in
compliance with all applicable Legal Requirements and Insurance
Requirements and (iv) no exterior walls of any building or other
improvement constituting a part of a Parcel of Property shall be
demolished unless (A) the Lessee has made adequate provision
according to nationally recognized sound and prudent engineering
and architectural standards to preserve and maintain the
structural integrity of the Parcel of Property and for the
restoration of such Parcel of Property to a structurally sound
architectural whole and (B) if such addition or alteration costs
more than $100,000 the obligations of the Lessee to preserve,
maintain and restore are reasonably assured to the Lessor's
satisfaction. Any and all such additions and alterations shall
be and remain part of the Parcel of Property and shall be subject
to this Lease. Notwithstanding anything contained herein, the
Lessee shall not perform any addition or alteration to any Parcel
of Property which would have an estimated cost in excess of
$200,000 without the Lessor's prior written consent, which
consent may be conditioned upon, among other things, the Lessor's
approval of the plans and specifications for such additions and
alterations and the Lessee's furnishing of such security as the
Lessor may reasonably require to protect the Lessor against any
Liens or claims affecting the Property as a result of such
addition or alteration.
(f) The Pork Production Facility Equipment leased by the
Lessee shall be maintained, repaired, refurbished or replaced by
the Lessee when necessary in order to ensure that all Pork
Production Facility Equipment located at the Pork Production
Facilities will include the Pork Production Facility Equipment
listed on the AFL Unit Leasing Record with respect to such Pork
Production Facility or replacements for such Pork Production
Facility Equipment of the kind, quality and in the quantities
included in the AFL Unit Leasing Record with respect to the Pork
Production Facilities (provided that the Lessee may replace Pork
Production Facility Equipment at the Pork Production Facilities
with equipment of different kind, quality and in different
quantities if such replacement equipment is of equal or greater
value in the Lessor's good faith judgment and is included in the
FF&E Specifications (as defined in the Agreement for Lease)) for
Pork Production Facilities and will be in such condition and
sufficient to allow the Pork Production Facilities to be operated
in accordance with industry standards and in a manner and to
standards at least substantially equivalent to the operation of
Pork Production Facilities owned and operated by the Lessee. As
equipment is substituted at the Pork Production Facilities or
Pork Production Facility Equipment at the Pork Production
Facilities and subject to the Lease, title to such substitute
equipment shall automatically be transferred to the Lessor and
such equipment shall be subject to this Lease and title to the
existing Pork Production Facility Equipment at the Pork
Production Facilities for which such equipment is being
substituted shall be released by the Lessor. Any equipment
substituted at the Pork Production Facilities for Pork Production
Facility Equipment shall be deemed to have an Adjusted
Acquisition Cost equal to such Pork Production Facility Equipment
for which it is substituted.
(g) The Poultry Production Facility Equipment leased by the
Lessee shall be maintained, repaired, refurbished or replaced by
the Lessee when necessary in order to ensure that all Poultry
Production Facility Equipment located at the Poultry Production
Facilities will include the Poultry Production Facility Equipment
listed on the AFL Unit Leasing Record with respect to such
Poultry Production Facility or replacements for such Poultry
Production Facility Equipment of the kind, quality and in the
quantities included in the AFL Unit Leasing Record with respect
to the Poultry Production Facilities (provided that the Lessee
may replace Poultry Production Facility Equipment at the Poultry
Production Facilities with equipment of different kind, quality
and in different quantities if such replacement equipment is of
equal or greater value in the Lessor's good faith judgment and is
included in the FF&E Specifications (as defined in the Agreement
for Lease)) for Poultry Production Facilities and will be in such
condition and sufficient to allow the Poultry Production
Facilities to be operated in accordance with industry standards
and in a manner and to standards at least substantially
equivalent to the operation of Poultry Production Facilities
owned and operated by the Lessee. As equipment is substituted at
the Poultry Production Facilities for Poultry Production Facility
Equipment at the Poultry Production Facilities and subject to
this Lease, title to such substitute equipment shall
automatically be transferred to the Lessor and such equipment
shall be subject to this Lease and title to the existing Poultry
Production Facility Equipment at the Poultry Production
Facilities for which such equipment is being substituted shall be
released by the Lessor. Any equipment substituted at the Poultry
Production Facilities for Poultry Production Facility Equipment
shall be deemed to have an Adjusted Acquisition Cost equal to
such Poultry Production Facility Equipment for which it is
substituted.
(h) The Lessee, at its own cost and expense, shall: (i)
maintain, service, repair, overhaul and test the Aircraft (A) so
as to keep the Aircraft in operating condition as good as when
delivered to the Lessee hereunder, ordinary wear and tear
excepted, and (B) so as to keep the Aircraft in such operating
condition as may be necessary to enable the airworthiness
certification of the Aircraft to be maintained in good standing
at all times under the Federal Aviation Act of 1958, as amended,
except during such period or periods as the Aircraft is being
overhauled, maintained, serviced, repaired or tested; (ii)
maintain all records, logs and other materials required by the
Federal Aviation Administration to be maintained in respect of
the Aircraft; and (iii) promptly furnish to the Lessor such
notification and take such other action on the Lessor's behalf as
may be required to be filed by the Lessor with any governmental
authority because of the Lessor's interest in the Aircraft.
SECTION 10. INSURANCE.
(a) Public Liability Insurance with Respect to Equipment.
The Lessee will carry at its own expense public liability
insurance and property damage insurance with respect to all
Equipment (i) in amounts which are not less than the public
liability and property damage insurance applicable to similar
equipment owned, leased or held by the Lessee; provided, that in
no event shall such amounts be less than $15,000,000 per
occurrence, (ii) of the types usually carried by corporations
engaged in the same or a similar business, similarly situated
with the Lessee, and owning or operating similar equipment and
which cover risk of the kind customarily insured against by such
corporations, and (iii) which are maintained in effect with
insurers of recognized responsibility satisfactory to the Lessor.
The insurance required by this paragraph (a) may be subject to
such deductibles and the Lessee may self-insure with respect to
the required coverage only to the extent approved in writing by
the Lessor.
(b) Insurance Against Loss or Damage to Equipment. The
Lessee will maintain in effect with insurers of recognized
responsibility satisfactory to the Lessor, at its own expense,
physical damage insurance with respect to all Equipment, which is
of the type usually carried by corporations engaged in the same
or similar business, similarly situated with the Lessee, and
owning or operating similar equipment and which covers risk of
the kind customarily insured against by such corporations, and in
substantially the amount applicable to similar equipment owned,
leased or held by the Lessee; provided, that such insurance shall
at all times be in an amount not less than the aggregate Adjusted
Acquisition Cost of all Equipment. The insurance required by
this paragraph (b) may be subject to such deductibles and the
Lessee may self-insure with respect to the required coverage only
to the extent approved in writing by the Lessor.
(c) Insurance with respect to Property. The Lessee will
maintain or cause to be maintained insurance of the following
character, on each Parcel of Property:
(i) All risk insurance coverage against losses by fire
and lightning and other risks for the full
insurable replacement value of each Parcel of
Property, with agreed amount endorsement or
endorsements providing equivalent protection,
including loss by windstorm, flood, hail,
explosion, riot (including riot attending a
strike), civil commotion, aircraft, vehicles,
smoke damage, and vandalism and malicious
mischief, in amounts not less than the full
insurable replacement value of all buildings and
other improvements on each Parcel of Property, but
in no event less than the Adjusted Acquisition
Cost of each Parcel of Property. The term "full
insurable replacement value" as used herein means
the actual replacement cost, including the costs
of debris removal, but excluding the cost of
constructing foundation and footings.
(ii) Comprehensive general public liability insurance
covering the legal liability of the Lessor and the
Lessee against claims for bodily injury, death or
property damage, occurring on, in or about each
Parcel of Property or occurring as a result of
ownership of facilities located on each Parcel of
Property or as a result of the use of products or
materials manufactured, stored, processed,
constructed or sold, or services rendered, on each
Parcel of Property, in the minimum amount of
$15,000,000 with respect to any one occurrence,
accident or disaster or incidence of negligence.
(iii) The Lessee shall comply with applicable
workers' compensation laws of the states where
each Parcel of Property is located, and shall
maintain such insurance if and to the extent
necessary for such compliance.
(iv) Explosion insurance in respect of any boilers and
similar apparatus located on each Parcel in the
minimum amount of $250,000 or in such greater
amounts as are then customary for property similar
in use to each Parcel.
(v) Such other insurance, in such amounts and against
such risks, as is customarily maintained by
operators of similar properties.
The insurance required under this paragraph (c) shall be
maintained in effect with insurers of recognized responsibility
satisfactory to the Lessor. Such insurance may be subject to
such deductibles and the Lessee may self-insure with respect to
the required coverage only to the extent approved in writing by
the Lessor; provided that, with respect to flood insurance, the
Lessee may self-insure with respect to the required coverage in
an aggregate amount with respect to all Property not in excess of
$1,000,000.
Insurance claims by reason of damage or destruction to any
Parcel of Property shall be adjusted by the Lessee, subject to
the approval of the Lessor, which approval the Lessor agrees not
to unreasonably withhold or delay; provided, that if the amount
claimed exceeds $1,000,000 the Lessor may participate in such
adjustment, at the Lessee's expense.
(d) Public Liability and Property Damage Insurance with
Respect to Aircraft. The Lessee shall, at its own cost and
expense, procure or cause to be procured and maintain or cause to
be maintained, with insurers of recognized responsibility
satisfactory to the Lessor, public liability insurance with
respect to the Aircraft, covering both bodily personal injury and
damage to property (as to all Persons, including employees of the
Lessee or the Lessor). Policies covering bodily injury and
property damage shall provide for coverage in an amount which is
not less than the public liability and property damage insurance
usually carried with respect to aircraft similar to the Aircraft
by corporations of a similar size engaged in the same or similar
business and similarly situated with the Lessee; provided, that
such insurance shall at all times be in an amount not less than
$30,000,000 per occurrence.
(e) Insurance Against Loss or Damage to Aircraft. The
Lessee shall, at its own cost and expense, procure or cause to be
procured and maintain or cause to be maintained, with insurers of
recognized responsibility satisfactory to the Lessor, all risk
aircraft hull insurance with respect to the Aircraft, of the type
and in substantially the amounts usually carried by corporations
engaged in the same or similar business and similarly situated
with the Lessee; provided, that such insurance shall at all times
be in an amount not less than the Adjusted Acquisition Cost of
the Aircraft at such time.
(f) Additional Insureds; Notice. Any policies of insurance
carried in accordance with this Section 10 and any policies taken
out in substitution or replacement for any such policies (i)
shall name the Lessor, Xxxxxxx, Xxxxxxx Xxxxx, Xxxxxxx Leasing,
the general partner of the Lessor and its shareholders, officers
and directors, the limited partners of the Lessor, and each
Assignee as additional insureds, as their respective interests
may appear (but without imposing upon any such Person any
obligation imposed on the insured, including, without limitation,
the liability to pay the premium for any such policy), (ii) with
respect to insurance carried in accordance with the preceding
paragraphs (b), (c)(i), (c)(iv), (c)(v) and (e) shall name the
Assignee, if any, or the Lessor, if no Assignment has been made,
as loss payee, (iii) with respect to insurance carried in
accordance with the preceding paragraphs (b), (c) and (e), shall
provide that as against the Lessor the insurers shall waive any
rights of subrogation, (iv) shall provide that if the insurers
cancel such insurance for any reason whatsoever, or any
substantial change is made in the coverage or the same is allowed
to lapse for nonpayment of premium or such insurance coverage is
reduced, such cancellation, change, lapse or reduction shall not
be effective as to the Lessor, Xxxxxxx, Xxxxxxx Xxxxx, Xxxxxxx
Leasing, the general partner of the Lessor and its shareholders,
officers and directors, the limited partners of the Lessor, or
any Assignee for thirty (30) days after receipt by the Lessor,
Xxxxxxx, Xxxxxxx Xxxxx, Xxxxxxx Leasing, the general partner of
the Lessor and its shareholders, officers and directors, the
limited partners of the Lessor, or such Assignee, as the case may
be, of written notice by such insurers of such cancellation,
change, lapse or reduction, and (v) shall provide that in respect
of the interest of the Lessor, Xxxxxxx, Xxxxxxx Xxxxx, Xxxxxxx
Leasing, the general partner of the Lessor and its shareholders,
officers and directors, the limited partners of the Lessor, and
each Assignee in such policies the insurance shall not be
invalidated by any action or inaction of the Lessee or any other
Person (other than of the Lessor, Xxxxxxx, Xxxxxxx Xxxxx, Xxxxxxx
Leasing, the general partner of the Lessor and its shareholders,
officers and directors, the limited partners of the Lessor, or
any such Assignee in respect of its own interest) and shall
insure the interests of the Lessor, Xxxxxxx, Xxxxxxx Xxxxx,
Xxxxxxx Leasing, the general partner of the Lessor and its
shareholders, officers and directors, the limited partners of the
Lessor, and each such Assignee, as they appear, regardless of any
breach or violation of any warranties, declarations or conditions
contained in such policies by the Lessee or any other Person.
Each liability policy (A) shall be primary without right of
contribution from any other insurance which is carried by the
Lessor with respect to its interest as such in the Property or
Equipment and (B) shall expressly provide that all of the
provisions thereof, except the limits of liability, shall operate
in the same manner as if there were a separate policy covering
each insured.
(g) Application of Insurance Proceeds for Loss or Taking.
As between the Lessor and the Lessee it is agreed that any
insurance payments received as the result of the occurrence of
(i) any event of loss described in paragraph (c) of Section 15
hereof with respect to any Parcel of Property or Unit of
Equipment, or (ii) any event of Taking described in Section 16
hereof shall be paid to an account of the Lessor and disposed of,
as set forth in paragraph (c) of Section 15 hereof.
(h) Application of Insurance Proceeds for Other than Loss
or Taking. As between the Lessor and the Lessee, the insurance
proceeds of any property damage loss to any Property or Equipment
will be held in an account of the Lessor and applied in payment
(or to reimburse the Lessee) for repairs or replacement in
accordance with the terms of paragraph (b) of Section 15 hereof.
The Lessee shall be entitled (i) to receive the amounts so
deposited against certificates, invoices or bills satisfactory to
the Lessor, delivered to the Lessor from time to time as such
work or repair progresses, and (ii) to direct the investment of
the amounts so deposited as provided in paragraph (i) of this
Section 10. To the extent that the Lessor estimates that the
cost of such work or repair shall exceed the amount of proceeds,
the Lessee shall make adequate provisions for the payment
thereof, which provisions shall be acceptable to the Lessor. Any
moneys remaining in the aforesaid account after final payment for
repairs has been made shall be paid to the Lessee.
(i) Investment. The Lessor, at the Lessee's instruction,
may invest the amounts deposited with the Lessor pursuant to
paragraph (h) of this Section 10 in any investments permitted
under a Credit Agreement. Such investments shall mature in such
amounts and on such dates so that amounts shall be available on
the draw dates sufficient to pay the amounts requested by and due
to the Lessee. So long as no Event of Default has occurred and
is continuing, any interest earned on investments of such funds
shall be paid to the Lessee. The Lessor shall not be liable for
any loss resulting from the liquidation of each and every such
investment and the Lessee shall bear the risk of such loss, if
any.
(j) Application in Default. Any amount referred to in
paragraphs (g) or (h) of this Section 10 which is payable to the
Lessee shall not be paid to the Lessee or, if it has been
previously paid to the Lessee, shall not be retained by the
Lessee, if at the time of such payment an Event of Default shall
have occurred and be continuing. In such event, all such amounts
shall be paid to and held by the Lessor as security for the
obligations of the Lessee hereunder or, at the Lessor's option,
applied by the Lessor toward payment of any of such obligations
of the Lessee at the time due hereunder as the Lessor may elect.
At such time as there shall not be continuing any Event of
Default, all such amounts at the time held by the Lessor in
excess of the amount, if any, which the Lessor shall have elected
to apply as above provided shall be paid to the Lessee.
(k) Certificates, etc. On or before the execution of this
Lease, on the Effective Date with respect to any Parcel of
Property or Unit of Equipment, and annually on or before the
anniversary of the date of this Lease, the Lessee will furnish to
the Lessor certificates or other evidence reasonably acceptable
to the Lessor certifying that the insurance then carried and
maintained on each Parcel of Property or Unit of Equipment
complies with the terms hereof.
(l) Use or Operation of Property and Equipment. The Lessee
covenants that it will not use or operate any Equipment or use or
occupy any Property or permit the use or occupancy of any
Property or the use or operation of any Equipment at a time when
the insurance required by this Section 10 is not in force with
respect to such Property or equipment.
(m) Prosecution of Claims. The Lessee may, at its cost and
expense, prosecute any claim against any insurer or contest any
settlement proposed by any insurer, and the Lessee may bring any
such prosecution or contest in the name of the Lessor, the
Lessee, or both, and the Lessor will join therein at the Lessee's
request; provided, that the Lessee shall indemnify the Lessor
against any losses, costs or expenses (including reasonable
attorneys' fees) which the Lessor may incur in connection with
such prosecution or contest.
SECTION 11. INDEMNITIES.
The Lessee shall indemnify and hold harmless the Lessor,
Xxxxxxx, Xxxxxxx Xxxxx, Xxxxxxx Leasing, any Assignee, any
successor or successors and any Affiliate of each of them, and
their respective officers, directors, incorporators,
shareholders, partners (general and limited, including, without
limitation, the general and limited partners of the Lessor),
employees, agents and servants (each of the foregoing an
"Indemnified Person") from and against all liabilities
(including, without limitation, strict liability in tort), taxes,
losses, obligations, claims (including, without limitation,
strict liability in tort), damages, penalties, causes of action,
suits, costs and expenses (including, without limitation,
attorneys' and accountants' fees and expenses) or judgments of
any nature relating to or in any way arising out of:
(a) The ordering, delivery, acquisition, construction,
title on acquisition, rejection, installation, possession,
titling, retitling, registration, re-registration, custody by the
Lessee of title and registration documents, ownership, use,
non-use, misuse, financing (including, without limitation, all
obligations of the Lessor under or in respect of any interest
rate swap, cap, collar or other financial hedging arrangement and
any amounts payable by the Lessor under any such arrangement to
reduce the notional amount thereof by the amount of any
prepayment of any borrowing to which such interest rate swap,
cap, collar or other financial hedging arrangement relates),
operation, transportation, repair, control or disposition,
including, without limitation, disposition at the end of any
Extended or Renewal Term, of any Property or Equipment or the
release of hazardous substances on, under, to or from, or the
generation or transportation of hazardous substances to or from,
any Property, leased or to be leased hereunder, (i) except to the
extent that such costs are included in the Acquisition Cost of
such Property or Equipment within the limitations provided in
paragraph (a)(v) of Section 3 hereof (or within any change of
such limitations agreed to in writing by the Lessor and the
Lessee), (ii) except for any general administrative expenses of
the Lessor, (iii) except the income taxes with respect to which
indemnification is excluded under paragraph (c) of this Section
11 and (iv) except that this indemnity shall not increase any
payment required to be made by the Lessee pursuant to paragraphs
(b)(iii)(A), (c)(iii)(A), or (d)(iii)(A) of Section 12 of this
Lease;
(b) The assertion of any claim or demand based upon any
infringement or alleged infringement of any patent or other
right, by or in respect of any Property or Equipment; provided,
however, that upon request of the Lessee, the Lessor will make
available to the Lessee the Lessor's rights under any similar
indemnification arising from any manufacturer's or vendor's
warranties or undertakings with respect to any Property or
Equipment;
(c) All U.S. Federal, state, county, municipal, foreign or
other fees and taxes of whatsoever nature, including but not
limited to license, qualification, franchise, sales, use, gross
income, gross receipts, ad valorem, business, personal property,
real estate, value added, excise, motor vehicle, occupation tees
and stamp or other taxes or tolls of any nature whatsoever, and
penalties and interest thereon, whether assessed, levied against
or payable by the Lessor or otherwise, with respect to any
Property or Equipment or the acquisition, purchase, sale, rental,
use, operation, control, ownership or disposition of any Property
or Equipment (including, without limitation, any claim by any
Governmental Authority for transfer tax, transfer gains tax,
mortgage recording tax, filing or other similar taxes or fees in
connection with the acquisition of any Property by the Lessor or
otherwise in connection with this Lease) or measured in any way
by the value thereof or by the business of, investment in, or
ownership by the Lessor with respect thereto; provided, that this
indemnity shall not apply to Federal net income taxes, or to
state and local net income taxes, except that such indemnity
shall apply to state and local net income taxes (A) to the extent
imposed by reason in whole or in part of (1) a relation or
asserted relation of any such taxing jurisdiction to the Property
or Equipment or to the transactions contemplated herein or (2)
the actual or deemed use by any Person of the Property or
Equipment in such taxing jurisdiction, other than in the case of
both clauses (1) and (2), taxes to the extent such taxes would
have been imposed by a taxing jurisdiction because of a
relationship between the Lessor and such taxing jurisdiction
without regard to the circumstances described in clauses (1) and
(2), and (B) to the extent imposed as a result of the inability
to claim, disallowance or other loss by Shawnee Funding, Limited
Partnership of deductions customarily allowed in computing net
income (e.g., interest expense, financing, administrative,
ordinary operating expenses and other tees and expenses); and
provided further, that the Lessee's obligation to indemnify
Indemnified Persons for state and local net income taxes under
clause (A) and (B) above shall be limited to an amount of such
taxes equal to the greater of (1) $20,000 per year and (2)
..06667% of the Acquisition Cost of the Property and Equipment
under this Lease per year; or
(d) Any violation, or alleged violation by the Lessee, of
this Lease or of any contracts or agreements to which the Lessee
is a party or by which it is bound or of any laws, rules,
regulations, orders, writs, injunctions, decrees, consents,
approvals, exemptions, authorizations, licenses and withholdings
of objection, of any governmental or public body or authority and
all other Legal Requirements.
The Lessee shall forthwith upon demand reimburse any
Indemnified Person for any sum or sums expended with respect to
any of the foregoing or, upon request from any Indemnified
Person, shall pay such amounts directly. Any payment made to or
on behalf of any Indemnified Person pursuant to this Section 11
shall be increased to such amount as will, after taking into
account all taxes imposed with respect to the accrual or receipt
of such payment (as the same may be increased pursuant to this
sentence), equal the amount of the payment, reduced by the amount
of any savings in such taxes actually realized by the Indemnified
Person as a result of the payment or accrual of the amounts in
respect of which the payment to or on behalf of the Indemnified
Person hereunder is made. To the extent that the Lessee in fact
indemnifies any Indemnified Person under the indemnity provisions
of this Lease, the Lessee shall be subrogated to such Indemnified
Person's rights in the affected transaction and shall have a
right to determine the settlement of claims therein.
The indemnities contained in this Section 11 shall not be
affected by any termination of this Lease as a whole or in
respect of any Parcel of Property or Unit of Equipment leased
hereunder or any failure or refusal of the Lessee to accept any
Property or Equipment acquired or ordered pursuant to the terms
hereof.
Notwithstanding any provisions of this Section 11 to the
contrary, the Lessee shall not indemnity and hold harmless any
Indemnified Person against any claims and liabilities arising
solely from the gross negligence or willful misconduct of such
Indemnified Person.
In the event the Lessor shall be a party defendant to any
litigation arising out of any provision contained in this Lease
for which the Lessee has given indemnification, the Lessor shall
give prompt notice thereof to the Lessee by telephone and in
writing and shall consult and cooperate, at the Lessee's expense,
with the Lessee, and if the Lessor shall not have appeared or
pleaded to any such action then the Lessor does hereby empower
any attorney of any court of record appointed by the Lessee (who
shall give prompt written notice to the Lessor of such
appointment) to appear for the Lessor and in good faith and with
due diligence defend such action, to enter counterclaims, to
institute actions against third parties and to do all things
necessary or desirable in the judgment of such attorney after
consultation with the Lessor and the Lessee to preserve the
rights of the Lessor and the Lessee, all at the Lessee's own cost
and expense. No failure or delay of the Lessor to give the
notice required by this Section 11 shall excuse the obligation of
the Lessee to indemnify the Lessor with respect to such
litigation except to the extent that any increase in liability is
a direct result of such failure or delay.
SECTION 12. LESSEE'S RIGHT TO TERMINATE.
(a) So long as no Event of Default has occurred and is
continuing and with respect to any Parcel of Property not
undergoing any repairs, additions or alterations, the Lessee
shall have the right, upon ninety (90) days' notice to the
Lessor, to terminate the lease of any Parcel of Property or any
or all Units of Equipment on the Basic Rent Payment Date of the
last month of the Initial Term or on any Basic Rent Payment Date
during the Extended Term or the Renewal Term, if any, by
arranging, at its own cost and expense, for the sale of such
Property or Equipment in an arms' length transaction on the date
of termination and the receipt by the Lessor of cash in an amount
equal to the sale price of such Property or Equipment (the "Cash
Proceeds"); provided that, if such sale does not occur, this
Lease shall not terminate with respect to such Property and
Equipment. The lease of Pork Production Facility Equipment may
be terminated pursuant to this Section 12 only in conjunction
with a termination pursuant to this Section 12 of the lease of
the Pork Production Facility at which such Pork Production
Facility Equipment is used, or is to be used, and conversely,
upon the termination pursuant to this Section 12 of the lease of
a Pork Production Facility, the lease of all of the Pork
Production Facility Equipment used, or to be used, in such Pork
Production Facility must be terminated pursuant to this Section
12 concurrently therewith. For purposes of this Section 12, in
connection with the sale of a Pork Production Facility and the
related Pork Production Facility Equipment, the term "Cash
Proceeds" shall mean the aggregate cash proceeds from the sale of
such Pork Production Facility and Pork Production Facility
Equipment and "Adjusted Acquisition Cost" shall mean the
aggregate of the Adjusted Acquisition Costs of the Pork
Production Facility and the Pork Production Facility Equipment
being sold pursuant to this Section 12. The lease of Poultry
Production Facility Equipment may be terminated pursuant to this
Section 12 only in conjunction with a termination pursuant to
this Section 12 of the lease of the Poultry Production Facility
at which such Poultry Production Facility Equipment is used, or
is to be used, and conversely, upon the termination pursuant to
this Section 12 of the lease of a Poultry Production Facility,
the lease of all of the Poultry Production Facility Equipment
used, or to be used, in such Poultry Production Facility must be
terminated pursuant to this Section 12 concurrently therewith.
For purposes of this Section 12, in connection with the sale of a
Poultry Production Facility and the related Poultry Production
Facility Equipment, the term "Cash Proceeds" shall mean the
aggregate cash proceeds from the sale of such Poultry Production
Facility and Poultry Production Facility Equipment and "Adjusted
Acquisition Cost" shall mean the aggregate of the Adjusted
Acquisition Costs of the Poultry Production Facility and the
Poultry Production Facility Equipment being sold pursuant to this
Section 12. At the time a Parcel of Property or Unit of
Equipment is sold pursuant to this Section 12, such Parcel or
Unit shall be in compliance with all Legal Requirements and shall
not be subject to any Permitted Contest or any Lien.
(b) In the event the Lessee exercises its right to
terminate the lease of any Equipment pursuant to this Section 12
on the Basic Rent Payment Date of the last month of the Initial
Term with respect to such Equipment or in the event a termination
of the lease of any Equipment occurs pursuant to Section 14
hereof and the Basic Rent Payment Date on which such termination
occurs is on or before the last month of the Initial Term of such
Equipment and the Lessee chooses to effect a sale pursuant to
this Section:
(i) if the Cash Proceeds are greater than the Adjusted
Acquisition Cost of the Equipment sold, the Lessor
shall pay to the Lessee the amount by which such
Cash Proceeds exceed such Adjusted Acquisition
Cost;
(ii) if the Cash Proceeds are equal to or less
than the Adjusted Acquisition Cost of the
Equipment sold, but greater than or equal to 15%
of the Adjusted Acquisition Cost of such
Equipment, the Lessee shall pay to the Lessor an
amount equal to (A) such Adjusted Acquisition Cost
less (B) the Cash Proceeds; and
(iii) if the Cash Proceeds are less than 15% of the
Adjusted Acquisition Cost of the Equipment sold,
the Lessee shall pay to the Lessor an amount equal
to the sum of (A) 85% of such Adjusted Acquisition
Cost and (B) the amount by which the residual
value of such Equipment has been reduced by wear
and tear in excess of that attributable to normal
use (the amount of such excess wear and tear to be
such amount as the Lessor and the Lessee agree, or
if no agreement is reached, the amount determined
pursuant to the Appraisal Procedure).
(c) In the event the Lessee exercises its right to
terminate the lease of any Property pursuant to this Section 12
on the Basic Rent Payment Date of the last month of the Initial
Term with respect to such Property or in the event a termination
of the lease of any Property occurs pursuant to Section 14 hereof
and the Basic Rent Payment Date on which such termination occurs
is on or before the last month of the Initial Term of such
Property and the Lessee chooses to effect a sale pursuant to this
Section:
(i) If the Cash Proceeds are greater than the Adjusted
Acquisition Cost of the Property sold, the Lessor
shall pay to the Lessee the amount by which such
Cash Proceeds exceed such Adjusted Acquisition
Cost;
(ii) if the Cash Proceeds are equal to or less than the
Adjusted Acquisition Cost of the Property sold,
but greater than or equal to 20% of the Adjusted
Acquisition Cost of such Property, the Lessee
shall pay to the Lessor an amount equal to (A)
such Adjusted Acquisition Cost less (B) the Cash
Proceeds; and
(iii) if the Cash Proceeds are less than 20% of the
Adjusted Acquisition Cost of the Property sold,
the Lessee shall pay to the Lessor an amount equal
to the sum of (A) 80% of such Adjusted Acquisition
Cost and (B) the amount by which the residual
value of such Property has been reduced by wear
and tear in excess of that attributable to normal
use (the amount of such excess wear and tear to be
such amount as the Lessor and the Lessee agree, or
if no agreement is reached, the amount determined
pursuant to the Appraisal Procedure).
(d) In the event the Lessee exercises its right to
terminate the lease of any Property or Equipment pursuant to this
Section 12 on any Basic Rent Payment Date during the Extended
Term or Renewal Term with respect to such Property or Equipment
or a sale of Property or Equipment occurs during the Extended
Term or Renewal Term as the result of the Lessee's election under
paragraph (b)(i) of Section 14 hereof:
(i) if the Cash Proceeds are greater than the Adjusted
Acquisition Cost of the Property or Equipment
sold, the Lessor shall pay to the Lessee the
amount by which such Cash Proceeds exceed such
Adjusted Acquisition Cost;
(ii) if the Cash Proceeds are equal to or less than the
Adjusted Acquisition Cost of the Property or
Equipment sold, but greater than or equal to 13%
of such Adjusted Acquisition Cost, the Lessee
shall pay to the Lessor an amount equal to (A)
such Adjusted Acquisition Cost less (B) the Cash
Proceeds; and
(iii) if the Cash Proceeds are less than 13% of the
Adjusted Acquisition Cost, the Lessee shall pay to
the Lessor an amount equal to the sum of (A) 87%
of such Adjusted Acquisition Cost and (B) the
amount by which the residual value of such
Property or Equipment has been reduced by wear and
tear in excess of that attributable to normal use
(the amount of such excess wear and tear to be
such amount as the Lessor and the Lessee agree, or
if no agreement is reached, the amount determined
pursuant to the Appraisal Procedure).
(e) All payments and credits referred to in paragraphs (b),
(c) and (d) above shall be made on the termination date of the
Property and Equipment pursuant to this Section 12, and the
parties shall account to each other for such payments and
credits, and the Lessee shall pay to the Lessor all Basic Rent
payable, the Variable Component of Basic Rent accrued with
respect to such Property or Equipment and any Additional Rent and
other amounts owing hereunder. Upon receipt by the Lessor of the
aggregate Cash Proceeds and all other amounts then due and owing
hereunder, including without limitation the aggregate amount of
excess wear and tear determined pursuant to paragraph (b)(iii) of
Xxxxxxx 00, xxxxxxxxx (x)(xxx) of Section 12, or paragraph
(d)(iii) of Section 12 hereof, as the case may be, the Lessor
shall transfer title to such Property and Equipment to the
purchaser at the sale designated by the Lessee. The "Cash
Proceeds" referred to in paragraphs (b), (c) and (d) above shall
mean the aggregate cash proceeds of sale without reduction for
any amounts paid by the Lessee. In the event of a sale pursuant
to this Section 12, neither the Lessee nor any Affiliate of the
Lessee shall purchase the Property or Equipment sold.
(f) In its notice given pursuant to paragraph (a) of this
Section 12, the Lessee shall advise the Lessor if the sale
provided for in such notice will result in the applicability of
paragraph (b)(iii) of Xxxxxxx 00, xxxxxxxxx (x)(xxx) of Section
12 or paragraph (d)(iii) of Section 12 hereof. If the Lessee
advises the Lessor that any such Section will be applicable, the
Lessor may arrange for such sale to be made to a purchaser
designated by the Lessor, if such purchaser will pay an amount
greater than the amount offered by the Lessee's purchaser.
Unless the Lessor shall arrange for such sale and shall give the
Lessee notice thereof within thirty (30) days of the Lessor's
receipt of the Lessee's notice, the Lessee may proceed with the
sale to a purchaser designated by it. Within thirty (30) days of
the Lessee's receipt of the Lessor's notice provided for in the
preceding sentence, the Lessee may arrange for such sale to be
made to another purchaser designated by it, if such purchaser
shall pay an amount sufficient to render paragraph (b)(iii) of
Xxxxxxx 00, xxxxxxxxx (x)(xxx) of Section 12 or paragraph
(d)(iii) of Section 12 hereof inapplicable.
SECTION 13. LESSEE'S RIGHTS OF PURCHASE AND RENEWAL.
(a) So long as no Event of Default has occurred and is
continuing, the Lessee shall have the right, upon ninety (90)
days' written notice to the Lessor, to purchase any Parcel of
Property or Unit of Equipment on the Basic Rent Payment Date of
the last month of the Initial Term or on any Basic Rent Payment
Date during any month of the Extended Term or the Renewal Term,
if any, thereof for an amount equal to its Adjusted Acquisition
Cost; provided that, (1) the Lessee shall be entitled to purchase
Pork Production Facility Equipment pursuant to this paragraph (a)
only in conjunction with a purchase pursuant to this Section 13
of the Lessor's interest in the Pork Production Facility at which
such Equipment is used, or is to be used, and conversely, the
Lessee shall be entitled to purchase the Lessor's interest in a
Pork Production Facility pursuant to this paragraph (a) only in
conjunction with a purchase pursuant to this Section 13 of the
Pork Production Facility Equipment used, or to be used, at such
Pork Production Facility, and (2) the Lessee shall be entitled to
purchase Poultry Production Facility Equipment pursuant to this
paragraph (a) only in conjunction with a purchase pursuant to
this Section 13 of the Lessor's interest in the Poultry
Production Facility at which such Equipment is used, or is to be
used, and conversely, the Lessee shall be entitled to purchase
the Lessor's interest in a Poultry Production Facility pursuant
to this paragraph (a) only in conjunction with a purchase
pursuant to this Section 13 of the Poultry Production Facility
Equipment used, or to be used, at such Poultry Production
Facility. In connection with any purchase under this paragraph
(a), on the Basic Rent Payment Date upon which such purchase
occurs, the Lessee shall pay to the Lessor the purchase price,
all Basic Rent payable, the Variable Component of Basic Rent
accrued with respect to such Property or Equipment and any
Additional Rent and other amounts owing hereunder.
(b) So long as no Event of Default has occurred and is
continuing, the Lessee shall have the right, upon ninety (90)
days' written notice to the Lessor, to renew the lease of any
Parcel of Property or Unit of Equipment for a term (the "Renewal
Term") equal to the number of calendar months set forth opposite
such Parcel of Property or type of Equipment under the heading
"Renewal Term" in Exhibit A hereto, commencing on the first day
of the calendar month following the last day of the Lease Term
thereof, at a rental equal to 0.125% per month of the Acquisition
Cost of such Property or Equipment.
(c) Upon the occurrence of an Event of Default and upon the
written request of the Lessee, which shall be received no later
than five (5) Business Days subsequent to receipt of notice from
the Lessor or any Assignee pursuant to this Lease that an Event
of Default has occurred, the Lessee shall have the right, not
later than ten (10) Business Days after receipt of such request,
to purchase any or all Property and Equipment leased hereunder at
a price equal to its then Adjusted Acquisition Cost, provided
that the purchase option contained in this paragraph shall only
be available to the Lessee if (i) such Event of Default is an
Event of Default under paragraph (c) or (g) of Section 18 hereof,
(ii) such Event of Default shall relate solely to one or more
Pork Production Facilities (but less than all of the Pork
Production Facilities under this Lease) or one or more Poultry
Production Facilities (but less than all of the Poultry
Production Facilities under this Lease), and (iii) in the
reasonable judgment of the Lessor or any Assignee, the purchase
price and all other amounts paid by the Lessee will not in the
circumstances in which such payment is made constitute a
preferential payment or a voidable transfer pursuant to the
provisions of the Federal Bankruptcy Code in a bankruptcy
proceeding by or against the Lessee and will not otherwise result
in the payment being subject to recapture from the Lessor. The
Lessee shall be entitled (1) to purchase Pork Production Facility
Equipment pursuant to this paragraph (c) only in conjunction with
a purchase pursuant to this paragraph (c) of the Lessor's
interest in the Pork Production Facility at which such Equipment
is used, or is to be used, and conversely, the Lessee shall be
entitled to purchase the Lessor's interest in a Pork Production
Facility pursuant to this paragraph (c) only in conjunction with
a purchase pursuant to this paragraph (c) of the Pork Production
Facility Equipment used, or to be used, at such Pork Production
Facility and (2) to purchase Poultry Production Facility
Equipment pursuant to this paragraph (c) only in conjunction with
a purchase pursuant to this paragraph (c) of the Lessor's
interest in the Poultry Production Facility at which such
Equipment is used, or is to be used, and conversely, the Lessee
shall be entitled to purchase the Lessor's interest in a Poultry
Production Facility pursuant to this paragraph (c) only in
conjunction with a purchase pursuant to this paragraph (c) of the
Poultry Production Facility Equipment used, or to be used, at
such Poultry Production Facility. In connection with, and as a
condition to, the purchase of any Property and Equipment pursuant
hereto, (i) the Lessee shall pay at the time of purchase, in
addition to the purchase price, all Basic Rent payable through
the date of termination, the Variable Component of Basic Rent
accrued with respect to such Property and Equipment, any
Additional Rent and other amounts owing hereunder, including,
without limitation, all Accrued Default Obligations, and all
transfer taxes, transfer gains taxes, mortgage recording tax, if
any, recording and filing fees and all other similar taxes, fees,
expenses and closing costs (including reasonably attorneys' fees)
in connection with the conveyance of such Property and Equipment
to the Lessee and all other amounts owing hereunder, and (ii)
when the Lessor transfers title, such transfer shall be on an
as-is, non installment sale basis, without warranty by, or
recourse to, the Lessor.
SECTION 14. LESSOR'S RIGHT TO TERMINATE.
(a) The Lessor shall have the right upon written notice to
the Lessee to terminate the lease of any or all Property or
Equipment as of a Basic Rent Payment Date stipulated in such
notice if at any time, for any reason (other than an Event of
Default by the Lessor under a Credit Agreement (as therein
defined) which has not been caused by or resulted from an Event
of Default under this Lease or from a breach by the Lessee of its
obligations under any agreement or document executed and
delivered in connection with this Lease), Commercial Paper cannot
be issued by the Lessor upon terms reasonably acceptable to the
Lessor, the Lessor cannot arrange for bank borrowings to finance
or refinance the purchase of such Property or Equipment upon
terms reasonably acceptable to the Lessor, and the Lessor may no
longer make or continue to obtain financing under a Credit
Agreement sufficient to finance or refinance such purchase.
(b) In the event of a termination with respect to any or
all Property or Equipment pursuant to paragraph (a) of this
Section 14, the Lessee shall be required, at its option, either
(i) to arrange for such Property or Equipment to be sold in
accordance with the terms, and subject to satisfying the
conditions for the use, of Section 12 above and with the
consequences therein provided, except that such sale must occur
on the Basic Rent Payment Date stipulated in the written notice
contemplated in paragraph (a) of this Section 14, or (ii) to
purchase, on the Basic Rent Payment Date stipulated in the
written notice contemplated by paragraph (a) of this Section 14,
such Property or Equipment for cash at its Adjusted Acquisition
Cost. If a notice under paragraph (a) of this Section 14 shall
be given with respect to the Lessor's inability to finance a
Pork Production Facility or Pork Production Facility Equipment,
the sale or purchase referred to in this paragraph (b) shall
include both the affected Pork Production Facility and all Pork
Production Facility Equipment used, or to be used, at such Pork
Production Facility and if a notice under paragraph (a) of this
Section 14 shall be given with respect to the Lessor's inability
to finance a Poultry Production Facility or Poultry Production
Facility Equipment the sale or purchase referred to in this
paragraph (b) shall include both the affected Poultry Production
Facility and all Poultry Production Facility Equipment used, or
to be used, at such Poultry Production Facility. In connection
with any purchase or sale under this paragraph, on the Basic Rent
Payment Date upon which such purchase or sale occurs, the Lessee
shall pay to the Lessor, in addition to any purchase price
payable, all Basic Rent payable, the Variable Component of Basic
Rent accrued with respect to such Property or Equipment and any
Additional Rent and other amounts owing hereunder.
SECTION 15. LOSS OF OR DAMAGE TO PROPERTY OR
EQUIPMENT.
(a) The Lessee hereby assumes all risk of loss of or damage
to Property or Equipment, however caused. No loss of or damage
to any Property or Equipment shall impair any obligation of the
Lessee under this Lease, which shall continue in full force and
effect with respect to any lost or damaged Property or Equipment.
(b) In the event of damage of any kind whatsoever to any
Property or Equipment (unless the same is determined by the
Lessee to be damaged beyond repair) the Lessee, at its own cost
and expense, shall place the same in good operating order,
repair, condition and appearance. The Lessee's right to any
proceeds paid under any insurance policy or policies required
under Section 10 of this Lease with respect to any such damage to
any Property or Equipment which has been so placed by the Lessee
in good operating order, repair, condition and appearance is
governed by paragraph (h) of Section 10 hereof.
(c) If any Property or Equipment is lost, stolen,
destroyed, seized, confiscated, rendered unfit for use or damaged
beyond repair (in the reasonable judgment of the Lessee), or if
the use thereof by the Lessee in the ordinary course of business
is prevented by the act of any third Person or Persons or
governmental instrumentality for a period exceeding forty-five
(45) days, or if such Property or Equipment is attached (other
than on a claim against the Lessor as to which the Lessee is not
obligated to indemnify the Lessor) and the attachment is not
removed within forty-five (45) days, or if a Taking as described
in Section 16 shall occur, then in any such event, (i) the Lessee
shall promptly notify the Lessor in writing of such event, (ii)
on the Basic Rent Payment Date following such event the Lessee
shall pay to the Lessor an amount equal to the Adjusted
Acquisition Cost of such Property or Equipment, (iii) the Lease
Term or Renewal Term of such Property or Equipment shall continue
until the Basic Rent Payment Date on which the Lessor receives
payment from the Lessee of the amount payable pursuant to this
paragraph (c) and of Basic Rent payable, the Variable Component
of Basic Rent accrued with respect to such Property or Equipment
and any Additional Rent and other amounts owing hereunder, and
shall thereupon terminate and (iv) the Lessor shall on such Basic
Rent Payment Date transfer title to such Property or Equipment to
the Lessee, and the Lessee shall be subrogated to the Lessor's
rights resulting from such event. Insurance and condemnation
proceeds, if any, received by the Lessor in excess of the
Adjusted Acquisition Cost of the affected Property or Equipment,
so long as no Event of Default has occurred and is continuing,
shall be paid by the Lessor to the Lessee upon the payment by the
Lessee of all amounts referred to in the preceding sentence. If
the lease of a Pork Production Facility or Pork Production
Facility Equipment is terminated pursuant to this paragraph (c),
then the lease of both the affected Pork Production Facility and
the Pork Production Facility Equipment used, or to be used, at
such Pork Production Facility shall be terminated in accordance
with this paragraph (c) and if the lease of a Poultry Production
Facility or Poultry Production Facility Equipment is terminated
pursuant to this paragraph (c), then the lease of both the
affected Poultry Production Facility and the Poultry Production
Facility Equipment used, or to be used, at such Poultry
Production Facility shall be terminated in accordance with this
paragraph (c)
SECTION 16. CONDEMNATION AND DEDICATION OF
PROPERTY; EASEMENTS.
(a) If the use, occupancy or title to all or a substantial
portion of a Parcel of Property is taken, requisitioned or sold
in, by or on account of actual or threatened eminent domain
proceedings or other action by any person or authority having the
power of eminent domain (such events collectively referred to as
a "Taking"), then the Lease Term or Renewal Term shall terminate
as provided in paragraph (c) of Section 15 hereof. Upon receipt
of proceeds from any award or sale made in connection with such
Taking, if the Lessee has paid all amounts owing under paragraph
(c) of Section 15 hereof, so long as no Event of Default has
occurred and is continuing, the Lessor shall remit to the Lessee
the net amount of such proceeds remaining after reimbursement for
all costs and expenses (including, without limitation, reasonable
attorneys' fees) incurred by the Lessor in connection with the
negotiation and settlement of any proceedings related to such
Taking. A Taking shall be deemed to relate to a "substantial
portion" if after giving effect to such Taking a Parcel of
Property is, or will be, unusable for the Lessee's ordinary
business purposes.
(b) If less than a substantial portion of a Parcel of
Property is subject to a Taking, then this Lease shall continue
in effect as to the portion of the Parcel not taken and any net
proceeds, so long as no Event of Default has occurred and is
continuing, shall be paid to the Lessee.
(c) So long as no Event of Default hereunder has occurred
and is continuing, the Lessee shall have the right (i) to xxxxx
xxxxx easements for the benefit of any Parcel of Property, (ii)
to voluntarily dedicate or convey, as required, portions of any
Parcel of Property for road, highway and other public purposes
and (iii) to voluntarily execute petitions to have any Parcel of
Property or a portion thereof annexed to any municipality or
included within any utility, highway or other improvement or
service district, provided that no more than minor restoration is
required. If any monetary consideration is paid for such
easement or dedication, the Lessee shall be entitled to receive
or retain such consideration.
The Lessee shall exercise the above power to grant without
the joinder of the Lessor, except that the Lessor will cooperate,
without unreasonable delay and at the Lessee's expense, as
necessary and join in the execution of any appropriate instrument
or shall execute any separate instrument as necessary. As a
condition precedent to the Lessee's exercise of any of the
Lessee's powers under this Section 16, (i) the Lessee shall give
the Lessor five (5) Business Days' prior written notice of the
proposed action and (ii) the Lessee shall provide to the Lessor a
certificate of the Lessee stating that such action will not
adversely affect either the fair market value of such Property or
the use of such Property for its intended purpose, will not
affect the Lessor's ability to exercise its rights and remedies
under this Lease and that the Lessee undertakes to remain
obligated under this Lease to the same extent as if the Lessee
had not exercised its powers under this Section 16 and the Lessee
will perform all obligations under such instrument and shall
prepare all required documents and provide all other instruments
and certificates as the Lessor may reasonably request.
SECTION 17. SURRENDER OF PROPERTY OR EQUIPMENT.
(a) Subject to the provisions of Sections 12, 13, 14, 15,
19, 20 and 29 hereof, upon termination of the lease of any
Property or Equipment hereunder, the Lessee shall surrender such
Property or Equipment to the Lessor. Equipment shall be
surrendered by delivering the same to the Lessor at such location
as the Lessor and the Lessee may agree and, if they are unable to
agree, at such location as the Lessor may reasonably direct.
Such Property or Equipment shall be surrendered in the condition
required by paragraph (b) of Section 9 or, in the case of the
Aircraft, paragraph (h) of Section 9 of this Lease. Any cost of
removal and delivery of Equipment to the Lessor shall be paid by
the Lessee.
(b) Subject to the provisions of Sections 12, 13, 14, 15,
19 and 20 hereof, upon termination of the lease of the Aircraft,
the Lessee, at its own expense, will cause such Aircraft, if not
then registered in the name of the Lessor, to be registered in
the name of the Lessor or its designee. At the time of such
return the Aircraft shall be duly certified as airworthy by the
Federal Aviation Administration.
(c) Subject to the provisions of Sections 12, 13, 14, 15,
19, and 20 hereof, upon termination of the lease of the Aircraft,
the Lessee shall have the option of having the aircraft engines
installed on the Aircraft be engines of the same model as the
original Engines or substitute engines suitable and approved by
the Federal Aviation Administration for the Aircraft, free and
clear of all Liens, encumbrances or rights of others whatsoever
and having a value and utility at least equal to, and being in as
good operation and condition, ordinary wear and tear excepted, as
such original Engines. "Ordinary wear and tear" as used herein
is intended to reflect the Federal Aviation Administration
regulations pertaining to the requirement of a periodic
overhauling of aircraft engines. Thus, in returning the Engines,
the Lessee, under normal circumstances, shall be required to
overhaul them only if the total flying hours of such Engines
would require an overhaul under the Federal Aviation
Administration regulations.
(d) Upon the return of the Aircraft, the Lessee shall
deliver to the Lessor or its designee, all logs, manuals,
inspection data, modification and overhaul records or copies
thereof which are applicable to the Aircraft and are of the type
that the Lessee customarily retains or is required by law to
retain with respect to its own aircraft.
SECTION 18. EVENTS OF DEFAULT.
Any of the following events of default shall constitute an
"Event of Default" and shall give rise to the rights on the part
of the Lessor described in Section 19 hereof:
(a) Failure of the Lessee to pay amounts due to the Lessor
at the time of any scheduled sale of any Parcel of Property or
Unit of Equipment hereunder, failure of the Lessee to pay Basic
Rent for more than five (5) days after such payment is due
pursuant to Section 7 hereof, or failure of the Lessee to pay any
other amount payable by the Lessee hereunder or more than ten
(10) days after such payment is due; or
(b) Failure to comply with paragraph (b) of Section 14
hereof or to maintain the insurance required by Section 10
hereof, or default in the performance of the covenant contained
in paragraph (1) of Section 10 hereof; or
(c) Default in the performance of any other obligation or
covenant of the Lessee pursuant to this Lease or any Consent and
the continuance of such default for thirty (30) days after
written notice to the Lessee by the Lessor or any Assignee;
provided that such default shall not constitute an Event of
Default if (i) such default is of a nature that it cannot be
completely remedied with reasonable and diligent efforts within
such thirty (30) day period, but is capable of being remedied
within an additional ninety (90) days and (ii) the Lessee shall
have commenced and thereafter diligently prosecuted to completion
all steps necessary to remedy such default and such default is in
fact remedied within such additional ninety (90) day period and
(iii) the continuance of such default does not at any time place
the Lessor or any Assignee in any danger of civil liability for
which the Lessor or such Assignee is not adequately indemnified
(the Lessee's obligations under Section 11 of this Lease shall be
deemed to be adequate indemnification if no other Event of
Default exists hereunder and if such civil liability is
reasonably likely to be less than $5,000,000) or subject the
Lessor or any Assignee to any criminal liability as a result of
such default; or
(d) The entry of a decree or order for relief in respect of
the Lessee by a court having jurisdiction in the premises in an
involuntary case under the Federal bankruptcy laws, as now or
hereafter constituted, or any other applicable Federal or state
bankruptcy, insolvency or other similar law, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of the Lessee or of any substantial part of
the Lessee's property, or ordering the winding up or liquidation
of the Lessee's affairs, and the continuance of any such decree
or order unstayed and in effect for a period of sixty (60)
consecutive days; or
(e) The suspension or discontinuance of the Lessee's
business operations, its insolvency (however evidenced) or its
admission of insolvency or bankruptcy, or the commencement by the
Lessee of a voluntary case under the Federal bankruptcy laws, as
now or hereafter constituted, or any other applicable Federal or
state bankruptcy, insolvency or other similar law, or the consent
by it to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or other
similar official) of the Lessee or of any substantial part of its
property, or the making by it of an assignment for the benefit of
creditors, or the failure of the Lessee generally to pay its
debts as such debts become due, or the taking of corporate action
by the Lessee in furtherance of any such action; or
(f) A default or event of default, the effect of which is
to permit the holder or holders of any indebtedness (including,
without limitation, lease obligations which are shown on the
balance sheet of the Lessee or which relate to sale-leaseback
transactions), or a trustee or agent on behalf of such holder or
holders, to cause such indebtedness to become due prior to its
stated maturity shall occur under the provisions of any agreement
pursuant to which such indebtedness was created or any instrument
evidencing such indebtedness of the Lessee in excess of
$5,000,000 in the aggregate or any obligation of the Lessee for
the payment of such indebtedness shall become or be declared to
be due and payable prior to its stated maturity, or shall not be
paid when due; or
(g) Any representation or warranty made by the Lessee in
this Lease, any Consent or any document contemplated hereby or
thereby proves to be false or inaccurate in any material respect
on or as of the date made or deemed made; or
(h) Final judgment or judgments for the payment of money in
excess of $250,000 shall be rendered against the Lessee by any
U.S. Federal or state court and the same shall remain
undischarged for a period of thirty (30) days during which
execution of such judgment or judgments shall not be effectively
stayed; or
(i) An Event of Default (as defined in the Agreement for
Lease) shall occur under the Agreement for Lease; or
(j) The letter agreement dated the date hereof between the
Lessee and the Lessor ceases to be in full force and effect or
the Lessee defaults in the performance of any obligation or
covenant contained in such letter agreement.
SECTION 19. RIGHTS UPON DEFAULT.
Upon the occurrence and continuation of any Event of Default
the Lessor may do any one or more of the following (subject to
the provisions of paragraph (c) of Section 13 of this Lease):
(a) Terminate the lease of any or all Property or Equipment
leased hereunder;
(b) Whether or not the lease of any Property or Equipment
is terminated, take immediate possession of and remove any or all
Equipment and other equipment or property of the Lessor in the
possession of the Lessee, wherever situated, and for such
purpose, enter upon any premises without liability to the Lessee
for so doing;
(c) Whether or not any action has been taken under
paragraph (a) or (b) above, sell any Property or Equipment (with
or without the concurrence or request of the Lessee);
(d) Hold, use, occupy, operate, remove, lease or keep idle
any or all Property or Equipment as the Lessor in its sole
discretion may determine, without any duty to account to the
Lessee with respect to any such action or inaction or for any
proceeds thereof; and
(e) Exercise any other right or remedy which may be
available under applicable law and in general proceed by
appropriate judicial proceedings, either at law or in equity, to
enforce the terms hereof or to recover damages for the breach
hereof.
Suit or suits for the recovery of any default in the payment
of any sum due hereunder or for damages may be brought by the
Lessor from time to time at the Lessor's election, and nothing
herein contained shall be deemed to require the Lessor to await
the date whereon this Lease or the term hereof would have expired
by limitation had there been no such default by the Lessee or no
such termination or cancellation.
The receipt of any payments under this Lease by the Lessor
with knowledge of any breach of this Lease by the Lessee or of
any default by the Lessee in the performance of any of the terms,
covenants or conditions of this Lease, shall not be deemed to be
a waiver of any provision of this Lease.
No receipt of moneys by the Lessor from the Lessee after the
termination or cancellation hereof in any lawful manner shall
reinstate, continue or extend the Lease Term or any Renewal Term,
or affect any notice theretofore given to the Lessee, or operate
as a waiver of the right of the Lessor to enforce the payment of
Basic Rent or Additional Rent or other charges payable hereunder,
or operate as a waiver of the right of the Lessor to recover
possession of any Unit of Equipment or Parcel of Property by
proper suit, action, proceedings or remedy; it being agreed that,
after the service of notice to terminate or cancel this Lease,
and the expiration of the time therein specified, if the default
has not been cured in the meantime, or after the commencement of
any suit, action or summary proceedings or of any other remedy,
or after a final order, warrant or judgment for the possession of
any Unit of Equipment or Parcel of Property, the Lessor may
demand, receive and collect any moneys payable hereunder, without
in any manner affecting such notice, proceedings, suit, action,
order, warrant or judgment; and any and all such moneys so
collected shall be deemed to be payments on account for the use
and operation of any Unit of Equipment or the use, operation and
occupation of any Parcel of Property, or at the election of the
Lessor, on account of the Lessee's liability hereunder.
Acceptance of the keys to any Parcel of Property, or any similar
act, by the Lessor, or any agent or employee of the Lessor,
during the term hereof, shall not be deemed to be an acceptance
of a surrender of any Parcel of Property unless the Lessor shall
consent thereto in writing.
After any Event of Default, the Lessee shall be liable for,
and the Lessor may recover from the Lessee, (i) all Basic Rent
accrued to the date of payment, (ii) any Additional Rent owing
with respect to all Property or Equipment leased by the Lessee,
(iii) all amounts payable pursuant to Sections 11, 25 and 27
hereof and (iv) all losses, damages, costs and expenses
(including, without limitation, attorneys' fees and expenses,
commissions, filing fees and sales or transfer taxes) sustained
by the Lessor by reason of such Event of Default and the exercise
of the Lessor's remedies with respect thereto, including, in the
event of a sale by the Lessor of any Property or Equipment
pursuant to this Section 19, all costs and expenses associated
with such sale. The amounts payable in clauses (i) through (iv)
above are hereinafter sometimes referred to as the "Accrued
Default Obligations".
After an Event of Default, the Lessor may sell (in a
commercially reasonable manner) its interest in any Property and
Equipment upon any terms that the Lessor deems satisfactory, free
of any rights of the Lessee or any Person claiming through or
under the Lessee. In the event of any such sale, in addition to
the Accrued Default Obligations, the Lessor shall be entitled to
recover from the Lessee, as liquidated damages, and not as a
penalty, an amount equal to the Adjusted Acquisition Cost of any
Property or Equipment so sold, minus the proceeds of such sale
received by the Lessor. Proceeds of sale received by the Lessor
in excess of the Adjusted Acquisition Cost of such Property or
Equipment sold shall be credited against the Accrued Default
Obligations the Lessee is required to pay under this Section 19.
If such proceeds exceed the Accrued Default Obligations, or, if
the Lessee has paid all amounts required to be paid under this
Section 19, such excess shall be paid by the Lessor to the
Lessee. As an alternative to any such sale, or if the Lessee
converts any Property or Equipment after an Event of Default, or
if such Property or Equipment is lost or destroyed, in addition
to the Accrued Default Obligations, the Lessor may cause the
Lessee to pay to the Lessor, and the Lessee shall pay to the
Lessor, as liquidated damages and not as a penalty, an amount
equal to the Adjusted Acquisition Cost of such Property or
Equipment. In the event the Lessor receives payment pursuant to
the previous sentence of this paragraph, the Lessor shall
transfer all of the Lessor's right, title and interest in and to
the Property and Equipment to the Lessee.
In the event of a sale pursuant to this Section 19 to a
purchaser other than the Lessee, upon receipt by the Lessor of
the proceeds of such sale, the Lessor shall transfer all of the
Lessor's right, title and interest in and to the Property and
Equipment to such purchaser.
No remedy referred to in this Section 19 is intended to be
exclusive, but each shall be cumulative and in addition to any
other remedy referred to above or otherwise available to the
Lessor at law or in equity, and the exercise in whole or in part
by the Lessor of any one or more of such remedies shall not
preclude the simultaneous or later exercise by the Lessor of any
or all such other remedies. No waiver by the Lessor of any Event
of Default hereunder shall in any way be, or be construed to be,
a waiver of any future or subsequent Event of Default.
With respect to the termination of this Lease as to any
Parcel of Property as a result of an Event of Default, the Lessee
hereby waives service of any notice of intention to re-enter.
The Lessee hereby waives any and all rights to recover or regain
possession of any Parcel of Property or to reinstate this Lease
as permitted or provided by or under any statute, law or decision
now or hereafter in force and effect.
SECTION 20. EQUIPMENT TO BE PERSONAL PROPERTY.
It is the intention and understanding of the Lessor and the
Lessee that all Equipment shall be and at all times remain
personal property. The Lessee shall obtain and record such
instruments and take such steps as may be necessary to prevent
any Person from acquiring any rights in Equipment paramount to
the rights of the Lessor by reason of such Equipment being deemed
to be real property. If, notwithstanding the intention of the
parties and the provisions of this Section 20, any Person
acquires or claims to have acquired any rights in any Equipment
superior to the rights of the Lessor, by reason of such Equipment
being deemed to be real property, the Lessee shall promptly
notify the Lessor in writing of such fact and (unless the basis
for such claim is waived or eliminated to the satisfaction of the
Lessor within a period of thirty (30) days from the date it is
asserted) the Lessee shall on the Basic Rent Payment Date
following the expiration of the thirty (30) day period referred
to above in this sentence pay to the Lessor an amount equal to
the Adjusted Acquisition Cost of such Equipment at the time of
payment. On such Basic Rent Payment Date, in addition to the
payment of the Adjusted Acquisition Cost, the Lessee shall pay to
the Lessor Basic Rent payable, the Variable Component of Basic
Rent accrued with respect to such Equipment and any Additional
Rent and other amounts owing hereunder and the lease of such
Equipment shall thereupon terminate. The Lessor shall on such
Basic Rent Payment Date transfer title to such Equipment to the
Lessee, and the Lessee shall be subrogated to the Lessor's rights
in the affected transaction.
SECTION 21. SALE OR ASSIGNMENT BY LESSOR.
(a) The Lessor shall have the right to obtain equity and
debt financing for the acquisition and ownership of the Property
or Equipment by selling or assigning its right, title and
interest in any or all amounts due from the Lessee or any third
party under this Lease; provided, that any such sale or
assignment shall be subject to the rights and interests of the
Lessee under this Lease.
(b) Any Assignee shall, except as otherwise agreed by the
Lessor and such Assignee, have all the rights, powers, privileges
and remedies of the Lessor hereunder, and the Lessee's
obligations as between itself and such Assignee hereunder shall
not be subject to any claims or defense that the Lessee may have
against the Lessor. Upon written notice to the Lessee of any
such assignment, the Lessee shall thereafter make payments of
Basic Rent, Additional Rent and other sums due hereunder to such
Assignee, to the extent specified in such notice, and such
payments shall discharge the obligation of the Lessee to the
Lessor hereunder to the extent of such payments. Anything
contained herein to the contrary notwithstanding, no Assignee
shall be obligated to perform any duty, covenant or condition
required to be performed by the Lessor hereunder, and any such
duty, covenant or condition shall be and remain the sole
obligation of the Lessor.
SECTION 22. INCOME TAXES.
(a) The Lessor agrees that it will not file any Federal,
state or local income tax returns during the Lease Term or
Renewal Term, if any, with respect to any Property or Equipment
that are inconsistent with the treatment of the Lessee as owner
of such Property or Equipment for Federal, state and local income
tax purposes.
(b) Paragraph (a) of Section 22 above notwithstanding, the
Lessor agrees that, at the written request of the Lessee, it will
take all such action as may be required to be taken by a lessor
to elect under any provision of the Code substantially similar to
section 48(d) of the Internal Revenue Code of 1954, as amended
prior to the enactment of the Tax Reform Act of 1986, permitting
a pass-through of an investment tax credit to a lessee, to treat
the Lessee as having acquired any Unit of Equipment or any
qualifying appliances, equipment and machinery attached to any
Parcel of Property acquired by the Lessor that would qualify for
such a credit (within the meaning of section 48(b) of the Code);
provided, that such request is received by the Lessor reasonably
in advance of the date on which the Lessor is required to take
such action, and the Lessee provides the Lessor in a timely
fashion with all information (other than identifying information
pertaining to the Lessor) required to take such action. The
Lessor does not represent or warrant to the Lessee that credits
will be allowable with respect to any Unit of Equipment or other
property under the Code or that any election will be effective to
transfer any such credits that are allowable to the Lessee. The
Lessor, Xxxxxxx, Xxxxxxx Xxxxx and Xxxxxxx Leasing shall have no
liability to the Lessee resulting from the disallowance to the
Lessee of credits under the Code with respect to any Unit of
Equipment or other property unless such disallowance is directly
and primarily attributable to the failure of the Lessor to comply
with its obligations under the first sentence of this paragraph
(b).
SECTION 23. NOTICES AND REQUESTS.
All notices, offers, acceptances, approvals, waivers,
requests, demands and other communications hereunder or under any
other instrument, certificate or other document delivered in
connection with the transactions described herein shall be in
writing, shall be addressed as provided below and shall be
considered as properly given (a) if delivered in person, (b) if
sent by express courier service (including, without limitation,
Federal Express, Xxxxx, DHL, Airborne Express, and other similar
express delivery services), (c) in the event overnight delivery
services are not readily available, if mailed by international
airmail, postage prepaid, registered or certified with return
receipt requested, or (d) if sent by telecopy and confirmed;
provided, that in the case of a notice by telecopy, the sender
shall in addition confirm such notice by writing sent in the
manner specified in clauses (a), (b) or (c) of this Section 23.
All notices shall be effective upon receipt by the addressee;
provided, however, that if any notice is tendered to an addressee
and the delivery thereof is refused by such addressee, such
notice shall be effective upon such tender. For the purposes of
notice, the addresses of the parties shall be as set forth below;
provided, however, that any party shall have the right to change
its address for notice hereunder to any other location by giving
written notice to the other party in the manner set forth herein.
The initial addresses of the parties hereto are as follows:
If to the Lessor:
Shawnee Funding, Limited Partnership
c/o ML Leasing Equipment Corp.
Project and Lease Finance Group
North Tower-27th Floor
World Financial Center
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy of all notices under this Section 23 to be
simultaneously given, delivered or served to Xxxxxx X. XxXxxxxxx
at the following address:
ML Leasing Equipment Corp.
Controller's Office
World Financial Center
South Tower-14th Floor
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
If to the Lessee:
Seaboard Corporation
P.O. Box 2972
0000 Xxxx 00xx Xxxxxx
Xxxxxxx Xxxxxxx, Xxxxxx 00000
Attention: Legal Department
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxxx & Worcester
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy of all notices under this Section 23 to any Assignee
at such address as such Assignee may specify by written notice to
the Lessor and the Lessee.
SECTION 24. COVENANT OF QUIET ENJOYMENT.
During the Lease Term or Renewal Term, if any, of any
Property or Equipment hereunder and so long as no Event of
Default or Potential Default shall have occurred and be
continuing, the Lessor recognizes the Lessee's right to quiet
enjoyment of the Property or Equipment on the terms and
conditions provided in this Lease without any interference from
the Lessor or anyone claiming through or under the Lessor.
SECTION 25. RIGHT TO PERFORM FOR LESSEE.
(a) If the Lessee fails to perform or comply with any of
its covenants or agreements contained in this Lease, the Lessor
may, upon notice to the Lessee but without waiving or releasing
any obligations or default, itself perform or comply with such
covenant or agreement, and the amount of the reasonable expenses
of the Lessor incurred in connection with such performance or
compliance, shall be payable by the Lessee, not later than ten
(10) days after written notice by the Lessor.
(b) Without in any way limiting the obligations of the
Lessee hereunder, the Lessee hereby irrevocably appoints the
Lessor as its agent and attorney at the time at which the Lessee
is obligated to deliver possession of any Parcel of Property or
Unit of Equipment to the Lessor, to demand and take possession of
such Parcel of Property or Unit of Equipment in the name and on
behalf of the Lessee from whomsoever shall be at the time in
possession thereof.
SECTION 26. MERGER, CONSOLIDATION OR SALE OF ASSETS.
The Lessee may not consolidate with or merge into any other
corporation or sell all or substantially all of its assets to any
Person, except that the Lessee may consolidate with or merge into
any other corporation which is an Affiliate of the Lessee, or
sell all or substantially all of its assets to any Person which
is an Affiliate of the Lessee; provided, that the surviving
corporation or transferee Person shall assume, by execution and
delivery of instruments satisfactory to the Lessor, the
obligations of the Lessee hereunder and become successor to the
Lessee, but the Lessee shall not thereby be released, without the
consent of the Lessor, from its obligations hereunder and;
provided, further, that such surviving corporation or transferee
Person will, on a pro forma basis, immediately after such
consolidation, merger or sale, possess a consolidated net worth
and credit rating substantially equivalent to or greater than
that of the Lessee immediately prior to such consolidation,
merger or sale. The terms and provisions of this Lease shall be
binding upon and inure to the benefit of the Lessee and its
respective successors and assigns.
SECTION 27. EXPENSES.
The Lessee shall pay all of the out-of-pocket costs and
expenses incurred by the Lessor, and any Assignee in connection
with this Lease including, without limitation, the reasonable
fees and disbursements of counsel to the Lessor and counsel to
any Assignee.
SECTION 28. PERMITTED CONTESTS.
(a) The Lessee shall not be required, nor shall the Lessor
have the right, to pay, discharge or remove any tax, assessment,
levy, fee, rent, charge or Lien, or to comply or cause any Parcel
of Property or Unit of Equipment to comply with any Legal
Requirements applicable to any Parcel of Property or Unit of
Equipment or the occupancy, use or operation thereof, so long as
no Event of Default exists under this Lease, the Lessee is
contesting or plans to contest the existence, amount,
applicability or validity thereof by appropriate proceedings and,
in the opinion of the Lessee's counsel, the Lessee shall have
reasonable grounds to contest the existence, amount,
applicability or validity thereof by appropriate proceedings,
which proceedings in the reasonable judgment of the Lessor, (i)
shall not involve any material danger that any Parcel of Property
or Unit of Equipment or any Basic Rent or any Additional Rent
would be subject to sale, forfeiture or loss, as a result of
failure to comply therewith, (ii) shall not affect the payment of
any Basic Rent or any Additional Rent or other sums due and
payable hereunder or result in any such sums being payable to any
Person other than the Lessor or any Assignee, (iii) will not
place the Lessor or any Assignee in any danger of civil liability
for which the Lessor is not adequately indemnified (the Lessee's
obligations under Section 11 of this Lease shall be deemed to be
adequate indemnification if no Event of Default or Potential
Default exists and if such civil liability is reasonably likely
to be less than $500,000 per Parcel or Unit and $5,000,000 in the
aggregate) or to any criminal liability, (iv) if involving taxes,
shall suspend the collection of taxes, and (v) shall be permitted
under and be conducted in accordance with the provisions of any
other instrument to which the Lessee or the Parcel of Property or
Unit of Equipment is subject and shall not constitute a default
thereunder (the "Permitted Contest"). The Lessee shall conduct
all Permitted Contests in good faith and with due diligence and
shall promptly after the final determination (including appeals)
of any Permitted Contest, pay and discharge all amounts which
shall be determined to be payable therein. The Lessor shall
cooperate in good faith with the Lessee with respect to all
Permitted Contests conducted by the Lessee pursuant to this
Section 28.
(b) In the event the Lessor deems, in its sole discretion,
that its interests under this Lease or in any Parcel of Property
or Unit of Equipment are not adequately protected in connection
with a Permitted Contest brought by the Lessee under this Section
28, the Lessee shall give such reasonable security, as may be
demanded by the Lessor to insure payment of such tax, assessment,
levy, fee, rent, charge or Lien and compliance with Legal
Requirements and to prevent any sale or forfeiture of any Parcel
of Property or Unit of Equipment, any Basic Rent or any
Additional Rent by reason of such nonpayment or noncompliance.
The Lessee hereby agrees that the Lessor may assign such security
provided by the Lessee to any Assignee.
(c) At least ten (10) days prior to the commencement of any
Permitted Contest, the Lessee shall notify the Lessor in writing
thereof if the amount to be contested exceeds $100,000, and shall
describe such proceeding in reasonable detail. In the event that
a taxing authority or subdivision thereof proposes an additional
assessment or levy of any tax for which the Lessee is obligated
to reimburse the Lessor under this Lease, or in the event that
the Lessor is notified of the commencement of an audit or similar
proceeding which could result in such an additional assessment,
then the Lessor shall in a timely manner notify the Lessee in
writing of such proposed levy or proceeding.
SECTION 29. LEASEHOLD INTERESTS.
The following provisions relate to each lease (a "Ground
Lease") under which a leasehold interest in a Parcel of Property
is subleased to the Lessee hereunder:
(a) The Lessee hereunder covenants and agrees to perform
and to observe all of the terms, covenants, provisions,
conditions and agreements of the underlying Ground Leases on the
Lessor's part as lessee thereunder to be performed and observed
(including, without limitation, payment of all rent, additional
rent and other amounts payable by the Lessor as lessee under any
Ground Lease) to the end that all things shall be done which are
necessary to keep unimpaired the rights of the Lessor as lessee
under any Ground Lease. The Lessee further covenants that it
shall cause to be exercised any renewal option contained in the
Ground Lease which relates to renewal occurring in whole or in
part during the term of this Lease.
(b) The Lessee covenants and agrees pursuant to Section 11
hereof to indemnify and hold harmless the Lessor and any Assignee
from and against any and all liability, loss, damage, suits,
penalties, claims and demands of every kind and nature
(including, without limitation, reasonable attorneys' fees and
expenses) by reason of the Lessee's failure to comply with any
Ground Lease or the provisions of this Section 29.
(c) The Lessor and the Lessee agree that the Lessor shall
have no obligation or responsibility to provide services or
equipment required to be provided or repairs or restorations
required to be made in accordance with the provisions of any
Ground Lease by the Lessor thereunder. The Lessor shall in no
event be liable to the Lessee nor shall the obligations of the
Lessee hereunder be impaired or the performance thereof excused
because of any failure or delay on the part of the Lessor under
any Ground Lease in providing such services or equipment or
making such restorations or repairs and such failure or delay
shall not constitute a basis for any claim against the Lessor or
any offset against any amount payable to the Lessor under this
Lease.
(d) If the Lessor's interest under any Ground Lease shall
expire, terminate or otherwise be extinguished, the Lease of the
Parcel of Property to which such Ground Lease relates shall
thereupon terminate as provided in this paragraph (d). Upon such
expiration, termination or extinguishment, the Lessee shall be
required to purchase the Lessor's interest in such Parcel of
Property at its Adjusted Acquisition Cost. If the Lessee shall
be required to purchase the Lessor's interest in such affected
Parcel, then (i) on the Basic Rent Payment Date next succeeding
such event, the Lessee shall pay to the Lessor an amount equal to
the Adjusted Acquisition Cost of such Property, (ii) the Lease
Term or Renewal Term of such Property shall continue until the
date on which the Lessor receives payment from the Lessee of the
amount payable pursuant to this paragraph (d) and of all Basic
Rent payable, the Variable Component of Basic Rent accrued with
respect to such Parcel of Property and any Additional Rent and
other amounts owing hereunder, and shall then terminate upon the
payment of such amounts and (iii) the Lessor shall on such date
transfer title to the Lessor's interest in such Parcel to the
Lessee.
(e) The Lessee shall ensure that each Ground Lease shall be
a Mortgageable Ground Lease.
SECTION 30. MISCELLANEOUS.
(a) All agreements, indemnities, representations and
warranties, and the obligation to pay Additional Rent contained
in this Lease shall survive the expiration or other termination
hereof.
(b) This Lease, the Unit Leasing Records and the AFL Unit
Leasing Records covering Property or Equipment leased pursuant
hereto and the instruments, documents or agreements referred to
herein constitute the entire agreement between the parties and no
representations, warranties, promises, guarantees or agreements,
oral or written, express or implied, have been made by any party
hereto with respect to this Lease or the Property or Equipment,
except as provided herein or therein.
(c) This Lease may not be amended, modified or terminated,
nor may any obligation hereunder be waived orally, and no such
amendment, modification, termination or waiver shall be effective
for any purpose unless it is in writing, signed by the party
against whom enforcement thereof is sought. A waiver on one
occasion shall not be construed to be a waiver with respect to
any other occasion.
(d) The captions in this Lease are for convenience of
reference only and shall not be deemed to affect the meaning or
construction of any of the provisions hereof. Any provision of
this Lease which is prohibited by law or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and the parties
hereto shall negotiate in good faith appropriate modifications to
reflect such changes as may be required by law, and, as nearly as
possible, to produce the same economic, financial and tax effects
as the provision which is prohibited or unenforceable; and any
such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any
other jurisdiction. To the extent permitted by applicable law,
the Lessee and the Lessor hereby waive any provision of law which
renders any provision hereof prohibited or unenforceable in any
respect. THIS LEASE HAS BEEN EXECUTED AND DELIVERED IN THE STATE
OF NEW YORK. THE LESSEE AND THE LESSOR AGREE THAT, TO THE
MAXIMUM EXTENT PERMITTED BY THE LAW OF THE STATE OF NEW YORK,
THIS LEASE, AND THE RIGHTS AND DUTIES OF THE LESSEE AND THE
LESSOR HEREUNDER, SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW) IN ALL RESPECTS, INCLUDING WITHOUT
LIMITATION IN RESPECT OF ALL MATTERS OF CONSTRUCTION, VALIDITY
AND PERFORMANCE. THE LESSEE HEREBY IRREVOCABLY SUBMITS, FOR
ITSELF AND ITS PROPERTY, TO THE JURISDICTION OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND THE
SUPREME COURT OF THE STATE OF NEW YORK IN THE COUNTY OF NEW YORK
IN ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST IT AND RELATED
TO OR IN CONNECTION WITH THIS LEASE OR THE TRANSACTIONS
CONTEMPLATED HEREBY, AND TO THE EXTENT PERMITTED BY APPLICABLE
LAW, THE LESSEE HEREBY WAIVES AND AGREES NOT TO ASSERT BY WAY OF
MOTION, AS A DEFENSE OR OTHERWISE IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF SUCH COURT, THAT THE SUIT, ACTION OR PROCEEDING
IS BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT,
ACTION OR PROCEEDING IS IMPROPER, OR THAT THIS LEASE OR ANY
DOCUMENT OR ANY INSTRUMENT REFERRED TO HEREIN OR THE SUBJECT
MATTER HEREOF MAY NOT BE LITIGATED IN OR BY SUCH COURT. TO THE
EXTENT PERMITTED BY APPLICABLE LAW, THE LESSEE AGREES NOT TO SEEK
AND HEREBY WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF ANY
SUCH COURT BY ANY COURT OF ANY OTHER NATION OR JURISDICTION WHICH
MAY BE CALLED UPON TO GRANT AN ENFORCEMENT OF SUCH JUDGMENT. THE
LESSEE AGREES THAT SERVICE OF PROCESS MAY BE MADE UPON IT BY
CERTIFIED OR REGISTERED MAIL TO THE ADDRESS FOR NOTICES SET FORTH
IN THIS LEASE OR ANY METHOD AUTHORIZED BY THE LAWS OF NEW YORK.
THE LESSOR AND THE LESSEE EXPRESSLY WAIVE ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM RELATED TO THIS
LEASE OR THE TRANSACTIONS CONTEMPLATED HEREBY. THE LESSOR AND
THE LESSEE ACKNOWLEDGE THAT THE PROVISIONS OF THIS PARAGRAPH (D)
OF SECTION 30 HAVE BEEN BARGAINED FOR AND THAT THEY HAVE BEEN
REPRESENTED BY COUNSEL IN CONNECTION THEREWITH.
(e) In connection with any sale of Property or Equipment
pursuant to Section 12, 13, 14, 15, 19, 20 or 29 of this Lease,
when the Lessor transfers title, such transfer shall be on an
as-is, non-installment sale basis, without warranty by, or
recourse to, the Lessor. The purchase price for any such sale
shall be paid entirely in cash and in immediately available
funds.
(f) In connection with the sale or purchase of Property or
Equipment pursuant to Section 12, 13, 14, 15, 19, 20 or 29 of
this Lease, the Lessee shall pay or shall cause the purchaser of
such Property or Equipment to pay in addition to the purchase
price, all transfer taxes, transfer gains taxes, mortgage
recording tax, if any, recording and filing fees and all other
similar taxes, fees, expenses and closing costs (including
reasonable attorneys' fees) in connection with the conveyance of
such Property or Equipment to the Lessee or any purchaser.
(g) When used in Section 12, 13, 14, 15, 20 or 29 of this
Lease, the phrase "the Variable Component of Basic Rent accrued"
means the Variable Component of Basic Rent accrued through the
date of termination of this Lease pursuant to such Section which
has not been included in Basic Rent then payable or previously
paid.
(h) If any costs of the Lessor related to the Agreement for
Lease which were not included in the Acquisition Cost of a Parcel
of Property are allocated to such Parcel of Property pursuant to
the definition of Unit Acquisition Cost in the Agreement for
Lease, the Lessee and the Lessor shall execute a revised AFL Unit
Leasing Record to amend the Adjusted Acquisition Cost for such
Parcel to reflect the increase in the Acquisition Cost.
(i) The Lessor agrees that it shall not cause or permit to
exist any Lien with respect to any Parcel of Property or Unit of
Equipment arising as a result of any willful act or omission of
the Lessor which is not permitted or contemplated by this Lease,
the Agreement for Lease, any Credit Agreement or the transactions
contemplated thereby.
SECTION 31. NO RECOURSE.
The Lessor's obligations hereunder are intended to be the
obligations of the limited partnership and of the corporation
which is the general partner thereof only and no recourse for the
payment of any amount due under this Lease or for any claim based
thereon or otherwise in respect thereof, shall be had against any
limited partner of the Lessor or any incorporator, shareholder,
officer, director or Affiliate, as such, past, present or future
of such corporate general partner or of any corporate limited
partner or of any successor corporation to such corporate general
partner or any corporate limited partner of the Lessor, or
against any direct or indirect parent corporation of such
corporate general partner or of any limited partner of the Lessor
or any other subsidiary or Affiliate of any such direct or
indirect parent corporation or any incorporator, shareholder,
officer or director, as such, past, present or future, of any
such parent or other subsidiary or Affiliate, it being understood
that the Lessor is a limited partnership formed for the purpose
of the transactions involved in and relating to this Lease on the
express understanding aforesaid. Nothing contained in this
Section 31 shall be construed to limit the exercise or
enforcement, in accordance with the terms of this Lease and any
other documents referred to herein, of rights and remedies
against the limited partnership or the corporate general partner
of the Lessor or the assets of the limited partnership or the
corporate general partner of the Lessor.
SECTION 32. NO MERGER.
There shall be no merger of this Lease or of the leasehold
estate hereby created with the fee estate in any Parcel of
Property by reason of the fact that the same person acquires or
holds, directly or indirectly, this Lease or the leasehold estate
hereby created or any interest herein or in such leasehold estate
as well as the fee estate in any Parcel of Property or any
interest in such fee estate.
SECTION 33. CONFIDENTIALITY.
(a) The Lessee agrees to treat information concerning the
structure and documentation of the Agreement for Lease and this
Lease confidentially, except to the extent that disclosure is
required by law (in which circumstance the Lessee will notify the
Lessor prior to such disclosure of any information). The
foregoing constraint shall not include (i) information that is
now in the public domain or subsequently enters the public domain
without fault on the part of the Lessee, (ii) information
currently known to the Lessee from its own sources as evidenced
by its prior written records, and (iii) information that the
Lessee receives from a third party not under any obligation to
keep such information confidential.
(b) The Lessor agrees to treat information which is
designated as confidential concerning the structure and
documentation of this Lease, the Agreement for Lease, the
Lessee's operations and the Property and Equipment
confidentially, except to the extent that disclosure is required
by law (in which circumstance the Lessor will notify the Lessee
prior to such disclosure of any information). The foregoing
constraint shall not include (i) information that is now in the
public domain or subsequently enters the public domain without
fault on the part of the Lessor, (ii) information currently known
to the Lessor from its own sources as evidenced by its prior
written records, (iii) information that the Lessor receives from
a third party not under any obligation to keep such information
confidential, (iv) information disclosed to any Assignee or any
lender for the purpose of financing or refinancing the purchase
or ownership of any Property or Equipment or (v) information
disclosed to any Person for the purpose of enforcing the rights
of the Lessor under this Lease, the Agreement for Lease, the
Credit Agreement or any other document contemplated hereby or
thereby.
SECTION 34. CERTAIN LIMITATIONS.
It is the intention of the parties hereto to conform
strictly to all usury laws that are applicable to each such
party, this Lease, and to each of the transactions contemplated
by this Lease (collectively the "Transactions"). Accordingly,
notwithstanding anything to the contrary in this Lease, or any
other document, certificate, instrument or agreement entered in
connection with the Transactions (collectively the "Transaction
Documents"), it is agreed as follows: (i) the aggregate of all
consideration which constitutes interest under Applicable Usury
Law (hereinafter defined) that is contracted for, taken,
reserved, charged or received by any party under the Transaction
Documents or otherwise in connection with the Transactions shall
under no circumstances exceed the maximum amount of interest that
could lawfully be charged by such party under Applicable Usury
Law, (ii) in the event that the maturity of any indebtedness
evidenced by or payable pursuant to the Transaction Documents is
accelerated for any reason, or in the event of any required or
permitted payment or prepayment of all or any part of such
indebtedness (including, without limitation, and if applicable,
any required or permitted purchase of any Property or Equipment,
or any required or permitted payment of the Adjusted Acquisition
Cost), then such consideration that constitutes interest as to
any such indebtedness under Applicable Usury Law may never
include more than the maximum amount allowed by such Applicable
Usury Law, and (iii) excess interest, if any, provided for in the
Transaction Documents or otherwise in connection with the
Transactions shall be, in accordance with the following
provisions of this Section 33, canceled automatically and, if
theretofore paid, shall be credited by the recipient on the
principal or stated amount of the affected indebtedness (or, to
the extent that the principal or stated amount of such
indebtedness shall have been or would thereby be paid in full,
refunded by such recipient to the party entitled thereto). If at
any time the rate of interest (denominated as such) contractually
called for in any Transaction Document (as the same may vary from
time to time pursuant to the terms of such Transaction Document,
the "Stated Rate"), exceeds the maximum non-usurious rate of
interest permitted by Applicable Usury Law (the "Maximum Rate")
in respect of the indebtedness evidenced by such Transaction
Document, taking into account all other amounts paid or payable
pursuant to the Transaction Documents which constitute interest
with respect to such indebtedness under Applicable Usury Law
regardless of whether denominated as interest (collectively, the
"Other Charges"), then the rate of interest to accrue on such
indebtedness shall be limited to such Maximum Rate (taking into
account the Other Charges), but any subsequent reduction in the
Stated Rate applicable to such indebtedness shall not reduce the
rate of interest or yield to accrue on such indebtedness to a
rate that is less than such Maximum Rate (taking into account the
Other Charges) until such time as the total amount of interest or
yield on such indebtedness equals the amount of interest or yield
which would have accrued if the Stated Rate applicable to such
indebtedness had at all times been in effect. If at the maturity
or final payment of any indebtedness the total amount of interest
or yield paid or accrued on such indebtedness under the preceding
sentence is less than the total amount of interest or yield which
would have accrued if the Stated Rate applicable to such
indebtedness had at all times been in effect, then to the
fullest extent permitted by Applicable Usury Law there shall be
due and payable with respect to such indebtedness an amount equal
to the excess, if any, of (a) the lesser of (i) the amount of
interest which would have accrued on such indebtedness if such
Maximum Rate in respect of such indebtedness had at all times
been in effect and been chosen as the rate of interest or yield
to be applicable throughout the term of such indebtedness (taking
into account the Other Charges) and (ii) the amount of interest
which would have accrued on such indebtedness if the Stated Rate
applicable to such indebtedness had at all times been in effect,
over (b) the amount of interest accrued in accordance with the
provisions of the Transaction Document evidencing such
indebtedness after giving effect to the preceding sentence. All
amounts paid or agreed to be paid for the use, forbearance or
detention of sums pursuant to or in connection with the
Transaction Documents shall, to the extent permitted by
Applicable Usury Law, be amortized, prorated, allocated and
spread throughout the full term thereof so that the rate or
amount of interest paid or payable with respect to any amount of
indebtedness evidenced by or payable pursuant to the Transaction
Documents does not exceed the applicable usury ceiling, if any.
As used herein, the term "Applicable Usury Law" means that law,
if any, that is applicable to any particular Transaction and that
limits the maximum non-usurious rate of interest that may be
taken, contracted for, charged, reserved or received with respect
to such Transaction, including the Federal laws of the United
States of America, the laws of the State of New York, the laws of
the State of Texas, and the laws of any other jurisdiction that
may be mandatorily applicable to such Transaction notwithstanding
other provisions of this Lease and the other Transaction
Documents. As used herein, the term "interest" means interest as
determined under Applicable Usury Law, regardless of whether
denominated as interest in the Transaction Documents (except to
the extent that this Section 34 specifically refers to interest
denominated as interest). The right to accelerate maturity of
any indebtedness evidenced by any Transaction Document, and the
right to demand payment of the Adjusted Acquisition Cost does not
include the right to accelerate any interest, or to receive any
other amounts, which would cause the Transactions to be usurious
under Applicable Usury Law. To the extent (if any) that Texas
law determines the Maximum Rate, such Maximum Rate shall be
determined by utilizing the indicated rate (weekly) ceiling from
time to time in effect pursuant to Texas Revised Civil Statutes
Annotated Article 5069-1.04, as amended. In no event will the
provisions of Texas Revised Civil Statutes Annotated Articles
5069-2.01 through 5069-8.06 or 5069-15.01 through 5069-15.11 be
applicable to the Transactions. All computations of the maximum
amount allowed under Applicable Usury Law will be made on the
basis of the actual number of days elapsed over a 365 or 366 day
year, whichever is applicable pursuant to such Applicable Usury
Law. The provisions of this Section 34 shall prevail over any
contrary provisions in this Lease or any of the other Transaction
Documents.
IN WITNESS WHEREOF, the Lessor and the Lessee have
caused this Lease to be executed and delivered by their duly
authorized officers as of the day and year first above written.
(Corporate Seal) Shawnee Funding, Limited Partnership
ATTEST by Shawnee Capital, Inc.,
its General Partner
________________________ By_________________________
Name: Name:
Title: Title:
(Corporate Seal) Seaboard Corporation
ATTEST:
________________________ By_________________________
Name: Name:
Title: Title:
IN WITNESS WHEREOF, the Lessor and the Lessee have
caused this Lease to be executed and delivered by their duly
authorized officers as of the day and year first above written.
(Corporate Seal) Shawnee Funding, Limited Partnership
ATTEST by Shawnee Capital, Inc.,
its General Partner
________________________ By_________________________
Name: Name:
Title: Title:
(Corporate Seal) Seaboard Corporation
ATTEST:
________________________ By_________________________
Name: Name:
Title: Title:
STATE OF )
: ss.:
COUNTY OF )
The foregoing instrument was acknowledged before me on this
____ day of August, 1994 by ____________________, as
_________________________ of Seaboard Corporation, a Delaware
corporation.
(Notarial Seal) _______________________
Notary Public
My commission expires:
________________________
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me on this
____ day of August, 1994 by ____________________, as Vice
President of Shawnee Capital, Inc., a Delaware corporation,
general partner of Shawnee Funding, Limited Partnership, a
Delaware limited partnership.
(Notarial Seal) _________________________
Notary Public
My commission expires:
_______________________
STATE OF )
: ss.:
COUNTY OF )
The foregoing instrument was acknowledged before me on this
____ day of August, 1994 by ____________________, as
_________________ of Seaboard Corporation, a Delaware
corporation.
(Notarial Seal) ________________________
Notary Public
My commission expires:
________________________
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me on this
____ day of August, 1994 by ____________________, as Vice
President of Shawnee Capital, Inc., a Delaware corporation,
general partner of Shawnee Funding, Limited Partnership, a
Delaware limited partnership.
(Notarial Seal) _______________________
Notary Public
My Commission Expires:
______________________
EXHIBIT A
Type of Initial Extended Renewal
Equipment Term Term Term
or Property (in months) (in months) (in months)
Pork Production Facilities 36 324 *
Pork Production Facility ** *** *
Equipment
Poultry Production Facilities 36 324 *
Poultry Production Facility ** *** *
Equipment
automobiles 12 12-60 *
light trucks (< 13,000 pounds) 12 12-84 *
heavy trucks ( 13,000 pounds) 12 12-120 *
telecommunica- 12 24-108 *
tions equipment
computer and peri- 12 12-72 *
pheral equipment
manufacturing equipment 12 12-60 *
real property 60 420 *
office equipment 12 12-108 *
aircraft 12 108-348 *
furniture and fixtures 12 72-132 *
other****
* To be determined by agreement of the Lessee and the Lessor.
** The Initial Term for Pork Production Facility Equipment will
end on the Basic Rent Payment Date on which the Initial Term
ends with respect to the Pork Production Facility at which
such Pork Production Facility Equipment is used or to be used
ends. If such Term has ended prior to the Effective Date of
such Pork Production Facility Equipment, then such Pork
Production Facility Equipment shall be deemed to have only an
Extended Term. The Initial Term for Poultry Production
Facility Equipment will end on the Basic Rent Payment Date on
which the Initial Term ends with respect to the Poultry
Production Facility at which such Poultry Production Facility
Equipment is used or to be used ends. If such Term has ended
prior to the Effective Date of such Poultry Production
Facility Equipment, then such Poultry Production Facility
Equipment shall be deemed to have only an Extended Term.
*** The Lease Term for Pork Production Facility Equipment and
Poultry Production Facility Equipment will equal 36-120 months
and its Extended Term will be such Lease Term (i) minus the
number of months of the Initial Term for such Equipment, if
any, and (ii) plus any partial calendar month during which the
Effective Date of such Equipment not having an Initial Term
occurs.
**** To be determined by agreement of the Lessee and the
Lessor.
EXHIBIT B
Description of Aircraft
Intentionally left blank
EXHIBIT C
AFL UNIT LEASING RECORD to Lessor: Shawnee Funding,
the Lease Agreement, dated Limited
Partnership
as of August 11, 1994, Lessee: Seaboard Corporation
between Shawnee Funding,
Limited Partnership,
as lessor, and Seaboard Corporation,
as lessee (the "Lease Agreement").
A. AFL ULR No.:
Effective Date of this AFL
Unit Leasing Record ("AFL ULR") _______ ___, 19__.
B. PLEASE COMPLETE THE FOLLOWING STATEMENTS, IF APPLICABLE:
1. This AFL ULR relates to [Deed/Ground Lease] dated
__________ ____ 19___.
PROPERTY DESCRIPTION AND RENTAL INFORMATION.
C. Type of Property (use category specified in Exhibit A to the
Lease Agreement)
___________________________
D. Specific Description: (See Schedule A hereto if more space
needed)
____________________________________________________________
E. Location of
Property __________________________________________________
State County City
F. Unit Acquisition Cost under the Agreement for Lease is
$__________.
G. If the Effective Date of this AFL ULR is after the first day
of the month and prior to the Lease Rate Date in such month,
the partial first month's Basic Rent for Property placed
under lease by this AFL ULR will be paid from the date of
this AFL ULR until the end of the month on the Basic Rent
Payment Date in such month. If the Effective Date of the
AFL ULR falls on or after the Lease Rate Date, the partial
first month's Basic Rent will be paid from the date of this
AFL ULR until the end of the month on the next succeeding
Basic Rent Payment Date.
H. The Initial Term, Extended Term and Renewal Term for the
Property placed under lease pursuant to this AFL ULR will be
in accordance with Exhibit A to the Lease Agreement.
I. The Basic Rent is as defined in the Lease Agreement. The
Monthly Rent Component will be in accordance with Schedule B
hereto.
J. The Property will be fully amortized as of the last day of
the Lease Term on _________ ___, ______.
K. The Basic Rent for the Renewal Term (after the Property is
fully amortized) equals fair market rental value.
L. Termination of the lease of the Property leased pursuant to
this AFL ULR will be in accordance with the Lease Agreement.
M. ACKNOWLEDGEMENT AND EXECUTION
The undersigned Lessor hereby leases to the undersigned
Lessee, and the Lessee acknowledges delivery to it in good
condition of the Property described on this AFL ULR. The
Lessee agrees to pay the Basic Rent, Additional Rent and
additional payments set forth in the Lease Agreement. The
covenants, terms and conditions of this lease are those
appearing in the Lease Agreement, as it may from time to
time be amended, which covenants, terms and conditions are
hereby incorporated by reference. The terms used herein
have the meaning assigned to them in the Lease Agreement.
Seaboard Corporation, Shawnee Funding, Limited
Lessee Partnership, Lessor By Shawnee
Capital, Inc., its General Partner
By______________________ By__________________________
Name: Name:
Title: Title:
(Corporate Seal) (Corporate Seal)
ATTEST: ATTEST:
________________________ _________________________
Name: Name:
Title: Title:
STATE OF )
: ss.:
COUNTY OF )
The foregoing instrument was acknowledged before me on this
____ day of _______, 2002 by ________________________, as
________________________ of Seaboard Corporation, a Delaware
corporation.
(Notarial Seal) _________________________
Notary Public
My commission expires:
_____________________________
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me on this
____ day of __________, 2002 by ____________________, as Vice
President of Shawnee Capital, Inc., a Delaware corporation,
general partner of Shawnee Funding, Limited Partnership, a
Delaware limited partnership.
(Notarial Seal) ________________________
Notary Public
My commission expires:
_____________________________
EXHIBIT D
UNIT LEASING RECORD to the Lessor: Shawnee Funding,
Limited
Lease Agreement, dated as Partnership
of August 11, 1994, between Lessee: Seaboard
Corporation
Shawnee Funding, Limited
Partnership, as lessor, and Seaboard
Corporation, as lessee
(the "Lease Agreement").
A. ULR No.:___
Effective Date of this
Unit Leasing Record ("ULR") _________ ___, 19___.
B. PLEASE COMPLETE THE FOLLOWING STATEMENTS, IF APPLICABLE:
1. This ULR relates to [Deed/Ground Lease/
Xxxx of Sale/Invoice] dated __________ ___, 19___.
PROPERTY OR EQUIPMENT DESCRIPTION AND RENTAL INFORMATION.
C. Type of Property or Equipment (use category specified in
Exhibit A to the Lease Agreement)
____________________________________________________________
D. Specific Description (See Schedule A hereto if more space
needed)
____________________________________________________________
____________________________________________________________
E. Location of Property
or
Equipment________________________________________________________
State County City
F. Basic Additional Sale & Use Acquisition
Cost Charges Tax Cost
$____+ $____ + $____ =
$____
G. If the Effective Date of this ULR is after the first day of
the month and prior to the Lease Rate Date in such month,
the partial first month's Basic Rent for Property or
Equipment placed under lease by this ULR will be paid from
the date of this ULR until the end of the month on the Basic
Rent Payment Date in such month. If the Effective Date of
this ULR falls on or after the Lease Rate Date, the partial
first month's Basic Rent will be paid from the date of this
ULR until the end of the month on the next succeeding Basic
Rent Payment Date.
H. The Initial Term, Extended Term and Renewal Term for the
Property or Equipment placed under lease pursuant to this
ULR will be in accordance with Exhibit A to the Lease
Agreement.
I. The Basic Rent is as defined in the Lease Agreement. The
Monthly Rent Component will be in accordance with [Schedule
B hereto] [the definition set forth in the Lease Agreement].
J. The Property or Equipment will be fully amortized as of the
last day of the Lease Term on _____________ ___, ______.
K. The Basic Rent for the Renewal Term (after the Property or
Equipment is fully amortized) equals fair market rental
value.
L. Termination of the lease of the Property or Equipment leased
pursuant to this ULR be in accordance with the Lease
Agreement.
M. ACKNOWLEDGMENT AND EXECUTION
The undersigned Lessor hereby leases to the undersigned
Lessee, and the Lessee acknowledges delivery to it in good
condition of the Property or Equipment described on this
ULR. The Lessee agrees to pay the Basic Rent, Additional
Rent and additional payments set forth in the Lease
Agreement. The covenants, terms and conditions of this
lease are those appearing in the Lease Agreement, as it may
from time to time be amended, which covenants, terms and
conditions are hereby incorporated by reference. The terms
used herein have the meaning assigned to them in the Lease
Agreement.
Seaboard Corporation, Shawnee Funding, Limited Partnership,
Lessee Lessor By Shawnee Capital, Inc.,
its General Partner
By______________________ By______________________
Name: Name:
Title: Title:
(Corporate Seal) (Corporate Seal)
ATTEST: ATTEST:
________________________ ________________________
Name: Name:
Title: Title:
STATE OF )
: ss.:
COUNTY OF )
The foregoing instrument was acknowledged before me on this
___ day of _________, 2002 by ________________________, as
_________________________ of Seaboard Corporation, a Delaware
corporation.
(Notarial Seal) _____________________
Notary Public
My commission expires:
_____________________________
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me on this
____ day of ____________, 2002 by _______________________, as
Vice President of Shawnee Capital, Inc., a Delaware corporation,
general partner of Shawnee Funding, Limited Partnership, a
Delaware limited partnership.
(Notarial Seal) ______________________
Notary Public
My commission expires:_____________________________
AMENDMENT NO. 1
Dated as of August 9, 1995
to
LEASE AGREEMENT
Dated as of August 11, 1994
between
Shawnee Funding, Limited Partnership
as Lessor
and
Seaboard Corporation
as Lessee
This Amendment has been manually executed in 8
counterparts, numbered consecutively from 1 through 8,
of which this is No. __. To the extent, if any, that
this Amendment constitutes chattel paper (as such term
is defined in the Uniform Commercial Code as in effect
in any jurisdiction), no security interest in this
Amendment may be created or perfected through the
transfer or possession of any counterpart other than
the original executed counterpart which shall be the
counterpart identified as counterpart No. 1.
Amendment No. 1 dated as of August 9, 1995 to Lease
Agreement ("Amendment No. 1"), dated as of August 11, 1994,
between Shawnee Funding, Limited Partnership, a Delaware limited
partnership ("Lessor"), and Seaboard Corporation, a Delaware
corporation ("Lessee"), amending the Lease Agreement referred to
below.
WHEREAS, Lessor and Lessee have heretofore entered
into a Lease Agreement, dated as of August 11, 1994 (the "Lease
Agreement"); and
WHEREAS, Lessor and Lessee wish to amend the Lease
Agreement as hereinafter provided;
NOW, THEREFORE, Lessor and Lessee hereby agree that the
Lease Agreement is amended as follows:
1. A new Exhibit E is added to the Lease to read in
its entirety as set forth in Annex I hereto.
2. Paragraph (a)(iii) of the definition of "Basic
Rent" in Section 1 of the Lease Agreement is amended to read in
its entirety as follows:
"the decimal equivalent of a percentage (which
percentage will be based upon the Lessee's debt rating
as follows: (1) if the Lessee's debt rating is Level 1,
the percentage shall be (A) during the Initial Term
0.505% with respect to the aggregate Adjusted
Acquisition Cost of Property and 0.515% with respect to
the aggregate Adjusted Acquisition Cost of Equipment,
at any time subject to this Lease; and (B) during the
Extended Term, 0.50% with respect to the aggregate
Adjusted Acquisition Cost of Property and Equipment at
any time subject to this Lease; (2) if the Lessee's
debt rating is Level 2, the percentage shall be (A)
during the Initial Term, 0.555% with respect to the
aggregate Adjusted Acquisition Cost of Property and
0.567% with respect to the aggregate Adjusted
Acquisition Cost of Equipment, at any time subject to
this Lease and (B) during the Extended Term, 0.55% with
respect to the aggregate Adjusted Acquisition Cost of
Property and Equipment at any time subject to this
Lease; (3) if the Lessee's debt rating is Level 3, the
percentage shall be (A) during the Initial Term, 0.606%
with respect to the aggregate Adjusted Acquisition Cost
of Property and 0.620% with respect to the aggregate
Adjusted Acquisition Cost of Equipment, at any time
subject to this Lease and (B) during the Extended Term,
0.60% with respect to the aggregate Adjusted
Acquisition Cost of Property and Equipment at any time
subject to this Lease; (4) if the Lessee's debt rating
is Level 4, the percentage shall be (A) during the
Initial Term, 0.708% with respect to the aggregate
Adjusted Acquisition Cost of Property and 0.724% with
respect to the aggregate Acquisition Cost of Equipment,
at any time subject to this Lease and (B) during the
Extended Term 0.70% with respect to the aggregate
Adjusted Acquisition Cost of Property and Equipment at
any time subject to this Lease; (5) if the Lessee's
debt rating is Level 5, the percentage shall be (A)
during the Initial Term, 0.809% with respect to the
aggregate Adjusted Acquisition Cost of Property and
0.829% with respect to the aggregate Adjusted
Acquisition Cost of Equipment, at any time subject to
this Lease and (B) during the Extended Term 0.80% with
respect to the aggregate Adjusted Acquisition Cost of
Property and Equipment at any time subject to this
Lease; and (6) if the Lessee's debt rating is Level 6,
the percentage shall be (A) during the Initial Term,
1.214% with respect to the aggregate Adjusted
Acquisition Cost of Property and 1.249% with respect to
the aggregate Adjusted Acquisition Cost of Equipment,
at any time subject to this Lease and (B) during the
Extended Term, 1.20% with respect to the aggregate
Adjusted Acquisition Cost of Property and Equipment at
any time subject to this Lease, plus (A) the weighted
average bond yield equivalent percentage cost per annum
(including as part of such cost any fees payable under
or pursuant to any Credit Agreement and any dealer
discount or placement agency commission payable by the
Lessor in respect of its Commercial Paper) on all
Commercial Paper of the Lessor issued to finance or
refinance the acquisition and ownership of Property and
Equipment outstanding at any time during the period
from and including the 16th day of the preceding
calendar month to and including the 15th day of the
calendar month for which Basic Rent is being computed
(the "Computation Period"), or (B) if no such
Commercial Paper of the Lessor is outstanding during
the Computation Period, the Lessor's weighted average
percentage cost per annum (including as part of such
cost any fees payable under or pursuant to any Credit
Agreement and whether or not interest is accruing at a
default rate) of other borrowings outstanding at any
time during the Computation Period for which Basic Rent
is being computed to finance or refinance the
acquisition and ownership of Property or Equipment or
(C) if both Commercial Paper and other borrowings are
outstanding at any time during the Computation Period
for which Basic Rent is being computed, a weighted
average blended rate based on the calculations referred
to in clauses (A) and (B) above."
3. A definition of the term "Consolidated Funded
Debt" is added to Section 1 of the Lease immediately following
the definition of "Consent" in such Section, to read in its
entirety as follows:
""Consolidated Funded Debt" means, at any
time, the amount of Funded Debt of the Lessee and the
amount of Subsidiary Funded Debt of all Subsidiaries,
determined on a consolidated basis at such time."
As used in this definition,
"Funded Debt" means, at any time, with respect to any
Person, Indebtedness of such Person having a final maturity of
more than one (1) year from such time or that is renewable or
extendible at the option of such Person for a period more than
one (1) year from the date of determination.
"Subsidiary Funded Debt" means, at any time, with
respect to any Subsidiary, (a) Funded Debt of such Subsidiary and
(b) Preferred Stock of such Subsidiary. For purposes of
determining the amount of Subsidiary Funded Debt at any time, the
amount of Subsidiary Funded Debt shall include the amount of the
principle of all Indebtedness constituting Subsidiary Funded
Debt, the amount of accrued and unpaid interest thereon, the par
or stated value of all Preferred Stock constituting Subsidiary
Funded Debt, and the amount of declared but unpaid dividends
thereon, and any other amounts due in respect of such
Indebtedness and Preferred Stock.
"Indebtedness" means with respect to any Person,
without duplication, (a) its liabilities for borrowed money
(whether or not evidenced by a Security (as such term is defined
in section 2(1) of the Securities Act of 1933, as amended)) and
its obligations in respect of mandatorily redeemable preferred
stock; (b) any liabilities for borrowed money secured by any Lien
existing on any interest in any kind of property or asset,
whether real, personal or mixed, and whether tangible or
intangible owned by such Person (whether or not such liabilities
have been assumed); (c) any obligations in respect of, at any
time, any lease of such Person, with respect to which lease the
lessee is required to recognize the acquisition of an asset and
the incurrence of a liability at such time (a "Capital Lease");
(d) the present value of all payments due under any arrangement
for retention of title or any conditional sale agreement (other
than a Capital Lease) discounted at the implicit rate, if known,
with respect thereto or, if unknown, at 8% per annum; (e)
obligations of such Person in respect of letters of credit or
instruments serving a similar function issued or accepted by
banks and other financial institutions for the account of such
Person (whether or not representing obligations for borrowed
money); (f) the aggregate net obligations under Swaps of such
Person; and (g) any Guaranty of such Person of any obligation or
liability of another Person.
"Swaps" means, with respect to any Person, obligations
with respect to interest rate swaps and currency swaps and
similar obligations obligating such Person to make payments,
whether periodically or upon the happening of a contingency,
except that if any agreement relating to such obligation provides
for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the
simultaneous payment of amounts by and to such Person, then in
each such case, the amount of such obligations shall be the net
amount thereof. The aggregate net obligation of Swaps at any
time shall be the aggregate amount of the obligations of such
Person under all Swaps assuming all such Swaps had been
terminated by such Person as of the end of the then most recently
ended fiscal quarter of such Person. If such net aggregate
obligation shall be an amount owing to such Person, then the
amount shall be deemed to be Zero Dollars ($0).
"Guaranty" means with respect to any Person (for
purposes of this definition, the "Guarantor") any obligation
(except the endorsement in the ordinary course of business of
negotiable instruments for deposit or collection) of such Person
guaranteeing or in effect guaranteeing any indebtedness, dividend
or other obligation of any other Person (the "Primary Obligor")
in any manner, whether directly or indirectly, including, without
limitation, obligations incurred through an agreement, contingent
or otherwise, by the Guarantor:
(a) to purchase such indebtedness or
obligation or any interest in any kind of property or
asset, whether real, personal or mixed, and whether
tangible or intangible, constituting security therefor;
(b) to advance or supply funds
(i) for the purchase or payment of such
indebtedness or obligation, or
(ii) to maintain working capital or
other balance sheet condition or any income statement
condition of the Primary Obligor or otherwise to
advance or make available funds for the purchase or
payment of such indebtedness or obligation;
(c) to lease or purchase any interest in any
kind of property or asset, whether real, personal or
mixed, and whether tangible or intangible or to
purchase Securities or services primarily for the
purpose of assuring the owner of such indebtedness or
obligation of the ability of the Primary Obligor to
make payment of the indebtedness or obligation; or
(d) otherwise to assure the owner of the
indebtedness or obligation of the Primary Obligor
against loss in respect thereof.
For purposes of computing the amount of any
Guaranty, in connection with any computation of
indebtedness or other liability, it shall be assumed
that the indebtedness or other liabilities that are the
subject of such Guaranty are direct obligations of the
issuer of such Guaranty, and the amount of the Guaranty
is the amount of the direct obligation then
outstanding.
4. A definition of the term "Consolidated
Shareholders' Equity" is added to Section 1 of the Lease
immediately following the definition of "Consolidated Funded
Debt" in such Section, to read in its entirety as follows:
""Consolidated Shareholders' Equity" means,
at any time,
(a) the amount of shareholders's equity of
the Lessee and the Subsidiaries (but excluding, without
limitation, all Preferred Stock other than perpetual
Preferred Stock and, to the extent included therein,
minority interest), minus
(b) (i) the Restricted Basket Transfer
Proceeds Amount, plus
(ii) the Restricted Subsidiary Net Worth
Amount,
all determined on a consolidated basis at such time."
5. A definition of the term "Consolidated Tangible
Net Worth" is added to Section 1 of the Lease immediately
following the definition of "Consolidated Shareholders' Equity"
in such Section, to read in its entirety as follows:
""Consolidated Tangible Net Worth" means, at
any time, the amount equal to
(a) the sum of
(i) the par value or stated value
(as the case may be) at such time of all
authorized, issued and outstanding capital stock
of the Lessee and the Subsidiaries (excluding
capital stock held in treasury), plus (or minus in
each case of a deficit),
(ii) the amount of the paid-in
capital and retained earnings at such time of the
Lessee and the Subsidiaries, plus
(iii) the amount of Unamortized Tax
Incentive Grants and Tax Incentive Financings,
plus
(iv) the amount of IRC 447(i)
Suspense Account Amount,
minus
(b) (i) the net book value (after
deducting related depreciation, obsolescence,
amortization, valuation and other proper reserves)
of all Intangible Assets of the Lessee and the
Subsidiaries, plus
(ii) the Restricted Basket Transfer
Proceeds Amount, plus
(iii) the Restricted Subsidiary Net Worth
Amount,
all determined on a consolidated basis at such time."
As used in this definition,
"Intangible Assets" with respect to any Person, means the
following:
(a) deferred assets (including, without limitation,
insurance and prepaid taxes), other than prepaid expenses which
are refundable;
(b) patents, copyrights, trademarks, trade names,
service marks, brand names, franchises, goodwill, experimental
expenses and other similar intangibles;
(c) unamortized debt discount and expense; and
(d) any other interest in any kind of property or
asset, whether real, personal or mixed, and whether tangible or
intangible, which would be considered to be intangible under
generally accepted accounting principles.
"IRC 447(i) Suspense Account Amount" means, at any time, the
amount included in deferred tax liabilities on a consolidated
balance sheet of the Lessee and the Subsidiaries prepared in
accordance with GAAP at such time in respect of deferred tax
liabilities incurred in connection with section 447(i) of the
Code.
"Unamortized Tax Incentive Gains and Tax Incentive
Financings" means, at any time, the amount included in
liabilities on a consolidated balance sheet of the Lessee and the
Subsidiaries prepared in accordance with GAAP at such time in
respect of all monies granted by political subdivisions as
contractual concessions for economic development by the Lessee or
the Subsidiaries in such political subdivisions.
6. A definition of the term "GAAP" is added to
Section 1 of the Lease immediately following the definition of
"Extended Term" in such Section, to read in its entirety as
follows:
""GAAP" means accounting principles as
promulgated from time to time in statements, opinions
and pronouncements by the American Institute of
Certified Public Accountants and the Financial
Accounting Standards Board and in such statements,
opinions and pronouncements of such other entities with
respect to financial accounting of for-profit entities
as shall be accepted by a substantial segment of the
accounting profession in the United States."
7. The definition of "Level 2" in Section 1 of the
Lease is amended by adding the following phrase at the end of
such definition, to read in its entirety as follows:
"and the minimum Consolidated Tangible Net Worth
of the Lessee is greater than or equal to $300
million".
8. The definition of "Level 3" in Section 1 of the
Lease is amended to read in its entirety as follows:
""Level 3" means when the Lessee's senior
debt rating or, if the Lessee has no senior debt
rating, when the Lessee's Implied Senior Debt Rating is
not Level 1 or Level 2 and when the Lessee's senior
debt rating, or if the Lessee has no senior debt
rating, when the Lessee's Implied Senior Debt Rating is
BBB+ to BBB- by S&P, or if the Lessee has no senior
debt rating or Implied Senior Debt Rating from S&P,
Baa1 to Baa3 by Xxxxx'x, or if the Lessee has no senior
debt rating or Implied Senior Debt Rating from either
S&P or Xxxxx'x, BBB+ to BBB- by Duff & Xxxxxx, or if
the Lessee's senior debt or subordinated debt is not
rated by any of S&P, Xxxxx'x or Duff & Xxxxxx, when the
Lessee's private debt is rated NAIC 2 by the NAIC,
provided, however, that if the Lessee's private debt
rating has not been reviewed and affirmed by the NAIC
within the previous 15 month period, then when the
Xxxxxxx Xxxxx Fixed Income Research Rating is 6.0 or
higher but less than 7.0."
9. The definition of "Level 4" in Section 1 of the
Lease is amended to read in its entirety as follows:
""Level 4" means when the Lessee's senior
debt rating or, if the Lessee has no senior debt
rating, when the Lessee's Implied Senior Debt Rating is
not Xxxxx 0, Xxxxx 0 or Xxxxx 0, and when the Lessee's
senior debt rating, or if the Lessee has no senior debt
rating, when the Lessee's Implied Senior Debt Rating is
BB+ to BB- by S&P, or if the Lessee has no senior debt
rating or Implied Senior Debt Rating from S&P, Ba1 to
Ba3 by Xxxxx'x, or if the Lessee has no senior debt
rating or Implied Senior Debt Rating from either S&P or
Xxxxx'x, BB+ to BB- by Duff & Xxxxxx, or if the
Lessee's senior debt or subordinated debt is not rated
by any of S&P, Xxxxx'x or Duff & Xxxxxx, when the
Lessee's private debt is rated NAIC 3 by the NAIC,
provided, however, that if the Lessee's private debt
rating has not been reviewed and affirmed by the NAIC
within the previous 15 month period, then when the
Xxxxxxx Xxxxx Fixed Income Research Rating is 5.0 or
higher but less than 6.0 and the minimum Consolidated
Tangible Net Worth of the Lessee is greater than or
equal to $250 million."
10. The definition of "Level 5" in Section 1 of the
Lease is amended to read in its entirety as follows:
""Level 5" means when the Lessee's senior
debt rating or, if the Lessee has no senior debt
rating, when the Lessee's Implied Senior Debt Rating is
not Xxxxx 0, Xxxxx 0, Xxxxx 0 or Xxxxx 0, and when the
Lessee's senior debt rating, or if the Lessee has no
senior debt rating, when the Lessee's Implied Senior
Debt Rating is BB+ to BB- by S&P, or if the Lessee has
no senior debt rating or Implied Senior Debt Rating
from S&P, Ba1 to Ba3 by Xxxxx'x, or if the Lessee has
no senior debt rating or Implied Senior Debt Rating
from either S&P or Xxxxx'x, BB+ to BB- by Duff &
Xxxxxx, or if the Lessee's senior debt or subordinated
debt is not rated by any of S&P, Xxxxx'x or Duff &
Xxxxxx, when the Lessee's private debt is rated NAIC 3
by the NAIC, provided, however, that if the Lessee's
private debt rating has not been reviewed and affirmed
by the NAIC within the previous 15 month period, then
when the Xxxxxxx Xxxxx Fixed Income Research Rating is
5.0 or higher but less than 6.0."
11. A definition of the term "Level 6" is added to
Section 1 of the Lease to read in its entirety as follows:
""Level 6" means when the Lessee's senior
debt rating or, if the Lessee has no senior debt
rating, when the Lessee's Implied Senior Debt Rating is
not Xxxxx 0, Xxxxx 0, Xxxxx 0, Xxxxx 4 or Xxxxx 0, and
when the Lessee's senior debt rating, or if the Lessee
has no senior debt rating, when the Lessee's Implied
Senior Debt Rating is B+ or below by S&P, or if the
Lessee has no senior debt rating or Implied Senior Debt
Rating from S&P, B1 or below by Xxxxx'x, or if the
Lessee has no senior debt rating or Implied Senior Debt
Rating from either S&P or Xxxxx'x, B+ or below by Duff
& Xxxxxx, or if the Lessee's senior debt or
subordinated debt is not rated by any of S&P, Xxxxx'x
or Duff & Xxxxxx, when the Lessee's private debt is
rated NAIC 4 by the NAIC, provided, however, that if
the Lessee's private debt rating has not been reviewed
and affirmed by the NAIC within the previous 15 month
period, then when the Xxxxxxx Xxxxx Fixed Income
Research Rating is below 5.0."
12. A definition of the term "Preferred Stock" is
added to Section 1 of the Lease immediately following the
definition of "Poultry Production Facility Equipment" in such
Section, to read in its entirety as follows:
""Preferred Stock" means, with respect to any
corporation, capital shares or capital stock of such corporation
that are entitled to preference or priority over any other
capital shares or capital stock of such corporation in respect of
either or both of the payment of dividends or the distribution of
assets upon liquidation."
13. A definition of the term "Restricted Basket
Transfer Proceeds Amount" is added to Section 1 of the Lease
immediately following the definition of "Responsible Officer" in
such Section, to read in its entirety as follows:
""Restricted Basket Transfer Proceeds Amount"
means, at any time, the net book value of all
Restricted Basket Transfer Proceeds of the Lessee and
the Subsidiaries, determined at such time."
As used in this definition, "Restricted Basket Transfer
Proceeds" means all consideration other than cash received by the
Lessee or any Subsidiary in respect of any Transfer (as defined
in the Note Purchase Agreement, dated as of December 1, 1993,
between the Lessee and the purchasers listed on Annex 1 thereto
(the "Note Purchase Agreement")) of any interest in any kind of
property or asset, whether real, personal or mixed, and whether
tangible or intangible of the Lessee or any Subsidiary permitted
solely by Section 6.8(b) of the Note Purchase Agreement and in
which the Fair Market Value (as defined in the following
sentence) of the aggregate consideration payable for such
Transfer and all related Transfers is greater than Seven Million
Five Hundred Thousand Dollars ($7,500,000). "Fair Market Value"
means, with respect to any interest in any kind of property or
asset, whether real, personal or mixed, and whether tangible or
intangible, the sale value of such property that would be
realized in an arm's-length sale at such time between an informed
and willing buyer, and an informed and willing seller, under no
compulsion to buy or sell, respectively.
14. A definition of the term "Restricted Subsidiary
Net Worth Amount" is added to Section 1 of the Lease immediately
following the definition of "Restricted Basket Transfer Proceeds"
in such Section, to read in its entirety as follows:
""Restricted Subsidiary Net Worth Amount"
means, at any time, with respect to any Subsidiary, the
amount of the shareholders' equity of such Subsidiary
that cannot at such time be paid as a dividend on the
capital stock of such Subsidiary by virtue of
restrictions, direct or indirect, on the payment of
such dividends imposed by the terms of any
Indebtedness, whether or not such Indebtedness is
recourse or non-recourse to such Subsidiary."
15. A definition of the term "Subsidiary" is added to
Section 1 of the Lease immediately following the definition of
"S&P" in such Section, to read in its entirety as follows:
""Subsidiary" means, at any time, a
corporation that, in accordance with GAAP, is properly
included in a consolidated balance sheet of the Lessee
and its consolidated subsidiaries prepared at such
time, as a subsidiary of the Lessee."
16. Clause (i) of paragraph (h) of Section 2 of the
Lease is amended to read in its entirety as follows:
"promptly, and in any event not more than 120 days
after the end of each fiscal year of the Lessee, copies
of its Annual Reports on Form
10-K and promptly, and in any event not more than 50
days after the end of each fiscal quarter of the Lessee, its
Quarterly Reports on Form 10-Q, and promptly any other reports it
files with the Securities and Exchange Commission,".
A new clause (ii) is added to such paragraph to read in its
entirety as follows:
", (ii) simultaneously with the delivery of each
set of Annual Reports on Form 10-K and Quarterly
Reports on Form 10-Q referred to in clause (i) of this
paragraph (h), a certificate of a Responsible Officer
of the Lessee substantially in the form of Exhibit E
hereto,"
and clauses (ii), (iii) and (iv) of such paragraph are renumbered
(iii), (iv) and (v), respectively.
17. Section 2 of the Lease is further amended by
adding the following paragraphs (o), (p) and (q) to the Lease, to
read in their entirety as follows:
"(o) The Lessee will not at any time permit
Consolidated Tangible Net Worth to be less than Two
Hundred Fifty Million Dollars ($250,000,000).
(p) The Lessee will not at any time permit
Consolidated Funded Debt to be greater than ninety
percent (90%) of Consolidated Shareholders' Equity,
determined in each case at such time.
(q) The Lessee will not enter into any written
agreement that would cause any obligations of the
Lessee hereunder and under the Agreement for Lease to
rank on a less than pari passu basis with any other
unsecured and unsubordinated loans, debts, guarantees
or other obligations of the Lessee."
18. The first sentence of paragraph (a) of Section 12
of the Lease is amended to read in its entirety as follows:
"(a) So long as no Event of Default has
occurred and is continuing and with respect to any
Parcel of Property not undergoing any repairs,
additions or alterations, the Lessee shall have the
right, upon ninety (90) days' notice to the Lessor and
until August 9, 2005, to terminate the lease of any
Parcel of Property or any or all Units of Equipment on
the Basic Rent Payment Date of the last month of the
Initial Term or on any Basic Rent Payment Date during
the Extended Term or the Renewal Term, if any, by
arranging, at its own cost and expense, for the sale of
such Property or Equipment in an arms' length
transaction on the date of termination and the receipt
by the Lessor of cash in an amount equal to the sale
price of such Property or Equipment (the "Cash
Proceeds"); provided that, if such sale does not occur,
this Lease shall not terminate with respect to such
Property and Equipment."
19. This Amendment No. 1 may be executed in several
counterparts, each of which when executed and delivered shall be
deemed an original and all of which counterparts, taken together,
shall constitute but one and the same Amendment No. 1.
20. This Amendment No. 1 shall in all respects be
governed by, and construed in accordance with, the laws of the
State of New York, including all matters of construction,
validity and performance.
21. Except as provided herein, all provisions, terms
and conditions of the Lease Agreement shall remain in full force
and effect. As amended hereby, the Lease Agreement is ratified
and confirmed in all respects.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment No. 1 to be duly executed as of the date first above
written.
Shawnee Funding, Limited Partnership
By Shawnee Capital, Inc., its general partner
By:______________________
Name:
Title:
Seaboard Corporation
By:______________________
Name:
Title:
ANNEX 1
EXHIBIT E
Form of Compliance Certificate
SEABOARD CORPORATION
Compliance Certificate as of ___________, 199_.
(Capitalized terms used but not
defined herein shall have the respective
meanings given to such terms in the Lease Agreement)
A. CONSOLIDATED TANGIBLE NET WORTH
1. Par value or stated value of $
issued and outstanding capital
stock of Lessee and its
Subsidiaries; plus
2. Amount of paid-in capital or $
retained earnings of the Lessee
and its Subsidiaries; plus
3. Amount of Unamortized Tax $
Incentive Grants and Tax
Incentive Financings; plus
4. Amount of IRC 447(i) Suspense $
Account Amount; minus
5. Net Book Value (after deducting $
related depreciation,
obsolescence, amortization,
valuation and other proper
reserves) of all Intangible
Assets of the Lessees and its
Subsidiaries; minus
6. Restricted Transfer Proceeds $
Amount; minus
7. Restricted Subsidiary Net Worth $
Amount
Consolidated Tangible Net Worth as $
of ________________:
Minimum Covenant Requirement: $250,000,000
B. CONSOLIDATED FUNDED DEBT RATIO
I. Consolidated Funded Debt
1. Amount of Funded Debt of the $
Lessee; plus
2. Amount of Subsidiary Funded $
Debt.
Consolidated Funded Debt as of $
.
II. Consolidated Shareholders' Equity
1. Amount of shareholders' equity $
of the Lessee and its
Subsidiaries (excluding all
Preferred Stock other than
perpetual Preferred Stock and,
to the extent included therein,
minority interest); minus
2. The sum of:
a. Restricted Basket $
Transfer Proceeds; plus
b. Restricted Subsidiary $
Net Worth.
Consolidated Shareholders' Equity as $
of .
Consolidated Funded Debt Ratio
(I / II) .
Maximum covenant requirement:
.90
C. CONSOLIDATED NET DEBT RATIO (as
defined in the Amended and Restated
Credit Agreement dated as of August
9, 1995)
I. Consolidated Funded Debt $
(B. I above) as of .
II. Unrestricted Cash (as defined in the $
Amended and Restated Credit
Agreement dated as of August 9,
1995) as of .
III. Adjusted Consolidated Shareholders'
Equity
1. Consolidated Shareholders' $
Equity (B. II above); plus
2. Amount of Unamortized Tax $
Incentive Grants and Tax
Incentive Financings; plus
3. Amount of IRC 447(i) Suspense $
Account.
Adjusted Consolidated Shareholders' $
Equity as of ___________________.
Consolidated Net Debt Ratio
[(I - II) / III)] %.
I hereby certify that the information set forth above is accurate
and complete as of __________________________, 199_.
SEABOARD CORPORATION
By:____________________
Name:
Title:
Date:
AMENDMENT NO. 2
Dated as of December 19, 1995
to
LEASE AGREEMENT
Dated as of August 11, 1994
between
Shawnee Funding, Limited Partnership
as Lessor
and
Seaboard Corporation
as Lessee
This Amendment has been manually executed in 8
counterparts, numbered consecutively from 1 through 8,
of which this is No. __. To the extent, if any, that
this Amendment constitutes chattel paper (as such term
is defined in the Uniform Commercial Code as in effect
in any jurisdiction), no security interest in this
Amendment may be created or perfected through the
transfer or possession of any counterpart other than
the original executed counterpart which shall be the
counterpart identified as counterpart No. 1.
Amendment No. 2 dated as of December 19, 1995 to Lease
Agreement ("Amendment No. 2"), dated as of August 11, 1994,
between Shawnee Funding, Limited Partnership, a Delaware limited
partnership ("Lessor"), and Seaboard Corporation, a Delaware
corporation ("Lessee"), amending the Lease Agreement referred to
below.
WHEREAS, Lessor and Lessee have heretofore entered
into a Lease Agreement, dated as of August 11, 1994, as amended
by Amendment No. 1 to Lease Agreement, dated as of August 9, 1995
(as amended, the "Lease Agreement"); and
WHEREAS, Lessor and Lessee wish to further amend the
Lease Agreement as hereinafter provided;
NOW, THEREFORE, Lessor and Lessee hereby agree that the
Lease Agreement is amended as follows:
1. Section 1 of the Lease Agreement is amended to:
(a) amend section (a)(iii)(B) (which begins on page 6)
of the definition of "Basic Rent" to read in its entirety as
follows:
"(B) if no such Commercial Paper of the Lessor is
outstanding during the Computation Period, the Lessor's
weighted average percentage cost per anuum (including
as part of such cost any fees payable under or pursuant
to any Financing Arrangement and whether or not
interest is accruing at a default rate) of other
borrowings, reimbursement obligations or other
repayment obligations outstanding at any time during
the Computation Period for which Basic Rent is being
computed to finance or refinance the acquisition and
ownership of Property or Equipment or"
(b) delete the definition of "Credit Agreement"
therein; and
(c) add a new definition of "Financing Arrangement"
immediately after the definition of "Extended Term" in such
Section, to read in its entirety as follows:
"'Financing Arrangement' means each credit
agreement, each loan agreement, each indenture
providing for the issuance of securities in connection
with the acquisition and financing of Property or
Equipment, each other indenture or deed of trust and
each other agreement or arrangement between the Lessor
and a lender to the Lessor or other person providing
credit support to the Lessor or to debt issued by or on
behalf of the Lessor related to the financing of
Property or Equipment, as each may be amended,
restated, modified or supplemented from time to time."
2. The Lease Agreement is amended to replace the term
"Credit Agreement" with the term "Financing Arrangement" in each
place where the term "Credit Agreement" appears in the Lease
Agreement.
3. Paragraph (a) of Section 14 of the Lease Agreement
is amended to read in its entirety as follows:
"(a) The Lessor shall have the right upon written
notice to the Lessee to terminate the lease of any or
all Property or Equipment as of a Basic Rent Payment
Date stipulated in such notice if at any time, for any
reason (other than an Event of Default by the Lessor
under a Financing Arrangement (as therein defined)
which has not been caused by or resulted from an Event
of Default under this Lease or from a breach by the
Lessee of its obligations under any agreement or
document executed and delivered in connection with this
Lease), Commercial Paper cannot be issued by the Lessor
upon terms reasonably acceptable to the Lessor, the
Lessor cannot arrange for financing upon terms
reasonably acceptable to the Lessor to finance or
refinance the purchase of such Property or Equipment
and the Lessor may no longer make or continue to obtain
financing under a Financing Arrangement sufficient to
finance or refinance such purchase."
4. This Amendment No. 2 may be executed in several
counterparts, each of which when executed and delivered shall be
deemed an original and all of which counterparts, taken together,
shall constitute but one and the same Amendment No. 2.
5. This Amendment No. 2 shall in all respects be
governed by, and construed in accordance with, the laws of the
State of New York, including all matters of construction,
validity and performance.
6. Except as provided herein, all provisions, terms
and conditions of the Lease Agreement shall remain in full force
and effect. As amended hereby, the Lease Agreement is ratified
and confirmed in all respects.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment No. 2 to be duly executed as of the date first above
written.
Shawnee Funding, Limited Partnership
By Shawnee Capital, Inc., its general partner
By:___________________________
Name:
Title:
Seaboard Corporation
By:____________________________
Name:
Title:
AMENDMENT NO. 3
Dated as of November 26, 1997
to
LEASE AGREEMENT
Dated as of August 11, 1994
between
Shawnee Funding, Limited Partnership
as Lessor
and
Seaboard Corporation
as Lessee
This Amendment has been manually executed in 8 counterparts,
numbered consecutively from 1 through 8, of which this is No. 1.
To the extent, if any, that this Amendment constitutes chattel
paper (as such term is defined in the Uniform Commercial Code as
in effect in any jurisdiction), no security interest in this
Amendment may be created or perfected through the transfer or
possession of any counterpart other than the original executed
counterpart which shall be the counterpart identified as
counterpart No. 1.
Amendment No. 3, dated as of November 26, 1997, to Lease
Agreement ("Amendment No. 3"), dated as of August 11, 1994,
between Shawnee Funding, Limited Partnership, a Delaware limited
partnership ("Lessor"), and Seaboard Corporation, a Delaware
corporation ("Lessee"), amending the Lease Agreement referred to
below.
WHEREAS, Lessor and Lessee have heretofore entered into a
Lease Agreement, dated as of August 11, 1994, as amended by
Amendment No. 1 to Lease Agreement, dated as of August 9, 1995
and Amendment No. 2 to Lease Agreement, dated as of December 19,
1995 (as amended, the "Lease Agreement"), and
WHEREAS, Lessor and Lessee wish to further amend the Lease
Agreement as hereinafter provided;
NOW, THEREFORE, Lessor and Lessee hereby agree that the
Lease Agreement is amended as follows:
1. The definition of Adjusted Acquisition Cost in Section 1 of
the Lease Agreement is amended to read in its entirety as
follows:
"Acquisition Cost means, at any time, with respect
to any Parcel of Property or Unit of Equipment,
its Acquisition Cost less the aggregate amount of
all Monthly Rent Components paid as portions of
Basic Rent for such Parcel of Property or Unit of
Equipment as of the time of determination, less
any reduction in Adjusted Acquisition Cost
provided for under paragraph ) of Section 30 of
this Lease."
2. A new paragraph (j) is added to Section 30 of the Lease
Agreement to read in its entirety as follows:
"a) the Lessee shall have the right, upon
fifteen (15) days' notice to the Lessor, to
terminate the lease of any portion of any
Parcel of Property constituting undeveloped
land acquired pursuant to this Lease -
Agreement (the "Undeveloped Property"), at any
time during the Initial Term, the Extended
Term or the Renewal Term, if any, by
arranging, at its own cost and expense, for
the sale of such Undeveloped Property in an
arms' length transaction on the date of
termination and the receipt by the Lessor of
cash in an amount equal to the Net Sale Price
(as defined below); provided that, as a
condition to any such sale (i) the Lessee
shall determine, in its reasonable business
judgment, that such Undeveloped Property shall
not be necessary for the use, maintenance or
operation of any Pork Production Facility or
Poultry Production Facility, as the case may
be, except for rights to be obtained pursuant
to an Effluent Easement and Waiver and
Perpetual Easement and Right-of-Way on such
Undeveloped Property; and (ii) the Lessee
shall provide to the Lessor, upon the Lessor's
request, evidence reasonably satisfactory to
the Lessor that such sale will not impair the
value, utility or condition of any Pork
Production Facility or Poultry Production
Facility, as the case may be. The proceeds of
any sale net of all transfer taxes, transfer
gains taxes, if any, recording and tiling fees
and all other similar taxes, fees, expenses
and closing costs (including reasonable
attorneys' fees) that are customarily the
seller's expense (such proceeds being the "Net
Sale Price") pursuant to this paragraph (j)
shall be remitted to and retained by the
Lessor and Adjusted Acquisition Cost shall be
reduced by the Lessor by the amount of such
proceeds. Upon receipt by the Lessor or the
Lessor's closing agent of the proceeds of
sale, the Lessor shall transfer title to such
Undeveloped Property to the purchaser at the
sale designated by the Lessee. In connection
with any sale pursuant to this paragraph (j);
(i) when the Lessor transfers title, such
transfer shall be on an as-is, non-installment
sale basis, and, upon the reasonable request
of the Lessee and subject to the provisions of
paragraph (d) of Section 7 and Section 11 of
this Lease, shall include a warranty limited
to any Person claiming an interest by, through
or under the Lessor; (ii) the purchase price
for any such sale shall be paid entirely in
cash and in immediately available funds; and
(iii) the Lessee shall pay or shall cause the
purchaser to pay in addition to the purchase
price, all mortgage recording taxes, if any,
recording and filing fees and all other
similar taxes, fees, expenses and closing
costs (including reasonable attorneys' fees)
that are the responsibility of the purchaser
in connection with the conveyance to any
purchaser. The Lessee hereby acknowledges and
agrees that any sale by the Lessor of
Undeveloped Property pursuant to this
paragraph (j) shall be subject to the
provisions of paragraph (d) of Section 7 and
Section 11 of this Lease."
3. This Amendment No. 3 may be executed in several
counterparts, each of which when executed and delivered shall be
deemed an original, and all of which counterparts, taken
together, shall constitute but one and the same Amendment No. 3.
4. This Amendment No. 3 shall, in all respects, be governed by
and construed in accordance with the laws of the State of New
York, including all maters of construction, validity and
performance.
5. Except as provided herein, all provisions, terms and
conditions of the Lease Agreement shall remain in full force and
effect. As amended hereby, the Lease Agreement is ratified and
confirmed in all respects.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment No. 3 to be duly executed as of the date first above
written.
Shawnee Funding, Limited
Partnership
By: Shawnee Capital, Inc.,
its general partner
By:
Name: Xxxx X. Xxxxxxxxx
Title: Vice President and
Assistant Secretary
Seaboard Corporation
By:
Name:
Title:
